We keep hearing that Yellow Page is OUT and Internet IN

Is it true? should we now move all the eggs from the printed basket to the Internet?

Why should I trust Google search results, if for a town the size of 40,000 house holds I get 125,000 plumbers search results?

Can we trust the social media if we learn that 65% of its traffic is not ‘social’ but business?

Maybe – the good old sold ‘double spread’ ads are still an answer of real legit, physical business and not shady-anonymous-virtual business?

See the following presentation by Peleg Forman:

No wonder you feel overwhelmed … see the following facts:

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The amount of new technical information is doubling  (x2) every 2 years…

For a student starting a 4 years technical degree  this means that…

Half of what they learn in their first year of study  will be outdated by the third year of study!!!

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2009 – 31 BILLION Searches in Google every Month!

2006 – only 2.7 Billion.

How did we surf B.G (before Google)?

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First TXT message – December 1992

Today we have more than 5 Billion TXT messages a day! (more than Earth population)

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The number of internet devices

1984: 1,000.

1992: 1,000,000.

2008: 1,000,000,000.

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How many years it took to get to 50,000,000 people!

Radio → 38 years

TV → 13 years

Internet → 4 years

iPod → 3 years

facebook →2 years

My 7 years old daughter loves the story of “Who Moved My Cheese!” (for kids) by Spencer Johanson. A graphical tale of 4 characters in search of the magical cheese; their different characteristics, dreams, challenges and fears. I love the book and it analogy and I often use it when discussing change management at business.

Often we mistake technology with innovation! Technology is a vehicle and many people just admire the new vehicle but don’t do the adjustments and changes that come with it. Why?

Yes we are afraid of changes! We get used to do things, arrange our schedule around the routine and if it works, we keep the status-quo. We need huge motivation to go out of this state and very often we give up on incentives just to keep ourself in the current balance state.

In the many sessions and workshops I had I always faced this, if not from all participants then from the majority. So before changing anything at your business acknowledge the individuals who will need to bear it first – your employees.

Business Changes are great if they are managed properly.

When designing a change you should consider the following steps – not necessarily in this order – some may be recursive or repetitive:

1. Motivation
   • What is the justification for this change?
   • Most reasons for changes are visible to individuals in the upper management team. You will need to make sure that the reason for the change – Motivation – is well-known throughout your organization (top to bottom, left to right).
   • Using current business analysis workshop – focusing on the desired topic can help promote motivation.
2. Umbrella
   • Why do you think your partners and co-managers will support you?
   • Many changes in one department may result in changes in other departments; resource changes, routines and processes and often budget allocation.
   • Make sure that you have a ‘lobby’ of managers to support the change – you’ll need it.
   • I call it the Umbrella you will use when the rain will start purring!
3. Agents
   • How do you think to successfully implement the change if you don’t have your ‘man-on-the-street’ to be your eyes and mouth?
   • Every change needs change agents – trustees. These are often lower level managers or employees who will need to bear the changes on their day-to-day activities.
   • They can be selected – elected - volunteered - or compensated – as long as yo are convinced they are YOUR agents and not double agents (:-()
   • You will learn that these guys will contribute to the goals and often be willing to go the extra mile for this effort – when they believe in it.
   • Facilitating workshops with a neutral party (3rd party or vendors) often helps to identify good candidates
4. Plan
   • Make a detail plan of the implementation
   • Include in your plan – training, technology, communication, check points and exit criteria.
   • Don’t forget you opposition! they will need your attention in the planning.
   • Don’t forget every plan has risks – see risk management
5. Quick hits
   • Physical changes needs ENERGY! build up this energy with quick hits.
   • Quick hits are those small wins that can be accomplished easy – even if they do not mark milestones in the major change they will reward the participants and keep them buy-in to the grand process.
   • Plan your quick hits throughout you grand implementation plan.
6. PR
   • It can’t be a secret! you need to make a commotion.
   • Posters, Slogans, Competitions, Rewards, and Nominations – are common PR tools.
   • Often send out communications on the change progress, next steps and challenges you had overcome.
   • Keep remind the business the WHY and the GOAL.

I remember one of the largest implementations my company was involved (over $150M). Instead of utilizing the vast business knowledge and progress using the new software technologies – we surrendered to the customers requests and developed the new software based on the old clerical processes they had in place. The business assumed that leaving the old processes in place will reduce the cost of change. Needless to say they ad paid almost 1:1 for the implementation as they did on the software engineering.

S.W. Foss wrote an ageless poem on this subject. It always inspired me and it is good stuff to share with the team. enjoy

Peleg Forman

Similar to a life  insurance policy – a person suffering from asthma will pay a higher premium. The insurance company see him as a ‘threat’ with higher probability to redeem his benefits. They manage the risk by collecting a higher premium.

So – a risk is actually a formula; Probability multiplied by the negative impact.

When talking about risks – it should always be associated with a plan of some kind (We will assume a plan is in place).

