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The Future of Business Aviation w/Scott Ashton

The future of business aviation is changing as companies recognize the benefits of using corporate shuttles and private jets. What will be the impact of smaller companies in the aerospace industry? Why do many companies use private jets as part of their branding tactics? And why will technology never replace face-to-face business meetings? In this episode, Scott Ashton shares on the future of business aviation.

 

Aviation is an entrepreneurial enterprise led by entrepreneurs. -Scott Ashton

 

Takeaways + Tactics

  • While the goal is to lower the prices for business aviation, this is impossible at the moment, as the wages of pilots and other costs are on the rise.

  • Many corporations are now looking into corporate shuttles to save time when sending their people over to engage with clients. In just a matter of hours, a corporate shuttle can fly back and forth, and this can’t be done by airlines.

  • Video conferences, email interactions, and phone conversations don’t build the same amount of trust as a face-to-face meetings do.

 

At the beginning of the episode, we talked about the costs of business aviation and how corporations and smaller businesses save time by using corporate shuttles.

We also covered:

  • The competitive advantage of smaller businesses in the aerospace industry
  • Why a revival of the aerospace industry is only possible if we attract more young people to it
  • How working for a small business is more rewarding

 

Many businesses use private jets as a branding tactic. Mid-level executives, engineers, and salespeople use private jets when meeting with clients, not necessarily because they need to but because it’s a branding and authority move. For many businesses, investing in a private jet is a business need when negotiating with clients.

 

Guest bio

Scott Ashton is the President on the board of directors at New England Air Museum, President and CEO at Corporate Service Supply and Manufacturing and a board member of EvoLux Transportation.

He has a diverse background that includes knowledge of finance, marketing, sales, finance modeling, mission analysis, and strategic planning. Scott is also an NBAA certified aviation manager and a certified flight instructor.


You can find out more about Scott here.

Don’t Change the Players, Change the Behaviors w/David Marquet

David Marquet show how Intent Based leadership turns compliant followers into engaged leaders— fueling performance and driving results.

 

Leadership isn’t about telling people what not to do. It’s about creating an environment where they can be great just the way they are. -David Marquet

 

Takeaways + Tactics

  • People who feel valued drive results.  Make them a part of something big.
  • A single leader who does all the thinking stifles growth and inhibits performance.  Force your teams to think, and they will grow.
  • Top-down decisions forced on compliant teams don’t face scrutiny, and the results are often disastrous.

 

David Marquet expertly shows:

  • How forcing people to make their own decisions will increase their job satisfaction and performance
  • Why a great leader doesn’t need to know everything, but should continue learning
  • How great leaders communicate in order to drive performance

 

Guest Bio

David Marquet is a nationally recognized speaker and the author of the bestselling book Turn the Ship Around!.

As the captain of a nuclear submarine, David experienced the power of intentional leadership and how much it changed his team. Today, he helps companies create leaders at every level and delegate flawless execution.

You can find out more about David’s approach to leadership and his educational materials here.

Leadership, Attracting Experts, and High Employee Engagement w/Krister Ungerboeck

 

Good leaders teach others how to become leaders themselves. As we grow our team, why is it important to stop giving answers and start helping others find solutions on their own? How can we attract experts to our company? Why should we strive to become better communicators? In this episode, Krister Ungerboeck talks about the most common leadership mistakes and what we can do to lead others to success.

 

Managers can be managed, but executives can only be led. -Krister Ungerboeck

 

For the Resources mentioned by Krister in this conversation, go to https://krister.com/aerospace

 

Takeaways + Tactics

  • There is a big difference between leading small teams and larger ones.
  • Good leaders teach others to ask the right questions… and find their own conclusions.
  • The biggest enemy of entrepreneurs is ego. It’s okay to hire smarter.
  • Empathy and high emotional intelligence are crucial qualities that good leaders develop.

 

At the beginning of the episode, we talked about how small teams are managed differently than big teams. Next, we talked about why it’s important to accept the fact that there are people who are better than us and more qualified to hold certain positions in our company.

We also covered:

  • Why a big monetary compensation isn’t enough and what else we can offer to high achievers
  • Why being a lone wolf in the world of entrepreneurship can cost you a lot of learning opportunities
  • How we can learn to communicate better with our team and the role empathy plays in doing so

 

Resources

For more aerospace industry news & commentary: http://northstaresg.com/

To learn more about Craig Picken and the NorthStar Group, visit http://northstaresg.com/

 

We can’t become better leaders and grow our business if we don’t learn to communicate more effectively. A crucial element in emotional intelligence is having empathy— the ability to put ourselves in somebody else's shoes even when we have nothing in common. Setting aside time for empathy exercises is crucial for leaders like us, as we have to connect, communicate and lead people on a daily basis.

 

Guest Bio

Krister Ungerboeck, The Leadership Archeologist, is a global leadership expert, award-winning CEO, coach, speaker and author. As the world’s first Leadership Archaeologist, Krister is a seeker of secrets. He’s a perspective-changing explorer who ventures beyond the edge of the comfort zone of most leaders and brings back tales of what he’s learned. He experiments with unique, sometimes outlandish approaches to building leadership skills in order to save leaders the time, money, and (possibly) embarrassment of experimenting on themselves. Go to https://krister.com/aerospace for a free Leadership Assessment and more!

How to Stay on Top of the Aerospace Industry as a Sales Executive w/Brant Dahlfors

There is no end to what you can learn about the airplanes you sell, the sales processes, and how to manage a team. But how do you keep reinventing yourself? What are the best sources of leads? How can you add more value to your clients? On this episode, Brant Dahlfors shares his approach to selling jets.




I do believe you have to reinvent yourself to stay relevant through your career.  -Brant Dahlfors

 

Takeaways + Tactics

  • The best way to sell is to develop a direct relationship with your prospects.

  • Refusing some deals is part of the business. So is bringing more value to your prospects via detailed information that is relevant to their interests

  • Pay attention to the new factors that affect your business. You can never know too much about sales processes, the tech of your competitors, and the technology of airplanes.

  • Word of mouth and recommendations are some of the best lead generation sources.

 

At the start of the show, we talked about how to broaden your horizon outside the local market, and the importance of developing a direct relationship with your prospects. We also discussed the value of word-of-mouth and personal recommendations, as well as the importance of keeping an eye on everything that affects your business.

We also covered:

  • The importance of being in touch with the latest technology advancements
  • How to improve the dynamics in your sales team
  • How to look more professional in the eyes of the client

Constantly reinventing yourself is a strong way to stay relevant in a competitive business. Make the tech work for you. It will keep your work fresh and interesting.

 

The Democratization of Business Aviation w/Alasdair Whyte

With the growth of global business, airlines are struggling to keep up with the demand of travelers. What does this mean for business aviation as an industry? Are we on the verge of a Golden Age for aviation? What makes this industry so unique? On this episode, I talk to the co-owner and founder of Corporate Jet Investor, Alasdair Whyte, who shares the future for the business aviation industry.




