Listen To The Market

“The single most important decision in evaluating a business is pricing power.”

–     Warren Buffett (b. 1930), one of the world’s wealthiest men, who knows a thing or two about pricing

A neighbor of mine once swore to me that his house was worth 40% more than the market said it was worth.  “Your house is a lot like our house, right?” I said.  He agreed with me.  “Want to know how much they’re worth?” I asked him.  He said, “Yes!”

“They’re worth exactly what someone will pay for them.”

The same is true of our products and services in the markets we serve.

Can we build more value around our widgets?  Of course, we can!  And we should.  Value-add is where the magic is, especially in B2B selling.  Where we get all dorfed up is when we ignore the market. We have to listen to the market.  Unless we’re Jeff Bezos.

Jeff Bezos has built a business around defining markets.  First, books and then everything else we buy.  Unless I need to physically touch a product to evaluate it, I buy it from Amazon, and Jeff Bezos drops it on our doorstep 48 hours later.  Yesterday I bought a Bluetooth speaker, two Mother’s Day gifts, socks and underwear from Jeff.  He’s defined the market for those goods in the eyes of me, his prospect.

If we’re not Amazon, or unless we have the capital, staying power and stones to define a market, or unless we sell something that is materially different or better than competitive products, we have to listen to the market.

That said, the market will tell us the truth more quickly when we ask better questions.

What problem are you trying to solve?  How much will it be worth to you to solve that problem?  Besides the obvious elements of the product, what benefit are you looking to gain?  How do you define value in comparison to your competitors?

I paid $2100 for a brand new lawn tractor three years ago.  Today, I can buy a 4″ bigger deck and more horsepower for $1800, from the same manufacturer.

The market moved.  The dealer might still believe the smaller, slower tractor is worth $2100.  If he does, he’ll be sitting on a lot of tractors and financing a lot of inventory, right up until he is out of business.

We have to build as much value into our offering as we can.  That is our job as sales professionals.  As leaders, we have to listen to the market, so we don’t lose touch with what the market tells us about where our price and our value intersect.

Editor’s Note:  Value-based statement on National Executive Administrative Professionals day — Pam Wilson and Kelly Betts — you’re worth 50x more than I ever could have paid you — and I miss you every day!  Here’s to the value-added behind the scenes and across the board!

 

Be ready or get ready?

“A ready person need never get ready.”

–     Oswald Chambers (1874 – 1917), in “My Utmost For His Highest” (April 18th entry)

Yesterday, we opened up the concept of “winging it.”

As Oswald says with his typical, 2 x 4-to-the-noggin simplicity — it ain’t gettin’ ready…it’s being ready. 

One day in 1995, as we were about to sign the largest deal I’d ever done at that point of my career, a Texas banker for whom I have a lot of respect said, “Steve, I’m fixin’ to commence to get ready to tell you something…”  I replied, “Joe, with all that getting ready, this had better be good!”  It was.  He was one of the best bankers in a great banking state, and he was always ready, no matter what the market threw his way.  Not getting ready.  Just ready.

Barry Sanders might be one of the best football players ever. Some sportscasters call him “the greatest improvisational runner in NFL history.”  Here are 50 examples of why they say that…  Odd thing is, though, he wasn’t improvising.  He was ready.  A friend of mine coached Sanders’ team when Barry was about ten years old.  “To this day you’ll never see a kid work harder at getting better every day, from the time he could pick up a ball,” he said about Sanders.

ESPN and NFL Films’ “The Last Dance” documentary on Michael Jordan‘s last championship season with the Chicago Bulls began Sunday night.  Was Jordan the most talented basketball player in history?  Some might argue that LeBron, Kobe or Oscar Robertson might have a claim to that label.  That said, anyone who played with or against Jordan will tell you that he worked harder in practice than anyone they ever knew.  Michael Jordan didn’t have to get ready.  He was ready.

Not into sports analogies?  Consider Charlie Parker, the great jazz musician.  Eddie Murphy and Robin Williams, the comedians.  Eminem, the rapper.  John Maxwell, Zig Ziglar, John Wooden — coaching legends.  Choose the greatest performer in any pursuit and they are long past the point of getting ready.  They.  Are.  Ready.

We don’t have to be world-class to make a difference.  We just have to be ready.

