Saturday, August 30, 2008

The Mistakes that follow Failure

You may not recall the name Julie Wainwright, but you probably remember the company she led: Pets.com.

Founded in August 1998, the online pet-supply company went public in February 2000 and went bust nine months later. Since then it has acquired iconic status as the classic dot-com disaster – a domain name looking for a business plan. Its mascot, the infamous sock puppet, became a much-satirized symbol of Internet excess.

Prior to buying into Pets.com and becoming CEO, Wainwright had enjoyed a stellar entrepreneurial career. As CEO of Reel.com, she grew the online video store sales from $1 million to $20 million in a single year, then engineered its sale to Hollywood Video for $100 million. At Berkeley Systems, she oversaw a strategic shift from producer of software utilities (such as screensavers) to a developer of interactive entertainment (including the popular game, "You Don't Know Jack").

Wainwright resurfaced recently as company-founder of SmartNow.com, an information site (beauty, health, fitness, relationships, you know the deal) for women over 30. In a brave move, she has written an editorial about her personal problems since closing Pets.com.

“What most people don’t know is that the very same week that Pets.com failed, my marriage of seven years failed as well. Actually, it had been failing for a long time. It became officially over that week. My husband decided to call it quits the day before I announced to the employees and the public markets that I was shutting down Pets. It was a really bad week.”

Why is this relevant to Canadian Entrepreneurs? Because it’s so easy to make the same mistakes Wainwright did: focussing too much on your business, and taking the rest of the world (including your spouse) for granted.

“Now, I would like to tell you that [after the failure of Pets.com] I was down but not out. That I just brushed myself off and got on with life. I didn’t. At first, I kept myself hyper-busy. That lasted for about three months. Then, I sank into a depression. I’m sure I was in shock for a long time. It was a very dark, confused time in my life. I kept pushing myself to get back to normal. That didn’t happen.”

Check out Wainwright’s list of “Five Life-Changing Mistakes and How I Moved On.” Here’s a quick summary:

Mistake 1: I allowed others to define me. I completely defined myself as a failure, as the press did.

Mistake 2: I built my image of myself on two main supporting pillars [being “smart,” and being married].

Mistake 3: I stopped believing in myself. You can see how the first and second mistakes might lead to the third.

Mistake 4: I stopped taking care of myself. I had gained weight over the years and stopped exercising. When Pets was collapsing, I started exercising again and the pounds had started to come off, so my physical health had started to improve. What I didn’t realize is that my emotional health was deteriorating. I did not recognize my own depression. For at least two years after Pets shut down, I didn’t care if I lived or died.

Mistake 5: Allowing my head to rule my heart… The head is the ego. Mine was shattered. I had to exercise my heart in order to heal.
Wainwright’s article includes a lot more information, including details on how she coped with each of these problems. It’s candid, revealing and inspiring.

As Wainwright concludes, “If you have made your own mistakes and are not sure how to get on with your life, perhaps my reflections will help you. And if you make mistakes in the future, I hope my lessons help you in some way and that you will learn from your humanness and not slip slide into a dark place for long.”

Check out her story here.

Wednesday, August 27, 2008

Gold-Medal Economics Lesson

Economist William Watson had a great column last week in the Financial Post on why the Olympics works differently from the world economy.

Noting China’s sudden dominance in gold-medal victories, Watson figures some Canadians might be wondering whether the developing nations that are beating us so handily now at track, gymnastics and field hockey will soon be wiping the floor with us economically.

It’s a good question. Fortunately, as Watson writes, “economic life is very different from Olympic life.”

Point 1: In the Olympics, you're either a winner or a loser. There are no medals for fourth place, even if you finish one-tenth of a second out of gold. “But in economic life,” says Watson, “close counts a lot.”

If you are lucky enough to be the country whose living standards are ranked fourth-best in the world, you still have it pretty good. Iceland last year was No. 1, with a score of 0.968 out of a possible 1.0. Canada was fourth, with 0.961. The difference among the top countries is essentially negligible.

Point 2: Economics is not a zero-sum game. Winners create wealth, they don't take it from other countries. With China, India and other countries emerging from poverty to become industrial powerhouses, Canada may lose some companies, and indeed whole industries. But we also gain billions of new customers, with growing appetite for imported goods and services that smart businesses are moving to supply.

