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Archive for May, 2013

Obamacare-2012-460x306Woe is us, my small business brethren.  The Affordable Care Act is eminent and a small business apocalypse is creeping in on little cat’s feet.  And lo, while it cometh under the benign name of the Affordable Care Act, it is better known under the more sinister sobriquet of Obamacare.

As a society we are about to succumb to the most rococo, convoluted, slovenly written major law in American history; a law that is packed with sneaked-in surprises, inefficient bureaucracy (over 160 new government entities and counting), up to a two trillion dollar increase in healthcare cost, and a loss of 800,000 jobs (both figures estimates from the non-partisan Congressional Budget Office.)  Premiums will be going up at least 12% and, for single adults under 30, they will go up 46%, according to the American Academy of Actuaries.

But wait.  It gets better.  To make a profit with the added services mandated, existing policies in most of the small group and individual insurance markets will be forced to create much more restrictive networks, possibly separating you from your personal physician (which we were assured would never happen under this act.)

Nancy Pelosi famously told us we had to pass Obamacare to find out what’s in it.  Well, finding out we are.  Even the most left wing Democrats are voicing buyer’s remorse.  Democratic Senator Jay Rockefeller, a key proponent, now calls the ACA “beyond comprehension”, and Democratic Senator Max Baucus calls it “a train wreck.”  And, get this, Henry Chaowho is the Obama administration’s own head of ACA implementation, states frankly, “I’m pretty nervous…Let’s just pray it’s not a third world experience.”  Not very reassuring, Henry.

picBut the worst mandates in the ACA place a bull’s eye on the back of the entrepreneur and small businessman.  It is an unholy madness aimed straight at us.  It is a flat out disincentive to grow our companies and thereby grow the American economy.  Expansion now becomes expensive for the 500,000 US businesses with fewer than 100 employees.  For example, a company with 49 employees doesn’t provide health benefits.  Hiring just one more worker triggers a mandate to cover all workers or pay a tax penalty ($2000/worker).  Just how likely is that 50th worker to be employed?  Or, if a small business has more than 50, isn’t the company much more likely to fire workers or make them part-time?  I predict huge amounts of entrepreneurial energy and creativity will be syphoned into avoiding expansion requiring new employees.

In a recent study by Mercer, a growing number of entrepreneurs will employ this exact strategy.  Journalist Michael Tanner, in a recent article, points out that in France, another country where numerous government regulations kick in at 50 workers, there are 1500 companies with 48 employees and 1,600 with 49 employers, but only 500 with 51.  (Michael Tanner, NY Post, 11/18/12, p. 27)

Can this non-comprehensible 2,000 page plus new system (ACA) actually be put in place in 2014 without throwing healthcare into utter chaos?  To my thinking, no.

donald-trump1I have lawyer friends with employment specialties who are licking their chops at the tort possibilities in the impending confusion.  And to whom will their torts often be directed at?  You and me, brothers and sisters; we, who can ill afford a full-time lawyer to parse the particulars of the ACA.  I predict a veritable Obamacare tortfest beginning in 2014.

Donald Trump, comb over and ego aside, warns, “I support health care for people.  I want people well taken care of.  But I also want health care that we can afford as a country.  I have people and friends closing down their businesses because of Obamacare.”  Thanks for sharing, Donald.  Would that it were not so.

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185180626_640Business gurus ain’t my thing.  The very mention of insta-presto, silver bullet salvation peddlers sends me into paroxysms  of eye-rolling cynicism.  Charismatic business wise men and women may indeed be wise, but the results of their tutelage has always seemed ephemeral to me.  While I do believe there is much to be gleaned from such folk (gurus), and I have picked up useful things here and there over the years, I have not experienced or observed real life-changing, long-term transformation.

Well hush my mouth.  I do believe I have found a program that is overthrowing my years of looking askance at such stuff.  That program is Tracy Goss’ Executive Reinvention Program.

I recently spent two weeks studying under Goss and her colleague Ed Gurowitz along with 20 other corporate executives and business owners.  Goss is very well-known and respected for her 20 years of leading what she calls the Executive Re-invention Program (ERP) for the leadership of such companies as IBM, Chase, Paramount Pictures, Owens-Corning, Monsanto, Ciba-Geigy, and many others.  Her philosophy is limned in her best selling book The Last Word On Power (Doubleday, 1996).

Let me see if I can simply give you a sense of Goss’ work without being totally superficial.

For me, her key concept in the executive reinvention process concerns defeating what she calls your “winning strategy.”  To wildly oversimplify her thesis, her core insight is that what makes you a successful entrepreneur or corporate leader—your winning strategy–is exactly what will prevent you from growing into your full realization and greatness.  In other words, to move into your true center and power you must jettison the very successful strategies and qualities that you are admired for, that have seemingly been the bedrock of your success.  To become a fully realized transformational business leader requires you to step into an abyss as a new thinker and a person free of commitment to ingrained and successful qualities.

9780385474924_p0_v2_s260x420In the first page of her book Goss puts it this way:

The power that brought you to your current position of prominence and responsibility as a leader–the power that is the source of your success in the past–is now preventing you from making the impossible happen in your life and in your work….The pathway to new power is to completely and intentionally “re-invent” yourself:  to put at risk the success you’ve become for the power of making the impossible happen.

This is scary stuff.  Goss asks her executives to radically change their way of being.  She notes that change is usually a function of altering what you are doing well—that is, doing it “better, different, or more.”  What she demands is that you change your whole manner of existence to create something that is not currently possible in your reality.  This she calls Transformation and is the stuff of dynamic leadership.