Oswald is, of course, referring to being ready in the spiritual sense.  That’s job #1, of course.  Whether in Faith, work or life, all of our getting ready comes before.  Now, it’s time to be ready.

 

 

 

Winging It

“I’m going to wing it.  Me, in reference to something I definitely should not wing it”

          –     T-shirt slogan

The more experienced we become, the more tempting it is to “wing it.”

Being experienced does not make that a good idea.

In a time when there is so much information available that it’s not ok not to know — our prospects and clients have every right to expect us to be prepared.  Well prepared.

Here’s the kicker.  We have an opportunity to help them be prepared, too.  “Hey, Paula.  When we talk on Thursday, what is it you’d like me to be ready to cover?”  “Hey, Paul, when we talk on Wednesday, there are two things I’m hoping to get really good insight on; ______________ and ____________.  If you’d be willing to dig into those two topics a bit, I’ll know pretty quickly whether I can help you, or, if not, I’ll be able to point you in a direction to get the help you need.”

Great jazz musicians are, by definition, improvisers.  After 10,000 hours of rehearsal, however, they are most definitely not winging it.

Preparation might make it look effortless, but difference-makers know that the effort was put in well before the lights went up and the performance began.

Maxwell Friday: Respect

“Great leaders don’t set out to be a leader…they set out to make a difference.”

–     Lisa Haisha, speaker, TV host

Our Friday Morning Group is about a third of the way through Maxwell’s 21 Irrefutable Laws of Leadership — and it’s been a great ride with a great group of guys so far.

Simplified, The Law of Respect boils down to six qualities Maxwell believes go into being a respected leader.  I’ve added my own little paraphrased niblet beside each one (well, five of mine and one from Henry Kissinger…)

  1. Natural Leadership Ability — this is the stuff that’s wired in and developed in our early years
  2. Respect of Others — gotta give it to get it back, right?
  3. Courage —  Kissinger said, “A leader does not deserve the name unless he is willing occasionally to stand alone.”
  4. Success — Winning requires a willingness and desire to grow.  We respect others who have put in the work to succeed.
  5. Loyalty — Powerful and compelling, stand by those in our influence and those who lead us
  6. Value Addes to Others — Pour into others, and watch the investment flourish

I’m partial to the Haisha quote at the top, but Kissinger’s thought by bullet #3 hits home, too.  Sometimes a leader has to move in a direction alone, and trust that her instincts, experience and judgment are pointing her in the right direction.

Make it a great weekend.

 

Merge, Accelerate, Check Mirrors, Exit

“A man’s conscience, like a warning line on a highway, tells him what he shouldn’t do, but doesn’t keep him from doing it.”

–     Frank A. Clark (1860 – 1936), American lawyer, politician and US Congressman

On-ramps and off-ramps — the way we navigate the open road and good checks and balances for our plans, forecasts, and execution.

Sidebar:  I’m always impressed when a historical figure nails a topic that they never really experienced in their lifetime.  There weren’t a tremendous amount of “highway” be the time ol’ Frank passed in 1936…but I digress…

The Youngest of The Three will start “practice driving” this weekend, preparing for June when she gets her drivers’ permit.  Her older bro and sis both had the same reaction the first time we went on to a major highway.  “Whoa, Dad, how do I know when to go faster, slower, when to get on and off the highway?”  (The tallest also said, “Dad, just so you know, I hate those big trucks…but I digress again…)

It’s like our plans and forecasts and executing against them.

Once we have a plan, we know we’re trying to get from Napa Valley to Chicago, we map our route.  That’s our plan.  We estimate it will take us about 31-ish hours, based on the “fastest route.”  Depending on the time of year, we might have to change course due to snow in the mountains (twice), seasonal weather swings, traffic mishaps, road construction — tons of factors.

Where we get it wrong in our business planning is saying, “We’re going to Chicago on I-80.  We’re leaving Napa at 6 AM Tuesday, driving straight through, switching drivers every five hours, and with gas / potty stops, we’re going to arrive at The Bean at 3 PM on Wednesday.  There.  It’s settled.”

We hit snow at Lake Tahoe.  The “plan” says “press through!”  We hit traffic in Denver. We get tenser and terser and more impatient, because the plan says, “Bean by 3 PM tomorrow!”  By the time we hit the Nebraska border, we’re doing 94 mph, which the Nebraska Highway Patrol takes great exception to, and the stop adds 22 minutes to our already wrecked “plan.”  Our “forecast” is shot, with a third of the trip left — and no chance to recover.  At this point, we’re too far from the nearest airport to even get there via alternate means of travel.  We gotta keep driving, keep executing, but now towards a different plan.