Yes, risk taking is inherently failure-prone. Otherwise, it would be called sure-thing-taking.

James Robert “Jim” McMahon, Jr. (American Football Player. b.1959)

All GOOD PLANS has risks.

The key for successfully managing projects is having a good plan and a good risk management system.

Risk management system should be a tool not a target. It is affective only if it does not consume too much of managers resources. The trick is to increase awareness and FOCUS on the real risks.

In 2008 the Attorney General of Colorado opened an investigation against me, my partners and the company we owned – accusing us for deceptive advertisement and consumer fraud.

Bad – very bad stuff.

Are we heading a disaster..?

Short background;
We have a small business – advertising and a call center, which we generate leads and work orders for many service providers. We pay for the advertisement and the 24/7 call center that routes the work orders to the relevant contractor. This had been running well for 3-4 years. The problem was that among other services we advertised (towing, road side assistance, plumbing, HVAC, etc), we worked with locksmiths. If you lie down with dogs – you’ll get up with fleas and that’s the fruits of working with a bad reputable industry. The trade of the locksmith is an honest trade, yet being unregulated and not standardized – bad behaviors of contractors become common. Working with people in stress who are stuck outside of their car or home feeling miserable and helpless was an easy ground for ripoffs and “easy money” for some. Thus, shady companies started and the trade became crowded, competitive, and a ruthless industry – not only to the customers but between locksmiths. So that being said,  if you lie down with dogs – you’ll get up with fleas.

OK – Back to our story – February 2008

Based on old BBB complaints (that were already all resolved) and the background of the unregulated locksmith trade in Colorado – the Attorney General decided to open an investigation against our company.

The alleged claims brought against us were:

• Intentionally misleading consumers to believe that the price for locksmith services would be less than the actual price.
• Deceptive advertising that led consumers to believe that we had local offices.
• Falsely advertising an affiliation with the Associated Locksmiths Of America (ALOA) when none existed.

We submitted sworn depositions, 6 boxes of documents and hundreds of letters, emails, electronic documents, and recorded calls. We spent hundreds of hours digging out old materials, talking to attorneys and having many sleepless nights asking, “Are we doing the right thing?”.

This investigation was a long and agonizing process. State officials do not need to justify their expenses, nor do they have any incentive to hold back civil cases even if the State has a low chance of winning. We incurred thousands of dollars in lawyer’s expenses to satisfy the State’s investigation with no way to recover these expenses, even if we won the case.

After their investigation, the State realized that not only have we NOT conducted our business as stated by the claims, but we have demonstrated transparency and other very good business practices.

We offered the State Arbitrary Services (a neutral judge serving as a mediator) to try to reason this case out of court and to let them understand that there is no justification to keep accumulating attorney fees on both sides. The State came in with a demand to charge us with $350,000!

With our full cooperation, collaboration, and with all the actions we had taken prior to the lawsuit being filed against us – the Attorney General agreed to settle the case with us on the grounds of recovering their expenses, which by then (a year and a half later) had piled up. Our lawyers advised us to agree to the settlement as the cost of a trial, even with a good prospect of winning, would be much more than the settlement fees. We finally agreed on a compensatory payment of $100,000.

When the settlement was done, the State had no victory. Yet to try to recover it’s pride, the Attorney General Spokesman released a press release about the settlement. The article was one-sided and failed to represent the full spirit of the agreement. Unfortunately, the media quoted the press release without checking it thoroughly (by the way, the agreement is public knowledge).

Here is where this story ends…

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According to the Constitution, you are innocent until proven differently. In reality … well, you fill in the blanks.

How do you prove that you are not the bad guy? How do you convince a state attorney who is under huge pressure to prosecute locksmiths? BBB claims? Ex-employees? Upset Competitors? In other states the Attorney Generals had been able to prosecute shady locksmiths and here they have a ‘big fish’…

‘Cash is King’

What does a small business do when a blow of $260,000 hits its cash flow ($100K to the state + $160K to legal counselors)?

Good lawyers are priceless – but was there a way around this?

Checking our executive insurance we were covered for bodily injuries but not from advertisement accusations.

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Risk Management

Risk management is the identification, assessment, and prioritization of risks followed by coordinated and economical application of resources to minimize, monitor, and control the probability and/or impact of unfortunate events

My professor once taught me that you can only foresee so many risks before you go out on an operation (being an army veteran) and you need to trust your decision-making process to assess risks on the go. Was it possible to manage this damage?  For a long time, the business developed to be a very organized business:

• Customer service management
• Recording system for 100% of the calls
• A good billing system
• Good subcontractor agreements
• Insurance
• Policy & procedures
• Legal consultancy
• Proofs for advertisement

Given the fact that the law suit was inevitable we made a judgment call to fight it up to the point that fighting for justice was counter business and from cost/benefit we should settle it and not go to trial.

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Conclusion

Our business is recovering. Demonstrating good citizen corporate we are now much stronger and confident  in our operation and legitimacy of how we do business.