In Praise of Praise


I’ve written previously about Millennials, Baby Boomers and all the other generational labels that we pretend we know. So far, though, I’ve neglected the ‘Snowflake Generation.’

‘Snowflake,’ for those of you that don’t know, is a less-than-complimentary term applied to the young adults of the 2010s: it probably comes from the 1999 film Fight Club and its famous line: ‘We are not special. We are not beautiful and unique snowflakes.’

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It’s now come to be applied to a generation that supposedly were told they were special; children that were given an over-inflated sense of their own worth and – as a consequence – are now far too easily offended.

But now these easily-offended snowflakes are entering the workplace. So what are we as employers and business owners going to do when these ‘snowflakes’ increasingly make up the workforce? Are we going to have to constantly shower them with praise, irrespective of how well they’re performing?

Maybe the question is academic though – because far too many bosses and managers seem to have a problem with giving their teams any praise.

Why is that? Any number of research studies show that praise and positive recognition in the workplace can be hugely motivating – and not just for the person on the receiving end of it. Employee of the Month is too easily dismissed as a cliché: that’s wrong, it works.

We don’t really need a research study, do we? Our own commons sense tells us that praise works. Your wife only has to say, “Oh, darling, that was wonderful…” And you’ll be far more likely to make her another slice of toast.

One of the worst things a manager can do is reward hard work and achievement with silence. Yet only one in four American workers are confident that if they do good work they’ll be praised for it. Far too often the culture seems to be, “No news is good news” or – as they say in Germany – “Nicht gescholten ist lob genug.” (No scolding is praise enough.)

But we all know that’s nonsense. So why do people struggle to give praise? Maybe it starts with a false belief that really good managers are the tough ones who don’t hold back when it comes to telling people what’s wrong. Maybe some managers believe that giving praise will encourage staff to take it easy and rest on their laurels. Some might be consciously or unconsciously copying their own previous bosses: some managers might even see giving praise as a sign of weakness.

Whatever the reason the number of managers who don’t give any positive feedback is frighteningly high – 37% according to a recent survey in the Harvard Business Review. And you can probably add a few percentage points more: there is plenty of anecdotal evidence that what a manager sees as ‘straightforward, honest feedback’ is all too often perceived as criticism.

I think that’s a tragedy. There’s no better way to motivate people than by giving praise and it always works. There cannot be a more effective phrase in a manager’s vocabulary than, “You did a great job. Thank you.”

Not for the first time, I’m struck by the parallel between managing a team and being a parent. I’ve always tried to be honest with my boys: if they’ve done brilliantly, I’ll shower them with praise. If they could have done better, I’ll try to tactfully point it out – and suggest a way they could improve. I’ve never been a believer in praising everything they do – otherwise praise becomes meaningless – and the same is true in the workplace. But if someone has done a great job, tell them.

It will be the best investment of time and no money you ever make.

And now I must turn my attention to my own beautiful, unique snowflakes. If you can call someone who thinks his bedroom floor should be covered in underpants and needs a three course meal two hours before a three course meal a ‘snowflake…’

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Negotiating with Friends: How we got it Right


Negotiation is very rarely about the short term. It’s an area where you really need to think ‘win/win’ because nine times out ten you’re going to have an ongoing relationship with the person across the table. So don’t set out to ‘screw’ someone: in the long run that attitude is unlikely to be profitable.

That was what I said last week when I was discussing the general principles of negotiation. ‘Think win/win. Nine times out of ten you’re going to have an ongoing relationship.’ But that becomes even more true when you’re negotiating with a friend – as I did when I bought TAB UK from Paul Dickinson and Jo Clarkson.

“Never do business with a friend,” is an old business maxim – and it’s probably saved a lot of friendships – but sometimes doing business with friends and, ultimately, negotiating with them is inevitable.

“Loan oft loses both itself and friendship,” said Polonius, giving advice to his son Laertes before he set sail for France. Well negotiation can do exactly the same: the negotiations can flounder and the friendship can be ruined. Worse still, the negotiations can apparently ‘succeed.’ And then one party gradually realises he’s been ripped off: that he’s been taken advantage of by someone he previously considered a friend. Not any more…

The negotiations to buy TAB UK were long and complex: there were two people involved on both sides, plus accountants, bankers, lawyers – and our respective families.

