How to deal with harmful energy suckers.

I’ve been having a problem with my battery lately. Not my internal human battery. The battery that powers my car. Several times over the past couple of months my car wouldn’t start and I had to jump it to get it going again (with jumper cables, not the Fosbury Flop.)

The Replacement

I decided to measure my car battery with a voltage meter. Sure enough, the voltage was way low, like Consuelo. So I replaced the battery. But two weeks later, with a brand new battery, I found the car dead again. Watt The Volt?

Spotting a Pattern

I began noticing a pattern. When the car wasn’t driven for a couple of days it would wind up dead. It was dead when we returned from a family weekend in Chicago. It was dead-dead when I got back from a 4-day business trip to Atlanta and Orlando. So it was time to take my car to the dealership to get to the bottom of the issue.

Diagnosing The Problem

When I made the phone call to set up an appointment, the service representative seemed to understand my problem better than he should have with the limited amount of information I gave him. When I brought the car in, the representative shared his diagnosis without ever looking at the car. He said:

‘I am 99.9% sure that you have a parasitic draw on your battery, caused by the Bluetooth control module. When that malfunctions it draws down the battery at an abnormally high rate while the car is off. The demand eventually drains the battery until you don’t even have enough power to unlock the doors.’ -Acura Dealership Dave

The test the technicians performed confirmed that we was right. Se we replaced the Bluetooth control module. And the problem disappeared.

Beware The Parasitic Draw!

Parasitic draws are not limited to car batteries. They can happen anywhere. In businesses, on teams, and in social groups. Malfunctioning human parasites draw down the energy of the group, depleting them of power, until they limp along severely compromised, or ruined.

Key Takeaway

Great organizations, teams and groups require energy to function properly. If anyone in the system is taking away energy, rather than contributing it, you have to remove them from the system. Do it as quickly as you diagnose it. There is no cure, other than a parasitectomy. Don’t waste your time trying to fix it. Removing the offender is the only way to return to full power and achieve your full potential. And you should never settle for anything less.

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How our agency overcame a Biggie Smalls experience.

It was the rapper Notorious B.I.G. who once penned that famous American quote: ‘Mo Money. Mo Problems.’ In 2018 I learned Biggie was right. Because as my young advertising and idea agency was growing at an exciting pace, we also faced mo money problems. Or was it less money problems? Maybe it depends on whether you’re more East Coast or more West Coast.

Go With The Cashflow

In 2018 The Weaponry, faced a cash flow problem. It wasn’t as if I hadn’t been warned. My posse of entrepreneurial homies, including Dan Richards of Global Rescue and Jeff Hilimire of Dragon Army, warned me that as you work with larger and larger clients they will use their financial muscle to get longer and longer payment terms. So instead of our standard 30-day terms, new clients began requesting, pushing for or demanding 45, 60 and even 90-day terms. #WhatWouldSugeKnightDo?

The 60 and 90-day terms put growing businesses like mine in a conundrum. Obviously we want to work with the biggest and best companies in the world. The problem is that while we wait to get paid for the work we have completed, we still have to pay the Weapons, vendors and freelancers who work for us. Which means that like a leaky bucket, more money is leaving the system than coming in. #DearLizaDearLiza

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Big Poppa

By June of 2018 we had been in business for 2 years. We could clearly feel the momentum build. There was sharp rise in the demand for our work. But with all the new work, longer payment terms, and invoices that seemed to have taken the slow boat to PayMe Town, we started carrying between $500,000 and $700,000 in our monthly accounts receivable stack.

For a business that bootstrapped its way into being just 24 months earlier this was an interesting turn of events. It is nice to be owed that kind of money. But cash is the life blood of a business. And there were serious demands on our blood supply.

We were always able to pay our salaries and all of our bills. But the depleted cash on hand meant that we weren’t able to invest in our own growth. We had started looking at space for our Columbus office in June, then hit pause on our plans to sign a lease in order give ourselves some breathing room. We waited on transitioning some of our freelance help to full-fledged Weapons. And we postponed the company offsite meeting in Monaco.

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It Was All A Dream.

When I shared our mounting money challenge with our team, they once again stepped up to solve the problem. Simon Harper, one of our outstanding account directors, shared how we could adjust our invoice timing to make sure we were paid by our clients sooner. Other account leads also contacted their client contacts about the outstanding bills. Which helped get the money ball rolling.

Our accountant, slash bookkeeper, slash egg dealer, Sally Bretsch, recommended another adjustment to our billing process that would ensure that our invoices got into our clients’ accounts payable systems faster, with greater accountability. Which is either totally meta or just a nice word play (Did I mention I used to read Word UP! magazine?)