"We’re about to see a Golden Age of business aviation." -Alasdair Whyte


Takeaways + Tactics

  • Business Aviation is a small community.  OEMs rely on good brokers. Brokers rely on good operators. OEMs, Brokers and Operators get leads from financiers or lawyers and other channels.
  • When 1,000 random Americans were surveyed, 25% said they’ll fly in a business jet in the next 10 years.
  • The US is a great place to own a jet because fuel is cheap, and it’s easy to take-off, land, & park. Permits are obtainable, and there are many private airports. This is not the case throughout the world.


Alasdair talked about how he got started and the advantages of growing a business in a lean economy. Next, we talked about why business aviation is such a unique industry and what is going to create more demand for it.


We also discussed:

- Why Alasdair thinks business aviation is on the verge of a Golden Age

- The average age of owners in the business aviation space

- Different players and countries in the global market


The cost of business aviation is coming down, and more people are going to adopt it. Airlines are going to struggle to fulfill the needs of a growing global business community, and this is where business aviation steps in. The US has proven to be THE best places to own a jet from a business standpoint-- and that’s why it’s booming.

JSSI’s Neil Book is Running an Innovative Technology Company that Benefits Aircraft Operators

The OEM and third-party maintenance worlds are incredibly competitive. How can a company provide value that cuts through the competition? What are some of the additional commodities that can benefit the whole market? How does leveraging of data raise industry standards? On this episode Neil Book, President and CEO of Jet Support Services, Inc shares valuable insights on these topics.



I try to bring a sense of urgency and the need to innovate. -Neil Book

 

Takeaways + Tactics

  • A younger fleet means aircraft can be in engine programs a lot longer.
  • As new aircraft sales have stalled, the OEMs are focusing heavily on the aftermarket.
  • As you build new businesses and revenue streams, it is important that they continue to feed the core business.


At the start of the show, we talked about the work JSSI does, and the changes they’ve made to the age of the aircraft in their engine program. We also discussed why manufacturers and OEMs are focusing more on the after-market. He shares the value-add commodities they have integrated into their customer service.

We also discussed:  

  • Strategic partnerships and communication
  • How Neil’s tech experience translated to how he does his work at JSSI
  • The importance of new revenue streams the feed into the core business

Leveraging buying power with the maintenance community will translate into very competitive rates. This removes the risk of aircraft maintenance and can reduce the overall maintenance cost. Combine technology, innovation and partnerships with the best MROs in the industry, and the ultimate beneficiaries of this are the aircraft operators.

 

Guest Bio:

Neil Book, President and CEO of Jet Support Services, Inc. (JSSI). Find him on LinkedIn https://www.linkedin.com/in/neilbook/.

How Jeff Barger Used Leadership Essentials to Turn Around a Business & Get Union Buy-In

A winning company is rooted in strong culture and good leadership. When this is lacking, what are the questions you should ask to start turning things around? How do you evaluate whether the management has the appetite to do what needs to be done? How can you go about assembling the right team? On this episode, President and CEO of Zodiac Aerospace, Jeff Barger, shares his strategies for transforming a company from struggle to profitability. 



The right team has to be assembled. -Jeff Barger


Takeaways + Tactics

  • You want collaborative, cross-functional types of leaders.
  • Lead by example and do what you say you’re going to do. 
  • Bonuses for operators: money is nice to have, but it’s the recognition they really want. 

 

At the start of the show, Jeff gave some background on his career. He shared his experiences turning businesses around, and how he has successfully done this over the last 15 years. Next, we talked about how to evaluate the culture and leadership to see what needs to be done, as well as the best ways to incentivize hard work.

We also discussed:

  • The kinds of leaders you need to have
  • How do get the buy-in of the workers
  • Dealing with unions
  • Mistakes other companies have made

It’s natural for people to be a little cold to a new leader, but when they see that action is taking place, they will start warming up. Once the trust builds, they will start to do the things necessary for their own personal success. That's where you really see the ownership start to get traction at the operator level. 

How Data Sharing Will Dramatically Change the Aviation Industry w/Eldon Thomas

The aviation industry is ripe for excess and unnecessary spending. How has this affected the balance of power? How will technologies like blockchain promote better data sharing and conversations? On this episode, we are joined by Eldon Thomas from Velo Aviation and Jet Data to answer these questions. 


We can share information and data across the industry on the best solutions for performance and reliability. -Eldon Thomas

 

Takeaways + Tactics

  • GE is driving more revenue on the aftermarket services than they are from selling new engines.
  • OEMs invest a lot of money into the products so they can capitalize on the backend, and the leasing companies all want products for a price that makes sense for their balance sheets.
  • A tracking and information system for parts will help everyone in the industry, and keep insurance costs in check.
  • Blockchain technology is coming to aviation.

 

Eldon shared how he got started, and explained his interest in supply chain management in aviation. Next we talked about the whole parts industry and the factors controlling it, followed by the possibilities blockchain presents for aviation, and how it can completely change everything for every stakeholder in the industry.

We also discussed:

  • Why companies end up overpaying for insurance
  • What makes the airline industry unique
  • Why there’s a demand for surplus parts

The airline industry is unique. There is a global need for parts which is unpredictable, and parts traceability is expensive. The entire industry can be transformed by Blockchain, the same technology used in Bitcoin, to create a very secure database that is difficult to hack and misuse to bring sanity to an often insane supply chain. 

How Aerospace Executives Succeed at the Highest Levels w/Bill Koch, Certified Executive Coach & Chairman of Hawthorne Aviation

What does it take to be an executive at the highest level? Should you focus on developing your strengths to the maximum extent, or do you shore up your weaknesses? What happens in a world where IQ is just table stakes? Certified Executive Coach and Chairman of Hawthorne Aviation, Bill Koch joins us to share how to become an executive that attracts and motivates others to high performance.




Effective leaders make investments in others, and far beyond their direct reports. It’s about building a community of trust and letting go of some of the control. - Bill Koch

 

Takeaways + Tactics

  • There is magic in letting go - Effective leaders build a community of trust by investing in others and letting go of the control.
  • In each executive, there are usually just 2-3 behaviors that hold them back.
  • At the highest levels, executive leaders need to a whole person. You cannot just be good at one function.

As the youngest CEO of AMR Combs, Bill took over the position at age 34 and quickly realized he needed help. The lessons Bill learned in that period of challenge and rapid growth set the stage for his current coaching work with aerospace executives and leaders.

Bill shared key insights on:

  • The ultimate predictor of success at the highest levels of business
  • How to look past the immediate financial challenges and invest in people
  • Why emotional intelligence skills must be developed and practiced
  • Whether you should lean into your strengths or shore up your weaknesses
  • What needs to change for aerospace to attract the next generation of talent

The aerospace industry, and leading executives, face two major challenges. The first is developing themselves and their people, building emotional intelligence at every level of the organization. The second challenge is learning how to adjust and adapt the culture and structure of their organizations to attract the next generation of talent. Be sure to listen to this special conversation and take notes! Bill shares some valuable guidance any leader can use to improve the leadership and emotional intelligence skills that so often determines success and failure.


