The Agile Scaleup

Raising Entrepreneurs; Fortune 500 Ap; Coaching is Hot; Sports Coaching Challenge

"...keeping you great"

HEADLINES:   

Raising Entrepreneurs -- more on this below, but first...

Selling to Large Companies? - if the Fortune 1000 are on your radar, here's a must download Fortune 500+ web ap that runs via your browser - no tablet needed. Where data is king, this gives you loads of info and contacts inside the 1000 largest firms with which you can arm your sales team. There is a two-week free preview available. This is a serious and inexpensive marketing tool.

Peer Coaching Update -- taking a page from the top executive coach in the world, Marshall Goldsmith, who keynoted our Fortune Leadership Summit, I set-up a peer coaching relationship like he suggested - and the outcome, so far, has been life-changing. A dear friend and fellow entrepreneur in Barcelona is serving as my peer coach. We've started with just five areas in each of our lives we want to improve anchored by a question i.e. did I do my morning breathing exercises. Rather than talk each day, we simply email each other answers to our five questions - takes literally one minute. We then try and meet once per week for breakfast or lunch. It's amazing the changes you can make and the habits you can break when you have to answer to someone besides yourself every day!

No Such Thing as Self-Help -- this experience of a daily peer coach, so far, underpins Darren Hardy's idea (author of The Compound Effect) that there is no such thing as self-help! Find someone to be your peer coach, choose several areas in your personal and professional life that need improved, and then hold each other accountable on a daily basis - the key is daily. Plus it gives you someone to commiserate with! Please share with me some of your own peer coaching stories if you embraced Goldsmith's strongest suggestion for becoming a better leader.

Coaching is Hot -- this is the title of a recent Fortune article reporting on a July 2011 American Management Association survey that showed half the participating companies had coaches for their promising middle and upper managers. The coaches are focused not only on helping those struggling but more on optimizing strong performers - the best have coaches. What I find lacking in many firms is someone focused on Talent Development - I would like to see this specific accountability assigned to someone in the firm. And let me know if we can help you find a coach - we have 91 coaching partners around the world, most of who will be at the Fortune Growth Summit continuing their education -- something required of our professional coaches.

Inside/Out Coaching -- Joe Ehrmann, former NFL superstar often referred to as "the Most Important Coach in America" has a new book out entitled InsideOut Coaching: How Sports Can Transform Lives. This is a must read for any parent who has children participating in sporting activities - and a book to give to their coach. In essence, your child's coach can make or break their spirit, self-esteem, and souls. Ehrmann shares his own coaching experiences growing up and how there are various types of toxic, mostly volunteer, coaches: the Dictator, Bully, Narcissist, Saint, and Misfit. Today, a coach to many of the NFL coaches and coach of one of the winningest high school teams, Erhmann offers an approach to sports coaching that is transformational vs. transactional.

Raising Owner/Entrepreneurs -- Steve Mariotti, founder of the global organization NFTE (Network for Teaching Entrepreneurship), wrote an excellent article for The Huffington Post on why we need to coach/teach more young people to be owner/entrepreneurs - worth giving it a 3 minute read. One recent success story is NFTE alum Zoe Damacela, who is on the October cover of Seventeen Magazine as the "Real Teen Model" winner who launched her clothing business when she was 14. Here's a link to her interview and cover shot


NFTE Adopt-a-Class Helping Entrepreneurs -- think about having your company sponsor a NFTE class for $10k per year (or co-sponsor for $5000) - these classes as part of the regular curriculum, which is the key to their success -- it's not an after school activity. And have your executive team and managers spend time in these NFTE classes teaching students about business - there is likely a class in your own city around the world. We all have our favorite charities, but this activity most directly aligns with your everyday activities - we first and foremost must be growth firms that help other growth firms so we have vibrant economies that can purchase our goods and services. Here's a link for more info - please sign-on and support NFTE - thanks.

Clever Index; Fortune Column; 5 Ways to Save; Web Strategy Template

"...keeping you great"

HEADLINES:   

5 Clever Ways to Save Money -- my latest Fortune magazine "Venture" column is on the newsstands (September 26th edition) and online. Take three minutes to glance through 5 creative ways mid-market firms are saving substantial money. Please share your comments/ideas online at the Fortune website and tweet, recommend, share, etc. - your support of my column (just clicking on it helps) is greatly appreciated.