Goss’ message particularly resonates for me as a former addict of several sorts.  When I was a full-blown addict my addiction served a function.  That function was dulling existential pain and deep feelings of personal inadequacy.  Addiction worked as that for me.  It helped me survive.  Part of recovery for the addict is simply realizing that the addictive survival strategy no longer works at some point and is rather an encumbrance to a real life.

While most executives are not addicts, I absolutely believe the principle is the same for creative leadership.  While I have just begun to plumb its depths, Goss’ Executive Re-invention Program is simply a practical way to break through your “success” logjams into unimagined realms of potential achievement and centered meaning.

Her program is a knock out.  I highly recommend if if you are feeling in any way stuck as a leader or a human being.  It offers a unique and powerful structured methodology for seminal, long-term growth.  (One caveat:  Goss’ ERP is not for emotional sissies.  It is bloody exhausting and not inexpensive.)

In a large sense Tracy Goss’ work is about overcoming and defying your own success.   Here is what Victor Frankl says about success in  Man’s Search For Meaning.

“Don’t aim at success. The more you aim at it and make it a target, the more you are going to miss it. For success, like happiness, cannot be pursued; it must ensue, and it only does so as the unintended side effect of one’s personal dedication to a cause greater than oneself or as the by-product of one’s surrender to a person other than oneself. Happiness must happen, and the same holds for success: you have to let it happen by not caring about it. I want you to listen to what your conscience commands you to do and go on to carry it out to the best of your knowledge. Then you will live to see that in the long-run—in the long-run, I say!—success will follow you precisely because you had forgotten to think about it”

Thank you, Victor.

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I believe in the empowerment innate in freedom, both as an entrepreneur myself and as an employer of a highly-skilled outsourced executive sales force.  My philosophy is if you hire ’em, trust ’em.

pubArticleFull417_62271Arnsten_Amy_011410_024My personal perspective is that the most effective business trop, particularly for the small businessman, is one of fulgent freedom.  That is, a communal ambience populated by peer-level associates working in tandem to accomplish tasks or offer services within a through-branded value system, each member of the corporate organism bringing his unencumbered and uncensored individual strengths to the collegial effort of offering something distinct and useful to the world.

The key conundrum implicit in this business philosophy is how a leader can maintain sufficient control to orchestrate a profitable game plan while still allowing the maximum in creative chaos and personal development within an organization.  Yet, therein lies the greatest ability to untap the full human resources of your cadre of employees and associates.

I was reminded of this by my haircutter Letty last week.  While in her chair, I tried to tell her exactly how she should handle my beautiful forelock, mainly leaving it longer than it looked like she wanted to cut it.  Well, it looked like shit when I got home and I had to shamefacedly go back in the next day to ask her to fix the damage wrought by my sage styling advice.

This experience was a cautionary reminder to me about the dangers of micromanagement.  (For God’s sake let the professionals be professionals, Tim!)  I strayed from my own business faith of letting my employees accomplish corporate goals by maximizing the free rein of their own skills, creativity, and intuition under a broad rubric of clearly bright-lined ethics and administrative process.  I have always believed that this creates a much more committed, loyal group of associates, who invariably produce more confident, consistently authoritative work.

Now there is increasing neuro-scientific evidence to show that employees are less effective when their work is dictated top-down.  Note the work of Yale professor Amy Arnsten, who’s Arnsten Lab has recently highlighted the importance of feeling in control.  Arnsten’s research reveals that when people (employees) lose their sense of control, like when tasks are micro-dictated to them from on high, the brain’s emotional response center actually causes a decrease in cognitive functioning.  Thus, the feeling of not being in control, whether it is based on reality or not, leads to a drop in employee efficacy.

Case-smlFor this reason I continue to be fascinated by John Case‘s concept of Open Book Management, in which corporate collegiality is encouraged through throwing open all aspects of corporate management, including financials and salaries.  The idea is to not only help employees do their jobs better, but also give them a sense of ownership and empowerment in accomplishing their daily tasks.  Open Book is being increasingly tried by owners and CEOs in small and medium-sized companies searching for a more integrated way of corporate management.

My friend Ed Dorian, owner and CEO of Dorian Drake, operates his firm under Open Book and he swears by it.  He allowed me to sit in on a session of his quarterly management meeting last month.  There was unquestionably a palpable warmth and sense of practical common purpose to the meeting I witnessed, a sense of practical problem-solving dialogue among equals.

Though I loved the tone of the meeting, I told Ed I would find it very uncomfortable to share bad or scary financials with my company.  Wouldn’t this  leave my associates feeling fearful and insecure?  Ed told me his experience is quite the opposite.  He told me, “We generally share all the financial news—good, bad, or ugly.  In fact, I think Open Book is at its most powerful when the numbers aren’t good.  This lets everyone know that it is crunch time and that we need to redouble our efforts to generate income and manage costs.”

I must say frankly this is a bridge too far for me at present.  Or perhaps it’s simply entrepreneurial cowardice on my part, since in every other way I try to nurture a horizontal community of equals in my own firm, Corporate Rain.  In a sense, I hope to have a firm of “bosses”, where each individual operates autonomously and lends the full power of his individual peculiarity and genius to each task.

As Albert Einstein put it in Out of My Later Years (1950), “Everything that is really great and inspiring is created by the individual who can labor in freedom.”  Thank you (again), Albert.

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