As Mags and I sat across the table from Paul and Jo I had four priorities:

  • I wanted to buy the UK franchise for The Alternative Board: I’d talked it over with Dav – at length – and I absolutely believed it was the right thing for me, and for my family
  • But like any business deal, I wanted to buy it at the right price
  • I wanted to make sure the negotiations did nothing to damage TAB UK going forward
  • And I wanted to retain the friendship of two people I liked, respected and valued greatly as business colleagues and confidantes.

So how did we set out to achieve that? There were three key rules that guided us through the negotiations and which protected and strengthened our friendship.

  • First and foremost, we set the stage. Both sides were absolutely open about what they wanted to achieve in the negotiations. We constantly asked ourselves a simple question: ‘Is this fair to you? Is it fair to us? And is it in the best long-term interests of TAB UK?’ That question was, if you like, the mission statement of the negotiations
  • …Which inevitably brings me to one of Stephen Covey’s ‘7 Habits.’ “Seek first to understand, then to be understood.” There was a real willingness to see the other side’s point of view. If you do find yourself negotiating with a friend it’s vital to see the negotiations from both sides of the table
  • So there was plenty of goodwill on both sides. But even with all that goodwill, there were bumps in the road: that was inevitable with such complex negotiations. The key was to look ahead and anticipate problems, to be open about setbacks and to clear up any misunderstandings as quickly as possible.

The net result? A very successful negotiation and both sides happy with the outcome. Was it easy? No, but then readers of this blog don’t need telling that few things that are worthwhile are easy. Ultimately, I’m absolutely delighted with the outcome – I’m equally delighted that Paul and Jo will be friends for life.

As it’s Easter, let me finish on a slightly lighter note – and a warning, if you’re planning to spend four days in the garden…

When I’m writing these posts I always – irrespective of how well I know the subject – check with Google, just to see if the Harvard Business Review or one of the entrepreneur magazines has a different perspective. And I’m increasingly astonished at how few words I need to type in before Google guesses what I’m after.

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Or I was – until this morning. How do you negotiate with I tapped in. Before I could add a friend, Google completed the sentence for me. How do you negotiate with a Sim eating plant? Seriously? That’s the most popular query about negotiation?

Well, fair enough. I always preach the value of knowing and researching your market…

So for those of you whose Easter might otherwise be ruined by the death of your carefully-nurtured Sims, I present perhaps the most useful advice ever offered on this blog. (Warning: the video contains violent scenes which some readers might find distressing. It also contains a teenage son doing nothing while his father is eaten by a tomato plant…)

What can we Learn from Loyalty Cards?


Open your wallet.

Go ahead. Open your wallet. Or your purse. I’m conducting an experiment.

I am prepared to wager that in there – along with the photograph of your children and the credit cards – are two or three loyalty cards. I don’t mean your Tesco Clubcard – I mean the ones that are stamped. The loyalty cards from coffee shops, bakeries and your enterprising local burger restaurant.

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…And I’m prepared to make a second wager: that all those loyalty cards – that need eight or ten stamps before you get your free bagel or burger – have just one or two stamps on them. That you thought, ‘hey, that’s a good idea, I’ll do that’ and then quickly lost interest.

You’re not alone: that’s archetypal human behaviour – but according to an article in the Harvard Business Review it’s behaviour that may offer business owners and managers an insight into how to improve results from their teams.

Interestingly, it flies in the face of most current business thinking, especially when it comes to setting and achieving goals.

The modern trend is towards flexible working. As I wrote recently, the evidence suggests that teams allowed to work flexibly are both happier and more productive. And unsurprisingly, the vast majority of people have a preference for flexibility when it comes to goals. As the HBR puts it, ‘Adopting a somewhat elastic approach to setting goals allows us some future wiggle room.’