Over $100k in Annual Savings - learn how:

1)	Vancouver-based Nurse Next Door saves money on office space
2)	Dallas-based DriversSelect slashed interest, insurance, and storage costs
3)	Denver-based Cherry Creek Dance reduced perceived "nonnegotiable" recurring costs
4)	Maryland-based Veterinary Orthopedic & Sports Medicine Group cut credit card transaction fees
5)	Charlotte-based Choice Translation eliminated huge IT expenses

Thank you to these five companies for contributing their ideas to my latest Fortune column.

The Real CPI -- I just wrapped up my Australian tour a few hours ago. It seems several growth company leaders have embraced David Meerman Scott's notion that "you are what you publish." One of my favorite examples is Wayne Fowler's Cappuccino Price Index (CPI). Playing off the media's ongoing interest in the Consumer Price Index, Fowler, Managing Director of Brisbane-based Gilkatho Coffee , has garnered substantial attention from this clever and fun industry indicator, including ongoing coverage by The Wall Street Journal, ABC News, and various industry publications. What index might you create and publicize?

Web Strategy Planning Template -- Adam Franklin and Toby Jenkins, co-founders of Bluewire Media, actually collaborated with David Meerman Scott (The New Rules of Marketing and PR fame) to create a Web Strategy Planning Template based on Scott's book - a way to guide implementation of his ideas. It's a free download along with Franklin and Jenkins' Web Strategy Secrets E-Book.

MRH eBook in Multiple Formats -- FYI, Mastering the Rockefeller Habits is now in various eBook formats (Spanish, English) and on various e-readers (Kindle, Nook, Sony, Apple...).

#1 Business Book; Fascinate Customers; 7 Triggers; Business Model Generation

"...out-learning the competition"

HEADLINES:   

Fascinate -- it's no longer good enough to get noticed; you need to fascinate - something Apple has done beautifully. There happens to be a formula for doing this - for any product or service - and Sally Hogshead has written it down. Raved about by Seth Godin, Alan Webber, Tom Peters, etc. Sally's book is entitled Fascinate: Your 7 Triggers to Persuasion and Captivation.

7 Triggers -- Here's a quick online slide presentation (just 23 slides) that walks you through the 7 Fascination Triggers: Power, Lust, Mystique, Alarm, Prestige, Vice, and Trust (hope this list makes it past your SPAM filters). And come hear her keynote at the upcoming Fortune Growth Summit, Oct 25 - 26 in Phoenix. Book club members will get her book this week. Go right to Part 2 to dig into each trigger with concrete examples that will help you brainstorm ideas for your own products and services - Part 1 was a little too racy for me!

Business Model Generation -- still in the top 50 of all business books since being published in 2010, Business Model Generation has been a smash hit providing an one-page look at your company's business model - and allowing you a way to visualize and improve it. If you don't get the business model right, the rest of your time is a waste. I had co-author Alexander Osterwalder keynote our European Growth Summits earlier this year and followed along as he helped me model Gazelles (I carry it with me). It was so helpful I'm flying him over from Europe to keynote the Fortune Growth Summit where he'll walk you through the same one-page process and demo his iPhone app. It's also a great way to model new products and services.

#1 Business Book -- at least at the moment I'm writing this insight it's also the #1 of ALL books - Fred Reichheld's dramatically updated Ultimate Question 2.0: How Net Promoter Companies Thrive in a Customer-Driven World was released today. And several of you, including Rackspace, are featured in the book. We've been pushing the use of NPS as a simple measurement of customer advocacy since Fred keynoted our Summit several years ago, and Fred credits us for getting the tool pushed down into the mid-market company sector. Fred is producing a one-hour online seminar for Gazelles and we're hosting him in Sydney March 15 - 16 at our National Growth Summit in Australia.

Bob Parsons, Dan Pink, Youngme Moon, Sally Hogshead, Alexander Osterwalder, Travis Bradberry, Todd Klein, Alan Miltz, Stephen Baars (and me) -- all in one place. If you haven't absorbed their ideas (or know who they are), you'll fall behind those who do!! See you in Phoenix.

