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A Surprising Solution for Capitalists

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Bruce Piasecki author of The Surprising SolutionTwo thoughts came to mind before I even got through the Forward and Introduction sections of The Surprising Solution: Creating Possibility in a Swift and Severe World by Bruce Piasecki.

1. Is this book is going to be preaching to the choir about addressing environmental and social issues? Will it be a studied treatment of the issues or a piece of propaganda?

2. It takes a bold author to first thank the Forward writer Darryl Vernon Poole for comparing him to Rachel Carson and Malcolm Gladwell. Then, proceed to compare himself to George Orwell. If he’s that good I need to read on. [Read more…]

Gazelle Tracks™

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gazelletracks__o2So what are Gazelle Tracks™ and what are “Gazelles.”  Before we answer that, let’s discuss a few pertinent questions.

Where to we grow from here?   Who’s growing who, and how?  Who’s touting who, and why?  Who will be driving growth over the next two to five years.  And more importantly how and while.

We’re looking into the market sectors that provide the greatest growth potential within each of more than a dozen cities.  For starters, we’ve profiled, in some level of detail, a couple major metros that we’re intimately familiar.  In most cases, there are at least six to eight market sectors that are major growth drivers.  In addition, there are cultural, governance, demographic, educational, and locational trends that help determine the rate of growth within a particular city or region.  In addition, these issues may also help to shape what industries represent the strongest growth potential.

But now for Gazelles Tracks™.  Companies that grow consistently at a rate of 50 percent or greater annually are referred to by some as “cheetahs.”  Companies that grow consistently at a rate of 20 percent or better annually are considered to be “gazelles.”

So what makes a gazelle a gazelle?  The answers may surprise you.  First, since we’re also discussing “Growing up KC” in the Alpha Board discussions, and we’re also at least initially focused on Midwest based companies and markets it’s helpful to know that fast growth, new and high tech, are not always necessarily correlated.

It’s the belief of many that the new companies, the start-ups, high tech companies, and coastal companies are the ones that are driving growth.  While there is an element of truth in some of this, the realities of gazelles might surprise you.

First, a typical way to evaluate regions of the country on the occurrence of high growth companies, is based on the “percentage” of companies in the region that are in the category of high growth, or gazelles.  Three percent or greater (of all companies falling into the high growth category) is a large, and quite impressive number.  Midwest markets are NOT voids for gazelle performance.

According to a major study by the Small Business Administration, Johnson County, Kansas, Jackson County, Missouri and St. Louis County, Missouri all scored well on the measure of the percentage of companies in the region that qualified as gazelles.  The reason why is just as interesting.

  • Alpha BoardFirst, gazelles really don’t show significant correlation between the volume of growth and the industries or SIC codes that the companies represent.
  • What gazelles do typically represent are the following:
  • Gazelle companies and high growth companies tend to be scattered across essentially any and actually most industries.
  • Gazelle companies represent the most effective, most well-managed companies, not only on an overall basis, but more specifically within their industries.
  • Gazelle companies are typically smaller companies, with often less than 100 employees.
  • Gazelle companies are typically privately and/or closely held companies.
  • Gazelle companies tend to be very well established, often well within their second decade of life.
  • And clearly gazelle companies account for a significant portion of not only economic growth, but also job growth.

What are some relevant conclusions of the analysis?

  • This means that while technology companies can be high growth, SBA found little evidence that participation in technology industries was the key driver of growth.
  • A strong work ethic, commitment and focus of Midwesterners and Midwestern leadership style are strong components for achieving gazelle growth status.
  • And, for areas like the urban core of Kansas City and other cities that struggle with blight, all hope is not lost.  While KCMO has lost a significant number of jobs, in raw numbers as well as to the more suburban communities, some, if not most of this job loss is confined to the largest companies.
  • Gazelles are clearly growth and employment drivers, but when they are located, in the case of KCMO next to larger companies who suffer greater layoffs, they cannot always offset the regional job loss.
  • The SBA study indicated that because most gazelle companies are well established and typically more than 10 years old, economic development dollars funneled toward start-ups, were not always the wisest investments for long term job growth.
  • It means that leadership of the companies, and how and who runs the companies are critical element for growth.
  • And, one final note.  Because gazelle companies tend to be smaller companies, the 50 percent employment size cut-off for Obamacare, and the growth distortions being created by this government mandated cut-off could bode very poorly not only for job growth, but for economic growth in general, until that issues is addressed.

