A Small Business Forecast: Let’s Try Optimism!
As I draft this blog after the epic 2010 blizzards, it becomes easy to see how challenges can make us all feel a bit “snowed in.” Thirty inches of snow will hinder even the best of plans and intentions. Much like a recession can hinder the success of many small businesses. Will 2010 be better for business than 2009?
There is much information on the web regarding the trends and concerns of small business and all seem to agree that the major issue is the economy. The top five concerns facing small business are all regarding costs. The cost of Health Care and Social Security, the cost of increased federal and state taxation and energy costs are all at the forefront. These major issues along with the other expenses of operations are still a major snowstorm for business to navigate through. Optimism will be a key to small business success.
A recent survey of businesses with 5 – 499 employees showed that business optimism is currently at a twelve month high. Most would agree that this level is at its highest point since 2007. The survey which is ongoing was conducted by the American City Business Journals. It shows 75 percent of business decision makers thought at the end of 2009 that their prospects would be better for the next twelve months. Perhaps the most positive sign was that the number who felt the overall economy is turning around jumped from 28 percent last August to 40 percent currently. However, it must be stated that the level of optimism was still overshadowed by some rather dark clouds.
The survey also showed an increase in overall concerns about business safety and survival. This is a natural reaction to a severe business climate. This is also reinforced by the high percentage of business owners who still have concerns about the overall US economy. However, another sign of optimism was clear shift of concern toward employees; 47 percent of current business owners were more concerned about finding and keeping employees compared to just 27 percent less than six months ago. That movement is typically seen as a positive trend for the whole economy since it indicates a more robust job market. A higher rate of unemployment can produce this effect as well. Seems there are almost as many negatives as there are positives.
Winston Churchill once said “I am an optimist. It does not seem too much use to be anything else.” There must be an emphasis on this type of positive thinking if small business is to survive. Just as I will have to dig out today one shovel at a time….so too will small business have to grasp a positive outlook and dig deeper to find solutions to the trials ahead. This is not a time for pessimism but a time for action. Small business should channel its focus on how to take advantage of an improving economy. Revisit your business plans, are they working or not? Measure and evaluate your customer satisfaction. Reexamine costs, personnel and equipment as well as infrastructure. Work smarter and harder and from positive energy will come success.
Will 2010 be better than 2009? Let’s stay OPTIMISTIC!
Toyota and Tylenol
Filed Under: Essays
Tags: George Merlis, Media, Media Training, News
If corporate crises were a game, the Toyota safety recall would be a Superbowl contender.
Toyota Motors is a company that heavily promotes its engineering innovation, production quality and service reliability. In a haymaker blow to Toyota’s reputation, the company suspended production and sales of eight of its most popular models — including America’s (previously) best-selling car, the Camry. And now Toyota is recalling millions of already-sold cars worldwide to fix a potentially life-threatening problem: unintended acceleration.
(Disclosure: I have a personal stake in this story: I own a second-generation Toyota Prius.)
This week Toyota began shipping parts to dealers across the country to correct an accelerator problem that could lead to cases of disastrous unintended acceleration. The Toyota problem is so serious the automaker stopped production and sales on eight of its top-selling models — including the Camry, the best-selling car in the U.S. The scope of the problem is staggering: I’ve seen stories on the web sites of European, Japanese, South African, Canadian and Israeli newspapers. Toyotas sold in China have also been implicated.
I always judge a company’s handling of a crisis by what I call the Tylenol Standard. Back in 1982, Extra-Strength Tylenol capsules were the best-selling over-the-counter pain reliever in the United States. Then, seven people in the Chicago area died; they had all been taking the drug. J & J jumped into action with an approach that is taught in business schools to this day. The company suspended all production of Tylenol immediately. It recalled the 31 million bottles of Tylenol then on store shelves, destroying all the medication that was returned. It launched a rigorous inspection of all its manufacturing facilities. And, Johnson & Johnson made top officials readily available to the media where their story was: “We don’t know how this happened. We will find out and correct it. Meanwhile, do not use any of our products that you have at home; return them immediately, and report any adverse effects from our medication that you have already taken.”
The company’s response was fast, comforting and took a page from the Harry Truman adage: “The buck stops here.”
As it turned out, the buck did not stop at Johnson & Johnson. The Tylenol deaths were murders, not the result of accidental contamination. Someone had tampered with some Extra-Strength Tylenol boxes in drug stores around Chicago. The killer opened the packaging and the bottles, inserted potassium cyanide into the capsules and then resealed everything and put the product back on the shelves. Police and FBI theorized the killer had a specific target in mind but killed others in order to make his intended victim look like a random casualty in a series of accidental poisonings-by-contamination. (The case remains unsolved to this day, possibly because the intended victim never took the contaminated drug.)
