What A Jet Crash Can Teach A Business Owner - Piloting Your Company

You’d be surprised by the number of similarities between the most common causes of military jet crashes and those of business failures. I have a unique perspective on both having served on accident investigation teams for the USN and Boeing and, for the last 13 years, come to the aid of business owners of start-ups and established businesses alike, striving to place their company on a sustainable growth path.

As a former Flight Safety Engineer for Boeing, one of my responsibilities was to support accident investigations involving our military jet fighters. As you might expect, the U.S. spends considerable resources analyzing aircraft accidents and sharing the findings. The reasoning is that if you can identify the causes and share the results you can drastically reduce the chance of the accident from happening again. The same should hold true for businesses. Right?

Let’s explore an accident I helped to investigate. It involved an F/A-18 at an air show. The pilot was demonstrating the aircraft’s maneuverability by performing a square loop. He crashed at the bottom of the loop - striking the ground with such force that he broke his back, legs and arm. Because the aircraft remained largely intact, we were able to pull computers and memory, install them in a simulator, and replay the flight, watching all the instruments as well as the stick and throttle movements.

We witnessed the simulator mimic the pilot as he pulled the aircraft up into the vertical climb of the square. We paid particularly close attention to the aircraft’s altitude and airspeed indicators. I recall there was a collective gasp in the room when we saw that the pilot had cut the top of the square too low to complete this maneuver. The primary cause of this accident became immediately clear - pilot error.

What does this have to do with running a business? Owners often make poor decisions when piloting their business in the pursuit of growth. In retrospect most could easily be avoided with strict adherence to a well thought out plan, assuming of course, there is a plan.

In this case the flight (business) plan was a square loop that the pilot (business owner) failed to execute properly. The maneuver (plan) required that he hold the climb (Step 1) for several hundred more feet before executing the pull at the top of the loop (Step 2). By deviating from the plan and not gaining the proper altitude (cutting short the foundational work in the business plan) the pilot (business owner) put his plane (the company) in jeopardy.

Yet still, the pilot (owner) had a chance to minimize the damage (save the company) when he cut short his ascent at the top of the loop. Realizing his problem, the pilot still had two choices available: (1) Abort the maneuver by simply rolling the aircraft upright and continue the show (admit error and return to the plan) or, (2) Proceed with the maneuver (on a gut feeling), thinking he could pull it out by sheer force of will. The pilot chose option two.

So why would a pilot (owner), with all the instruments (sales data, advisers, etc...) telling him he is too low to complete the maneuver, proceed anyway? Let’s return to the accident investigation to find out.

The pilot was an very experienced Marine. He was a fireplug of a man who worked-out with intensity. He took great pride in his shape, physical strength and health. This is likely what saved his life but it was also a contributing factor in the crash. He felt he could, through sheer strength, pull the aircraft through this maneuver before hitting the ground. Somewhere in the back of his mind he believed the rules for that maneuver (plan) were designed for the average pilot (owner) and that he, with his above average strength and experience, could prevail where others might not.

We often see highly confident business owners act on instinct. They don’t do the proper market research or long-term planning because they think the rules don’t apply to them. And the outcome is almost always the same - failure or a significant loss of cash burned (crash and burn) in the process.

And let’s not forget ego. The pilot had friends and family in the airshow audience. This was a hometown crowd and the last day of the show. Imagine how hard it would be to admit to his friends that he screwed up and had to abort one of the more dramatic acrobatic stunts unique to this aircraft. Think of the ribbing he would take when he landed. It might have been awkward and a bit humiliating but surely a better alternative than risking life and limb (bankruptcy), right? Not for this Marine. Aborting the maneuver was not an option.

There is something strange that happens the moment you add the title Owner, President, or CEO to your business card. You become a performer. In a way you view your employees, investors, business acquaintances, customers, friends and family as members of a great audience. There are expectations and preconceived notions you put in your head about how you should perform (run your business). For example, never show weakness or indecision, never admit you don’t know, never admit you made a mistake, and never reach out for help. This, “I can not disappoint my audience” mentality led this pilot to continue the maneuver and crash. It has led business owners to do the same.

The pilot miraculously survived this accident, recovered from his injuries and eventually returned to flying. This is rare for pilots and business owners alike. Who knows how many pilot lives were saved from this investigation and the sharing of his story. I hope the same will prove true for those who are pilot-in-command of their business.

Want to become a better pilot for your metro Atlanta, Georgia business?  Let's have a cup of coffee and talk about it.  Contact me here.

