Sam Keller's TEC Blog

Tuesday, November 30, 2010

Building Meaningful Relationships

As social animals, eighty percent of life's satisfaction comes from meaningful relationships with others.

So here's the question: If your relationships are the most important part of your life, what are you doing to make them all they can be?

In his book "The 100/0 Principle" Al Ritter provides us a road map. An excerpt follows.

Click here to learn more

An Excerpt from
The 100/0 Principle
by Al Ritter

What is the most effective way to create and sustain great relationships with others? It's The 100/0 Principle: You take full responsibility (the 100) for the relationship, expecting nothing (the 0) in return.

Implementing The 100/0 Principle is not natural for most of us. It takes real commitment to the relationship and a good dose of self-discipline to think, act and give 100 percent.

The 100/0 Principle applies to those people in your life where the relationships are too important to react automatically or judgmentally. Each of us must determine the relationships to which this principle should apply. For most of us, it applies to work associates, customers, suppliers, family and friends.

STEP 1 - Determine what you can do to make the relationship work...then do it. STEP 2 - Do not expect anything in return.
- Do not allow anything the other person says or does (no matter how annoying!) to affect you.
- Be persistent with your graciousness and kindness. Remember to expect nothing in return.

At times (usually few), the relationship can remain challenging, even toxic, despite your 100 percent commitment and self-discipline. When this occurs, you need to avoid being the "Knower" and shift to being the "Learner." Avoid Knower statements/ thoughts like "that won't work," "I'm right, you are wrong,"

Instead use Learner statements/thoughts like "Let me find out what is going on and try to understand the situation," "I could be wrong, let’s talk some more" In other words, as a Learner, be curious!

Principle Paradox

When you take authentic responsibility for a relationship, more often than not the other person quickly chooses to take responsibility as well. Consequently, the 100/0 relationship quickly transforms into something approaching 100/100. When that occurs, true breakthroughs happen for the individuals involved, their teams, their organizations and their families.

Seven Strategy Questions: A Simple Approach for Better Execution

Successful business strategy lies not in having all the right answers, but rather in asking the right questions, says Harvard Business School professor Robert Simons. In an excerpt from his new book, Seven Strategy Questions, Simons explains how posing these questions can help managers make smart choices. Here are the seven questions Professor Simons suggests:

1. Who Is Your Primary Customer? He emphasizes the adjective "primary". These are the customers to whom you should devote most of your company's resources.

2. How Do Your Core Values Prioritize Shareholders, Employees, and Customers?

Real core values indicate whose interest comes first when faced with difficult trade-offs.

Prioritizing core values should be the second pillar of your business strategy. Most companies with whom I deal would answer "Customers of course". But in practice, it is often not the case.

There is no right or wrong, but choosing and consistently sticking to your choice is necessary.

3. What Critical Performance Variables Are You Tracking? It's your job to ensure that your managers are tracking the right things by singling out those variables that spell the difference between strategic success and failure. Like the preceding two questions, the focus in this question is again on the adjective "critical". These variables should tell where the company is going, unlike your accounting statements that tell you where you've been.

4. What Strategic Boundaries Have You Set? Strategic boundaries, which are always stated in the negative, ensure that the entrepreneurial initiative of your employees aligns with the desired direction of the business. I prime example of failing to do this was the Enron experience.

5. Are You Generating Creative Tension? Sustaining ongoing innovation in organizations is notoriously difficult. People fall into comfortable habits, sticking with what they know and rejecting things that cause them to change their ways. Yet without innovation in a world characterized by rapid change, the company will eventually wither and die.

To overcome such inertia, you must push people out of their comfort zones and spur them to innovate. The author shows how to accomplish this.

6. How Committed Are Your Employees to Helping Each Other? This is a lot of what teamwork is all about. If your organization requires teamwork to succeed (and I believe that most do), then it's critically important to build norms so that people will help each other succeed—especially when you're asking people to innovate.