Within a year, Extra-Strength Tylenol had regained its position as the country’s top-selling pain killer. Unfortunately, the Toyota brass must have cut class in business school the day they taught the 1982 Tylenol lesson.
Toyota was late to the table with an admission that there was, indeed, a problem and slow with information to the media (and through the media to the millions of Toyota owners worldwide). This sowed the seeds of confusion and resulted in a serious erosion of trust in the company.
Toyota’s worldwide president, Akio Toyoda, grandson of the company’s founder, made no statements to the media and no apologies to customers until a crew from NHK, the Japanese TV network cornered him at the World Economic Summit in Davos the last week of January. This reclusive behavior despite the fact that the issue has gained massive media attention since last August when an off-duty California Highway Patrol officer and three family members burned to death after crashing a runaway Lexus they had borrowed from a dealer in San Diego. The company’s U.S. president, Jim Lentz, was also noticeably absent from the media until February 1, when it was time to announce the fix. Then he began a media blitz explaining the problem and the repair, a belated attempt to restore Toyota’s battered image.
But wait, there’s more, as the infomercials say. If you look at the list of cars being recalled for the accelerator fix (below) you’ll notice that the Lexus in which Highway Patrol officer Mark Saylor died — a 2009 ES — is not on it. That’s because those cars — and many other Toyota-made cars, including my Prius — were subject to an earlier recall, back in November, 2009. In that recall, the Lexus accelerator pedals were shortened so they could not be trapped under the floor mat — the ostensible cause of Officer Saylor’s accident. (For the Prius, I was just told to remove the mat — which I had already done. It still sits in my trunk awaiting the promised “permanent fix.”
But at the same time as the mat matter was being handled, Toyota was aware that for six years both the company and the National Highway Traffic Safety Administration has been looking into multiple cases of unintended acceleration and that the mats were unlikely culprits in all of them. In its autumn response, Toyota tried to sweep the more basic accelerator problem under the floor mat problem. In fact, in November, Toyota put out a press release misrepresenting the NHTSA’s conclusions about the floor mats and had to issue another press release correcting the first one. But neither press release acknowledged that unintended acceleration might have been caused by anything other than misplaced or mismatched floor mats.
So there were two problems and initially Toyota tried to conflate the simpler problem (the mats) with the more serious problem (the accelerator mechanism). The mat recall affected 3.8 million vehicles and despite the fact that NHTSA told Toyota that mat removal was at best an interim solution, no long-term solutions has been reached for many of those recalled cars. The faulty accelerator affects 4.6 million vehicles, some of which were previously involved in the mat recall (with the attendant danger that owners who addressed the mat problem will now think the entire problem solved.)
Here is a list of the cars in the current Toyota recall.
• 2009-2010 RAV4
• 2009-2010 Corolla
• 2009-2010 Matrix
• 2005-2010 Avalon
• 2007-2010 Camry
• 2010 Highlander
• 2007-2010 Tundra
• 2008-2010 Sequoia
Jobs, Jobs, Jobs and Steve Jobs
Filed Under: Essays
Tags: Apple, Media, Media Training, News
Originally, President Barrack Obama was going to give his State of the Union Address on Tuesday, January 26. But then someone in the White House realized that the address would preempt the season premier of “Lost” on ABC, so the SOU was moved to Wednesday, January 27. The focus of of the address was jobs. But exactly eight hours earlier, another Jobs presentation — this one by Apple, Inc.’s Steve Jobs — made big headlines and prompted the online magazine Slate to point out that with technology overtaking politics as an agent of social change, the president’s jobs speech might be overwhelmed by the Jobs (Steve) appearance.
The Jobs vs. Obama column was written before either man spoke. And it highlights a key point for me as a media trainer and consultant: Apple had generated nearly as much advance publicity for Jobs’ introduction of the new iPad by doing and saying nothing more than, “We’re going to be having an important announcement, we hope you’ll cover it” as the White House generated by selectively leaking elements of the State of the Union for the better part of a week.
It is counter-intuitive — and flies in the face of what I normally counsel clients — to generate publicity by shunning publicity. But in Apple’s case, it works. With iPad, it worked with amazing success.