But it you want to achieve a major goal, then the article suggests you’re much more likely to do so with a rigid and restrictive structure for the necessary steps.

And this is where loyalty cards – and yoghurt – come in.

Professor Szu-chi Huang and her colleagues in the marketing department at Stanford University conducted research on the effectiveness of loyalty cards at a local yoghurt shop. It was the standard offer: a free yoghurt after six purchases.

There were two separate offers – the ‘flexible’ one, where customers were free to buy any yoghurts they liked, and a far more restrictive one, where customers had to purchase specific yoghurts in a specific order.

Unsurprisingly, there was far more take-up of the ‘flexible’ offer. Rather more surprisingly, those customers opting for the restrictive offer were nearly twice as likely to complete six purchases and get the free yoghurt. (And before you think it’s just one yoghurt shop near Stanford University, YesMyWine, the largest imported wine platform in the world, has reported similar results with special offers.)

The academics at Stanford suggested that the result was because customers responded to not having to make a decision: that in our ‘information-overload, decision-fatigued’ society people will appreciate something that gives them the chance to make fewer decisions. They go on from that to draw a conclusion for business: that once a goal has been decided on, managers should be rigid in the steps needed to accomplish it – in effect, take any decisions away from the team.

I’m not so sure. First of all I’d argue that people who sign up for a ‘restrictive’ offer are more committed in the first place and therefore more likely to ‘see it through.’ Secondly, my experience of managing large teams suggests that the real answer is “it depends.”

Specifically, it depends on the experience and capabilities of your senior team. If you’re looking to achieve significant change and/or achieve a major goal then, yes, there needs to be a detailed, step-by-step approach with a list of actions and a series of deadlines.

But if you have a ‘details guy’ in the team, my advice is delegate it to the details guy: it’s almost always better to ‘trust and delegate.’ But if you don’t have a details guy, then the actions and deadlines become your job: what’s absolutely certain is that they cannot be left to chance.

So there I am, disagreeing with learned academics at the world’s third-ranked university. I’d be fascinated to hear your views on this: and yes, let’s discuss it over a coffee. I can’t miss a chance to double my number of stamps…

The Monday Morning Quarterback


It’s just about the perfect description. Instantly, we all know what it means…

So the wide receiver’s wide open. 20 yard throw straight into the end zone. Hell, even my six year old can do that. What’s he do? Tries to run it himself. Gets sacked. Turnover. And it’s game over. Season over. See you in September.

There isn’t an equivalent phrase in the UK, but no office is short of an expert round the watercooler on a Monday morning.

Seriously, he thinks X is a centre back? He needs to buy Y. And no wonder Z didn’t try an inch. My mate’s brother says he’s been tapped up by City.

Whichever side of the Atlantic you’re on, no sports fan gets a decision wrong on a Monday morning. Hindsight is a wonderful thing – and it guarantees you a 100% success rate.

Sadly, the entrepreneur doesn’t have the benefit of hindsight: he has to make decisions every day – and he’ll get plenty of them wrong. As a recent article in the Harvard Business Review put it, ‘The problems entrepreneurs confront every day would overwhelm most managers.’

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…And – just like the QB on a Sunday night – entrepreneurs get plenty of decisions wrong. Any entrepreneur who gets 50% of his decisions right first time is doing remarkably well. Fortunately, TAB members can improve on those numbers. They can bring their problems to the monthly board meetings – and rely on the collective wisdom, experience and insight of their colleagues: the Tuesday/ Wednesday/ Thursday quarterbacks. Once a problem – or an idea – has been run past seven people instead of one, the chances of a correct decision increase exponentially.

But I’m aware that not everyone who reads this blog is a member of TAB York: plenty of readers are just starting their journey as an entrepreneur. So here are three of the most common problems, proposed solutions and – ultimately – mistakes that I’ve seen in my business life. I hope they help – and don’t worry if you tick all three boxes: every successful entrepreneur has done exactly the same.