About the author. Mike Gomez is President and CEO of Allegro Consulting, a growth specialty firm in Atlanta, GA. Allegro has been helping Georgia’s private business owners to plan and execute sustainable growth strategies since 2002. Mike is a strategy and sales process evangelist with a tool chest built on direct experience in international sales ($10B), strategy and program management. He is a prolific speaker, writer, former aerospace engineer, and pilot of both aircraft and helicopters.

Getting Your Business Back in Shape (re-released and update)

It is the fourth week in January and the annual migration of the New Year’s resolution crowd is already departing gym’s across the United States; not to be seen again until next year.

At the start of each new year there is an enthusiasm to get back into personal shape. This same phenomena is present in the business world. Each year business owners declare, “This year will be different. We will have a well thought out strategic plan. We will have an actionable yearly tactical plan from which we will judge our progress. We will hold regularly scheduled staff meetings to review our plans, assess the actions of our competitors, and examine our financial health. Yes, 2012 will be different!”  And by the end of January.... they are back into their old routine, with the fire drills of each and every day dictating the rest of the year’s agenda. And like the fitness birds migrating through the gym each year, this cycle will sure to be repeated over again the next year.

I want to share with you a different story; one with exciting results and very much analogous to the business world, in hopes that it will inspire you to stick with your resolution.

At the end of November, a good friend of mine sent the following text message, “I need help.” He wanted to get back into shape and after numerous attempts on his own, he felt the aid of an outside expert was needed. I agreed to be his personal trainer. Before we began I wanted to hear what goals he had in mind in order to assess if it was realistic. He stated two specific objectives; (1) get back down to 175 lbs and (2) have a pool-worthy body for a vacation he planned in late March. We then looked at his current state; 5’11” and 198 lbs. We had a little over four months (18 weeks) interrupted by Thanksgiving, Christmas and New Years, to lose 23 lbs. and build some muscle. His goals were possible, but would require a very strong commitment to reach them. He agreed to commit to a plan that I would guide him to establish and we began.

Much like the human body, a company without steady work “on” the business versus “in” the business will too become out of shape and lose the market strength, they once enjoyed. So, exactly how do you get back into shape, or get into shape for the first time ever, and what can you expect from the process?

1. Look in the mirror. Are you happy with the current state? Is the performance what you expect? Are sales meeting your expectations? Are you stronger? Are you still as agile and responsive as you once were? How do your customers view you? What will you look like in 3 years?

2. If you don’t like what you see or are not sure what direction you are going do something about it.

3. Set measureable, realistic goals to be completed at a specific time. In the business world this means capturing your vision, and balancing that with a clear unbiased view of how you stand relative to the competition and in the market for which you chose to compete. Steve Covey said it best in his book, 7 Habits of Highly Effective People, “Begin with the end in mind”.

4. If you have never done step number three or don’t know how, don’t let your ego prevent you from engaging an outside expert. A business strategist brings two very valuable tools to the table; (1) experience working with a variety of companies in various industries from which you will benefit, and (2) they will stop you from drinking your own bathwater (declaring something is core strength when in reality it is not all that different from your competitors).

5. Craft a written plan and stick to it. This means you review the plan regularly and use it to guide how you and your team utilize your time, invest your resources, and select your people.

6. Accept the fact that change will involve some pain. Operating leaner is hard and demanding. Holding employees and yourself accountable to specific and measurable goals is also tough. Fight through the pain knowing what you are doing is for the long-term health of your company.

7. Beware of excuses used to revert back to old behaviors or not complete an assigned objective on time. It is not physically possible to complete everything in the fourth quarter because you either procrastinated or came up with reasons for why it couldn’t be done earlier in the year as originally agreed.

8. Most likely progress will be quicker for younger companies than older. That’s just nature. Older habits and patterns of behavior are tougher to change. But don’t use this as an excuse not to.

Now for the rest of the fitness story: The first few weeks were quite hard. He was a bit embarrassed being seen lifting the small amount of weights on the bar. He complained of being constantly sore. He would try to throw out an excuse or two for skipping a day; “Bad knees” and “I forgot my brace” were the excuses he used when I first suggested he start a running regiment. However, to his credit, he always showed up for our workouts. I knew we had turned a significant corner when on week eight he suggested going to the gym on one of our off days. That same week he set a goal to run a 5K. He had embraced the change in behavior. I was no longer pulling him along. His own goals and the measurable progress were now providing the motivation.