A quick search in Google News immediately before Jobs introduced the iPad revealed hundreds of articles, hyping the new tablet computer and building expectations with a brio that would embarrass a Hollywood press agent. These pieces were, without exception, written by journalists and bloggers who not only had never gotten their hands on the gadget, but who could not be 100 percent sure it even existed. Articles predicted that the forthcoming Apple tablet was going to save print journalism from the fate of the dinosaurs, reinvent book and magazine reading, revolutionize electronic games, and dwarf the iPhone in lifestyle impact. I sampled about a dozen articles while waiting for the live blogging from Jobs’ announcement and 99 percent of them were rave previews of a totally unknown object. The one percenters tended to write comments along the lines of: “There is no market for tablet computers” (because previously tablets had failed); “The Apple tablet will be too expensive.” (The generally accepted price dredged from the swamp of ignorance was a thousand bucks.), and “Apple is due for a flop.” (These journalists would be well advised to steer clear of Las Vegas’ gaming tables.)
A search of the New York Times website yielded half a dozen articles in just the week leading up to the Jobs announcement — clearly all of them written without any input from Apple spokespersons or from the New York Times digital folks who were cooperating with Apple on creating content for the iPad. (Jobs presentation featured a view of a New York Times front page on the iPad with photo slide shows, moving video on some stories and fonts that could be enlarged with the flick of a finger.)
What lesson can we learn from the free buzz Apple was able to generate? Avoid the media and they’ll write stories about you anyway? No. That tactic works only for the likes of Steve Jobs and Apple, Inc. Why? Three reasons:
1. Apple’s track record. Although the company has had false starts since Jobs returned to the helm in 1997 (Apple TV, Mac Mini), by and large the product line has been game-changing with iPod, iMac, MacBook, iPhone and iPod Touch. So the media’s expectations are always great when Apple announces not a new product but the fact that it is GOING to announce a new product.
2. Apple’s secrecy. The company’s passion for privacy and information control reminds me of nothing so much as North Korea. Case in point: the stonewalling that surrounded Jobs’ very serious illnesses which culminated in a liver transplant last year. Apple’s clandestine ways are an irresistible lure for media types who love to speculate.
3. Steve Jobs’ charisma. The media love celebrities and Jobs is one of the handful of business celebrities in the world today.
What works for Apple won’t work for the rest of us. We have to work to get in the media. We have to go out and seek attention; we can’t gain it by hiding under a rock. We have to drop hints, give out advance samples, supply facts and court journalists. Remember, even the President leaked the substance of his State of the Union address before he made his speech.
Oh, and by the way, the iPad, despite a name which some observers feel begs comparison with a feminine hygiene products, appears to be that game-changer that the speculators thought could help (if not save) print journalism, alter the way we read books and revolutionize electronic gaming. The early media speculators missed two very important points: business capabilities and price. None of the advance stories I read noted the tablet would offer three $10 software programs that enable a business user to write documents and spreadsheets and to create and display Apple’s Keynote slide shows (think PowerPoint on steroids). This gives what otherwise would be a personal leisure device — a turbo-charged book reader and media player — appeal to the business buyer and widens the possible customer base. (As does the optional keyboard dock which will appeal to those who can’t imagine writing anything serious on a touch screen.) As to cost, the predictions of an $800 to $1,000 price tag were off by a significant margin. Base price for the iPad is $500 and the device can go up to $800, depending on flash drive storage capacity and connectivity options.
One final note: Jobs looked as thin as he had when he returned to the company after his liver transplant surgery, but he was energetic and his voice was vigorous. Is he okay? Don’t expect to get any accurate information about his condition from Apple; that’s just not the way they do business in Cupertino.
Made in the USA
Now is a great time to start a manufacturing company in America.
I bought two Flexible Flyer sleds recently to have some fun in Switzerland when I go there next week. Having used them as a kid, as my personal vehicle in wintertime, I know every inch of the sled’s anatomy and how it performs even in extreme conditions. The sleds I received from my internet order were JUNK. Made to look like the real thing, with the same familiar logo. The metal parts were re-engineered to look like a sled but they were weak and even flimsy. The wooden slats that you lie on were the same quality wood as a pallet, not a craftsman-built sled like I used as a kid. The pins used to hold the steering mechanism together arrived with one snapped in two from shipping it. I wonder how it will hold up under my sledding on it! 200 pounds of me bumping up and down as I careen down a 600 foot hill in the mountains. The sleds were broken upon receipt, but I fixed them up with four bolts, duct tape and sandpaper. A sticker on the underneath side said MADE IN CHINA and DO NOT REMOVE THIS STICKER, but it was peeling off upon arrival and fell off during my repacking them for the trip to the alps. Yes, I’m going to try them out, but I wish I had a sturdy ol’ Flexible Flyer, made in the USA like I had years ago.