Learn More About Our Guest:

Bill Koch is a Certified Executive Coach and Bill has worked with some of the premier companies in the world, including Apple, American Airlines, British Petroleum, John Deere, Time Inc., McKesson, AMN Medical, Christus Health, Rice University, University of Texas Southwestern Medical Center, Raising Cane's Restaurants, Globe Life Insurance, CAE, Arcis Golf. Bill is an Associate Certified Coach with the International Coach Federation (ICF), a member of the elite Forbes® Council of Executive Coaches and plays an active role in the Rice University Leadership Development Program.

As an industry executive, Bill was the youngest CEO of AMR Combs, a leading FBO services provider, taking over the role at just 34 years old. For more than 25 years, Bill held C-Level positions in leading organizations, both public and private, including CEO for a Fortune 500 subsidiary. He currently serves on investment advisory boards, two corporate boards, and community and professional organizations, including his current role as Chairman of Hawthorne Aviation.

Resources

For more aerospace industry news & commentary: http://northstaresg.com/

To learn more about Craig Picken and the NorthStar Group, visit http://northstaresg.com/.

Introducing the Aerospace Executive Podcast

The Aerospace Executive Podcast features in-depth conversations with executives, leaders, influencers and journalists in this dynamic, high-stakes industry. Hosted by Craig Picken, founder of NorthStar Group and the leading executive recruiter for the aviation and aerospace industry, you'll learn how top aerospace executives are developing their people, competing for talent, overcoming challenges and adjusting to industry trends to drive growth and profits.




We’re going to have some company leaders who have dominated the industry...people who are coaching executives...people who build airplanes and the technologies that are changing the industry. -Craig Picken


Craig has a very unique background, being the only executive recruiter in the country (perhaps even the world) who has flown airplanes, sold airplanes and run a business. So rather than talk about recruiting and bringing on A players, the Aerospace Executive Podcast puts the focus on the industry and how aerospace leaders are facing the challenges of this dynamic, high-stakes industry.


In future episodes of the Aerospace Executive Podcast, Craig and his guests will cover:

  • How executives are setting the vision and culture of their companies
  • Challenges and industry trends
  • Developing and competing for talent
  • Strategies for driving new growth, revenue and profit
  • How unique technologies like blockchain could transform aerospace and aviation
  • Strategies we can take from executives in the light business jet and helicopter markets

Craig also leverages his experience and background as a naval officer and executive to give back to the military community, maintaining an active blog for military officers and enlisted people who are transitioning out of active service.

For executives or leaders in the aerospace and aviation industry, you’ll take away something actionable from each conversation, including leaders at aircraft OEM’s, aircraft operators, aftermarket providers, leasing financial organizations and MRO providers. Stay tuned for future episodes and subscribe on iTunes, Stitcher, Google Play to receive new episodes on your device automatically.


Learn More About Your Host:

Co-founder and Managing Partner for Northstar Group, Craig is focused on recruiting senior level leadership, sales and operations executives for some of the most prominent companies in the aviation and aerospace industry. Clients include well known aircraft OEM’s, aircraft operators, leasing / financial organizations, and Maintenance / Repair / Overhaul (MRO) providers.

Since 2009 Craig has personally concluded more than 150 executive searches in a variety of disciplines. As the only executive recruiter who has flown airplanes, sold airplanes AND run a business, Craig is uniquely positioned to build deep, lasting relationships with both executives and the boards and stakeholders they serve. This allows him to use a detailed, disciplined process that does more than pair the ideal candidate with the perfect opportunity, and hit the business goals of the companies he serves.

 

Resources

For more aerospace industry news & commentary: http://northstaresg.com/

To learn more about Craig Picken and the NorthStar Group, visit http://northstaresg.com/.

The Severance Agreement

An executive I know was just laid-off. As part of the process he was given a good-bye kiss in the form of a severance agreement – ONE month’s salary upon signature in exchange for a TWO YEAR non-compete.  

WHOA!...

A Few Things to Consider

Getting fired or laid off sucks. And, in the heat of the moment it’s easy to get caught up in the trap of signing a bad deal in exchange for a few bucks that cushions the blow. With regards to the non-compete, though, be very careful. 

If you're a skilled and knowledgeable executive, the companies that may have significant interest in your services are your competitors. Before you sign anything be sure you let them know of your availability. Simply walking across the street may be a good and quick solution to your unemployment issue.

The company that just terminated you feels your skills are no longer needed... or were no longer a value to the organization. What do they care where you go?  During your exit negotiations, down-play your potential value to the competition to ease feelings that a non-compete needs to exist at all. 

Severance agreements are drafted by corporate lawyers to protect THEIR clients. It is probably a benefit to get a lawyer who’s going to protect YOUR interests. 

Yes, Non-Competes Are Enforceable

As a professional Executive Recruiter, I often hear “Yes, I have a non-compete but it’s not enforceable, especially in my state because it’s a ‘right to work’ state.” WRONG!

Non-competes ARE enforceable. You signed it... it’s a deal. The company may not wish to pursue it, but that doesn’t mean they can’t.  So, if you don’t like the terms in front of you, don’t agree to them.

Right to Work does NOT mean that non-competes – that executives signed willingly or stupidly – do not matter. 

A “Right to Work State,” simply, is one that allows people to work in a UNION shop without being forced to join the union.  I.e. if a worker wants to work for Ford but does not want to join the UAW, which represents the local plant, he may do so – in Right to Work States. In NON-Right to Work states, he / she will be required to join the union because it is what the majority of workers voted for. Right to Work refers primarily to non-executive levels and government employees where unions are prolific.

To that regard, I have found that non-competes muddy waters. There are some companies that will litigate them to the greatest extent possible. There are others who don’t care…  It all depends on the circumstances.

Rule of Thumb

Many companies will make an aggressive non-compete a part of a hiring process and include as terms of employment. i.e. “We can’t wait for you to start with us next Tuesday…  here is your offer and non-compete.” And, they’re happy to get you all the way to the end-zone before they bring up the subject. If this happens, tread with caution! …  especially if you’re in sales and bringing your book of business or relationships to your new company. 

A good rule of thumb in your employment or exit negotiations is to work towards a dollar for days severance vs. non-compete - if a company wants you to sit on the bench for 12 months, they can pay you 12 months’ salary to do so. 

A Better Rule of Thumb - Get a Lawyer

The best advice is to contact a lawyer and pay $150 for advice as to what is or isn’t covered in the non-compete and the likelihood of it being enforced. The laws of each state are different. But, the last thing you ever want to do quit your job knowing you have an agreement in place, and then getting you and your new employer sued because you violated it. It rarely ends well.


Can Older Jets Threaten BizAv?

In the late 1990’s / early 2000’s Northwest Airlines created an entire strategy based on old, heavily used, pre-owned jets which has successfully carried over to Delta (post-merger). Could business aviation go the same direction?

Do Jets Wear Out?