  • No-one else cares like I care. The only answer is to do it myself

That’s true. It’s your business: no-one will ever care like you care. But you cannot do everything yourself. That way lies fatigue, burn-out and your wife telling you that she needs to talk… Embrace the division of labour: we live in an age where everything can be outsourced online. Your job is to manage the business: let someone else do the tedious stuff that takes away your creativity and your productivity.

  • There’s no more money in the budget. The only solution is to throw more hours at it

Let me refer you to one of my favourite books, Rework, and page 83: ‘throw less at the problem.’ As the authors say, the solution is not more hours, people or money. The solution is almost always to cut back. You cannot do everything and, as I wrote last week, success comes from a focus on your core business – not on trying to please all the people all the time. Besides, more hours simply means a second, more serious, talk with your wife…

  • Fire people: hire people

When you’re starting out you’ll be a small team: that breeds closeness – and loyalty. But not everyone who starts the journey with you is capable of finishing it. Sadly, at some stage you’ll learn just how lonely it can be as an entrepreneur: one day, you’ll accept that Bill’s just not up to it any more. You have to act: if you don’t, you’ll cause resentment among the rest of Bill’s team – and risk losing people who are up to it. And when you hire Bill’s replacement, don’t be afraid to hire someone smarter than you. See above, your job is to manage and lead the company, not to be the expert on every single aspect of it.

 

When I write this weekly post I sometimes ‘let it go cold’ for an hour and then give it a final read through. That’s what I did this week and I need to correct myself. The three mistakes above are mistakes we can make at every stage of our business journey – not just when we’re starting out.

It’s all too easy to slip back into bad habits, to think ‘it’s easier to do it myself’ or ‘If I work through the night I’ll have cracked it.’ We’ve all done it. But at least you won’t make the mistakes for long: those quarterbacks round the TAB table will be watching you…

The Knowledge Economy


“What do you do?” I asked someone I’d just met.

“We’re in the knowledge business,” she said. “My company adds knowledge to knowledge.”

We’ve all asked the ‘what do you do’ question a thousand times. And we’ve heard every reply imaginable. But I’d never heard one as intriguing as ‘adding knowledge to knowledge.’ I couldn’t help but ask her to explain.

…And I couldn’t help thinking about it afterwards either. Because we’re all in the knowledge business now.

When I started in business – not that many years ago despite what my sons think – people had stock: they had inventories. The auditors would turn up and spend a week stocktaking. Now, I look round the offices of so many of the TAB York members and all I see are the serried ranks of Apple Macs. Yes, there are honourable exceptions, but they’re becoming increasingly rare: those of us writing blogs may soon need to find a replacement for the apocryphal widget maker.

So everything’s fine: we’re all knowledge workers and whether we vote to Remain or to Leave (see next week…) then the future for our businesses is rosy.

Perhaps. I came across this article in the Harvard Business Review recently: it certainly bears out what I see – and what various TAB York members tell me. A bank of Macs is not necessarily the answer to all your problems: in fact the modern office throws up almost as many challenges as its Rolodex and Kalamazoo counterpart…

Interruptions

There’s a great line in the HBR article: I think it’s safe to say that at least some of the work of your company requires sustained focus of longer than two minutes.

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Absolutely: and yet we seem to go out of our way to encourage interruptions to our work. An e-mail flashes up: there’s an alert on your phone: your computer starts cheering – someone’s scored a goal in the Euros. (Yes, yes, I plead guilty to the last one.)

But if the knowledge economy demands anything, it demands concentration. All the studies show that your work takes longer if you’re constantly interrupted, and that you produce lower quality work. There are plenty of techniques for keeping you focused – from the Pomodoro upwards – but they all depend on you turning off interruptions. (And recognising that it really doesn’t matter if Croatia take the lead against the Czech Republic…)

The Design of the Office

Hand in hand with the banks of Macs have come open plan offices. As Maura Thomas describes in the HBR, they’re a double-edged sword. Yes, open plan offices bring increased collaboration, sharing of ideas and a more social working environment. But they also bring distractions, noise and a loss of privacy.