9/11 Business; 5 Marketing Tips; 100 Fastest Growing; Ridiculously Transparent

"...keeping you great"

HEADLINES:   

How 9/11 Launched a Business -- Robert Herzog narrowly escaped dying that day, the emotion from which he launched a successful company. Meet him and his team in Phoenix at the Fortune Growth Summit. His full story below, but first...

1 Great = 3 Good -- yes, there was a serious typo in my last insight about The Container Store. Their philosophy is that 1 Great employee equals 3 Good employees and they have the data to back it up.

5 Marketing Techniques -- my latest Growth Guy column for September is available. Entitled Improving Marketing: Five Techniques, it's another "mash-up" - this time of several leading marketing books - a way for you to glean key lessons from five top thought leaders in the 3 minutes it takes you to read the column. The most important first step is establishing a weekly marketing meeting, separate and distinct from the sales meeting. The techniques I highlight then provide you with plenty of questions to drive these marketing meetings.

Your Killer Marketing Ideas -- I need your help with my next Fortune "Venture" section column focused on killer marketing techniques (maybe examples of implementing the ideas in my column mentioned above). If you have one, please email me - no need to write it up, just give me a couple sentences about the marketing idea and its impact and we'll call to interview you. My email [email protected]

100 Fastest Growing Companies -- Fortune's latest list is out this week and not surprisingly, bracketing the list is a pair of healthcare companies. The winners have been invited to participate in the Fortune Growth Summit, so come meet the leaders of some of the fastest growing companies. Here's a link to the Top 100 -- click on the "Full List" tab if you want to just quickly scan the list.

Ridiculously Transparent -- once again, Ben Horowitz's blog is right on the mark. Authored by his partner Scott Weiss, CEO of IronPort, he describes how he mined information from all employees to drive the company. Notes Weiss, "The best information rarely sat with the senior executives but with the employees that were closest to the product and closest to the customers. And the best answers would often come from the most unlikely of places. For example, some of our most innovative features came from customer support reps identifying customers trying to use the product in ways it wasn't intended." EXACTLY. This is why "the most brains win" - and a non-negotiable is management talking to employees and customers every week and discussing what they've learned at the weekly meeting!

Robert Herzog's 9/11 Story -- Mark Green, Robert's certified Gazelles coach, alerted us of his story. As Robert notes below "after 9/11, I vowed that my life would never be the same and it hasn't."

Dear ZogSports extended family,

With this weekend being the 10 year anniversary of 9/11, my thoughts are with those of you who lost friends and family on that day. I can't imagine how hard this must be for you. As I personally reflect on the 10 year anniversary of 9/11, I am emotional and torn. I think about how my post-9/11 epiphany (ZogSports) has helped bring people together and build community, but I will never forget how close I was to dying that day and how many people and their families were not as lucky as me.

I want to thank those of you who have reached out to me this week. I've been touched by the stories people have shared about the impact ZogSports has had on their lives and encourage you to continue sharing those stories with us. After 9/11, I vowed that my life would never be the same and it hasn't.

Here is My Story

I got a new job as the VP of Operations for Marsh & McLennan's internet group in July 2001. My office was on the 96th Floor of World Trade Center Tower 1 (North Tower). Catching up from my Yosemite Park vacation on the morning of September 11th, there were dozens of little things I did on my way to work that I usually didn't do. In the end, these little decisions saved my life: I hit the snooze button twice, dropped off my laundry, picked up my held mail (stopped to toss the junk mail), took the local (C) train instead of the Express (A), and numerous other small decisions that caused me to arrive at work 5 minutes late.

On September 11th, I got off the subway and came outside at 8:45am in time to hear a loud explosion. I looked up and saw a gaping hole in the side of the building where my office had been. None of the 297 people from Marsh who were already at work survived. I don't know how long I stood there, but after the 2nd plane hit, mass hysteria broke out and I ran. I met up with my girlfriend (now wife) at her office and we walked home desperately trying to make sense of what had happened.