If you’re asking Delta Airlines, the answer is very simple – “At some point.” Delta’s fleet age is more than 17 years on average and its oldest aircraft is about 25 years old. 

Yes, older jets require more maintenance and typically use more fuel, but when you compare the reduced capital cost compared to that of new, then the financial dynamics can make a lot of sense.

“We’re seeing a huge bubble in excess wide-body airplanes around the world,” former Delta CEO Richard Anderson said during one of his last earnings calls before his retirement. 

The result of that bubble? According to Anderson, they were seeing mid-life Boeing 777-200 aircraft being made available in the market at about $10 million. Compared to a new jet from Boeing, with a list price of $200M+ and the delta (pardon the pun) is staggering! 

Northwest Airlines in the Early 00’s

Delta’s business case started in the early 00’s at Northwest Airlines whose executives discovered a few things:

Old Aircraft are Reliable and Cost Effective: Old DC-9’s flew passengers reliably for a long time and the minimal capital investment made the aircraft very profitable. All they required were ~$6M in structural / interior mods and updated avionics and they became long-term revenue producing machines. Interestingly, they were also the most reliable flyers in the Northwest fleet.

Surplus of Used Aircraft Are Leverage Against OEMs: Northwest also decided to purchase old DC-10-30’s and refurbish their interiors also. They were then used as leverage against Airbus for better deals on Airbus A330’s. The strategy worked as Airbus came to the table with “value” pricing and before they merged with Delta, Northwest was one of the biggest operators of A330’s in the world.

Costs Can Be Controlled:  Low engine lease rates on JT8 and JT9 engines and the use of Used Surplus Material (USM) from tear-down aircraft were effective in keeping costs down. 

Interior Upgrades Make the Difference: Keep the interiors upgraded and the passengers will never know the true age of the airplane. Just hide the data plates.

One Man’s Crisis is Another’s Opportunity. After 9/11 the values of JT8D engines were near zero. Northwest used depressed market conditions to secure RIDICULOUSLY low engine lease rates which made operating costs for the DC-9’s very low AND predictable.

 Business Jet Values Have Plummeted to Never Seen Bottoms

In 2001 I stood on in the lobby of a San Jose FBO and listened to finance executive proclaim “we love financing business jets, they NEVER depreciate.”  At the time, she was right. A five or six-year-old airplane would often command a premium over its original purchase price. 

 Oh… the sure signs of a bubble in its infancy stage. Welcome to 2017. 

Whatever the reasons, the market is now seeing gently used business jets, many with under 1,000 hours, available on the resale market for 50% (or less) from which they sold for new, causing agony for owners and OEMs. And, that agony is justified. As reported by AIN News, June 27, 2017:

The average asking price across six pre-owned business jet types decreased by approximately 35 percent, falling from $13.7 million to $8.9 million, between April 2014 and April 2017, according to research from London-based business aircraft broker Colibri Aircraft. Models in the study included the Cessna Citation Mustang, CJ2 and Excel; Bombardier Learjet 45 and Global XRS; and Gulfstream G550.

In just the last year of the study period, the average asking price fell by $1.97 million for these aircraft models, which represent the light, midsize and large-cabin business jet segments. They are also taking longer to sell, with the average number of days on the market before sale increasing from 345 days in April 2014 to 391 days this past April.

Comparing the Current Business Aviation Environment to Northwest and Delta Airlines

There are several, scary similarities to Northwest / Delta that business aviation is facing:

Enhanced Value in Pre-Owned: The OEMs are now competing against their own products – and often losing! They have certainly lost pricing power. As one OEM sales rep stated plainly. “New airplanes are being sold at wholesale prices.” 

Costs Can be Controlled: High quality maintenance support from respective airframe and engine OEMS and third parties such as JSSI allow today’s generation of business jets to age more gracefully than those of previous generations. More importantly, they can continue to be flown with very predictable costs since most of the maintenance is “on condition” or Power by Hour.

Abundance of Interior / Maintenance Shops: An abundance of interior completions / maintenance facilities keeps interior refurb and costs and maintenance labor rates competitive.  Add fresh paint, GoGo, ADS-B, new glass and, Voila, one has a “new” jet. 

One Man’s Crisis…: The politics of the great recession crushed business jet values which have only sporadically recovered. The low selling prices have been a boon to Part 135 operators and value focused buyers. 

Remanufacturing: Add “remanufacturing” to the list. The aftermarket’s ability to “remanufacture” piston aircraft drastically hurt the GA industry. I think it can do the same to business jets. It certainly supports the case that jets don’t really wear out.

What’s Next

After 9/11 the airline industry was in a crisis which created an entirely new definition of “value.” Fast forward to 2017 where the business jet industry is overbuilt and under threat of being redefined as well.  What are the options?

OEM Pause: The OEMs can always reduce production, and probably will. 

Reduced Product / Customer Support: Is the third or fourth owner of an older Learjet, Citation or Gulfstream really an OEM customer? To that regard, can the OEMs make support of older aircraft so expensive that it drives them out of the market? According to the CEO of one company, “YES, that can be done.” Does it make sense? Maybe. 

Revolutionary New Products: The Gulfstream V, Global Express, Citation X and Challenger 300 and fractional ownership were “game changers” that excited the market. The new Gulfstream 500 / 600, Falcon 8X and Cessna Latitude are great airplanes, but are they true “game changers” or a nicer version of the same? What’s the next product that overstimulates demand?  SSBJ? Tiltrotor? Something else? 

Wait It Out: Sometimes the best recipe is patience for, in many cases, overabundance can turn into shortage, which creates a new cycle in itself. In the meantime, the OEMs can do what they do best – design great jets – and accept what the market is willing to give.

 It’s Never Easy

It took a lot of creative thinking for airlines to survive the aftermath of 9/11 and nobody got more creative than the leaders of Northwest. In similar fashion, the politics and events of the great recession continue to hurt business aviation. For them to thrive, business jet manufacturers need to get creative and find ways to stabilize the values of their gently used products, lest they start to compete against them. 

Don't Judge A Company by Its Size

I was in the gym again this morning with headphones turned up. Black Keys, Royal Blood, White Stripes and Twenty-One Pilots all on the playlist. 

Each of these bands consist of just 2 players - one on the drums, one on the guitar. If one of them sucks neither can find greatness.

Compare that to the Boston Pops. Talented as he/she may be, does anyone really notice if the clarinet player in Row 3 is having a really good, or bad day? Would the audience really care if they weren't there at all? 

GE, Boeing, Bank of America, Google, Lockheed Martin are all great companies who will give you a good job. But you're probably like the clarinet player in Row 3 - a very talented player in a very large organization. How do you really stand out? 

If you're seeking to find greatness in your next career move, then don't be afraid to look at small companies who really need your help. You'll be amazed at the opportunity you have to truly make a difference.  

Why Tech Won'Takt e ALL Our Jobs - The Economics

I’ve been reading a lot of pundit posts about how technology will someday take all our jobs. I think they’re depressing and wrong.