I’m in two minds on this one: I can see the economic argument in favour of open plan offices – but sometimes adding knowledge to knowledge needs silence, focus and being unsocial. In my experience those offices that work best are the ones combining the best of both: where there’s a shared purpose, where you can collaborate – but where can also disappear when that report simply has to be finished by 5pm.

Absent Friends

As I wrote last week, my eldest son has just turned 14. With 8 or 9 years to go until Dan enters the workplace, I wonder if he’ll ever work in a traditional office? It’s much more likely that he’ll spend a large amount of his time working remotely – keeping in touch with colleagues via whatever’s replaced e-mail, WhatsApp and Basecamp by 2025.

But we don’t have to wait until 2025: remote working is a trend that’s already well established. I do wonder, though, if the vast majority of businesses are getting the most out of the team members that aren’t in the office. If it’s not ‘out of sight, out of mind,’ all too often it’s ‘out of sight, out of the loop.’ Success comes from keeping everyone involved and taking all your team on the journey – wherever they are.

…And with that, my thoughts turn back to the Brexit debate. By the time you read next week’s post we’ll have voted. The polls will be closed and if we don’t know the result, we’ll have a very good idea. But next week I’m going to ask a simple question. Leave or Remain: will it make any difference to your business?

What the Pope can Teach you About Business


Well, I’ve managed the blog on my own for nearly five years – but this week I had to seek inspiration from a higher authority: very nearly the Highest…

Mind you, I only found it through one of the more prominent supporters of Mammon – the Harvard Business Review.

I came across The 15 Diseases of Leadership, originally written by Pope Francis and translated into business-speak for us by one of HBR’s columnists.

A lot of the Pope’s ‘diseases’ – presumably aimed at what must be a vast bureaucracy in the Vatican – were vague to say the least. I’m still trying to work out no. 8 on his list – ‘the disease of existential schizophrenia.’ If any members of TAB York are suffering from it, maybe you could let me know at the next Board meeting?

But interestingly there are three points in the Pontiff’s list which really struck a chord with me: the dangers of excessive planning; the positive attitude of a leader and something that’s always irked me in my business career – extravagance.

I’ve spoken several times in blog posts of Rework – the irreverent business book written by the founders of 37 Signals, or Basecamp as the company’s now called.

One of the first – and most striking chapters – in Rework is ‘Planning is Guessing.’ As a business coach you might expect me to disagree violently with that statement. But the authors are right:

Unless you’re a fortune-teller, long term business planning is a fantasy. There are too many factors that are out of your hands: market conditions, competitors, customers, the economy…

Let me explain: I’m absolutely in favour of planning. I’m absolutely in favour of spending a serious amount of time in October or November making plans and setting targets for the coming year. But too many people do that and then think making the plans has put the business on auto-pilot – that success is guaranteed.

It hasn’t and it isn’t. Plans need to be kept under review. KPIs need to be constantly monitored. And you need to be prepared to change your plans if circumstances dictate. What’s more, the Pope agrees with me:

Things need to be prepared well, but without ever falling into the temptation of trying to eliminate spontaneity and serendipity, which is always more flexible than any human planning.

Put more simply, we live in a rapidly changing world. Your plans need to be flexible enough to change with it.

The second point is one Pope Francis describes as, ‘the disease of a downcast face.’ Couldn’t have put it better myself – and I think it’s one of the hardest things about being a leader. Whatever’s happened; whatever problems you have – either at home or in the office – you have to be positive. If you’re not optimistic and positive, then there’s no chance of your team being optimistic and positive. As the Chinese say, ‘A man without a smiling face should not open a shop.’ He probably shouldn’t try and motivate his staff either…

Lastly, the Pope and I turn to ‘the disease of extravagance and self-exhibition.’ My colleague in the Vatican sees this in leaders who seek “material gain [and] the front pages.” I see it in champagne…

Maybe there are some Puritans somewhere in the Reid family tree. I don’t like to see conspicuous consumption – especially when it’s the business that’s paying. You don’t need to spend that much money on Cristal champagne at York races.

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Sometimes you see signs that the business is being run for the wrong reasons: as an old school bank manager once said to me, “If I see a new Merc and the business is less than five years old, I’m looking to cancel the overdraft facility.”