As Watson concludes, “economic life is almost infinitely expandable. The number of medals available to be won is limited only by our imagination and entrepreneurship. There are plenty for everyone.”

You can read Watson's original article here.

Monday, August 25, 2008

Best-Ever Entrepreneurship Quotes, Week 99

This is No. 99 in our list of motivational business quotes. The series, begun in September 2006, ends next week with No. 100. Feel free to guess which Canadian Entrepreneur we have chosen to finish off our series.

Two weeks from now, a bold new weekly series begins on this blog.

In the meantime, who else could we quote in our 99th week than Wayne Gretzky, the man who redefined hockey for a whole generation of sports fans? Hard to believe it’s been 29 years since I first met him in the Edmonton Oilers’ dressing room as a budding sports reporter for Alberta Report magazine. Since then he’s been named the top player in NHL history, and his jersey number, “99,” has been retired not just by the teams he played for, but by the entire league.

Not the strongest or fastest player on the ice, Gretzky developed a breakthrough strategy involving timing, anticipation and positioning. Journalist Peter Gzowski, who followed the Amazing Oilers for a whole season, thought Gretzky could “see” a play developing faster than anyone else in the game. It’s a powerful reminder of the importance of stepping back from a situation and seeing the big picture, rather than chasing everyone else around the rink – or your competitors around and around your market.

Gretzky’s unique and thoughtful approach to hockey produced a surfeit of motivational quotes that apply to sports and business alike. Here are just a few of them:

* “A good hockey player plays where the puck is. A great hockey player plays where the puck is going to be.”

* “I wasn't naturally gifted in terms of size and speed; everything I did in hockey I worked for.”
* “Procrastination is one of the most common and deadliest of diseases, and its toll on success and happiness is heavy.”
* “The highest compliment that you can pay me is to say that I work hard every day, that I never dog it.”

But my favourite motivational Gretzky quote involves his understanding of opportunity, and the sheer importance of taking a chance:

“You will always miss 100% of the shots you don't take.”

Friday, August 22, 2008

What can we learn from the Olympics?

Del Chatterton of Montreal-based consultancy DirectTech Solutions, an occasional contributor to this blog, has written a terrific (and timely) newsletter article offering 12 “Olympic Ideas for your Business.” (I love "Tear and Repair.")

Since I couldn't find a copy of the article to link to, I will copy and paste below, and hope Del doesn't mind.

The Olympic Games of 2008 have already provided inspiring examples of what the human spirit can accomplish, but there are also some interesting ideas from the Olympics that can apply to business. Consider these ideas.

The four-year planning horizon: Set aside your current plan. Review the results for 2008 and define new Olympic performance objectives for 2012 with specific milestones for each year until then.

Focus on your strengths: Choose to compete in the areas where you are most likely to succeed. Michael Phelps selected eight events he could win in - he did not try 15 events hoping to win eight.

Decide: You have to make choices to either give it your best effort over a long period of time or quit.

Push your limits: Test your capabilities and endurance to the maximum. "Tear and repair" is the way to build strength and endurance in muscle tissue; maybe in your organization too.
Learn from the leaders: What do the top competitors do that you can also do? Look at their preparation and training techniques; the little things that add up to a big difference.

Learn from your losses: Study your own performance and learn what makes the difference between your best results and your second best.

It's not for the money: You have to love it enough to do what it takes to be a winner. The money will follow if you have the passion and persistence to excel.

There is only one gold medal: You may have to settle for being the fourth, or sixteenth, best in the world at what you do.

Prepare for upsets: The best competitors know how to deliver for the big events and usually avoid surprises. You could be the upset winner when the opportunity arises if you are equally prepared and committed to maximum performance when it's required.

Have a world-class support team: Coaching makes a difference. Check that your consultants, advisors and support staff are up to the Olympic standard.

Don't cheat: The short-term glory of victory will eventually be replaced by the long-term disgrace of breaking the rules.

It's never too late: Canadian equestrian Ian Millar finally won a medal at age 61 after competing in nine Olympics. American swimmer Dara Torres at age 41 won three silver medals at this Olympics after coming back from retirement. Her first medal was at age 17.