One of the worst is Elon Musk whose inspiration is to replace every human worker with a robot. Fortunately for us, Elon can’t change physics, and he can’t change the basic laws of economics, either.

LAW of DIMINISHING RETURNS

Every business student knows the “Law of Diminishing Returns.” It’s a simple theory:  the benefits of any action will reach a peak, and then taper off until there is no benefit at all.

In drinking terms: The first 3 martinis make you feel great. The 4th puts you on the edge. The fifth makes you puke. That’s the Law of Diminishing Returns…

With technology, there will be a point of diminishing returns and it comes when robots make every widget perfectly, and faster than a speeding bullet. You can’t get better than perfect and it’s hard to be faster than Superman. Attempts to do more will be futile.

 

MAXIMUM TECH = NO JOBS

Assuming Elon’s ideal scenario and technology does displace the vast majority of workers, there is still a problem: No worker income = No buying power. 

Driverless trucks and drones work to the degree that they fill a shortage of over the road drivers and airplane pilots. Robots on assembly lines can improve quality and efficiency. But vast increases in efficiency coupled with drastic cuts in labor can cause an economic problem – Deflation.

Deflation is the scourge of any economy and it is MUCH WORSE than inflation. If you know next year’s Tesla is going to be significantly cheaper than this year’s model, you’ll wait to buy it. 

In deflationary economies, there are no buyers’ incentives. When there are no buyers’ incentives, it is very difficult for producers to forecast production: how much will Tesla pay for raw materials today and how many cars will it produce when buyers know its product will be cheaper in 6 months?

In the United States we’re already seeing technology drive down incomes. Just ask any Midwestern factory worker who has seen his income drop about $4,000 in real dollars per year since 1999. Because of technology and outsourcing, the guy who made $60,000 in 1999 is now making $56,000 in today.  Lower buying power = need for cheaper goods. Cheaper goods come from Walmart. Despite its greatness, Walmart can’t offset the loss of income and buying power and, thus, the quality of life for many is decreasing versus getting better. 

In advanced societies replacing most of your workers with robots is stupid. Why? Because Maximum Tech = Minimum Jobs. Minimum Jobs = No Income. No Income = No Buyers. No Buyers = No Profits. No Profits = No Incentive to Produce. It’s a slow but certain death because no seller can make money off zero.

 

GOVERNMENTS CAN’T HELP

Elon is now an outspoken proponent of “Minimum Guaranteed Income” to be provided by governments. But this ability can be strained.

Taxes are garnered in multiple ways including taxes on workers’ income (income tax) and taxes on goods sold (sales taxes). However, a government’s ability to raise taxes is difficult in a deflationary economy. The guy making $100,000 in 2020, for example, pays $33,000 in taxes. If that same guy is only making $90,000 in 2025, he’s only paying $30,000 in taxes, assuming a 33% tax rate. If the value of the goods he’s purchasing is decreasing at a similar rate, sales taxes decrease also.  Thus, government income is reduced proportional to salaries and Cost of Goods Sold. 

The only way to provide a guaranteed level of income is to raise taxes at an inverse rate to the deflationary pressure. If governments put 100% of the tax burden on producers, the incentives to produce decrease in direct proportion to the increase in taxes. 

The Laffer Curve, below, shows the effects of over-taxation on production.

 


MAXIMUM TECHNOLOGY = MINIMUM EDUCATION

The Human Race is completely screwed if we ever hit the point of “Maximum Technology” – where workers are completely replaced by Bots. What’s interesting, however, is that technology is screwed, too.

Say we get to the point where robots do all the manufacturing, piloting, driving, stock trading and everything else meaningful in life, while people hang out at the beach. It’s at this point there is no value in education; why bother learning basic mathematics, a skill, trade or basic economic theory if you have no ability to put them to use? Kids who barely want to sit through school now most certainly won’t do it for no discernible purpose. And, what parent will be incentivized to walk them to the bus?

This is where technology starts to die.

Think about it. Unless Artificial Intelligence has an ability to continually improve itself (create new code, design and promote new products, create new technologies, etc.) then it will become maximized. People, now complacent that technology will do it for them, will no longer have the basic education or skillsets needed, or critical thinking necessary to take over where technology leaves off. 

The result is maximized technology and a broken society.

One only needs to go to Logan County, West Virginia to see what a community looks like when there is minimal economic opportunity and little education. UGLY!

WHERE PROFITS ARE MAXIMIZED

As technology advances become quicker and quicker we, as a society, need to remember the basic law of profit maximization: Profits are maximized when Marginal Cost = Marginal Revenue. In simple terms, when the next dollar you invest brings in EXACTLY a dollar of return – no more, no less.

With regards to technology, society’s goal should not be to replace workers for the sake of replacing workers. The goal should be to use it to create maximum employment, maximum economic output, and maximum income so that people can maintain AND GROW purchasing power. Everything beyond that is detrimental and a colossal waste of time, money and resources.

 

MAYBE HENRY FORD GOT IT RIGHT

Perhaps Henry Ford had it right a century ago when he said “There is one rule for the industrialist and that is: Make the best quality of goods possible at the lowest cost possible, paying the highest wages possible.”

Why was this his philosophy? Because he wanted ALL his workers to be able to afford Ford built cars.

We don’t know what the jobs of the future will look like, but they will be there. Our job today is to ensure our kids are prepared for them. 


 


Pack Your Trash, and GO!

Over the weekend Oklahoma beat Oklahoma State and the talk for NCAA football fans is who Oklahoma will play in the Championship Game.  The bigger story happened off the field. 

Baker Mayfield, the Sooners quarterback, was a walk-on at Texas Tech in 2013.  Coming out of high school in Austin, TX he wasn’t considered big enough or good enough to earn a football scholarship at any Division I college.

Enticed by a former high school teammate, he enrolled at Texas Tech and tried out for the football team, where he became the second string QB.  A few games later he became the starter after the first stringer went down with an injury.

He did well with the opportunity.  Very well, in fact.  Before succumbing to injuries himself, Baker started 6 or 7 games and did will enough to be named 2013 Big 12 Freshman Offensive Player of the Year.

And then things got weird…  

Citing  only a “miscommunication” with the Texas Tech coaching staff (they wouldn’t put him on scholarship for 2014), he quit the team a week before they were to play in a prominent bowl game, and enrolled at the University of Oklahoma for the spring semester.

The OU coaches told him, “C’Mon over.  But we don’t have a scholarship for you.  And, you’ll probably never play for us either…  And, just in case you still want to come over, unless Texas Tech gives you a release, you will have to sit out the 2014 season…”  (they didn’t, and he did)

In summary, from the time he left high school in May of 2013 until the spring of 2014 Mayfield was told:

You’re not good enough

Okay, you’re pretty good. We’ll let you play...

Wow, you really are good.

Yeah, you did well, kid. But it’s still our decision and you can play…  but by our terms

Wow… you’re leaving?  We know we didn’t show you the love…  but we don’t want you to get it at OU, either… 

Pack your trash and go

Don’t forget your non-compete

We’ll see…

In August of 2015 – after sitting out 2014 - Mayfield was named OU’s starting quarterback.  At the end of the season he may also be named “Heisman Trophy winner.”  He is THAT good!