Portraits of Leadership

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“Lead, follow or get out of the way.”  Thomas Paine

portraits-BennyL2While Lee Iacocca and others may claim credit for the quote above, it was first spoken by Thomas Paine, famous revolutionary and author of “Common Sense. “  It’s truer now than ever before.

It’s been fun through my career to witness many great business leaders and leading businesses from a bird’s eye vantage point.  I’ve seen a fair level of success with businesses, as well as witnessing a fair level of business failures.

So what is the point?  Understanding business from a visceral level is better than anyone’s canned work, studies, or textbooks. Authentic leadership and true innovation should be recognized and celebrated.

Leading businesses and business leaders deserve marketplace attention. That’s why Alpha Board was created.  Recognition and visibility is not only good for those companies and leaders, it’s good for business.  It’s also good for the organizations that help provide that recognition.

The art of the game:

Just because we recognize success though does not mean that we cannot learn from failures. Let’s not forget those who fail while gallantly trying.  Failure must be celebrated for a number of reasons.  Most notably because it takes a series of failures to achieve success.

The average football play results in less than five yards gained, and at any point in time, the odds are significant that the ball will either not move forward at all or a player will be sacked for lost yardage.

Yet we don’t stop watching football.  We don’t abandon our loyalties.  We always wish for the players to stand up, dust themselves off, and run another play.

Look at baseball.  A .300 batting average is something to be celebrated.  A .333 or .350 are worthy of Hall of Fame status.  And, without me going back and doing much research on the topic, that means that you can fail 70 percent of the time and still be a hero.

Now, before I go on, let me say I’ve had two personal experiences related to this. First, my experience growing up on a large family farming operation, in dry weather and rocky hills.  Second, I worked at 3M, one of the most respected “timeless” innovators in American business.  In both cases, there were systems to deal with failure, and an attitude that if you have not failed at some point, you have never done anything.

I did not mean to get too sidetracked on the failure mode, but let’s remember that first, the likely chance of failure is even more reason to celebrate success.  Second, great people learn great things from failure, and they ultimately go on to achieve great successes.

So, in the next discussion, we’ll dig deeper into the topics of business leadership and innovation.

Crisis Leadership from Former Medtronic CEO Bill George

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Bill George author of 7 Lessons For Leading in Crisis While pundits and experts are churning out a plethora of books analyzing the causes of the 2008 economic crisis, it’s refreshing to find a practical book that provides some good thinking on how to manage for success in crisis situations. In his new book, “7 Lessons for Leading in Crisis,” Harvard Business School Professor and former Medtronic CEO and Chairman Bill George, provides a concise handbook for applying proven leadership lessons in tough times so that companies and individuals can emerge successful on the other side of crises. Whether it’s the current economic crisis, a product recall or the loss of a job or a spouse, George’s book offers realistic actions leaders can take to put their companies and themselves on the right track. [Read more…]

International Investments in the Dark Corners of the Global Economy

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You and I fret over how to balance our investment dollars in a SEP or an IRA. Meanwhile, Robert P. Smith has his bags packed for Damascus, Syria to measure that country’s investment potential. That’s why he is portrayed as the “Indiana Jones” of international finance.

“Give me a country that is at war because the last President has been shot and I’ll figure out something to do to make money,” says Smith who is author of RICHES AMONG THE RUINS—Adventures in the Dark Corners of the Global Economy.

In this new book, Smith recounts his experiences risking not only his money, but his life, in war zones, dictatorships, and crime-ridden capitals in countries like El Salvador, Nigeria, Turkey, Russia and Iraq. [Read more…]

German Solar Energy and Technology Leader Focuses on Growing Midwest Market

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At all levels of government and at most dinner tables, the high cost of energy and the options possible from the renewable sources of solar and wind are familiar conversations. The change in recent years, however, is those conversations have become increasingly the focus of policy and action, not just topics conjecture and speculation.

SunCarrier, a division a+f GmbH, a company in southern Germany, has been researching Kansas City and the region as sites for installation of their solar technology. Marc Reimer, Head of Project Development, explained that his company has been a leader in solar technology and efficiency for six years with a new fashion of solar installation that has shown great success in Germany and Spain. They now seek to try that same technology in what he terms as “less than optimal conditions,” namely the winters of Midwestern United States. [Read more…]