7. What Strategic Uncertainties Keep You Awake at Night? No matter how good your current strategy is, it won't work forever. So adapting to change becomes imperative. Adapting is critical to survival, but it's extremely difficult to do. With change constantly surrounding us, employees often do not know where to look or how to respond.

Your personal attention is the critical catalyst to focus your entire organization on the strategic uncertainties that keep you awake at night. After all, everyone watches what the boss watches.

Please click here to see the complete article that was published by the Harvard Business School on November 22, 2010. You may want to read Professor Simons complete book, "Seven Strategy Questions"

Thursday, October 21, 2010

What Do You Think?

In this month's Corporate Report Wisconsin, Editor Laurie Arendt polled CRW's subscribers about the political environment and its effect on business. This lead to five questions that have been asked of the two Senate candidates, Senator Feingold and Mr. Johnson. Surprisingly, neither has responded. So my questions is "what do you think?"

Here are the five questions:

  • Our readers, all of whom are business owners and executives in the state of Wisconsin, are very concerned about the spending that is going on by our federal government. What is your opinion of the current federal spending levels and what must our country do to reduce our debt burden?
  • In your opinion, has the American Recovery and Reinvestment Act been a success or a failure? Why?
  • What is your opinion of cap and trade and similar type of policies? What do you believe is the real impact on American businesses if this type of mandate is implemented in the United States?
  • Many of our readers have responded to the current economy by hunkering down. They have stopped hiring because they are concerned about the cost of mandated health care coverage; they are concerned about the effects and costs of cap and trade. What do you believe our country’s leaders need to do to get business running again?
  • What defines a Wisconsin pro-business candidate, and which candidate comes closest to this definition?
So what do you think? Keep these questions in mind when you select a candidate and vote on November 2.

Click here for the link to the editorial.

Monday, August 30, 2010

Sustainable Recovery?

The Institute for Trend Research, headed by Brian and Alan Beaulieu and Jeff Dietrich, has long been recognized by TEC as an accurate source of economic forecasts.

Recent poor economic news has once again fueled speculation that we may be headed for a "double dip" recession. Alan Beaulieu disagrees. In an article published in the August 2010 issue of Automation World, Alan states that the U.S. and global recovery is sustainable.

He says a sustainable recovery "... has been our outlook and that remains our outlook going forward, despite the increasing clamor of the double-dip alarmists. Yes, there are real dangers out there that threaten our well being, but we have taken them into consideration when putting together our forecast."

"However, it is expected that the rate of recovery in the United States will be milder than most of us would like and milder than we had anticipated 15 months ago."

While the news is not great, there does seem to be a light at the end of this long tunnel we are now in.

Click here for the complete article.

Getting Constructive Solutions from Front-Line Employees

Well run manufacturing companies have long known that some of the best ideas for process improvement come from front line employees. Many, if not most successful companies have a process that takes a quality, safety or customer service problem or incident, finds the root cause and takes preventative measures that ensure that the issue does not occur again. A key part of the success of this process is having a culture in place that encourages participation throughout the organization.

Harvard Professors Julia Rose Adler-Milstein, Sara J. Singer, and Michael W. Toffel, recently completed a study titled "Speaking Up Constructively: Managerial Practices that Elicit Solutions from Front-Line Employees".

The authors report "This study is among the first to develop and empirically test theory about how specific management practices can encourage employees to speak up about operational problems they witness. Our findings provide evidence that (a) employees speak up more often and offer more solutions when managers promote this behavior through information campaigns and through their own engagement in problem-solving activities and (b) these managerial behaviors may be considered substitutes." In other words, either an information campaign or managerial engagement will work.

The authors further state that "By identifying specific managerial behaviors, this study empowers managers to adjust their approaches to engaging workers in problem solving, which in turn can provide them with new sources of information about opportunities to improve work systems. In organizations that can learn from mistakes, this information can spark a virtuous cycle of performance improvement."

These results are no surprise to us in manufacturing. I found it interesting that the study was of the health industry, suggesting that practices common to manufacturing have much broader application.

Click here for the complete text of the study.

