Guest Writer: 5 Productivity Tips

I was just published again at ChangeForge.com, writing about my 5 tips for boosting your productivity. Leave a comment on their blog with your favorite tip! http://www.changeforge.com/2009/02/28/gitterdun/

Open Letter: Adam Shephard

Dear Adam Shepard,

I want to thank you for your book Scratch Beginnings: Me, $25, and the Search for the American Dream. As a current member of the unemployed who has held very similar beliefs about the American Dream, this book arrived at an opportune time and has planted valuable seeds of thought.

This letter will hopefully encourage you to write further, expand your thoughts and research, and get the warm fuzzy feeling appreciated by authors that you have reached someone. In the interest of full disclosure, I should reveal now that my main intent is self-centered. You may never read my words, but I write them anyhow for the purpose of crystallizing my thoughts about your book while they’re fresh. I write this letter for my own purpose, but sincerely hope that you benefit as well.

The first thing that strikes me about your book is the audacity of your idea. Since this is an open letter, I will fill in your future readers on the idea: After graduating college, you take $25 and essential survival gear (sleeping bag, duffle bag.) and arrive in a strange town as a homeless person. Without using your network or degree, you will rise up from homeless to your own furnished residence with a car, steady work and cash in the bank, in less than a year. Why? To prove that hard work and goal-setting still pays off at the lowest levels of society.

I am a college graduate with a home, a network, and extensive experience, but I have lived the lifestyle that you experienced of heavy manual labor in a dead-end job surrounded by un-ambitious hooligans. I could never go back to the life I once lived, and I cannot imagine starting at the rung of homelessness. I had to start out low due to my lack of planning and education. If I had the choice, I doubt I would have been brave enough to attempt your experience. Kudos for going big, bringing a big set of brass balls, and executing your strategy well.

I am struck by your honest writing style. I never sensed that you were bragging or glossing over truth, even when you were pointing out your obvious strengths and bravery. Almost as brave as setting out to be homeless, your treatment of getting whooped by BG was courageous writing. Even though your tenacity overshadowed your weakness, it still took a great deal of courage to paint the bloody picture that you became within a second of the first blow.

I read both of Barbara Ehrenreich’s books that you referenced, with relish. She also has an appealing writing style and I think she revealed some important aspects of our society that we would never be aware of. Her books produced a lot of thought, and opened up my awareness to hidden aspects of our society.

Like you, I did not buy into Ehrenreich’s idea that the American Dream is a sham. Rather, I suspected that if you set out to prove it is a sham you will fulfill your own prophecy; likewise, if you set out to earnestly make your dream happen you will also find success. I didn’t enough ammunition to argue with Ehrenreich’s thesis until I read your book.

You proved to me with your experiment that paradigms play a major role in our success. Currently, I am unemployed. I was laid off from a job I enjoyed at an employer whom I respect. I worked hard and exceeded expectations, but was laid off anyhow due to the economy. When the executives realized that our revenue for the next several quarters would be lower than usual, they decided to reduce headcount to cover the loss. I had just been hired 6 months ago, and so I was one of the first selected to leave.

When you give so much to a company and get laid off, it is frustrating. On further reflection, I realize that there was absolutely nothing I could do to avoid the layoff, except to have remained in the previous job where I was stagnant and unfulfilled.

I sometimes find myself tempted to stoke feelings of bitterness and self-pity. I sometimes realize that I have developed an attitude of hopelessness, thinking that the next job will also be a waste of my time and effort. Of course, I am wrong and reading your book helped me maintain a reasonable perspective.

Shit happens. Like your broken toe and ulcer, we all run into bumps in the road that we cannot always avoid. We also run into the lucky breaks. You found a good shelter to live in, received the timely advice that landed you at Fast Company, and had a mentor in Derrick to provide guidance and motivation. I look at my own life and realize that I have made my own luck, received unexpected (and sometimes, undeserved) luck, and have had my share of bad luck as well.

I could focus on the bad luck and point to Ehrenreich’s conclusions to bury myself in hopelessness and self-pity. It is far more preferable to me that I focus on the good luck and self-made luck, point to the evidence of your example, and find a new path toward my goal.