Where are the on-ramps and off-ramps in our route?  Should our only plan be “3 PM on Wednesday at the Bean,” or should it be:  “In perfect conditions, with no hiccups, we’ll be at The Bean by Wednesday at 3 PM.  It’s 2103 miles, though, and we’re going to hit some snags, especially in the mountains and on the Kennedy Expressway.  Let’s plan on breakfast Thursday.  If we get in before dinner Wednesday night, we’ll call — and let’s get a bite then.  Worst case (the weather looks dicey around Tahoe), let’s plan on lunch Friday, and re-calibrate once we’re through the mountains.”

Where do we stay on the highway and maximize speed and traffic flow?  Where do we get off and rest, check the weather, consider whether our chosen route is still the best one?  Where do we choose a two-lane road with some stop lights and small towns?  Where do we get back on, how fast do we drive and where is our next option to get off the highway?  Back on?

What are our likelihoods?  Likely-case, best-case and worst-case?  What do we know, need to know and not know?

How much better will the trip be when 3 PM Wednesday at The Bean isn’t our only successful outcome?

Editor’s Note:  Long-time readers know I’m not a rear-view mirror guy, for the most part.  The headline today references it, but primarily intends we consider the side-view mirrors.  Who’s flying up on our left?  Who’s on our right, that might affect our ability to exit?  If there are 17 cars behind me, should I consider getting out of the left lane?  (Sorry, Wisconsin subscribers, I know that one hits close to home…!)

Higway driving, like business planning, is about entry and exit points, speed, options and knowing what is around us on the road.  Both require knowing when to merge, accelerate, check the mirrors and exit.  The destination doesn’t have to change — but how we get there likely will.

 

Forecasting vs Executing

“An economist is an expert who will know tomorrow why the things he predicted yesterday didn’t happen today.”

–     Evan Esar (1899 – 1995), American humorist and author of Esar’s Comic Dictionary

The more we rely on forecasts, the more susceptible we become to losing our way.

Are forecasts important?  Absolutely.  In the business of selling, there aren’t many disciplines more worthy of our time and attention.  In fact, it might be the most important exercise in which we engage.  But it’s a sucker’s bet to rely on the forecasts that we make.

The more we rely on execution, the more likely we are to reach our best destination.  Yes, executing on something is better than predicting just about anything.

To paraphrase Esar — predicting precisely is to miss completely, in advance.

So, how do we engage in forecasting?

Forecast in likelihoods; most-likely, best-case and worst-case.

Decide which questions we’ll ask and answer.  What could happen and why?  What would we have to do and when?  What would have to go right / wrong?

What do we know?  What don’t we know?  What do we know we need to know no matter what we don’t know that we need to know?  (That was fun to write, but Grammarly almost melted down over it…)

Great forecasters ask and answer, relentlessly, presuming they’ll be wrong while still giving themselves multiple paths to choose that will get them close to “right.”

Tomorrow, on-ramps and off-ramps — and their role in both forecasting and executing.

 

 

Gratitude

“Holy sh**, Richard!  What are you gonna DO?” asked Ira, our neighbor

“I reckon I’ll wait until the water goes down, and plant it again…” answered my dad, Dick Heston

“What?” Ira almost yelped, “What if it floods again?!” 

“Well, I guess I’ll wait for the water to go down again, and if it’s not too late, I’ll plant it again,” said Dad.  “If it’s too late, I guess I’ll just have to wait until next year.”

I remember it like it was yesterday, but it was sometime in the Spring of either 1968 or 1969.  The three of us, Ira, Dad and me, were standing with the water of Cedar Creek lapping at our toes, which sounds kind of cool until you realize that Cedar Creek’s banks were about 300 yards from where we were standing, and the water was rushing over the crop my father had planted just a couple weeks earlier.

Being a farmer is an extraordinarily challenging career choice.  Faith, hope and hard work get you through, and gratitude makes the challenge less daunting and more rewarding. I won’t say Dad never cursed the rain, but he understood the fine line his livelihood required him to walk.  And he was grateful to walk it.  He was grateful for the rain.  He was grateful for the snow.  (“Helps the subsoil moisture,” he’d say.)  He was grateful for the work and he was grateful for neighbors who pitched in and for the chance to pitch in for them, too.  He was grateful for nature, upon which he relied for his income.

