Monthly Archives: September 2012

Cost of Capital

My son, Jason, is in a new Internet movie, Cost of Capital. You can see the current episodes and subscribe here: http://www.mergersandinquisitions.com/cost-of-capital/

Jay doesn’t appear until the end of the third episode, which features him on the opening screen shot with two, ah, easy women. Each episode is about ten minutes.

Enjoy.

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To Monte Carlo

The car picked us up at 3:30 and at 4:40 we were in Logan Airport, with our bags being checked through to Nice via London. (A far cry from my morning drive to the Harvard Club last week that took almost two hours in rush hour traffic.) TSA has a first class line, but even it was fouled up by the routine inefficiencies of believing everyone is a criminal until proved otherwise. A TSA woman came along screaming to move the lines forward, which were stopped because the conveyors were stopped while 42 people tried to figure out if something in the luggage were radioactive or an alien artifact. (Last week a woman travelled undetected with a loaded handgun in her carry-on until she turned herself in when she realized the error.)

My wife’s new knee caused the machines to go “tilt” and she required a pat-down which had a nice flavor of San Quentin. Finally, honest citizens once again, we hit the Virgin Airways lounge, which is an oasis in the nutty international terminal in Boston.

Our plan is to heat heartily in the club, ignore the first class dinner on board, and go to sleep quickly since the flight is little more than 5.5 hours overnight.

© Alan Weiss 2012. All rights reserved.

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Guest Column: Invisible Decision Traps

Invisible Decision Traps

Constance Dierickx, PhD

Constance Dierickx is a member of Alan’s Growth Cycle®

When most people picture the executive suite they imagine rarified air, exacting decision-making and a buttoned up approach. Well, abandon those thoughts. No one is immune to decision traps. Why is that? The traps are made of our limited abilities of perception and judgment. Even those equipped with extraordinary intelligence can fall prey to them. What are these dangers lurking, waiting to undermine our best efforts? The top three:

1. Overconfidence

2. Groupthink

3. Need to avoid tension

Raise your hand if you are overconfident

Regardless how humble an individual’s demeanor most people are overconfident in their judgment. A just released survey indicates that over 50% of people asked, reported making a very serious financial mistake in the past five years. A follow up question revealed a stunning statistic. About the same percentage of people reported that they were confident in their ability to make good financial decisions.

It seems that a major error would call into question the decision making process but it doesn’t. People are not just overconfident they tend to remember events and outcomes that support what they believe. That’s right, we see what we believe not the other way around.

For example, I am confident in my judgment and ability to make good decisions. I pay more attention to evidence that I’m right and ignore or explain away evidence to the contrary. This will build my confidence but won’t make me more effective. Yet, I persist. What am I? A human being who lacks the courage to face and adjust to well known traps. What are my options?

  1. Make judgments and decisions based on evidence rather than belief.
  2. Listen to people you trust. They can help you see when defensiveness is getting in your way.
  3. Accept that mistakes are part of the deal. Then move on.

I gotta be me

A very funny cartoon by Gary Larson shows a group of penguins on an iceberg. One has his flippers in the air as he sings, “I gotta be me.” Gary often uses animals to make humorous and ironic points about people. In this case he depicts the urge of a single individual to stand out, even when the group is obviously homogenous. In the United States, individualism has historically been very important. We like to think that resisting the pressure of a group process is easy and happens by force of will. It turns out, that isn’t the case.

Groupthink is a psychological process that many of us learn about in an introductory psychology course. It means exactly what it sounds like, even if the name is new to you. It is the name for a group dynamic in which the people in a group think alike. What’s wrong with that? The feeling of agreement and even comrade can be very rewarding. It’s nice to agree. Sure but what are the consequences when agreement is a condition of discussion rather than an outcome? A few disasters that probably had groupthink as a partial cause:

-       Encyclopedia Britannica fails to move it’s content to digital media when the value of doing so was high, instead selling the company for a low price years later. Why? All the executives thought their printed volumes were irreplaceable.

-       US Navy leaders belief that they would “not be caught napping” days before the attack on Pearl Harbor.

-       Executives pushing for a higher than sustainable share price on a new public offering (Facebook is but one recent example).

Let’s make a decision, even if it’s wrong

I have heard these exact words in more than one business meeting. Why on earth would a smart executive talk like that? It sounds, well, dumb. That said even executives get tired, angry and anxious. When a group of people are tired and cranky at the same time bad decisions are mere seconds away. Recent research shows clearly that fatigue, hunger and frustration lead to worse decisions. No surprise.

So why do groups of people push themselves to endure ten-hour meetings? Doesn’t this make fatigue and frustration a given? Yes but behavior is not nearly so influenced by facts as by the social and status rewards that come from working long hours. Some organizations have such a macho culture that signs of exhaustion are actually celebrated.