I can’t tell you how many things I’ve purchased the past year that looked like the real thing, but almost immediately fell apart or rusted or broke or never worked out of the box. All made in China. I’m sure you’re noticing the same thing. A toaster lasts a year, tops. My mother’s GE lasted my whole childhood. All of a sudden, we look around and we’re replacing everything all the time. The world calls us a consumerist society, because we have to buy everything new again every year or two because nothing lasts longer than that anymore.
Nothing, that is, except things still actually made in America. We’re still the best at manufacturing almost anything. But we can’t manufacture it cheaper than the Chinese can make it AND ship it to America. Free Trade, and the perception that the lower priced item is the one to buy, has forced most American manufacturers to produce in China or face extinction. We all know that.
What’s worse is GREAT American brands like Schwinn and Flexible Flyer have been bought up by the Chinese for peanuts and the products coming out under those brands are just plain junk.
“Made in America” is going to make a comeback. Sooner or later American consumers, now facing a loss of disposable income and only long-term prospects to return to affluence again will choose to buy what lasts and they will turn back to American made goods. To find products still made in America look at http://www.stillmadeinusa.com/.
The world will react when this happens. The “American Consumer” is the most powerful group of individuals on the face of this Earth, in the whole history of this Earth, and it extends across all religious, political and ethnic groups. When American consumers begin to DEMAND products made in America the recession will take care of itself.
As long as we’re willing to buy the cheapest and keep China in business instead of our neighbors, we have no hope of real recovery from the deep financial reversal we’ve had thrust upon us over the past ten years by corrupt financial services companies and our needy, greedy, seedy Congress.
Quotes and Soundbites from Oprah
One way to make a point in a media interview is to quote or paraphrase a quote from an authority figure. A favorite quote many of business clients have deployed is President Harry Truman’s “The buck stops here.” Another unfortunately relevant Truman line gets some exposure these days: “It’s a recession when your neighbor loses his job; its a depression when you lose yours.” A favorite for paraphrase is John Kennedy’s line from his inaugural address: “Ask not what your country can do for you, but ask what you can do for your country.” I have heard that one altered to accommodate everything from a NASA moon mission: “With this mission we are asking not what we can do for the moon but what the moon can do for us,” to the release of a debut CD by a new singer-songwriter: “I don’t want to know what the audience can do for me, I want to know what I can do for the audience.”
Several weeks ago in this space I listed some great quotes from uber investor, Warren Buffett, the Sage of Omaha. A businessman quoting Buffet to help make his own point instantly wraps his message in Buffet’s credibility (and his uncanny knack for cogent expression).
Today, I’d like to cite another highly successful business figure who has a huge list of great quotes that will resonate in interviews: Oprah Winfrey (who recently made headlines with the announcement of the end of her long running talk show). Communication, after all, is Oprah’s business so it is only natural that over the years she had given us many rich quotes over the years. Here are a few of them:
“Real integrity is doing the right thing, knowing that nobody’s going to know whether you did it or not.” Not a bad quote to cite in this era when the actions of some traders have spread tarnish far and wide in the business world.
“The big secret in life is that there is no big secret. Whatever your goal, you can get there if you’re willing to work.” A well-worded endorsement of the work ethic.
Sometimes a journalist sees a business interview subject through the green eyes of jealousy (especially in these days of tightened news budgets, deferred raises and the other afflictions of an advertising-starved media). This one helps level the field: “Though I am grateful for the blessings of wealth, it hasn’t changed who I am. My feet are still on the ground. I’m just wearing better shoes.”
Harry Truman’s “The buck stops here,” was four words long, as was Douglas MacArthur’s “I shall return.” Oprah came up with a three-word grabber: “Dwell in possibility.”
A funny quote is often an effective quote. Here’s a fine one: “There’s no easy way out. If there were, I would have bought it. And believe me, it would be one of my favorite things!”
While Oprah was talking about taking personal time, this quote works well for any sort of business readjustment or even reassessment: “If you don’t recharge a battery, it dies.
Oprah clearly loves what she does, so this quote might be a good one if you do, too: “The best way to succeed is to discover what you love and then find a way to offer it to others.”
For the businessman explaining a daunting challenge to the media, Oprah’s got this, gem: “Challenges are gifts that force us to search for a new center of gravity. Don’t fight them. Just find a different way to stand.”
This one says it all about the nature of business today: “One of life’s greatest risks is never daring to risk.”
An element of Oprah’s prescription for success: “Do the one thing you think you cannot do. Fail at it. Try again. Do better the second time.”
One of my favorites is this one: “You can have it all. You just can’t have it all at once.”
And here’s a final one that’s especially relevant this time of year: “Cheers to a new year and another chance for us to get it right.”