From Negative To Positive (And it’s all good.)

With these team-driven enhancements in place, suddenly we dramatically decreased the turnaround time between work performed and payments received. We had our own Black Friday moment, when suddenly, following months of increased billing, but decreased cashflow, we started seeing the fruits of our labor manifest in our bank account.

Key Takeaway

Business is a team sport. As an entrepreneur, leader or department head, it’s important to understand that your team will find ways to solve problems and improve performance faster, and in better ways than you would be able to unearth on your own. Share information with your team. Make them part of the solution. If you’re thinking about starting a business, surround yourself with a strong crew who knows more about their specialties than you do. Then give them a mic and let them flow. That’s how small teams make big things happen.

The key to the Patriots’ success that most people never notice.

The New England Patriots are my favorite professional team, in any sport, hands down. Heck, I love the Patriots regardless of hand position. I have been a Pats fan since I was a boy growing up in Vermont, which for the international crowd, and the geographically challenged Americans, is one of the six states that make up New England.

In my youth, the highlight of my Patriots fandom was the kickoff of Super Bowl XX (that’s 20 for those of you who don’t speak Roman). I was so excited and full of hope, until my Pats got refrigerated and Super Bowl Shuffled off like the Buffalo Bills by the historically impressive 1985 Chicago Bears. If that game didn’t completely break my heart, Billy Buckner finished the job just a few months later.

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My Patriots took it in the worst way from the Chicago Bears in Super Bowl XX. 

A Whole New World

Oh, but this is a new millennium. It has been unbelievable for Patriot fans. But completely annoying for many non-Patriotic Americans. I get that too. Because I can’t stand the New York Yankees.

Since 2001, no team in any sport has been more dominant than the Patriots. Love them or hate them, their record has been spectacular this millennium. Since 2001 they’ve played in the Super Bowl 9 times, winning 5 championships, with a chance to add another W in Super Bowl LIII.

It’s Gets Harder And Harder.

Each return trip becomes less and less likely. Because following a Super Bowl appearance, both teams are rewarded for their efforts with one of the two worst draft positions, and one of the two hardest schedules the following year. Yet here the Patriots are, once again playing for the Lombardi Trophy.

Which Begs The Question…

Just why have the Patriots been able to remain so dominant for so long in the era of the salary cap and free agency? This is an era in which it should be the hardest of all to maintain a Joan Collins-caliber dynasty.

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Patriot great Tedy Bruschi checking Mike Vrabel for lice.

The Harder The Problem, The Harder You Look For Solutions.

Budget limitations often encourage us to approach our challenges differently. If you really study the NFL data like Bill Belichick has, it may lead you to create an entirely new formula for success.

Belichick and Brady

In Michael Holley’s New York Times bestseller, Belichick and Brady, there is an eye-opening analysis of the economics of football. While we are often distracted by the conspicuous performances on the field, we may be missing something far more important. There is far too much emphasis put on the traditional statistics. And Bill Belichick and Scott Pioli were just the people to unearth this non-intuitive truth.

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The following passage from the book offers one of the great aha’s of how the Patriots have accomplished so much despite the NFL’s systematically promoted parody.

We slowly accumulated winning stat guys as opposed to the high-sack, high-interception guys,” former Patriots linebacker Matt Chatham says. “Willie McGinest, Mike Vrabel. Those guys are way more valuable if they get eight sacks rather than sixteen. Dominating the edge, getting on the tight end, blowing up wide receivers and never letting them get into the pattern. That’s way more valuable than sixteen sacks.

“I think that the world thinks that the sixteen-sack guy is more valuable, but the Patriots don’t think that, and you can get into the economics of this: The sixteen-sack guy costs twice as much as the other guy. And once you get to a certain point, it’s saturation. It’s just sixteen plays and when you play five hundred snaps, it’s not that important. It just isn’t. Who are the best rerouters among outside linebackers? Who are the best edge setter? Does anyone in the media know that?”

-From Belichick and Brady by Michael Holley

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Matt Chatham: Revealer of truth. And guy who got stuck trying to shove his arms through a little kid’s bike inner tubes. 

Key Takeaway:

Know your winning stats. The winning formula isn’t always obvious. But understanding what really factors into your success gives you an edge in every endeavor. Analyze your own organization, or your own personal success. Know what works and which part of the performance may be distracting you from the things that matter most.

I hope the Patriots win the Super Bowl again this year. But even if they don’t, it sure is fun being a Pats fan. Because win or lose (and it is mostly win) they have found the winning formula to be in the mix every year.

Go Pats!

It’s time for a new office in a new city!