About 20 years after the conversation by the flooded corn crop, Jeff Young, an editor at the Fairfield, IA Daily Ledger, wrote a feature on Dad:  “I could stand here all day and watch these cattle,” Young quoted my father, also noting that several minutes later Dad was “still there, admiring the land and its creatures for what they’re worth and not the least bit worried about being a big-time producer.”

Being a leader is an extraordinarily challenging career choice.  Faith, hope and hard work get you through, and gratitude makes the challenge less lonely and more rewarding.  Our “floods” might look more like a virus that shuts down “business as usual,” or, it might look like a clear path to a record-setting year that becomes a bumpy road that hopefully leads to relevance and survival.

COVID-19 is still here.  The news media, social and otherwise, would still have us believe that Chicken Little was an optimist.  There is opportunity in these times.  What can we be planning while we wait for the water to go down?  What will we plant in the wake of the flood that will bear new crops and give us even more for which to be grateful?

 

 

New Beginnings

“Every new beginning comes from some other beginning’s end.”

–     Lyric from “Closing Time” by Semisonic

On the Monday after Easter Sunday, it’s easy to talk about new beginnings.  On this particular Monday after Easter Sunday, however, there are different filters through which we might view new beginnings, not just the overtly Faith-based.  In these unprecedented times, heck, maybe even in ordinary times, new beginnings await us at every turn.  Which brings me to a second quote for this edition of The Daily Difference:

Nothing is over until we decide it is.”

–     John “Bluto” Blutarski, (pre-Senatorial career) as portrayed by John Belushi in the 1978 comedy classic movie, Animal House

As Americans, living in the most privileged country on the planet, it can be easy to get over-confident.  “Anything is possible in America!” “You can be whatever you want to be!”  Those are things we’re told growing up here.  The American Dream is still why the USA is the only country with a line at the door, for people waiting to get in.  

“So, Heston, what’s the point?” I hear you asking, yet again.

The lyric is 100% correct.  Every new beginning does, in fact, sprout from the end of a different beginning.  And Bluto / Belushi is equal parts right and wrong.  There are times when it ain’t over until we throw in the towel, and there are others when it’s over, no matter how much we want for there to be time left on the clock.

COVID-19 will not be “over” today, no matter how much we want to re-start the economy and put this episode behind us.  That does not mean we can’t start anew today.  What if we start to take swings at moving toward the “Membership Economy?”  What if we look at our business exclusively from the perspective of someone who does not and has not, but might want to do business with us?  What if we say “good riddance” to the fear and trepidation that times like this can spawn, and by confidently or at least consciously welcoming in the opportunity to really separate ourselves from those addicted to the fear?

Regardless of where we are on the “Working From Home Since _______” timeline, what if we take a few minutes to decide what we’ll begin, and what we’re going to decide is over — and how will that make a difference?

 

Good Friday and Easter 2020

“To one who has Faith, no explanation is necessary.  To one without Faith, no explanation is possible.”

–      St. Thomas Aquinas

It bears repeating.  To one with Faith, no explanation is necessary.  To one without Faith, no explanation is possible.

To some degree, in our workaday lives, what we believe dictates what we can accomplish.  In the grander scheme of life, what we Believe (upper case “B”) dictates who we are.

A friend of mine and Brother in Him suggested the Twitter handle “#itisdone” for Easter.  And, he’s right.  It is.

It.  Is.  Done.

No greater gift could we ever be given.  No level of appreciation could ever be enough.

Yet we’re not called to appreciate.  And we’re not called to reciprocate.  We’re called to follow.  To Believe.  To live with the knowledge that with one, incredible, heroic feat borne of love — nothing else matters.

Whether no explanation is necessary, or whether no explanation is possible, it is done.

And no greater difference will ever be made.

 

Editor’s Note:  This is either the 16th or 17th Good Friday that this Daily Difference has posted.  Some minor variations, but pretty much these words in this order every year on Good Friday.  Upper-and-lower case letters matter in this post.  In 2020, it would be easy to postulate on the current pandemic.  The current state of our economy.  The fear.  It simply doesn’t matter.  It.  Is.  Done.  And we — make that He — has won.