The fact that you had a vision was probably the most important factor in your success. Many of the guys like BG who are uninspired by goals such as yours find themselves spinning their wheels. Could you have achieved your goal without the hope of it getting published? Could you have achieved your goal without knowing that you had a degree to call upon if necessary?

I would answer that you could still have achieved your goal if you could simply come up with another reason for doing so. The reward is what is important. For you, the reward was the book, and probably some mixture of self-satisfaction and respect among your family/friends. For Derrick, it is probably to raise kids in a better environment than he had. For BG, it could have been to land a sugar-momma, to prove his detractors wrong, or perhaps there was a dream job that would appeal to him (pilot, entrepreneur, private investigator, etcetera.) The key is having the vision that you can stick with, one that starts by scaring the hell out of you, and becomes so real you can taste it before you have achieved it.

On page 162, you discuss Fast Company’s relationship with its employees that really struck a chord for me. In pointing out the reason why Jed is not as successful a leader as Sherman was, you really highlight an important leadership lesson for anyone who is responsible for others. The employees were not concerned with money as much as they were with belonging to something. Napoleon said, “Leaders are dealers in hope.” Sherman helped his employees hope that no matter what was wrong with their job, at least they knew they were appreciated, protected, and fairly secure.

So many companies view their employees like Jed: unappreciative, suspicious, and callous. However, many successful companies can point directly at their human capital and say: “These are the reasons why we are successful.” It makes a tremendous difference as an employee to know your work is appreciated, not just compensated. I am far more likely to stretch my limits and risk discomfort if I know it will be appreciated.

Your conclusions really resonated with my own knowledge and experience. When arriving at pages 214-216, I transformed from passive reader to enthusiastic highlighter, and I believe I will often return to this section of your book. Mainly, I think you proved beyond any shadow of a doubt that those who are happiest at any level of life are those who seize responsibility for themselves. The contrast of Derrick and Shaun is something I have seen in my own life (I have a little Shaun and a lot of Derrick in myself waging war constantly) and in the lives of those around me. You point of assuming 60 years of hindsight and asking whether you are proud or bitter is a great method for assessing your current priorities.

Finally, I really appreciate the 7 points that you shared from your Ohio friend Neil Cotiaux. Among them, the opportunities provided by the peace corps and the military, as well the need for parenting skills mentoring are fantastic ideas for enabling more people like you and Derrick to find a path to their dreams.

Thank you for a great book, Adam. May you always find yourself able to dream bigger, achieve more, and make great friends along the way. I eagerly anticipate future works!

Blended Value

Are you skeptical of social entrepreneurship? Do you think that social entrepreneurship is a story of wasted money and effort? Then here is the point you are missing: The key to success is to create blended value. In their book The Power of Unreasonable People: How Social Entrepreneurs Create Markets That Change the World John Elkington and Pamela Hartigan describe blended value as, “…what results when businesses—whether for-profit or nonprofit—create value in multiple dimensions—economic, social, and environmental.”

Capitalism is not a complete success. If you are in the American middle-class, then you may not fully appreciate the failings of capitalism to reach inner city neighborhoods only a few miles from your two-car garage. You may find it easy to blame single mothers and college dropouts for their own mistakes. You may point at un-ambitious, but able bodied, minorities who would rather collect welfare and charity than work. You can even throw your hands up and point to the failure of government bureaucracy to make any inroads to the situation. These may all be valid points to make, but unless you’ve walked a mile in their shoes, you would better serve your own interests by considering how we can help them.

As a member of the American middle class, it is impossible for us to fathom the impossible situation in Haiti, where no amount of ambition and hustle can help you overcome the odds. We cannot imagine places in Africa where oil drilling has caused devastating pollution, taking away the ability villages once had to sustain themselves through fishing and farming, poisoning them, and preventing them from sharing in the profits that the oil generates.

There are many areas of this planet where capitalism is not working, and there are many reasons. There are many potential consumers who are unable to participate, prevented from participating, or fear participating due to the scandalous history of capitalism. That does not mean it is a flawed system that needs to be replaced. Capitalism is the greatest economic system when it works, and it can be tweaked to work anywhere.

