Making Music with Humanity

I'm a closet Michael Jackson fan... um, well I guess not anymore. Something about his music has always spoken to me, as it has with hundreds of millions. I just watched "This is It". In the Special Features section, one of the producers who worked closely with him said "MJ made music with humanity".

I love that comment because THAT'S what excites me most about creating great companies. To create organizations where our customers feel our humanity in everything we do. And to have the profitability to enable the freedom and sustainability to enjoy touching more people in more ways. Like MJ did with his music.

Many see business as a game to be won. Where winning means making as much money as possible. How can we "close" more customers, grab more eyeballs, grow as fast as possible, and flip the company to make millions? This has a much different feel. How can customers trust us to take care of them when this sort of intent underlies so many businesses?

I recently finished reading one of my wife's favorite books... The River Why. It's a hilarious story about the coming of age of a great fisherman. One of my favorite parts is when he discovers the difference between catching fish and making music together with them...
"It had always been my way to approach the river like a wanded magician out to work deception... The angler/fish, hunter/quarry paradigm began melting away like blood in water... There was only a chinook on its primordial journey, and an undone fisherman following... I came as a blind man led by a seeing-eye salmon- and it showed me a world I believed was destroyed, a world where a man could still walk unfeared among the animals and birds he calls 'wild'."

Are we still trying to be wanded magicians out to make money fast or are we making music with humanity in our businesses?

Discounting - good or bad for business?

Subway recently discovered that by lowering the price of their foot-long subs to $5, they got $3 billion worth of extra business (see article). I had two thoughts about this.
1. Good price points/discounts can attract a lot of customers in the short term.
2. Discounting is a crappy way to build a long term business. Once the $5 buzz wears off for Subway, they will be left with the previous volume AND a lower profit margin.

I would rather build a profitable relationship with customers based on the value of what I deliver, than depend on discounting to attract customers. It may take longer, but customer loyalties will last longer and help to create a more profitable business in the long run.

At RegOnline we decided to take a no-haggling, no-discounting approach. We had prospective customers ask us all the time if we would match our competitor's pricing. Our answer was ALWAYS no. We explained that "We like to treat all of our customers the same great way. No special deals for anyone other than the great deal we offer everyone. " We would also say "We aren't the cheapest and we aren't the most expensive either. But, we do offer the greatest amount of functionality and customer service for the price."

FullSizePosters.com used to make posters for $4.99 (after a hefty discount from $19.99). They sold a TON of posters, had no time to take care of customers, and made little money on it. Now as the site was reincarnated into PosterBrain.com, they do NO discounting, charge $24.99 for the same poster, are doing half the previous order volume, double the average order size, take great care of customers, and are growing a more profitable business. It was a tough cliff to leap off of to forgo the volume-discounting model.

I believe at the heart of discounting, we are manipulating our customers. Giving them a quick "fix" that becomes the focus (and addiction) of our relationship. I've heard the argument that by running specials it gets the word out and introduces more people to the company. This is true. But, then we've trained our customers to always look for the deal, rather than be delighted with the real value the company provides.

Is it worth manipulating our customers to buy from us? OR better to patiently grow a loyal following by providing value at a consistently fair price?

Urgency

I am one of the most impatient people I know. I have urgency in my blood to see things come to life. I can't help it. I LOVE ideas that turn into reality. I love the applause of new customers, and taking it up a notch for old ones. I breath it, I love it, and I sometimes drive the people around me crazy with my impatience for creating more of it NOW.

I've become more aware of my impatience/urgency over the years and have noticed a similar trait in entrepreneurs who have grown great companies. I was talking with one very successful friend about this and our system for creating urgency with our teams:
1. Discuss & assign a project with an urgent time frame
2. Wait one week
3. Ask how it's progressing...
Good progress = applause and celebration
No progress = ALL OVER it/get involved/reassign/unblock/raise the urgency level
4. Repeat cycle every week with as many projects as possible

When projects take more than a week. I like to do one of two things:
1. reduce the scope of the project to be able to get it done in a week
2. split the project into chunks that can be done each week
Letting progress go beyond a week increases the likelihood that it will get lost. A cool offshoot of this process is it also forces everyone to prioritize and ask more about which tasks should have higher priority... leading to better ROI thinking for everyone.