Thursday, August 5, 2010

Leadership Characteristics

Jeff Blackman, TEC/Vistage Resource Speaker and business growth specialist, listed in his July 2010 Newsletter, 12 characteristics that are shared by great leaders. I wanted to share them with you.

Great leaders:

1. create a culture of trust and integrity

2. are flexible and willing to change, improve, enhance and upgrade

3. make tough decisions...knowing some folks "ain’t gonna like it"

4. value their people and their knowledge, creativity and enthusiasm

5. challenge the status quo

6. are highly disciplined, especially about time or self-management

7. delegate to others who can “do it” faster, better or smarter (and then get out of their way)

8. make today meaningful, yet always have a vision for tomorrow

9. seek honest and hard-hitting outside counsel, (they know what they don’t know...and want to hear what they haven’t heard)

10. are focused on the acquisition, satisfaction and retention of quality clients, customers and employees

11. listen, listen, listen

12. ask intelligent generate significant results

Click here to visit Jeff's web site.

Thursday, July 29, 2010

You Can Raise Prices in a Downturn

In turbulent times like the present, the common wisdom when demand is down and competitors are fighting for every order is to cut prices, right? Not always.

If you and your customers understand the value of your product and/or service, you can—and should—charge more for delivering more by using "performance pricing".

This idea comes to me from work done by Harvard Business School Professors Frank Cespedes and Benson P. Shapiro who joined with former McKinsey Consultant Elliot B. Ross, President of the MFL Group, to write the paper "Performance Pricing in Tough Times."

Cespedes says, "Pricing builds or destroys value faster than almost any business action, especially in tough and uncertain economic conditions when price is a key and visible strategic choice. Conventional wisdom has firms cutting price in these circumstances. But most industries typically allow few firms to build a sustainable, low-cost business model, and once established, the very success of those low-cost competitors makes it difficult for others to duplicate."

In their paper, "Performance Pricing in Tough Times", the team of Cespedes, Shaprio and Ross describe their research of the many companies that don't compete on absolute cost advantages and low price. These firms can and should compete on the basis of initiatives for which their customers willingly pay higher prices.

Can this apply to your company?

Click here for the complete article to learn more about performance pricing. It's worth the read.

Friday, July 9, 2010

Teamwork - "The Wisdom of Wolves"

In his recent blog, Mac Anderson, founder of Simple Truths and Successories, Inc. (see comments on "The Wisdom of Wolves" by Twyman Towery. In his book, Towery describes a society where teamwork, loyalty and communication are the norm rather than the exception. As CEOs and business owners, we can learn from the wolves regarding team building as we strive for success in our businesses.

Here's an excerpt from his book:

"The attitude of the wolf can be summed up simply: it is a constant visualization of success. The collective wisdom of wolves has been progressively programmed into their genetic makeup throughout the centuries. Wolves have mastered the technique of focusing their energies toward the activities that will lead to the accomplishment of their goals.

Wolves do not aimlessly run around their intended victims, yipping and yapping. They have a strategic plan and execute it through constant communication. When the moment of truth arrives, each understands his role and understands exactly what the pack expects of him.

The wolf does not depend on luck. The cohesion, teamwork and training of the pack determines whether the pack lives or dies.

There is a silly maxim in some organizations that everyone, to be a valuable member, must aspire to be the leader. This is personified by the misguided CEO who says he only hires people who say they want to take his job. Evidently, this is supposed to ensure that the person has ambition, courage, spunk, honesty, drive - whatever. In reality, it is simply a contrived situation, with the interviewee jumping through the boss's hoops. It sends warnings of competition and one-upmanship throughout the organization rather than signals of cooperation, teamwork and loyalty.

Everyone does not strive to be the leader in the wolf pack. Some are consummate hunters or caregivers or jokesters, but each seems to gravitate to the role he does best. This is not to say there are not challenges to authority, position and status - there are. But each wolf's role begins emerging from playtime as a pup and refines itself through the rest of its years. The wolf's attitude is always based upon the question, "What is best for the pack?" This is in marked contrast to us humans, who will often sabotage our organizations, families or businesses, if we do not get what we want.