When I first decided to launch my own advertising agency, I had a clear vision of what the fully formed business would look like. It was spectacular, as visions should be. Because it costs just as much to envision a multi-billion dollar empire as it does to envision a lemonade stand. So you might as well envision big.

In 2015, even though my startup was still in the embryonic-stage, I was confident that great things lie ahead. I just never knew the pace at which success would unfold. But I knew, like a 2-year old in a laundry room, the unfolding was just a matter of time.

Things Started Happening

In the fall of 2015 I ran an alpha test of our minimum viable product (MVP) with our first client. The test run went as well as advertised. (#punsalwaysintended) Then, in the spring of 2016, my home office in Atlanta, where I planned every detail of the business, became The Weaponry’s first headquarters. Suddenly I was in business. And I had the best commute in Atlanta.

By the end of 2016, as part of my life design, I moved to Milwaukee. The Weaponry’s new headquarters was my new  home office. In 2017 the business was humming, we saw plenty of runway ahead, and we signed a lease on 1000 square feet of office space downtown, on the Milwaukee River (actually it was on the side of the river).

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Our Milwaukee office. As they say, home is where custom designed surfboard coffee table is.

But Wait. There’s More!

I never wanted to settle for just one office. That’s why I developed my Home Office Strategy. Which means I plan to establish an office every place I’ve owned a home. This includes Milwaukee, Atlanta and Columbus. I also want an office in New England, where I grew up. So Burlington, Vermont and Boston are possibilities too.

By 2018 we had full-time employees in Milwaukee, Columbus and Atlanta. 6 months ago we started thinking about the next office. And, (drumroll app please…) we’ve decided that Columbus, Ohio will be the home of the next office of The Weaponry.

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Columbus, Ohio just keeps getting better.

Discovering Columbus.

Columbus, Ohio is a hidden gem. It is well stocked with a highly educated workforce. It offers an amazing quality of life. And thriving industries. We have had full-time Weapons in Columbus for well over a year. And we are eager to add more.

Back Story

I spent 7 great years in Columbus with the ad agency Engauge, before it was acquired by Publicis, and I was asked to move to the new headquarters in Atlanta. Columbus has a 3-ship flotilla of talented advertising and design professionals. And there are more great brands and smart marketers there than even John Lennon could imagine.

Getting Down To Business

Columbus is the home to well-known brands like Nationwide Insurance and Safelite Auto Glass. There are great restaurants headquartered in C-Bus, including Wendy’s, Bob Evans, White Castle, Charley’s Philly Steaks, Sbarro, Donatos and Steak Escape. There are great retail brands, including Victoria’s Secret, Bath & Body Works, Hollister, Abercrombie & Fitch, and Express. Scott’s Miracle Grow is also growing plants miraculously in Columbus. Cardinal Health, which is the 14th largest company in America is headquartered there too.

The Weaponry C-Bus

We have collected a great nucleus of talent in Columbus, including both full-time and freelance Weapons. The relatively low-cost of living and high quality of life make the city a great draw. What’s even better is that Columbus is within a 3-hour drive of Detroit, Windsor, Cleveland, Pittsburgh, Cincinnati, Lexington, Louisville and Indianapolis. Not to mention Youngstown, Akron, Canton, Dayton and Toledo (wait, I DID just mention them!) The close proximity enables us to service clients in all of those cities from our Columbus hub.

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What is round on both ends, hi in the middle, and loaded with Weapons?

Key Takeaway

There is a lot to love about Columbus. Which is why we are excited to be opening our next office in this great city. I look forward to sharing how we’ve gone about the process of finding our new space, and why we landed where we did. If you are in Columbus and want to be part of a great team, we should talk. Because things are about to get really interesting.

Does your organization trust you to be an insider?

One of the great debates in business is about how much information we should share with our teams. There are two schools of thought:

  1. The ‘You-Can’t-Handle-The-Truth’ Community College.
  2. The ‘There’s-No-Such-Thing-As-TMI’ Prep Academy.

I have gone on recruiting trips to both campuses. They feel very different. One has a work hard, play hard vibe. The other feels like the place where the parents from Footloose went to school.

Solving For Happy

One of the key factors of employee satisfaction is feeling like you know what is happening within your organization. Employees are afraid of being left in the dark. It makes them feel like outsiders, when all they really want is to feel like insiders. #SodaPopAndPonyBoy

A lack of information sharing makes employees suspicious, and encourages them to jump to their own conclusions. In many corporate cultures conclusion jumping is like an Olympic event, and a world-class distraction.

Low Unemployment Means Higher Expectations.