And here is why I really love the story.  Baker was a big-time OU football fan as a kid and he always had a dream of playing there, too.  He is now living out that dream. 

So what does this have to do with anything?

Perhaps you are stuck in your career, unable to break out in the current environment.  Perhaps you were due for a promotion that went to Joe across the hall, instead.  Perhaps your job just evaporated – fired, laid-off, company sold, sideways with the board, didn’t get along with the boss… 

Congratulations!  You’ve just been given your opportunity to follow-your dreams…  It’s now time to pack your trash and go!

 Baker Mayfield and countless others have proven throughout the years that when doors are closed, others are opened.  But, it is your job to find those doors… and then have the courage to walk through them. 

Nobody says the journey will be easy; it may very well suck, indeed.  But, like they say, if it was easy, then everyone would be doing it… 

Most don’t.

Packing your trash and finding new doors isn’t all about finding a new job.  But, it IS about challenging yourself and seeking new heights, versus settling for the status quo. And it IS about striving for and achieving the goals you set for yourself, versus accepting the limitations others put on you.     

There are about 30 days left in 2015.  Get a box… and start packing.

I Met a Leader Last Weekend

What does a business leader look like?  It looks like Scott.

Last week I went to a peer conference, with 800 people in attendance.  Part of the agenda included a talented speaker and graffiti artist – Erik Wahl – who created some original canvas works in front of the crowd. 

One of these canvases was the Statue of Liberty, painted to the tunes of Cold Play with inspirational videos of military veterans returning home to their families playing on the big screen…

The paintings were fantastic, and at the end of the program each was auctioned off.  The Statue of Liberty was first up… and the bidding started.

$5,000 came and went, quickly; as did $6, 7, 8, and 9.  A minute or two later the bidding was at $11K and $12K…

And then a voice came from the crowd – “TWELVE THOUSAND FIVE HUNDRED…!”  The bidding stopped, the gavel fell - “SOLD!”

$12,500 dollars!

The buyer was Scott, a small business owner with 20 employees, who calmly walked up, collected his purchase, and coolly spoke into the microphone…  “This is for my teammate, ‘Jill’… whose brother never came home.” and he handed the painting to her.

With just eleven words Scott proved showed his team:   

“I care about you. I care about your family “

“I am loyal to you”

“It’s not just about money”

“I am generous”

But it wasn’t just for Jill.  All of the proceeds of Scott’s purchase, and $110K more, went directly to St. Jude’s Children’s Hospital, a wonderful organization in itself.

Thank you, Scott.  I hope your fantastic message can resonate to a much bigger crowd.  And it’s obvious why your business is as successful as it is.

An Open Letter to the Younger Crowd

Dear Mr. & Ms. Millenial:

You came and you went, after just a few short months.  You left because you need more...  ROS and ROI  wasn't of interest and "you're more than just a number."  You have a yearning need to “change the world, and it’s all a bunch of BS,”  you say…!  Afterall, you ARE a college graduate, don't we know.

Unfortunately, the fact that you graduated from college isn’t enough.  You have the degree, but it is really just the beginning.   And here is what I learned over 30 years.  

Long ago, I wanted to be a Naval Aviator.  Before I could do that, though, I, too, had to graduate from college, with a meaningful degree and attend Officer Candidate School (aka boot camp) where I encountered some of the Marine Corps' finest drill instructors.  I remember those times, well.  

Upon boot camp “check-in” I, and all my college educated classmates, became nameless.  We were simply referred to as “Candidate” and were not allowed to use our first name or call our fellow classmates by theirs.  It was BS… but if we did it, we got our ass kicked.

We started with learning how to make the bed, with tight hospital corners, perfectly folded sheets et. al.  The Harvard grads had to do it, too, and it was BS…  Every time we did it wrong, we got our asses kicked.

I, and all my buddies, had to learn how to march in formation and sing dumb songs, and we did it for hours each day.  It was BS.  Every time one of us got out of step, we got our asses kicked. 

I had to learn how to spit shine shoes, polish brass buckles and iron my uniform – all in less than 10 minutes.  It was BS...  And when there was a smudge, wrinkle, or scuff, I got my ass kicked. 

If we saw something amiss – anywhere- and didn’t actively work to correct it, we got our asses kicked.  It was BS…  And, after we corrected whatever it was that was amiss, we got our asses kicked, again, for not fixing it the first time. 

We all got thrown into a cold swimming pool where we had to swim a mile in our flight suits.  After that, we had to tread water for 30 minutes wearing 25 pounds of flight gear.  It was BS…  And if we didn’t do it well, we drowned - or got our asses kicked.

During the next 10 or so weeks we had to learn a whole bunch more. It was all BS... And if we didn’t learn it well, we got our asses kicked. 

Fifty percent of my class, who shared the same career desires as I did, thought it was BS, and they quit…   Not only did they quit, but they went home with really bad haircuts and told their friends that they quit.  And they left their dreams of flying fighters behind. 

After Officer Candidate School we became Naval Officers and were sent to squadrons where we got to fly trainer aircraft.  But, the routine was pretty strict; 10 feet off altitude or 2 degrees off heading during a training flight, you failed.  It was BS. 

And so on…  and so on… and so on…  and it didn’t stop until we graduated from flight school. 

But flying fighters (or aircraft of your choice) was not guaranteed.  There is this thing called “the needs of the Navy” and since the Navy just invested a million bucks into our training it was “they” who chose the airplane we flew.  I got my last choice of airplanes… which was BS.  When that happened, I complained.  And, I got my ass kicked…

And here is what I learned from all the BS…

Making beds perfectly is learning how to master the basics, and doing it consistently. If you can’t do the little, BS,  things right how can you be trusted with the bigger stuff?  

Marching in formation is learning how to master the art of teamwork and helping the team find cohesion. If one person is out of step, everyone is out of step.  The military is ALL about teamwork and if one person “gets out of step,” it can cost someone else their life.  Interestingly enough, Corporate America is the same.  Yes, there is room for individuality.  But cohesive organizations function well.  

Shining shoes, buckles and ironing uniforms in a quarter of the time needed is teaching how to set priorities. When your buddy is shot, you are being shot at, and the air cover is frantically asking you to pop smoke so they don’t drop bombs on you and your buddies, requires strong priority setting skills. In Corporate America you will always be asked to do more with less and stretch the organization’s limited resources.    When layoffs need to happen, you will need how to prioritize what is best for the business against what is best for the employees getting axed.    

Fixing stuff that is broken is called “taking responsibility.” Take action, without being told, and make whatever is broken, better.

Swimming in your flight gear teaches you to have stamina. Flail too much, you will get tired and drown.  Sometimes, it’s okay to roll over and float on your back.  It also teaches what gear is important when you’re swimming in the middle of the ocean after you ejected from your aircraft 10 miles from the aircraft carrier.  Hint:  You can take off your boots…   In Corporate America you will need to have stamina, and learn what is important.  Otherwise you will get tired and burned out.  