Wolves are seldom truly threatened by other animals. By constantly engaging their senses and skills, they are practically unassailable. They are masters of planning for the moment of opportunity to present itself, and when it does, they are ready to act.

Because of training, preparation, planning, communication and a preference for action, the wolf's expectation is always to be victorious. While in actuality this is true only 10 percent of the time or less, the wolf's attitude is always that success will come-and it does."

This and other great books on leadership are available at

Monday, June 28, 2010

How Do You Weigh Strategy, Execution, and Culture in an Organization's Success?

Recently, Harvard Business School Professor Jim Haskett asked this question of CEOs and Senior Managers - How Do You Weigh Strategy, Execution, and Culture in an Organization's Success?

To me, all three are important. A strategy without execution is nothing more than a document on the bookshelf. Execution of a poor strategy can be disastrous. Yet a solid culture is required for both the development of sound strategy and its execution.

So I would agree with the respondents who ventured to place weights on the determinants of success who gave the nod to culture. And those respondents did so by a wide margin.

So what do you think?

For a link to the study click here.

Friday, June 18, 2010

Health Care Reform - What You Should Know Right Now!

Before the health reform bill was passed, Nancy Pelosi famously said, "We need to pass this bill to find out what's in it". Now that the health reform and reconciliation bills were passed in late March (known, according to the Obama Administration, as the “Affordable Care Act” or “the Act” and enacted as P.L. 111-148 and 111-152, respectively) one thing is certain. The Affordable Care Act is massive, and upon studying its contents, the Act often generates more questions than answers. The Wisconsin law firm Whyte Hirschboeck Dudek has prepared a Special Report that focuses on 10 items that Wisconsin employers should know about the Act right now as health reform moves forward and likely evolves. The report suggests answers the following questions for business owners.
1. Is my company's Health Plan a “Grandfathered Health Plan?”
2. Am I a “Large” or “Small” Employer? What does than mean under the Act?
3. Are Wisconsin and Federal Initiatives to expand coverage to dependents in their early20s in conflict with each other?
4. Should I offer insurance or be self-Insured? What are the differences under the Act?
5. Are there advantages to offering coverage to employees who retire before age 65?
6. What if I have an employee that is eligible for the high risk pool due to preexisting conditions?
7. What are Workplace Wellness Grants, and are my employees
8. How Much will it cost me to cover employees and their dependents under the Act?
9. Is the Affordable Care Act more than Health Insurance Reform?
10. Are certain provisions like the individual mandate to purchase insurance coverage Constitutional?

Click here for the answers to these questions.

There still remain many unanswered questions. The Act is complex and written so that the average lay person cannot comprehend it. This law may soon be called the full employment act for attorneys that practice labor and employment law.

Monday, May 24, 2010

Federal Stimulus - Harvard Study Yields Surprising Result

Recent research at Harvard Business School began with the premise that as a state's congressional delegation grew in stature and power through a Chairmanship in Washington, D.C., local businesses would benefit from the increased federal spending sure to come their way.

It turned out quite the opposite. Researchers found that companies experienced lower sales and retrenched by cutting payroll, R&D, and other expenses. Indeed, in the years that followed a congressman's ascendancy to the chairmanship of a powerful committee, the average firm in his state cut back capital expenditures by roughly 15 percent, according to their working paper.

Over a 40-year period, the study looked at increases in local earmarks and other federal spending that flowed to states after the senator or representative rose to the chairmanship of a powerful congressional committee. These earmarks had a negative correlation to private sector growth in the state.

Conclusion: "Our findings suggest that they (the Federal Government) should revisit their belief that federal spending can stimulate private economic development. "

For more details click here.

Sam Keller
TEC 62

Friday, May 21, 2010

CO2 Controls are coming one way or another

Regardless of whether you are in the camp that that believes that climate change is a result of human produced Carbon Dioxide or you have noted that data has been corrupted by some "scientists" here and in the UK to try to "prove" their position, the U.S. Government is moving forward.