Today, the labor market is tighter than a Boca Raton facelift. Which means that we have to make sure our employees feel valued and included in order to keep them engaged (I mean actively interested and invested in your company, not committed to getting married).

That’s why I believe in this simple philosophy:

Share information to show your employees that you see them as part of the solution. And not part of the problem.

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If You’ve Got A Problem, Yo, Let Them Solve It.

At the beginning of 2018 all of the business at my advertising and idea agency, The Weaponry, was project based. We were thrilled to have the work. And the work we performed for many of our clients was steady throughout the year. However, because we didn’t have any long-term commitments from our clients it limited our ability to plan. And it prevented us from committing to more full-time hires, which would better serve our clients.

I shared this challenge with our team at the beginning of 2018. Our account leaders took matters into their own hands. They had discussions with several of our clients who regularly engaged us for projects. They shared the merits of having a fixed plan in place, dedicated employees who accumulated knowledge on their business, and the ad agency-equivalent of rollover minutes that would never expire.

As a result, by the 3rd quarter of 2018 we had 6 retainer clients who compensated us with a fixed monthly payment. That helped make our revenue stream steadier and more predictable. It makes it easier for our clients to manage their budget. The retainer commitments have enabled us to think longer term about the work we do for our clients. And it has allowed us to invest in our team and infrastructure to better serve our clients.

Key Takeaway

People love solving problems. They love showing that they know, or can find the right answers. So share information with your team. Let them solve more of your organizations challenges by giving them more of the information they need to create great solutions. Remember, leadership will never have all of the best answers to the challenges that face an organization. It’s amazing how much faster and more intelligently you can solve an issue when all of your best minds are working on the problem.

 

Recognizing the tremendous value of your client ark.

In your career you will have the opportunity to work with a broad range of clients. Some will help you make a lot of money. Some will help you make a little money. Some will help you grow old friendships. Some will help you make new friendships. Some will be strictly business. And some will be a party. Some will enable you to do great work. Some will help you make a difference. Some will build your confidence. Some will test your limits. Some will cost you money. Some you will love. And some, you will wish you never met. But if you pay attention, they will all help you grow smarter, stronger and more capable. So on the toughest days with the toughest clients, and the best days with the best clients, don’t forget to learn.

A better way to measure business success.

This week marks the beginning of the 22nd year of my advertising career. Over the past 22 years I have worked for an agency owned by private equity, an agency owned by a public holding company, and an agency that was privately held. I have learned a lot along the way. In 2016 I launched my own ad agency called The Weaponry. And I’m trying to apply all I have learned to make this bird fly.

Private Equity Goals

When I worked for the advertising agency owned by private equity, its main focus was growing to sell. A funny thing happens when you want to grow to sell your company. Especially when your investment clock is ticking, and you want to sell within the next 24 months or less.

You become hyper-focussed on revenue growth. When you obsess over revenue growth, you want to add business as quickly as you can. The quality of the work, the fit, the preparedness or the organization to take on the new work, and both the quality and the timeliness of the work flies out the window. Because short-term growth makes you do funny things.

Public Company Goals

Eventually that agency was bought by a large publicly held company. And the focus of the business changed. The new organization wasn’t obsessed with revenue growth. They were focused on margin growth. They wanted to make sure that we were making healthy profits on everything we did. They were constantly looking for ways to increase that margin.

The agency cut or discarded clients that didn’t offer the margin needed to sustain the infrastructure of a large, publicly held agency. As a result, they made decisions that were based on the target margin number of the day (that’s english for du jour). We walked away from clients who were facing some short-term challenges. We discarded several clients that had great long-term potential. Because the company was focused on meeting margins for the next quarter.

Family Business Goals

I recently worked with a company that had a very different way to think about their business growth. The organization was owned by a successful and impressive family. The key shareholders are not outside investors. They are family members. As a result, the most important measurement they focus on is generational growth. They ask deeper, more important questions, like How can we grow a healthy organization that can sustain generations of positive growth?’ And ‘Who let the dogs out?’

They certainly want good revenue. They also want a good margin. But they play the long game in every decision they make. As a result, they don’t grow faster than they can maintain a high quality of delivery. They don’t cut clients because they don’t live up to today’s margin standards. They are flexible and understanding of their clients’ challenges. That builds trust and loyalty. And long-term relationships. All of this has helped build both revenue and margin. And a long runway for growth for years to come.

Key Takeaway

Revenue and margin are important to a business. But we should never forget that they are results of how we run our organizations, and the hundreds of decisions we make along the way. When you think about your business in terms of generational growth, you will make better decisions for the long haul. You will build relationships that get you through hard times. And you will build something that lasts long after you are gone.