Del also offers creative, practical business management solutions at DirectTech.ca

Tuesday, August 19, 2008

Purdy Crawford spills the beans -- Updated

What's going on in the ABCP imbroglio? What's the future of Canada's commercial paper market? What will happen to the $32 billion in frozen asset-backed commercial paper? And how can we make sure messes like this never happen again?

You can get the latest info from the horse's mouth today at 3:30 pm (I'm presuming that's Eastern Time; so 4:30 Atlantic time, and 12:30 Pacific) at the Globe & Mail website. Purdy Crawford, the retired Imasco CEO brought in to clear up the asset-backed paper mess, will appear live on the Internet to answer your questions and explain what happens next.

If you can't make it at 3:30 EDT, you can submit questions prior to the event, and check out the transcript later.

I will post a link to the transcript after the event.

Get more info on the event here.
Submit your question by leaving a comment here.

Read useful background information here:
Court strikes down ABCP challenge
In ABCP ruling, judges approve legal shield

Kudos to the Globe for arranging live interactive sessions like this. They build awareness and create dialogues that could happen no other way (since no sane person listens to talk radio any more).

UPDATE: You can read the transcript here. It's not much like a dialogue, after all: it reads more like a terse email exchange with someone who doesn't really want to say much. Still, it's a newsmaker caught in amber at a busy time, so you may enjoy.

I asked a big-picture question: What have we learned that might help us avoid similar fiascoes in future?

Crawford's reply: "I have committed to appear before the House of Commons finance committee to review what reforms if any should be made in this matter. At this stage, we have been working to complete the restructuring and have not focused on what the reforms, if any, should be."

History on the run, bah!
Read all 6 questions and answers here.

Monday, August 18, 2008

Best-Ever Entrepreneurship Quotes, Week 98

Here's your inspirational quote of the week as we begin our countdown toward 100.

This week, a motivational gem from a man who's been hailed as the greatest Olympian of all time. U.S. swimmer Michael Phelps has just set a record for winning the most gold medals in one Olympics game. (If he were a country, he'd be in sixth place.)

"You can't put a limit on anything. The more you dream, the farther you get".

Michael Phelps (born June 1985), member of the U.S. Olympic swim team, 2008

Friday, August 15, 2008

Advisory Boards Work

My column in this week’s Post looks at advisory boards. Ever since I worked on a series abut advisory boards with entrepreneur Greig Clark for PROFIT Magazine last year, I am seeing more and more businesses that could use a formal set of advisors – to help them with marketing, developing contacts, sourcing financing, creating more efficient processes, improving their recruiting efforts, cracking new markets, and so much more.

The truth is, however, that advisory boards are complex structures that require the entrepreneur to be organized, proactive, inclusive and accountable. It’s like getting a dog. Once you bring it home, you're responsible for it forever: feeding, bathing, brushing and walking. The closer they get to your company, the more your advisors will expect to be kept regularly informed, consulted, heeded, and perhaps even rewarded for their efforts.

Yes, you're opening a Pandora's box.

But if you're the type that welcomes organization and governance, knows how to ask for advice (and take it!), and can swallow your ego and accept direction – you can really benefit from an advisory board that helps solve problems and expands your access to resources.

Where do you find advisors? Use your personal network, and that of your friends. Strike a balance between smart, communicative entrepreneurs and disciplined, experienced professionals. Meet with each candidate a few times and ask lots of questions to make sure you're compatible before you bring them on board – you may be going through hell together, so make sure they’re the sort of people you want on the journey.

My secret hope is that some bank, university or other organization that markets to small business will pick up on this. What we need is an annotated directory of Canadian entrepreneurs and advisors willing to participate on advisory boards. Any organization that offered to sponsor such a useful resource would make friends fast.

But I digress. Click here to read my Post column and find out why accountability trumps autonomy.

Monday, August 11, 2008

Best-Ever Entrepreneurship Quotes, Week 97

I was in Windsor, Nova Scotia this past weekend for a Spence Family Reunion. The events included a brief tour of Haliburton House, the home of Windsor’s favourite son, Justice Thomas Chandler Haliburton (1796-1865), who was one of Canada’s first best-selling authors.

His “Clockmaker” books, chronicling the comic misadventures of Yankee salesman Sam Slick, were best-sellers in North America and England, putting him in the same leagues as Mark Twain.