Three Months Later

I'm sitting on the beach with a pina colada in my hand lamenting about how terrible my life was: Before I started at Marsh & McLennan I closed down the internet company I was helping run, was forced to lay off 30 people who reported to me, and wound up unemployed. Worst of all, I almost got hit by a plane. My glass was half empty, but I decided to view it as half full. I thought about all the good things that had happened that year: I survived 9/11, I met my wife playing co-ed softball, and I was able to enjoy my passion of playing sports.

I reflected on my life and tried to figure out what I wanted to do with myself. I played in numerous sports leagues, and while I loved the sports and camaraderie part, I was disappointed with their lack of organization and disrespectful customer service. I could do better. While thinking about the changes in the NYC community post-9/11, I saw people being selfless and inspired to give back. That was the moment. I decided to combine sports, social and charity and create ZogSports. My goal that day is the same as it is now - to bring people together through sports and incorporate charity into things that people want to do anyway like play team sports, meet new people and hang out with their friends. All of this inspires what we do at ZogSports and how we do it every day.

Thank you for being part of our community.

Best regards,

Robert Herzog

This email was sent by: ZogSports
57 West 38th Street, 12th Floor New York, NY, 10018.

#1 Problem in India; Goldman Sachs Wages; Job Creation

"...keeping you great"

HEADLINES:   

Huge Wage Pressures in India -- I'm in India this week and the number one challenge, of the four decisions (People, Strategy, Execution, and Cash), is People. Attrition is increasing as it becomes harder to find talent to keep up with the rapid growth of companies attending my workshops - growth on the order of 25% to 100% per year - and these are basic businesses, not internet dot-coms. And compounding the problem are dramatic wage pressures, with wage costs for the BSE-500 increasing 19% last quarter (22% the quarter before). In turn, profits increased just 4.6%.

Coal India Ltd's (CIL) Employees Ask for 100% Raise -- though an extreme example, this is further indicative of the wage pressures felt by India's business sector. In fact, India has had the highest increase in wages of all Asian countries the past two years. Here's a Livemint.com article detailing the situation.

Goldman Sachs Wages -- so I dusted off some old PowerPoint slides and updated the figures. Prior to the financial crisis I noted how Goldman Sachs, Morgan Stanley, and Merrill Lynch had roughly identical size payrolls and net profits ($11 billion and $5 billion respectively), yet Goldman had roughly half the employees. This translated into Goldman's employees making on average twice that of Goldman's two nearest competitors - the first company to reach over a half million dollars per employee compensation - while having 2.5 times the profit/employee.

The Container Store - in turn, believing that "3 great employees = 1 good employee", one of the Best Places to Work companies, Dallas-based retailer The Container Store, also pays twice industry average wages -- $20/hour vs. an industry average of $10/hour - while achieving breath taking sales per sq ft. They also provide first year employees with 265 hours of training and 160 hours/year after that. So my message to firms, before the crisis, was to move in the direction of having less people paid more while providing lots of training. Better yet, double revenues without adding any net-new headcount so you're not cutting people (don't blame me for the job crisis!).

Goldman Update -- back to Goldman Sachs and their competitors, so I pulled data from 2010 and found an even starker contrast. Goldman, through the recession, saw profits jump to $8.4 billion while Morgan Stanley's dropped to $4.7 billion. As for Merrill Lynch, it doesn't exist anymore as an independent company! Average wages for Goldman employees are still almost twice that of Morgan Stanley's while profit per employee is up over 3 times. 1 great (well paid) employee does equal 3 good (50% paid) employees.

Get Ahead of the Curve -- so my advice to the leaders of India's fastest growing firms this week is to jump ahead of their wage inflation and focus on doubling revenue/employee while increasing wages 50% -- resulting in a win, win, win for the employees, company, and the Indian economy - it's as effective in low wage retails jobs as it is in the highest paid industry in the world.

High-Impact Firms And Job Growth -- Pam Watson Korbel, a friend and executive coach out of Denver, pointed in her blog today to a 2008 SBA study that revisited David Birch's research which found "gazelles" (vs. all small or large businesses) generate all the net new jobs in an economy. Their overall findings, quoting from the 91 page report:

High-impact firms are relatively old, rare and contribute to the majority of overall economic growth. On average, they are 25 years old, they represent between 2 and 3 percent of all firms, and they account for almost all of the private sector employment and revenue growth in the economy.