With that – and a word of thanks to my assistant for this week – I’ll leave you to enjoy the weekend. Next week I’ll be looking at an increasingly important question: do people still buy from people? Or as more and more business goes online, is it becoming impossible to offer a truly personal service?

The Internet Changes Everything. Or does it?


Let me begin by crediting my source. Last week the e-G8 summit took place in Paris. There’s a great article on it in the Harvard Business Review – it’s by Rosabeth Moss Kanter and if you want to read the full version, here’s the link.

So who was there? President Sarkozy, Rupert Murdoch, Mark Zuckerberg, Eric Schmidt – just a few average Joes… But more to the point, what does a conference of the great and good in Paris mean for your business in North Yorkshire?

 

Well, let’s begin with some stats, courtesy of the number crunchers at McKinsey. They estimate that the economic output of the internet is bigger than Spain and that it’s growing faster than Brazil. Web-intensive SME’s grow twice as fast as SME’s that ignore the internet – and they’re more profitable.

 

Add in the fact that social media is largely credited for the revolution in Egypt. Throw in that 1.3 million people now make a living from eBay, that theKhanAcademy is revolutionising education and the message is clear. Whatever you’re doing, if you’re not doing it online then you’re doing something wrong. And quite possibly your business isn’t long for this world…

 

So the internet changes everything, right? Well…maybe not. You know that I’m fond of quoting from some of the foremost business thinkers of our age. Here’s one from Herman Hupfeld. Herman who? He wrote ‘As Time Goes By’ from Casablanca – and what’s the key line from the song? The fundamental things apply/As time goes by…

 

Yep, internet or no internet; whatever the pace of the digital revolution; however fast web-based businesses are growing, three key basics of business remain unchanged, and North Yorkshire or just-north-of-Silicon-Valley, we ignore them at our peril. Back toParis, and back to Rosabeth Kanter’s article:

 

With all the talk of revolution, disruption, and really big change, I was struck by the things that are not changing – at least, not yet.

 

Here are three fundamental things that still apply (as time goes by) – and they have a message for all of us.

 

A great customer experience differentiates the winners from the losers.

 

This was a point made by Andrew Mason, the positively middle-aged (he’s 29) founder of Groupon, possibly the fastest growing company in history. Yes, companies like Facebook, sites like Social Media Examiner, even old fashioned companies like Google have expanded at phenomenal rates, and they’ve done it with the help of technology. But millions of companies have had the help of technology. What differentiates those companies – and what should differentiate your offering to your customers – is that they’ve consistently delivered a great customer experience. What does your customer want? Fine. Go well beyond it.

 

However good your technology, it’s useless without people.

 

The spread of mobile and e-health services is bringing real benefits, particularly in the third world. But it’s being hampered by a lack of professionals. Rupert Murdoch made a similar point about education – there are tools available (please, if you haven’t used it, just go to khanacademy.org) that could achieve enormous progress in poor and disadvantaged communities. But there aren’t enough visionary leaders adopting these tools themselves and setting an example.

 

Don’t be the leader fighting the war with bows and arrows who was too busy to see the machine gun salesman. I strongly recommend that you set aside a couple of hours a week just to learn. Browse the internet; look at some of the new technology. You know the old saying – “if you always do what you’ve always done…”

 

If you’re the leader, then it’s up to you to lead. And sometimes leading means learning.

 

If you pay peanuts…

 

Should everything on the internet be free? Well, it’s undeniable that you can learn an awful lot for free – and you can find plenty of people willing to work for $4 an hour. So there’s a substantial saving on your staff costs. Or maybe not.

 

The initial reaction to the internet – that it was a freelancer’s paradise and everyone’s back office would be moving to the Philippines – has given way to an eternal truth. You get what you pay for.

 

The really good stuff – that can significantly impact on your business – costs money. And it always will. So do the really talented people. The key to surviving (and thriving) in the recession isn’t to pay as little as possible; it’s to surround yourself with the best people – and to create a company where they can do brilliant things. And more on that in a couple of weeks…