Social Entrepreneurs are tweaking capitalism to create a blended value that is self-sustaining. Charity is ultimately not sustainable because it depends on a constant stream of generous donations. In places where people cannot yet compete in a global economy, charity is simply a matter of throwing money down a hole if it is not used to create value. However, if the charitable donations are used to enable participation in the global economy, then we can call it an investment.

When a multinational firm arrives in a developing nation, the locals will automatically assume that their best days are numbered. They will assume that a lucky few locals will benefit from the arrival, while the vast majority will experience exploitation, pollution, and neglect. The reason for this is because in the 20th century, the primary aim of capitalism was to generate profits for the shareholders of the company. If you did not own a share of the company, then your opinion and your welfare was not important. Hence, many people experienced capitalism in the form of quasi-slavery and oppression.

Today, we are seeing trends towards Corporate Social Responsibility and Social Entrepreneurship, which aim to make capitalism more responsible. In this model of blended value, capitalism aims to generate value for the stakeholder which includes the shareholder, the employees, the supplies, the customers, and the local community. In return, each stakeholder protects their interest in the corporation in order to ensure they receive their share of the benefits provided.

By focusing on stakeholders rather than shareholders, Capitalism is transformed from a model of “dog-eat-dog” and “every man for himself” to a model of symbiotic relationships, a functioning village, and a system of sharing resources. Competition still exists, and bad businesses will still fail, but there will be a level playing field and better chance for everyone to do well.

Better still, the firms who provide a greater benefit to the community will likely receive lower taxes, less political obstacles, and a better perception in the market. Your efforts at social equality and creating blended value may become your most successful form of marketing.

ChangeForge Guest Writer

ChangeForge is a nationally recognized blog that analyzes the collision of business and technology. They normally carry high standards for their content, but they lowered those standards today and posted a piece written by yours truly. I would be greatful if you would stop by their blog and leave a comment for me!

http://www.changeforge.com/2009/02/05/control-the-airwaves/

Who knows BOP?

If you are a Social Entrepreneur, you are helping people find their way in the global economy for the first time. Many of these people are participating in their national economy for the first time. Social Entrepreneurs may be providing education, venture capital, internet access, or one of many innovative means to help people build their own corporate ladder or find the first few rungs of an existing ladder.

As I stated in my last post, there is an untapped market of 4 billion low income consumers known as the BOP: the Base Of the economic Pyramid. There is an increasing demand for the labor and talents of the BOP, which means that they are beginning to receive money that they will spend on life's necessities. Moreover, many of these people will have money to increase their quality of life, which can be an especially lucrative market at low margin but high volume (see: Wal-Mart.)

If you are fiscally responsible for an enterprise that might be able to serve the demands of the BOP, then you should begin to research the BOP market now. In the near future, you will either compete in this market or miss out on a lot of activity. On the other hand, if you blaze a trail today and reap the return tomorrow, you will have fulfilled your responsibility. You may have even saved your enterprise.

This new global economy is not going to wait for you, it will be filled with nimble, hungry, elusive, and innovative enterprises which will consume your market share while you’re on vacation. While you are making the turn for the back nine or on a retreat, they will be eating your lunch.

How do you enter this enormous market with so many pitfalls and political obstacles? Look for the unreasonable men and women who are already blazing a trail, and step in their tracks. Better yet, ask them to lead you through the minefield. Without metaphors, what I mean to say is that if you find the Social Entrepreneurs and imitate them and/or partner with them, you will be establishing yourself in a market with lucrative potential.

As John Elkington and Pamela Hartigan point out in their book The Power of Unreasonable People the Social Entrepreneurs are going to know the BOP well. They can help you innovate your approach to this market to ensure your success. They can guide you around the political obstacles and help you avoid the pitfalls and dead ends. Best of all, they can help you build a reputation in a market that will initially regard you with suspicion. In fact, the greatest benefit that you can gain from Social Entrepreneurs is their marketing potential. The BOP will probably regard any traditional efforts at marketing with disdain. However, by participating with Social Entrepreneurs and NonGovernmental Organizations (NGO's) who are raising the standard of living for the BOP, you will change the market’s perception of your brand name before you pay a single dime/peso/etc on advertising. If you scratch the back of the BOP, you may find 4 billion people scratching your back in return. Even 1% of that market will be 200 million fingers (4 million people using one hand) on your back.