With eight weeks to go he is down to 182 lbs., having lost 16 of the 23 lbs. we targeted. He could barely run for 20 minutes when we first started, but can now run a full 5K in 30 minutes and is working to improve his time. 12 pushups in a row are now 40. He has doubled the amount of weight he is able to lift and fits into clothing sizes that he has not fit into since college. We’ve recently incorporated swimming into our routine and he is already thinking a triathlon may be a worthy goal for 2013.

Like your body, there is no shortcut to getting your company back into shape. It requires an investment in time and resources and an absolute dedication to follow through. The rewards however can be amazing. Your leaner, stronger company will be better able to compete and adapt effectively in an increasingly demanding, competitive, and ever changing world market. So, get back into the gym!

February 2014 UPDATE: Change means introducing new behavior.  The longer it is practiced the less it becomes 'new' and the more it becomes the norm.  But this requires a certain level of forced discipline over time.  My friend did not engage in this new behavior long enough to make it a habit - the new norm.  First his visits to the gym dropped off.  Then less running.  And yes, he was loaded with excuses for why.  Then the old eating habits returned.  At first these were exceptions, then the violations became
more forgivable.  Then no forgiveness was necessary.  The weight came back. The strength faded.  All progress was lost.

Change is hard for an individual.  It is even harder for a business because of the multitude of individuals (employees) who have to become both believers and practitioners of the new way. As the CEO, you set the tone. Are you sticking to the plan? Are your employees? What are the repercussions for failing to hit goals and milestone? As you can see here, it is easy to revert to the old way.

Need a personal trainer to get your metro Atlanta business back in shape.  Let's talk over a cup of coffee.  Contact me here.

About the author. Mike Gomez is President of Allegro Consulting, a growth specialty firm helping turnaround businesses wrestling with stagnant growth. He grew his very first client’s business from $8M to $35M in just two years. Mike is also a prolific speaker, writer, three-time marathoner, a former military officer and pilot of both aircraft and helicopters. www.allegroconsultant.com

Need for More ProActive and Accountability-Based Business Incubators/Accelerators

Over my eleven years offering sales strategy and long-term growth guidance to business owners I have had several opportunities to work with start-ups located within the communal walls of a business incubator/ accelerator/co-working space.  An increasingly common experience I recently had with a company in such an environment made me wonder.  Are we really helping these start-up companies by simply giving them encouragement (cheer-leading), access to mentors (which are rarely called upon), discounted office/bull-pin space, refrigerators full of Red Bull, pin-pong tables, good WiFi and conference rooms?  Is this enough to make a real difference, to lessen the high failure rate (40% first year) typically experienced by start-ups (hi-tech or otherwise) or create good jobs through growing enterprises? Or are we just being enablers, offering a site (albeit discounted) other than say home or a more expensive office space (like Regus) from which they will still unwisely burn precious cash on an questionable idea without a well vetted plan or realistic sales strategy.

I will argue most of these start-up sites (whatever you want to call them) would see dramatically different results (jobs, success, revenue) by (a) being more selective with whom they welcome (have the basics of a business plan and ability to say how they will make money (don't laugh, it is sad how many can't answer this question))  and (b) are more pro-actively engaged with those housed in their facilities (periodic mandatory reviews with ramifications).

I became a better engineer, salesperson, pilot, program manager, and leader because I had bosses who were motivated to hold me accountable, teach, challenge, measure and coach me (whether I liked it or not) because they too were expected to achieve aggressive performance goals.  I can vividly remember both how much I had to prepare for and how nerve racking it was to undergo a top to bottom program management review of a project I had P&L responsibility over or a "black-hat" review of a international sales campaign I was leading or even a check-flight while in the USAF.  These intense sessions in front of company leadership could be career making or career ending events. Did I have a choice on whether I participated? No, of course not, this was a condition of my job - these were my bosses. But I will tell you with absolute certainty I grew with each one.

Those who have started companies and failed one, two or three times before succeeding are walking encyclopedias (look it up) of valuable information that can be used to PREVENT others from experiencing the same pain and waste of valuable resources. Unfortunately there is a pervasive belief by those sponsoring or operating these co-working/accelerator/incubator spaces that failure is the best teacher, and further, that forced performance/strategy reviews will poison the collegial "creative," "stimulating," "nurturing," environment they are trying to foster. I say "nuts" to this notion (stealing a line from General Anthony McAuliffe during WWII when responding to the German's insistence that he surrender because he was clearly surround by an overwhelming force).