This type of progress and intensity doesn't work for everyone. I've found that those who love to push the envelope and be challenged, like it. Those who like things to stay the same and do the same thing everyday, don't like it (they tend to be better at maintaining existing systems). Smaller high-growth companies need more people who enjoy challenge and change. Bigger companies that move slower, need more people who like to maintain existing systems. Personally I've found that I need the people who I work directly with to thrive with challenge and change. If they don't then it's uncomfortable and I tend to piss them off and burn them out quickly.

Also, it's important to not confuse urgency with rash decision making. It's important to take time to make big decisions and set priorities (but not more than a week).

Urgency is the key to iterating like hell into what will make our companies more and more successful. Are we driving enough urgency? Do our core people thrive on urgency?

If you ever want inspiration for the "Urgent" (and a good laugh) just watch this...

Delegate, don't Abdicate

Part of the fun of being an entrepreneur for me is having a team who can help me move the needle and create great things. I've tried a lot of things over 15 years as it relates to delegating... and have had a lot of frustrating times with it too.

What's helped me the most is realizing the difference between delegation and abdication. What stuff do I delegate the implementation of and what stuff I need to OWN the strategy, design, and decisions on? What I've discovered is ANYTHING that touches ALL customers needs to be OWNED by the leader/entrepreneur... not abdicated. For example:

1. Mass automated emails to customers for signing up, order completion, ship confirmations, followup emails, broadcast emails and newsletters, etc.
2. Messaging on the homepage and through the conversion process
3. Prospect communications such as mailers, Adwords ads, etc.
4. New product design, packaging, pricing, and marketing
   
5. Support structures - such as how do we respond to, help, and WOW customers and in what modes
   
6. Development project prioritization

Now that doesn't mean that the team doesn't help with this stuff... of course that's what they are there for. But, it does mean that we don't abdicate the strategy, design, and decisions. I believe a leader who OWNS everything that touches the customer creates a much more consistent/enjoyable experience for them and more successful company as a result.

A couple examples:

1. Product Development project prioritization. I've seen companies let their IT team develop in an out-of-control fashion, hiring too many people, and not prioritizing in a way that makes a real difference in the customer experience and profitability of the company. It's easy for a CEO who doesn't know much about technology to abdicate that part of the business to a CTO. But again, if it touches all the customers, it's the leader's job to be in there making prioritization decisions for what will have the biggest impact and ROI for the company and it's customers. If Steve Jobs can be intimately involved with the designing of Apple's new products, than we can too.
   
   
2. Search Engine Optimization strategies. I've seen entrepreneurs who know that SEO is the most important driver of revenue for the company, try to abdicate that to others and lose traction and revenues as a result. With RegOnline, I personally tapped into SEO expert groups to dig for where we could take our strategy to the next level.
   
   
3. Customer Communications. It's common for leaders to fully abdicate customer communications to their marketing teams. And the messaging starts to sound like its coming from "marketing" instead of real people who care about their customers. If Jeff Bezos can write his own letters to customers, then we can too. I know a owner of $40 million in revenue company who write ALL mass emails to customers.
   

A couple years ago when I realized the difference between delegating the implementation and delegating the decisions (abdicating), I started communicating differently with my team. I would say "I'm going to be fully involved with you in designing this and then I'd like you to carry through the implementation of it."

What can we delegate more of and what can we abdicate less of to make our businesses more successful?

Thriving Companies (that Last?)

I am truly amazed by all the joy & abundance that the entrepreneurs I know bring to their organizations. And while I may talk a lot about profitability, it is mainly for the purpose of being able to sustain a great environment by which we can all have fun and thrive together.

I love the thought of medieval times and living in kingdoms ruled by benevolent kings who bring joy & abundance to their communities. I view entrepreneurs and the organizations they grow as being like those kingdoms. If they can create sustainable prosperity, they can bring a life of joy and abundance to their communities of people (employees, customers, and suppliers).

Another component of the health of kingdoms is sovereignty. Which I define as the ability to make decisions for the good of their community without being beholden to others. There's something powerful about being able to make decisions for our communities that are solely focused on the good of that community. I think this is another reason why I like to talk so much about maintaining our independence as entrepreneurs so as to afford the maximum long term prosperity for customers and employees.

At RegOnline we did a lot of great things that we didn't HAVE to do, but we did because it felt like a great way to help our little community thrive more. For example: company trip to Mexico (with guests) every year, homemade breakfast every morning, consistent bonuses, random gifts for customers. The more profitable we became, the more we looked for cool opportunities like these. However, all these perks have gone away as a result of RegOnline NOT being "sovereign" anymore (owned by a parent company that has different priorities).

What kind of kingdoms are we building and will they last?