Lucrative Profits: Where? BOP!

In The Power of Unreasonable People, authors John Elkington and Pamela Hartigan discuss the BOP: Base Of the (economic) Pyramid. The authors state that the BOP consists of 4 billion low-income consumers. What if you could generate $1 of profit from 10% of that market in a year? I’m not a natural at math so correct me if I’m wrong, but I expect that you’d make $400,000,000 in a year. That would be a good living for a small company or an attractive division in a multinational corporation. It may be possible to pull from more than 10% of that market, or to generate a larger profit from the 10%. Bottom line: we’re talking about lucrative potential here.

For those who are not inclined towards the language and methods of Capitalism, allow me to add a disclaimer here. I am not talking about exploiting poor people and robbing them of the little wealth they may hold. That is what we expect from Check Cashing companies and liquor stores. Through the magic of the internet, free markets and trade agreements, and a growing global market, the BOP is beginning to receive a trickle-down of profits. The BOP in Brazil, Russia, India, and China (also known as the “BRIC”) for instance, are receiving orders for their lower labor costs. In exchange, they receive wages in place of government handouts or agrarian/village life. In other words, billions of people now have or will soon have spending money and will participate in the global market where they once were non-existent. These people will increasingly demand to exchange their wages for products and services that were once surplus supply and/or undemanded. Bottom line: new profit potential for the global market.

Allow me to make one more thing clear, and forgive me if you are up to speed on macroeconomics. You have heard of the law of supply and demand, I assume. Basically, if supply (goods/services offered for sale) is higher than the demand (the number of people willing to buy) then prices are lowered to a point where people start buying. If demand is higher than supply, then you have a group of people with money to spend who are competing to buy products, and that is the reality we are facing if 4 billion people are beginning to spend money in the global market for the first time.

When demand goes up, everyone wins. Prices naturally rise because people are competing for scarce supply. That may not seem like a good thing for the low-income consumers, but I see an opportunity and many other capitalists will too. By using the Wal-Mart model of low margin and high volume, many enterprises will be able to undercut their competitors and prevent prices from rising too high. Therefore, business will customize themselves to reach the BOP and keep prices low enough for the low income consumers to raise their quality of life.

Low prices are only half the win, though. If demand is greater than supply, then intelligent enterprises will raise their production, creating more jobs. Simultaneously, entrepreneurs who may have been prevented from competing previously will now have a chance to meet the high demand. Entrepreneurs create new wealth, make new demands on the economy to spend that wealth, and create jobs both directly through their enterprise and indirectly through their increased demand.

In a nutshell, an increase in consumers leads to increased demand. More demand leads to increased opportunities and profits. More profits/opportunities leads to more demand. Point to the loser in this equation. I can’t find one.

Unreasonable People

I am currently reading a book entitled The Power of Unreasonable People by John Elkington and Pamela Harrington. The subtitle is “How Social Entrepreneurs Create Markets That Change The World.” To introduce the book’s title subject and thesis, the authors quote George Bernard Shaw: “The reasonable man adapts himself to the world; the unreasonable one persists in trying to adapt the world to himself. Therefore, all progress depends on the unreasonable man.”

Social Entrepreneurs do not accept the status quo and the traditional system. They are trying to bend Capitalism to also serve the fringes of our economy, where opportunities are scarce and the tradition is poverty. These are intelligent and often well-educated individuals, but rather than spend their ambition climbing a corporate ladder, they spend their ambition on trying to help people get on the ladder who normally wouldn’t. Better yet, they help people build their own ladder. By this last point, I mean enabling impoverished individuals to become entrepreneurs themselves in self-sustaining ventures that the global market will demand.

Social Entrepreneurs are trying to provide money in places where profits do not exist…yet. In my next post, I will share Elkington and Hartigan’s most exciting point: Social Entrepreneurs may be pointing to a very lucrative source of profits: the BOP.