On May 13, the EPA issued its final rule regulating Greenhouse Gases -initially limiting its reach to the largest stationary sources. Under the newly issued rule, the nation’s largest GHG emitters, such as power plants, refineries and cement production facilities, will be regulated, while smaller commercial facilities, farms and restaurants will not require Clean Air Act permits to address their GHG emissions (at least for now). For more information, click here for an article on the subject from Michael, Best and Friedrich.

Almost simultaneously, Senators John Kerry (D-Mass.) and Joe Lieberman (I-Conn.) formally introduced a new climate change bill, known as the American Power Act. The draft was originally scheduled to be introduced in April 2010; however, the rollout of the bill encountered setbacks after Senator Lindsey Graham (R-S.C.) walked away from the negotiation table just before the bill was set to be finalized. According to Sens. Kerry and Lieberman, the legislation is intended to reduce carbon emissions by 17 percent by 2020, and 80 percent by 2050. For more information, click here for another article from Michael, Best and Friedrich.

So whether through regulation or law, we are headed for some form of cap and trade with accompanying higher electric bills regardless of whether there is good science behind it.

Tuesday, May 4, 2010

Achieving Organizational Excellence

Pat McDonnell is a colleague and friend. Most of his career was spent at Coopers & Lybrand where he was Vice Chairman of Business Assurance Services. He began his career as an officer in the U.S. Marine Corps.

In his book "Everyone Wants to go to Heaven - But Nobody Wants to Die" he describes in detail his Six Steps to Organizational Excellence, which he refers to in his recent newsletter quoted below. I have seen these six steps implemented - they really work!

Pat’s Perspective: Continuous Improvement – The Ultimate Objective

Continuous improvement is another of those fads foisted on organizations by naïve, but well intentioned managers looking for painless success. It ranks up there with Six Sigma, Learning Organizations, Quality Councils and others that come and go.

How about you? How many continuous improvement programs have you endured over the years? That is always among the first questions I ask the MBA students in my class. I have learned to not be surprised at the number of hands, or the answer to the next question – how’d it go? The resulting groans have become familiar over the years.

Having said that, I have long concluded that the state of continuous improvement is the ultimate objective of our Six Step Process for achieving organizational excellence. It is ultimate for two reasons – first, it is virtually impossible to achieve and, second, once achieved, it can never end. Only two organizations of which I have been a member have ever even come close – the Marine Corps and the Audit Practice at Coopers & Lybrand circa 1997.

At its most basic, continuous improvement is the perpetual motion machine of organizational excellence. It occurs only after the organization has completed a long journey to the point where striving for excellence is embedded in the very fabric of the organization. It occurs when every individual in the organization comes to work every day committed to finding new ways to improve.

Continuous improvement is completely inconsistent with the tolerance for mediocrity that infects most organization to some degree. It is only after the process has purged this tolerance – along with tolerance of procrastination, institutional lack of integrity and the “C” players responsible for it, that continuous improvement may begin to take root.

The difficulty of achieving it creates great anxiety – and failure – when those proposing it realize that is the culmination of the long process of continuous upgrade that characterizes the first five of our Six Step Process. Our Process begins with understanding the fundamentals of change, including our innate human resistance. Next, we move to establishing the community of trust required to make the leap to excellence. The key is emplacing principled leaders who exhibit the intelligence and integrity to warrant our trust. It is only after effecting the required cultural change required that we can begin to think about creating a plan to maximize organizational excellence. It is here, by the way, that the Six Sigma and similar programs may be integrated with a comprehensive plan to create excellence. Once that plan is in place, only with the leadership and culture of responsibility that has been created, can we expect to actually execute it. It is here that most change programs – those that assume that the first three steps are in place, but rarely are – hit the wall.