10 feet or 2 degrees may not seem like a lot… but it can mean the difference between a bomb falling on its target, or on a school full of kids. In Corporate America, the extra few bucks you spend on American Airlines, because you’re a premier flier, when you could have flown Jet Blue, adds up over time.  That difference can determine whether Joe in the stock room will have a job, or go on unemployment.  

You may not get exactly what you want, but you have an opportunity. Your ongoing success is now 100% dependent on you and how aggressively you pursue it.  Will you get the most out of it, or will you just quit?

Nobody should be treated as a number. But, sometimes you’re just that until you prove yourself.  Work hard and prove yourself and you become a NAME.  When you quit, you’re nothing more than “that young kid who quit after 6 months...”

After 8 years as a Naval Officer who was in charge of $100M dollar machines, I joined Corporate America.  And guess what!  I had to prove myself all over again.  And it was BS and I got my ass kicked.  And I was impatient, and I whined and I wanted to quit…  But I couldn’t.  When you have a wife and young kids, quitting is not an option. 

Today, I have a business and I work with other business leaders.  Here is what WE want YOU to know.

WE DON’T HIRE YOU BECAUSE YOU WANT A JOB. We hire you because we have a need.  We have a need to drive profits, take care of customers, engineer products and fix broken processes that bottleneck our businesses.  We are now marching together to drive commerce.

YOU ARE NOT A NUMBER. You are a person.  But if you want me to pay attention to you, you need to make a NAME for yourself in a positive way.

WE HIRE YOU TO FIX PROBLEMS. If you have to be told what to do all the time, we don’t need you.  When something is amiss, FIX IT! 

WE HIRE YOU TO HELP US MAKE MORE MONEY. The mission is to make money.  If you don’t want to help us make or save money, you are overhead.  We don’t need your services. 

WE HIRE YOU BECAUSE WE ARE SELFISH. We hire you because YOUR efforts are going to help US earn OUR bonuses… and OUR Mercedes.  If you help me earn MY bonus, you WILL get yours, too! 

WE WANT YOU TO LEARN. What we ask of you may seem like a bunch of BS.  But, if you take a moment to learn from the BS, you will get where you want to go a whole lot quicker than if you just blow it off, and quit.  Learn to make the bed and show us you can do it, and we’ll give you more. 

WE CARE. We may focus on ROI and ROS and all of the stuff you hate.  Unfortunately, this is what business is about.  We care about our customers, employees, teammates and the lunch lady, too because it is they who help us find our success. 

WE WANT YOU TO BE SUCCESSFUL. Do great work, be on time, be resourceful and dependable and get stuff done.  If you do what we ask, we will help ensure your success…   I thought my drill instructor hated me.  The reality is that his tough love was helping me to succeed.  And if I couldn’t handle it, he was happy to see me quit so he could focus on someone else who simply wanted it more. 

But, if you still think it is all BS, you can quit.  And you can keep quitting until you realize that your quitting accomplished exactly - ZERO.  By then, however, your best days are probably behind you.

Respectfully yours,

A Boomer

PS:  I hate the terms Millenial and Boomer...  can we just bury them, now?

Fearing Failure Does Not Lead to Success

I had to take one of those funky personality tests recently.  One of the traits it highlighted about me is that I will make a change for the sole purpose of making a change.

Its conclusion was spot-on, I do make a lot of changes…

I don’t think I make changes because I’m bored.  I think I make them because I learned the art at an early age where I grew up with a lot of change.  

When I was a kid my father was a frequent victim of corporate restructures and activist investors, which caused a lot of chaos in my family.   By the time I was 18 we had relocated 6 times to 6 different states.  

When you grow up in chaos you start to play a lot of “what if” scenarios in your head… and they ALWAYS end up bad. So, you learn to make changes so that you can control the situations, and shirk away those you can’t.  You stay afloat…

But staying afloat is nothing more than playing defense.  And if you’re only playing defense, you can’t win.  I remember a few specific times when playing defense played against me:

In my early 20’s I was a Naval Officer in flight school in Pensacola.  It was my dream scenario but instead of kicking butt, I decided to stay afloat.  Unfortunately, I became so afraid of making mistakes that I made a lot of them.  And it sucked…   Although I ended up having a great Navy career I wonder how much more I could have done if I decided to just kick ass earlier in the process… 

I dated my wife for four years before I married her.  I almost passed out before the wedding.  We all know the what-ifs and the fact that the divorce rate is 50%.  With those statistics, who wouldn’t be scared poo-less?  When the doctor said “Great News!  You’re having TWINS…” I b-lined for the bar…  Being a great husband and father is a huge responsibility.  What happens if I fail?  But then I wonder how much more would I have enjoyed the moments if I embraced things and said “together we’re gonna make this great!”?  

After a few years living in Los Angeles my wife and I moved to West – by God – Virginia for a commission only sales job.  No salary, no benefits, no safety net… just an opportunity to make a lot of money.  And we did. But the fear of not making a living, me forget the other people in the organization.  My fear of failure was masked in arrogance and I think I pissed off a lot of folks of.  Sorry guys…  How many more sales could I have gotten had I asked for your help, versus steamrolling you over?

Like a scene out of “The Right Stuff” the only voice I heard in my head was “Please God, don’t let me F-Up.”…  But the louder it became, the more I did!

Maybe it’s a result of age; perhaps it’s wisdom.  Maybe it’s the fact that I have a fantastic wife who supports just about everything I do.  But, somewhere along the way I started to play devil’s advocate with the voice.  Instead of playing out all of the doomsday scenarios and asking ‘how to I keep from failing?’ I changed the conversation to ‘WHAT DO I NEED TO DO TO SUCCEED?’  And all of the sudden I was at peace…  I could now lay out a path and I could play OFFENSE!

For instance:  

To get a new customer takes me 100 phone calls.  Ok, I better find 100 people to call.  How do I get there?  What do I need to do to make a million dollars?  It’s all metrics and it’s all simple stuff…

With regards to my marriage it’s not ‘how am I going to stay out of divorce court?’  It’s about ‘what am I going to do to make this great?’  I buy her flowers every Saturday, we laugh a lot and we have fun together.  I’m truly lucky she puts up with my crap, too.

I spend a lot of time with my kids…  

I talk to a lot of people every week.  Too many are simply playing defense; so afraid to push the ball down the field that they don’t realize that they’re actually moving backwards.  Passed-up…, run over, pushed aside.  They’re stressed-out, strung-out, nervous wrecks.  And the only voice that they hear is ‘What if I fail?’   

Maybe it’s time to look at an alternative:   

Determine  what SUCCESS looks like 

Map out a plan to find it in whatever it is you’re doing!, complete with metrics and executables 

Be Nike and JUST DO IT

Indeed.  You may try and fail.  But that’s a hell of a lot better than not trying…  and failing, anyway.  


The Path to Success? - EARN IT!

I’m a fitness junkie and my work-out starts promptly at 7AM Monday thru Friday. 