What if they do? What if they don’t?

“The best way to predict the future is to invent it.”

–     Theodore Hook (1788 – 1841), English “man of letters,” known for his writings and his practical jokes

Thousands of businesses are conducting forecasting events this week, trying to estimate a range of impacts to their businesses as they operate in what one of my teammates calls “the new abnormal.”  These exercises will re-emphasize the importance of the questions we ask, over the answers we believe to be true.  In each case, I bet any of us could add ten really great questions to the lists below.  The intent of this post is to help guide those conversations today, in such a way that surviving businesses come out on the other side of this event better prepared to be trusted advisors for their Clients.

So, when executive teams sit down to talk about “what if our clients do”… and “what if our clients don’t…” one way to structure it is SHADAWANWAEG:

SHADAWANWAEG

Corollary:  In assessing a Client base’s vulnerability to a major economic event, it’s a good idea to start with a clean whiteboard, just as we use empty boxes to assess an org design.

Corollary II:  Client-facing teams should have been and should now ask and record the answers to these questions (and others), whether another icky event happens or not, simply because of the depth of relationship-equity these dialogues provide.

Back to the Crisis Assessment Meeting at the Whiteboard in the Boardroom…

On that whiteboard, after we write up “Current SItuation Description,” we start with SHA.  Questions we should have asked.  As early as we can in a business relationship, we need to know.

“What is your ownership structure?  How many shareholders?  Which owner(s) have the tiebreaker votes when big decisions have to be made?  LLC, C-Corp, S-Corp, PC — what’s the legal structure?  What happens if one of the owners wins Powerball and moves to Fiji?  What is the succession plan?  When I say “business continuity,” what comes to mind?  “Disaster recovery?” How well does your capital structure support major shifts in the market?  Who is your bank?  Are they local, national?  Are you personally guaranteeing debt if you have any?  In a crisis, which owner or manager can act without permission from the others?  What does your general decision-making process look like?

By knowing what we don’t know, we’ll understand where we’re flying blind – and where we need more answers.

Next we go to DA: questions we did ask (but which answers might shine in a very different light right now).

We probably know things like revenue, number of locations, emergency contact numbers (although you’ll be amazed how few of your clients have “official” emergency contacts for real emergencies…), seasonality, competitive landscape / competitors, locality / regionality of their customers, sensitivity to outside influences (weather, labor union strikes in the area…in Wichita, KS, when I worked in the Anheuser-Busch system, the aircraft workers unions went on strike and I expected my business to crater, but I learned that in a strike in a union town, beer sales skyrocket, for example).

Next, lets focus on questions we will ask now.  (WAN):

“Are you safe?  Is your family safe?  Are your employees and their families safe?  Are your suppliers supplying?  What worries you / scares you the most?  What are your peers suggesting?  What are your competitors doing?  How can I help?  Have you staged your business continuity plans – if you’re shut down until _________, at what point does that _________?  What’s the best idea you’ve seen from a peer / competitor / provider?  Have you applied for grants or SBA / PPP support loans?

At this point, we’ll be able to draw some conclusions that are based in fact.  Probably not too many, though.  We should record them and monitor them, for sure.  More likely, we are in a position to make some wild-ass educated guesses (WAEG):

Based on what we know, _____________ is likely to happen, we must solve for that and here are the __________ (three, four, etc) most likely impacts for our business.

Based on what we think we know, ______________ may happen, and as we solve for that, we should list the likely impact to our business for each possibility in general terms.*

Based on what we need to know, we’ll deploy our best people to get the answers or at least the indicators, and from there, we’ll refine our plans.

Based on our wild-ass-educated-guesses, we’ll establish three strategic foundations, in general terms*, and refine the tactics behind them as the reality plays out.  We’ll begin and go forward with a focus on the most-likely case, with contingencies for best-case and worst-case impacts.

 

It ain’t perfect.  It’s a framework.  I hope it helps you make a difference for the people who are counting on you to make a difference.

 

*Editor’s Note:  General terms — not deep detail!  If we try to solve at the third or fourth level of detail at this point, we’ll spin our wheels and depress ourselves.  Strategy is a high-level consideration, and tactics follow as strategies evolve.  I’ll bet you a good glass of single-barrel bourbon that the winners will get their strategies 80% right, and find that their tactics change five or six times, minimum, going forward…