Let me share the most recent experience that prompted this outburst.  A partner of a two-person software start-up housed in an incubator called and asked for a two-hour sales strategy consult. That partner had already experienced one failure and didn’t want to be involved in another. (I was later told the principal was resistant to the idea up until the very moment I arrived.  After all, he felt they were just fine, that this was an unnecessary use of $400.) In those two-hours we discussed the product and what was unique about it, the characteristic of their current customer (just one) and why they purchased the product. Then I let them explain and I provided feedback on their sales strategy - who they were targeting and how.  Here is an email I received from the principle the next day:

"That was a great session and extremely helpful. Your no BS approach is what a lot of startups should be getting. Problem is most people advising start-ups don't know what they are talking about. In 4 years I have not had one person advise me that my approach sucked and was a waste of time...when it did. That's the right advice to really help someone. I think our new strategy will be (emphasis on will be --- because we have some homework to do) extremely simplified and measurable based on our conversation. Time to build the war room."

Left alone I am certain, based on the course they were on, they would have run out of money and folded. Not because they didn't have a good product, in fact it's a great product. In just two short yet intense hours we discovered the shortcomings of their approach and set them on a new course.  How many other start-ups in these settings could be saved from this experienced and regular scrutiny? Are we doing them a disservice by sitting back and waiting for them to seek help (usually too late) or should we do like my bosses did to me and insist on regular reviews? Wouldn't it make for a better story if those who entered sites like ATL Tech Village or FourAthens are say 50% more likely to succeed because of these mandatory tough love reviews? I bet it would improve the attractiveness and PR of these sites as well.

About the author. Mike Gomez is President of Allegro Consulting, a growth specialty firm helping start-ups and established businesses alike wrestling with issues of growth. He formerly sold military fighter jets to international allies for the largest aerospace firms Boeing and Lockheed. Under Allegro he grew his very first client’s business from $8M to $35M in just two years. Mike is also a prolific speaker, writer, three-time marathoner, a former military officer and pilot of both aircraft and helicopters. www.allegroconsultant.com

NOT ONE DIME MORE UNTIL …. A message from a small business owner to the administration and Congress.

Like many of you business owners, I too recently completed my taxes and cringed at how much of my money is going to Washington DC.  Mind you, I don’t mind paying taxes.  I understand there are roles the federal government has a constitutional obligation to perform (defense, regulate commerce, regulate immigration, coin money, etc…) and as a “customer” of these services it is my duty to help fund them.  I also understand the federal government is not a private company and thus by it’s sheer size cannot behave like one.  Despite this I think it is reasonable to expect they will strive to adhere to common prudent business practices.  The top three as a I see it are: (1) be fiscally conservative and sound (solid balance sheet), (2) be good stewards of the funds they receive from tax payers by searching for ways to remain lean and efficient and avoid waste, and (3) never lose sight of who your customer is and try your best to meet or exceed their expectations.

The recently publicized lavish ($822,000) Vegas trip taken by GSA (government) employees was a gross violation of trust.  Add to this the $523,000,000 dollar federally backed loan given to now bankrupt solar start-up, Solyndra, one has to wonder if there is a business person among them in charge. 

Causing further angst is the latest chant from Washington “we cannot solve our current fiscal crisis with spending cuts alone”.  However it is worded you know this is political speak for - new taxes have to be raised. The conversation then immediately proceeds to who should pay and how much. Here is where I want to stand-up and yell, “STOP!” 

When a business is forecast to have red ink on their balance sheet and they know their customer will be extremely sensitive to any price increase they focus first internally to find a solution.  They start by tackling internal waste. Then they ferret out and eliminate “nice to have” versus “must have” spending. And lastly and most regrettably a company will look at their people – evaluating and cutting layers of management and staff – learning how to do the same with fewer.  It is only after they completely exhausted these stressful steps do they come humbly to their customer and make the case for raising prices.  This is a process that has been taking place and continues to take place in businesses large and small since the very first business opened its doors.

It is time we ask our federal government to do the same thing.  That before nonchalantly asking us, their customer, for one dime more we must insist they exhaust every means to internally bring down their operating budget now.

Let your voices be heard America and tell the folks in DC …..

Not one dime more until each of the 15 cabinet departments (Treasury, Defense, etc…) and the multitude of their subordinate agencies (see entire list here) completes a thorough review and cut of wasteful spending.

Not one dime more until these same agencies candidly review the necessity of all discretionary and operational spending. In a time of fiscal crisis if it is not an absolute “must have” then they should learn to live without it.

Not one dime more until each and every agency conducts a thorough review of management layers, administrative staff and the workforce.  Most companies have to deal with this at some stage in their lives.  The federal government is no different.  A high national unemployment figure is not sufficient rationale for skipping this step.  The goal is an ultra lean organization void of perks.