Although little read or remembered today, Haliburton was the first to coin (or just popularize) many phrases and expressions that are still in common use today. Examples:

* As quick as a wink
* Seeing is believing
* He drank like a fish
* I wasn’t born yesterday
* A stitch in time saves nine
* Barking up the wrong tree
* A miss is as good as a mile
* The early bird gets the worm
* And that perennial favourite, “This country is going to the dogs.”

For motivational purposes, however, you can’t beat this zinger:

“Punctuality is the soul of business.”

In a world of broken promises, how do you use punctuality to beat the competition?

Monday, August 04, 2008

Your Bucket List

Happy August Holiday Monday!

The Post does not publish today, so look for my column in tomorrow's paper.

As a holiday treat, here's a link to last week's column, which dares you to think about what would happen to your spouse, family, staff or executors if you were suddenly to die or become incapacitated.

Not a fun thing to dwell upon. But wouldn't you rather be remembered for your success and business acumen, rather than for a messy desk and your lack of comprehensible records?

One entrepreneur has already told me that his wife has been after him about this for years. The dog days of August might just be a good time to get your "business will" in order.

Here's the link: A bucket list for business owners

Thanks to Elizabeth Verwey for doing all the work.

Best-Ever Entrepreneurship Quotes, Week 96

Here’s your weekly motivational message, personally selected to get your week off to an inspired start.

This week: a formula for success.

Quality = Results of Work Efforts (divided by)
white typewh Total Costs


W. Edwards Deming, 1900-1993. Consultant, Statistician and founder of the “quality” movement

Dr. Deming believed that when people and organizations focus primarily on quality, defined by the above ratio, quality tends to increase and costs fall over time.

Alternatively, when people and organizations focus primarily on costs (standard human behavior), costs tend to rise and quality declines.

Why? Deming blames the failure to monitor and minimize waste, ignoring amount of rework occurring, taking staff for granted, not rapidly resolving disputes, failing to notice lack of product improvement... Plus, over time, the loss of customer loyalty.

What's your choice?

Saturday, August 02, 2008

Get your staff to do more

How do you get your staff to dig deep and “go the extra mile” for you?

An Oshawa, Ont. entrepreneur asked PROFIT Magazine that question, and this week a number of other entrepreneurs offered their solutions. This “Peer to Peer” feature is one of the coolest resources for Canadian entrepreneurs, because it’s not some journalism grad telling you what to do – it’s experienced entrepreneurs telling you what’s worked for them.

The question: “How can I encourage my team to be more entrepreneurial? Why don’t they care more about my business?”`

Here’s a selected look at some of the answers PROFIT’s readers came up with.

Answer 1: You can’t. That is why they are employees and not entrepreneurs. What you can do, however, is to start finding out what is truly important to them, then gearing their compensation (financial and other types) around it.
Most employees will not put in the extra effort if they believe it won’t get them something they value in return. ... If you do this, you’ll start to see a gradual change over time towards a more employee-preneurial atmosphere.

Answer 2: The most important thing you need to do is set expectations—from the recruitment process, during employee orientation, in regular team meetings, and with your performance-management programs.
To find entrepreneurial people, you need to identify in the recruitment and selection process those people who are keen to grow a new business.

Answer 3: Change the feel and atmosphere from “my company” to “our company.” … The staff have to see and feel the results from going the extra mile.

… When they feel the results—or lack of them—from their work and the effects on “their company,” they will feel empowered… Raving Fans: A Revolutionary Approach to Customer Service by Ken Blanchard comes to mind first as a recommended read, but there are many others.

Answer 4: Commitment comes from a sense of ownership. In some cases, selling shares or parts of the company to key employees is an effective option, though it is not usually very easy or simple. …

The other option is to create leaders. When someone is (really) in charge of a project that they helped get started or that originated from their ideas, that person essentially “owns” the project and will often go the extra mile to see it through.

… Talk to your people, asking them questions such as, “Are there operations that don’t make sense?”, “What would make a given task easier?” “How would you do it?” and “How should it be done?” Not only will you probably be surprised at their answers, you will likely perceive some of your staff differently.

You must be willing to involve them in improving certain aspects of their job, as well as get them involved in something bigger than simply completing the order, shipping the units or finishing the project.

Great stuff, huh?. Click here now for the full story.

For other Peer to Peer solutions, click this way.
This page also includes a clickable form for you to ask a question of other Canadian entrepreneurs. Go for it!