The surprise finding was the average age, which upon reflection, didn't surprise me. It's the "overnight successes take a long time" phenomenon that accounts for this situation. Anyway, as Watson Korbel notes "I don't think the government is reading its own studies and following them." I couldn't agree more.

Steve Jobs Neighbor; #1 Job of CEO; Air Force One; London & India

"...keeping you great"

HEADLINES:

"Our biggest competitor in the recruiting arena is extended unemployment benefits."
	Mark Lancaster, CEO Employment Group

Neighbor of Steve Jobs -- for all that's been written about Steve Jobs this past week, I found this article the most personal look at Steve the neighbor, father, citizen. On the same day, the NY Times published a piece entitled "The Mystery of Steve Jobs's Public Giving." My favorite paragraph from the article:

Two of his close friends, both of whom declined to be quoted by name, told me that Mr. Jobs had said to them in recent years, as his wealth ballooned, that he could do more good focusing his energy on continuing to expand Apple than on philanthropy, especially since his illness. "He has been focused on two things -- building the team at Apple and his family," another friend said. "That's his legacy. Everything else is a distraction."

And get your pre-orders in. The release of Steve's biography, by acclaimed Walter Isaacson, has been moved up to November 21. Many of our questions will be answered then.

Right Person for #2 Job -- finding the right #2 is the most important decision a leader can make. And my research found that the best choice is someone with whom you've worked with in the past -- existing employee, customer, supplier, colleague from a previous job, etc. Tristan White, founder and CEO of Melbourne (just named best place to live in the world)-based The Physio Company took note. Yesterday he sent me an email ahead of his attending my Australian workshop tour, sharing "about 9 months ago I appointed my first 'No. 2' (someone I had been working with as a supplier for 2 years). It's working out well and I am now able to spend much less time on the day to day. My focus right now is to grow myself and learn as fast as I can...hence, my obsession with learning." Launched in 2004, his firm will provide over 72,000 physiotherapy visits in 2011 and has been recognized as one of BRW's "Best Places to Work" and one of Australia's fastest growing firms. Congrats Tristan and his team.

#1 Job of the CEO -- according to Hermann Simon, author of Hidden Champions of the 21st Century, the #1 focus of the CEO is marketing and innovation (i.e. Steve Jobs!). And as David Meerman Scott, the top marketing guru right now, exclaims "you are what you publish." Again, Tristan White, CEO of The Physio Company, took note. "I've been blogging for the past 12 months and am about to write my first book. I love it and should have done it years ago! Thanks for the inspiration." Here's a link to his blog -- and a link highlighting their daily huddle called "To The Point."

Job Well Done -- where you host your upcoming quarterly/annual planning session is an important decision. Gerald Olesker, CEO of California-based Architectural Detail Group, Inc., hosted his ADG Eco-Lighting Product division's August strategic planning session under the wings of Air Force One. Here's a link to his blog with pictures of their historic event. Another idea is to host your planning session at a customer site, something we've often done at Gazelles. It gives the team an opportunity to visit a customer and include them at points in the planning where their feedback might be insightful.

Finding Jobs -- with talk about the US and European economies falling back into a recession, especially given the weak job market, I called several clients whose firms' performances provide a leading indicator to the economy. At least for Mark Lancaster and his Michigan-based staffing firm, Employment Group, his biggest challenge is finding enough people who want to work. Notes Lancaster, "Our biggest competitor in the recruiting arena is extended unemployment benefits." Known as the 99ers, since the US Government now provides up to 99 weeks of unemployment benefits, Lancaster's team try recruiting able people who exclaim "I still have 54 weeks on my 99, call me in 9 months." In turn, in the last 20 months Lancaster's firm has had almost 2000 of their temps hired permanently and almost 1000 of those in 2011. "This is a record number in our history," shared Lancaster. "So we know companies are struggling to find the right people. However, those sitting on the couch because of extended unemployment benefits are then not attractive to employers, so it's a double whammy -- they remain unemployed (and unemployable)."

London and India-bound -- hope to meet many of you in my workshops in London (Monday) and throughout India next week.