And finally, not one dime more until Congress reviews every single appropriation ($3,769,000,000,000). Are these “must have” spending or “nice to have”?  I would argue that in the fiscal climate we are in today a $500 million loan to a solar start-up is not a “must have”.

I realize these are painful, difficult steps that will have personal and political ramifications.  Politicians will have to let pet projects and agencies die. Those who remain will have to learn to do more with a lot less. Businesses and State governments have to weather these storms when they are in crisis, our federal government should do the same.

When the spending is actually cut and the excess people let go our legislative and executive branch leadership should report to their customers (tax payers) on the outcome and new state of the federal balance sheet.  Then, and only then should they be allowed to start the debate about how much and who should cover the remaining deficit.  But not one more dime until this is done.

Let’s put an immediate stop to any conversation of tax increases and compel our leadership to prove they can for once do the tough part of cutting waste, non value-added spending, and staff now – not in 2016 or 2020 - NOW! Not one more dime until then.

Let your voice be heard. Call/write your representative, those who are running for office and those who seek reelection, not one dime more until....

About the author. Mike Gomez is President of Allegro Consulting, a growth specialty firm helping turnaround businesses wrestling with stagnant growth. He grew his very first client’s business from $8M to $35M in just two years. Mike is also a prolific speaker, writer, three-time marathoner, a former military officer and pilot of both aircraft and helicopters. www.allegroconsultant.com

Accountability - A dirty word or a must for business?

Recently we watched President Obama accept full responsibility for the multitude of opportunities by the different federal intelligence agencies to “connect the dots” and prevent the “Underwear Bomber” from boarding a flight to the United States. Throughout his speech the President used some variation of the word “accountable” yet he never stated how he intended enforce accountability within his administration.
Does this word not have any teeth any more? Has it been relegated to the same politically incorrect or overused under-enforced trash heap of words such as “deadline,” “delivery date,” “fixed price,” “trust,” and “customer service”?
I contend that if your business has any ambitions of growth and long-term success then enforcing personal accountability is a must.
My experience in government, corporate America, small business and non-profits has taught me that mediocrity begins the moment leadership fails to hold their people accountable for not achieving specific goals and objectives on time. The message sent when this occurs is viral, spreading with firestorm-like intensity and speed throughout the company or organization. And, like a firestorm, the damage can be overwhelming and take years to overcome.
So what does it take to create a culture of accountability in your business?

1) A Plan - First and foremost it takes a written plan. Operating to a well thought out three-year strategic and one-year tactical plan is one of most important characteristics of companies and organizations that grow consistently in good times and bad. But, just having a plan is not enough. The plan has to be shared which allows every member of the team to know his or her role in its execution. Just as a movie cannot be made without a detailed script for the actors, cameraman, director, etc., a business owner cannot hold his or her employees accountable for completing their “movie” (tactical plan) without first giving them a script.

2) Written Job Description - The relationship between an employee and employer is a contractual one. As far as the business is concerned it should be nothing more. In return for a set amount of compensation and benefits, an employer expects you to have a certain level of experience and education, work a scheduled number of hours and be held accountable for defined responsibilities. With both a plan and a written job description in place, an employer has taken the steps to remove the excuse of “I didn’t know” as a means for employees to fend off accountability.

3) Resources - You cannot hold someone accountable unless you have given them the resources to do the job you’ve assigned. If, for example, you expect someone to build a widget in a certain timeframe, then you must ensure the employee has the materials, tools, instructions, and the proper environment to complete the task. The same is true for your salesmen. You can’t hold them accountable for meeting sales objectives unless you have first given them the value proposition, a clear understanding of the competition and other tools necessary to uncover prospects and close the sale.

4) Implication for Failure - Finally, and most importantly, there must be consistent repercussions associated with failure. A plan or job description is useless if you don’t hold the individual and leadership accountable for fulfilling their responsibility and meeting specific goals and objective. Tying bonuses or a portion of base pay to objectives is one method. Private or public rebuke when a deadline is missed is another. This is clearly a personal decision, but whatever the repercussion, it must be doled out with consistency.

Maintaining a strict culture of accountability does not, as some believe, negatively impact morale or performance. On the contrary, this culture takes away ambiguity and ensures each and every individual knows what is expected of them and as a result keeps them focused and comfortable knowing that if they perform they have a long future.

About the author: Mike Gomez is the President of Allegro Consulting, an Atlanta-based business growth specialty firm. Allegro provides operating advice to businesses and organizations on a wide range of management issues that effect growth, such as strategic and organizational planning, marketing, sales and business process improvement. www.AllegroConsultant.com