Is now the right time to start a business? -
Anand Deb, Vancouver, Canada
What? Did we read that right? If so, thank you. Amid the torrent of e-mails we've received lately from people feeling panicked, irate and/or depressed about the economy and their careers, your simple query was a welcome surprise.
And it was a welcome opportunity for us to realise, well, yes, it could be a very good time to start a business. In fact, we can think of at least four compelling reasons why, but only if the business you're hoping to start passes one major test: It can sell more for less.
To be clear, we don't mean a little bit more for a little bit less. In these recessionary times, a new business doesn't stand much of a chance unless it provides a value proposition that's demonstrably superior to the market's current offerings.
Sure, not that long ago, you could still take a competitor's service or product, tweak it or slap on a new feature or two and persuade customers to buy it at a premium. But with everyone in hunker-down mode, the days of marginal up-selling are gone - and could be for some time to come.
That said, if you're an entrepreneur who has actually come up with a product or service that will significantly improve people's lives - at a significantly lower cost than the competition - here's why this might very well be the right time to forge ahead.
First, if there is one thing a start-up needs to get out of the gate fast and compete effectively against established players, it's smart, driven-to-win people and those people happen to be more available right now than at any time in recent memory.
Now, obviously, layoffs are a terrible, terrible thing and there are millions of painful human stories behind the current national unemployment rate of 8.1 per cent. But the fact is, new businesses live or die depending on how quickly they can bring together bright, flexible, 'hungry' employees.
The current climate, in which job scarcity is such that seasoned professionals and freshly minted MBAs alike are looking for work, facilitates that process. The second reason is related to the first, although it has to do with something more ephemeral: the general urgency and lack of arrogance that most people are feeling these days. The economy's implosion has really taken everybody down a notch.
Former 'Masters of the Universe' have discovered they're mere mortals and people who thought it was all about them have discovered that if their companies don't succeed, they don't either. Even regular folks have had to confront the fragility of their industries and livelihoods.
So not only has today's environment made it easier to hire good people, but it has also fostered among employees a new understanding of the importance of true teamwork and unrelenting productivity. Such a 'vibe,' for lack of a better word, is every manager's hope and every entrepreneur's dream. The third reason concerns money - in a good way.
Despite all the news you hear about tight credit markets, financing for start-ups does exist, especially for those that have passed the more-for-less test mentioned earlier. We're not suggesting, of course, that today's entrepreneurs can expect the fairy tale conditions of yesteryear, when money truly did seem to grow on trees. But many regional banks are eager to lend and venture capital firms are always searching for breakthrough investment ideas. After all, start-ups are the lifeblood of their business.
Finally, starting a business now will position you especially well to enjoy the eventual economic recovery. Just think: if you start your business now, it will be staffed with smart, energised employees who have learned how to work together to keep costs low and innovation high.
Your company will carry no legacy costs, nor will it bear the scars of layoffs and the low morale that accompanies them. You will, in other words, be poised to catch the earliest wave of the turnaround and ride it to the next level.
How exciting. And how exciting to hear from you, too. Right now, the world needs thousands of entrepreneurs to ask the same question you did. Let's hope that they discover there may indeed be no time like the present to start anew.
Is it wrong to have high expectations of one's boss in terms of knowledge, wisdom and integrity?
- Chris Tay, Beijing, China
Your question brings back a funny memory. A few years ago, back when we were writing our first book together, we hit a real roadblock while discussing the section that was to cover 'managing' a lousy boss. One of us thought a few paragraphs would do.
Bad bosses are few and far between, went the case, because their organisations tend to toss them out in due course. The other insisted that bad bosses - people who manipulate, confuse and even torment employees - were much more prevalent and deserved more ink.
Unable to agree, we decided to put the question to a group of 20-odd friends we were going to see at a party that night. Guess which point of view prevailed? Yes, virtually every one of our friends had a story about a close encounter with a manager (or two or three) who had disappointed them in some way. One friend described a boss who never said what she was really thinking.
Another recalled a boss who made an art form of belittling employees in meetings. But we don't want to excoriate bosses.
We both know from experience that a great boss can change your life, inspiring you to reach new heights both professionally and personally and energising you and your team to together overcome challenges bigger than any one of you could handle alone. Such experiences are wonderful and luckily, not all that rare.
But in answer to your question - should you expect them? - we suggest that it is probably more reasonable to only hope for a great boss and more realistic to expect the following instead: 1. It's reasonable to expect your boss to provide two candid performance appraisals a year that make it absolutely clear how you're doing relative to your peers and in terms of your ambitions.
Your boss may galvanise your team to deliver stellar results. But no boss is doing his job properly if he's not letting each of his people know where they stand and in meaningful, constructive detail.
So even if you'd rather live without frank, biannual evaluations of your performance - and admittedly, the idea does makes some people uncomfortable - you are well within your rights to ask for them.
2. It's reasonable to expect your boss to avoid playing favourites. Very few things have the power to enervate an organisation like a boss who has an in-crowd and an out-crowd like one of the 'mean girls' in middle school.