That wall stands between the organization and continuous improvement. To punch through that wall requires a level of moral courage that few organizations can successfully sustain. The challenge begins with understanding that continuous improvement is all about upgrade – in leadership, people, the revenue machine, and the processes that support them. Those individuals, ideas and processes that were adequate in the past, must either grow and expand or fail in the face of ever increasing demands for improvement. This is the challenge inherent in achieving a state of continuous improvement and the major impediment to achieving it.

As Charles de Gaulle is reputed to have said about the indispensability of any individual to an organization “… the cemeteries are full of indispensable people.” He was correct – and before you launch your continuous improvement program, remember -- he was talking about you and me.

That is your challenge as the leader of organizational change. Face the challenges of continuous improvement – the need for continuous upgrading of resources – and the risks and responsibilities inherent therein.

Monday, April 19, 2010

Denial - In Business It Can Be Fatal

"Denial is the unwillingness to acknowledge and deal with reality. It is the choice—sometimes willful, sometimes unconscious, often semiconscious—to enter an 'as if' world, to act 'as if' facts are not facts because they are difficult to face." In business, denial can have disastrous, sometimes fatal, results.

Examples abound in both large and small companies, although we hear more about large companies because they make the financial news. Richard Tedlow discusses many of these examples in his book "Denial - Why Business Leaders Fail to Look Facts in the Face and What to Do About It".

Here's a few:
1. Why didn't Digital Equipment Corp. CEO Kenneth Olsen see the PC as a threat to minicomputers?
2. Did Coca-Cola's Roberto Goizueta really think New Coke was a good idea?
3. How long did Henry Ford think he could keep selling black-only Model Ts?
4. Why did the Challenger disaster of 1986 occur when a hard look at the facts screams "don't launch"?
5. And then there is A&P Foods, IBM, and Sears

Denial is so difficult because the CEO who is in it can't see it. For more information click here.

Monday, April 5, 2010

More of the New Health Care Laws

On March 30, President Obama signed the Health Care and Education Reconciliation Act, the companion law to the Patient Protection and Affordable Care Act of 2010. The new Act reflects the House and Senate's changes to the original bill.

Because of the size and complexity of these new laws, I thought it would be helpful to highlight some of the key provisions that may affect your business or impact your personal tax situation. I found an excellent summary written by Schenck's Tax Team.

Click here to learn about:




Saturday, March 27, 2010

Federal Hiring Incentives Act

On March 18, 2010, President Obama signed the Hiring Incentives to Restore Employment Act of 2010 (HIRE) into law. If you hire someone who has been unemployed for 60 days or more, you do not have to pay the employees payroll tax (6.2 percent) from the date of hire for the balance of 2010. In addition, you can get a $1,000 tax credit for qualified employees you hire this year and remain employed at least 52 weeks.

Let's say you hire an unemployed person on April 1, you pay them a salary of $40,000 and they work for you at least one year. The new law will save you $1,860 on payroll tax plus allow a $1,000 income tax credit. It seems very unlikely that this would be enough incentive to hire that new employee unless you were going to make the hire anyway. A nice gift, but not much incentive.

For more information, click here to view a Special Special Report from the law firm Whyte Hirschboeck Dudek on this legislation.

Health Care Legislation

On March 21, 2010 the U.S. House of Representatives passed major health care reform legislation which is likely to affect every citizen and every employer in the country. The “Patient Protection and Affordable Care Act” (H.R. 3590) or (“PPACA”) is the same bill passed by the U.S. Senate on December 24, 2009. President Obama has already signed the bill into law and it now imposes significant changes to the entire health care industry.

Two of our largest Wisconsin based law firms, Michael Best and Friedrich and Whyte Hirschboeck Dudek are offering summaries of this important legislation to help us understand it. Click here to view the Michael Best and Friedrich summary and here to view a table from them listing the main features of the bill.

Whyte Hirschboeck Dudek is offering a free Webinar on April 20, 2010 titled "Health Care Reform: A Preliminary View of What It Means To Employers." Here's the link to register.

Wednesday, March 24, 2010

Sam Keller

To learn about me, go to my page on our TEC Midwest web site.