One day last week I was in the midst of a tough one at the local college and noticed a group of high school kids doing the same, about a dozen in all.  With them were a few “twenty somethings” who I also recognized as the boys and girls soccer coaches for a local high school soccer team. 

In between my sets I was glancing at the kids with admiration; the workout these kids were doing was tough and included quarter mile sprints, hundred yard dashes, lunges, push-ups and a lot of tortuous exercises.  The coaches were ripe with encouragement and each of the kids had plenty of encouragement for each other. 

Over the weekend I was at the beach and ran into one of the coaches…  Yes, it is a local high school soccer team and the summer workouts are completely VOLUNTARY.  Attendance is 100% optional and the 90 minute workouts start at7 AM sharp.  Not so amazing is that he knows who will be there, and who won’t. While some kids are in the middle of their summer slumber, others are out there working with dedication. 

And then it gave me hope…   perhaps in the era of “everyone gets a prize” there are kids who are learning early that the path to success is to EARN IT.  Interesting concept… 

I just hope those results aren’t taxed to infinity to accommodate the rest.

What’s happening on your team?

Newspaper or Sales Commission ... the Dilemma

A few years ago I was VP of Sales for a premier and exclusive resort community development in West Virginia. 

It was the end of a late fall day and I was bored but, but couldn’t go anywhere as I had an upcoming dinner meeting, about 90 minutes away.  To go home and back would be a wasted effort and to go out and hit golf balls would only get me sweaty.  So I hung out in our lobby office, feet on the desk, and read the Wall Street Journal.

A few minutes into my read, a very humbly dressed guy came in and started talking about the really beautiful (and expensive) homes on the property.  Would the resort offer him and his wife a tour…  “was there a bus tour?” was his question.

“Nah, it’s a private community” was my answer…  no bus tours for you.  But we chatted for a minute anyway, where I discovered he was from (Texas) and that he was in town for a reunion.   Having nothing to do, I said…  “grab your wife and c’mon…  “

We jumped into my very dirty SUV and went onto the property for an hour where they oogled at every house, the mountains, and everything else they saw.  

Twenty minutes into the jaunt they bemoaned the fact they were being forced out of the l overbooked hotel and being moved to the local Days Inn.  So, from the top of the mountain, I called in a favor from a friend in reservations.  A new, and upgraded room was found and they were thrilled…!  Next, I found out that they had met as kids while going to school in West Virginia as well, and they began to reminisce.    

We talked some more… they asked some questions and then, suddenly, it hit me.  These aren’t tourists, they are CUSTOMERS.    

As it started to get dark we made the decision to head back.  I had dinner, they did too.  But during the ride off the mountain they asked if they could see more.  So we agreed to meet the next morning. 

The next day was beautiful and we jumped back into the still dirty SUV.  The first house we walked into was a “spec” house under construction and I introduced them to the craftsmen behind it…  They loved it.  While they spoke with the builders, they asked me to speak with their lawyer who they called the previous night…  BAM!

Things didn’t finalize immediately, but 6 weeks later they closed on the $5.5 MILLION dollar house.  My personal commission was Big…  Grand Slam, Home Run!

I still speak with sales teams about the lessons learned:

  1. Sitting on your butt gets you nowhere.  Every opportunity to sell is an opportunity to make a sale, and you never know when that opportunity will come.  Do the stuff you need to do to be successful – every day - even when you think it’s a fruitless effort. 
  2. Use the word “NO” in a very sparing matter. Sure, everyone in sales has come across a “time waster” or two.  But you never know…  Saying “NO” closes doors and gets you nowhere.  Perhaps the better answer is “perhaps not that, but how about this…” 
  3. Lucky and Good are synonymous terms. You really do make your own luck.  Like Woody Allen said, “80% of life is just showing up…”
  4. Be Nice to Everybody! Phyllis was my friend in reservations.  She was a long term hotel employee who didn’t make a lot of money.  Despite having no incentive to do so, she went way out of her way to help me.  She did, however, because for the previous 5 years I had made her a genuine friend, and friends always help out friends.  Phyllis, the janitor, the dishwasher, the humble guy from Texas, or whomever… they’re people.  Be Nice!

Master the Basics First

There has been a tremendous amount of noise in the media lately about the future of education and what it is going to take for the next generation to thrive economically.  Within the noise nearly every prognosticator speaks about the urgency of teaching advanced technology and how that is the driver of success. 

Granted, technology will be the main drive of the future, but it always has been.  Today’s technology is just different from that of 100 years ago and we are rapidly adapting to that fact  Depending on what movie you watched last week – Mad Max or Star Trek – what the future will look like is anyone’s guess.  Whichever holds true, however, my belief is that excellence in the “advanced” for both business and education requires mastery of the BASICS.  And, perhaps that is where the focus needs to be.

In 1903 the Wright Brothers, for instance, discovered and engineered the basic stages of aerodynamics and flight.  For decades after that thousands of aircraft were designed / engineered on paper with slide rules and #2 pencils and the engineers behind them had an overwhelming command of the basic principles.  Today, all of our airplanes are designed on computers, with CATIA and Computational Fluid Dynamics taking place of the #2 pencil.  No matter how advanced the systems or process, however, one cannot ignore the BASIC principles of aerodynamics and flight that airplanes still adhere to. 

In similar fashion the basics are the foundations from which the minds of our youth will grow and some of the basic premises in life include: 

  • The ability to proficiently read, write, do arithmetic and command one’s native language is more important that mastery of “Grand Theft Auto” and Java Script.
  • The Art of War, written centuries ago, is still relevant in the 21st century and taught at every military academy in the world.
  • To pilot a commercial airplane one needs to have mastered basic piloting skills, despite what Airbus engineers want folks to believe. Otherwise, the uncoupled approach into San Francisco will be challenging.
  • Career mastery starts early. If you can’t learn to do your first job well, the one you got in high school, what makes you think you will be successful at the second, third or fourth?
  • Cash is king. Credit is dangerous.
  • You can’t change physics.
  • No matter what the CFO, accountant or investment advisor says, if 2+2 doesn’t equal 4, then there is a problem.
  • A sales executive who has never made a cold call is an “Account Manager.” Know the difference…
  • Diversity is a good thing. A world filled only with engineers will be boring.  A world with no engineers will be REALLY boring.  The greatness of the world comes via diversity of thought. 
  • Research, discovery, and cognitive thought lie deeper than a simple inquiry to your buddy Google.
  • The best meal ever is a medium rare burger and fries.
  • A ball, a field and friends beats texting and iPhones for building long-term social skills and relationships. A face to face meeting with a customer beats an email or videochat.
  • To be a country music star, one must be have mastered the basics of playing guitar, shotgunning a beer, saluting the troops and singing about pick-up trucks in front of 20,000 semi-sober fans. There is no EDM in Nashville.

In life and business I think we try to over complicate things.  Granted, we all work on complicated stuff and the technology is changing quickly.  But when all goes to hell, the basics will always apply.

Thoughts?