This invariably spawns politicking among colleagues who need to trust each other in order to share information, generate ideas or simply get anything done. So if your boss is poisoning your workplace with favouritism, you shouldn't chalk it up to business-as-usual. It's not.
3. It's reasonable to expect your boss to stand by you in your hour of need. We have a friend we'll call Carol, whose boss once asked her to present a proposal at a meeting with the organisation executive team. Carol dutifully complied, but when the executives balked at the proposal, so did Carol's boss, throwing up her hands as though it annoyed her no end.
Such 'I don't know you' behaviour is the hallmark of a manager who feels that his position is vulnerable - or a manager who is just a plain jerk.
4. It's reasonable to expect your boss to deliver outsized rewards for outsized performance. We realise that it may sound crazy to talk about 'outsized' compensation in recessionary times like these. But every good boss understands how important - and how motivating - this differentiation is and very good bosses refuse to resort to the old line others haul out during a downturn: 'You were terrific, but this is all I could get for you from upstairs.'
5. Finally and certainly most important, it's reasonable to expect your boss to demonstrate integrity. It's awful to go to work each day wondering whether your boss is shading the truth, adding spin to his real beliefs or violating company values. So hold tight to this expectation.
And if you feel it ebbing, you may need to ask yourself whether it's time to move on. Now, that said, we understand that we're in an economic period when beggars - read: most employees - can't exactly be choosers about their bosses.
We also know how much a boss can affect your quality of life. Bottom line, then: Go ahead and hope for the best, but prepare yourself to be satisfied with reality - and reasonable expectations.
What is the role of HR departments as the world goes through turmoil and what is their future as so many industries face extreme change? - Effendi Ibnoe, Bali, Indonesia
Your question arrived in our inbox on the same day that we received a note from an acquaintance who had just been let go from his job in publishing - certainly one of the industries facing, as you put it, 'extreme change.' He described his lay-off as a practically Orwellian experience.
He was ushered into a conference room to meet with an outplacement consultant who, after dispensing with logistics, informed him that she would call him at home that evening to make sure that everything was all right"
. "I assured her I had friends and loved ones and a dog," he wrote, "and since my relationship with her could be measured in terms of seconds, they could take care of that end of things." "Memo to HR professionals: Instead of putting your dismissed employees (in a room) with solicitous outplacement reps," he noted wryly, "put them in a room with some crockery for a few therapeutic minutes of smashing things against a wall."
We'd suggest another, more serious memo to HR. "Layoffs are your moment of truth," it would say. "Your company must treat departing employees with the same attentiveness and dignity that it did when they were hired. HR proves its mettle and its worth during layoffs, demonstrating whether a company really cares about its people or just spouts lip service to that effect."
Look, we've written before about HR and the game-changing role we believe it can - and should - play as the engine of an organisation hiring, appraisal and development processes. We've asserted that too many companies relegate HR to the mundane busy-work of newsletters, picnics and benefits and we've made the case that every CEO should elevate his head of HR to the same level as the CFO.
But if there was ever a time that underscored the importance of HR, it has arrived with the world's 'going through turmoil,' to quote you again. And, sadly, if there was ever a time for seeing how few companies get HR right, it has arrived too, as our acquaintance's experience shows. So, on to your question regarding what HR's correct role is now, especially in terms of layoffs.
We'd suggest three roles.
First, HR's role is to make sure that people are laid off by their managers, not by strangers. Being fired is dehumanising in any event, but getting the news from a hired gun only makes matters worse. That's why HR must make sure managers accept their duty, which is not to delegate the one conversation at work that must be personal.
The bad news should be delivered face-to-face. Second, HR's role is to serve as the company's arbiter of equity.
Nothing raises hackles more during a layoff than the sense that some people - read: the loud mouths and litigious - are getting better deals than others. HR can mitigate that dynamic by making sure that severance arrangements, if they exist, are appropriate and evenhanded across units and divisions. You simply don't want people to leave your organisation feeling as though they were dealt with unjustly.
They need to feel, 'HR kept the process clean. I'm not happy, but at least I know I was treated fairly.' Finally, HR's role is to absorb pain. In the hours and days after being let go, people need to vent and it is HR's job to be completely available to console them.
At some point, an outplacement consultant can come into the mix to assist with the transition, but HR can never let 'the departed' feel as though they've been sent to a leper colony.
Someone connected to each let-go employee - either a colleague or HR staffer - should check in with them regularly. And not just to ask, "Is everything OK?" and be done with it, but to listen to the answer with an open heart and, when appropriate, offer to serve as a reference to prospective employers.
Three years ago we wrote a column called 'So Many CEOs Get This Wrong,' and while we received many letters in support of our stance that too many companies undervalue HR, a significant minority wrote in to pooh-pooh HR as being irrelevant to the 'real work' of business.
Given the current circumstances, we wonder how those HR minimalists are feeling now. If their companies are in crisis - or their own careers - perhaps they've at last seen the light. HR matters enormously in good times. It defines you during bad."