The adaptive alternative to this madness is to reward performance, not time and battle scars. No need to assume that important decisions take longer than more trivial decisions. Time isn’t the relevant variable. The nature of the process is far more germane. Here are some new rules of engagement that will help.

  1. Do not allow discussions to go on without end
  2. Do not allow people to repeat themselves or each other
  3. Create a placeholder for issues that are important but not relevant to the current discussion
  4. Evaluate the decision against your highest priority requirements

The human mind and psyche can play tricks on us. Even the brightest person is not immune. However, with discipline and a willingness to admit mistakes or accept blind spots, individuals, groups and organizations can accomplish amazing things.

Constance Dierickx, the Decision Doctor, helps leaders avoid invisible decision traps in mergers and acquisitions, transitions, leadership and to manage risks that others do not see. Her website address is www.CDConsultingGrp.com.

© 2012 Constance Dierickx All Rights Reserved

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The Adventures of Koufax and Buddy Beagle

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Episode 73: I Did Not Know That

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Thinking BIG

Are you thinking BIG enough? Listen and find out!

and now also on iTunes

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Old Fashioned WoM

As my son says, “in days of yore,” pre-Internet, I had to market myself virally, though I didn’t know what that meant. I focused on doing great work for clients, speaking and writing wherever I could, and being provocative and contrarian. I also continually asked for referrals if they weren’t spontaneously forthcoming.

That’s because I was convinced I could help people and companies significantly, and I was doing them a favor by providing value—not imposing on them by trying to “sell” and take their money.

Many people would claim that viral marketing is easier than ever today with the electronic amplification that’s available. But I don’t think so. When EVERTHING IS AMPLIFIED, nothing is really amplified. And the focus on doing outstanding work is subordinated to making a lot of noise. (If you don’t believe that, you’ve never visited Facebook.)

Word-of-Mouth is the original “viral marketing” and it’s more important in its mint form than every before—peers talking to peers on an intimate basis extolling you and your results. To assume that’s going to be accomplished amidst the job-seeking hordes on Linkedin or the 140-character nanoseconds on Twitter is a fantasy.

Do great work and ask your clients to tell others, to introduce you to others, and to respond to others who inquire about you. If you’re not aggressively seeking referrals you’re leaving six figures on the table every year.

Word.

© Alan Weiss 2012. All rights reserved.

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Entrepreneur and Million Dollar Web Presence

A nice writeup for Chad Barr’s and my recent book:

http://www.entrepreneur.com/article/223899

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Alan’s Monday Morning Memo – 9/24/12

September 24, 2012—Issue #157

This week’s focus point: I find that the most successful people are open to ideas and consider them without defensiveness or “NIH” (not invented here) syndrome. They are mature enough to reject an idea that makes no sense for them without condemning it or the messenger. These people thrive because they are accepting and evaluative. There are others, however, who seek immediately to refute, undermine, and disprove. They never learn or grow because their immune system rejects all that is new and previously unknown. (They even contest Tweets on Twitter!) They are prognathous in explaining why anything not originating with them can’t possibly work. Who do you want to be, and with whom do you want to hang out?

Monday Morning Perspective: I was born poor in rich America, yet my secret instincts were better than money and were for me a source of power. I had advantages that no one else could take away from me–a clear memory and brilliant dreams and a knack for knowing when I was happy. — Paul Theroux

Common Sense Consulting™ Weekly Video: Join the growing ranks of people improving their tool box, decreasing their labor, and raising their fees for $5 a week: http://www.summitconsulting.com/seminars/Common-Sense-Consulting-Weekly.php

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© Alan Weiss 2012. All rights reserved

I remember a meeting with a boutique consulting firm that had fallen on hard times. The debate was whether or not to sell their magnificent conference table. “Where would clients sit?” asked one partner. “We have no clients,” stated the advocate of selling. You can’t cut your way to renewal or success. Top line growth is the key to bottom line achievement, for you and for your clients. Today is the time to invest in the future. Once you cut muscle, you’re powerless.
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National Speakers Association of New England Creates Alan Weiss Award of Excellence

The good people at the New England Speakers Association have created a new award named in my honor and have granted the first one to me! It’s the Alan Weiss Award of Excellence, and I’m very grateful for the honor, and for Past President (and good buddy) Suzanne Bates introducing me. (I originally thought the award was for humility, but I guess I was mistaken.)

The late Charlene Shea founded this chapter, and an award named after her, over a decade ago, was bestowed on her and in the second year, provided for me. I’m thrilled to follow in that tradition.

I was jazzed to spend the morning addressing the group, and  a seat in my December Million Dollar Consulting® College went at auction for $7,000, to help jump-start the fund raising.  My thanks to all who attended and made it such a great morning.

Alan Weiss and Suzanne Bates

© Alan Weiss 2012. All rights reserved.

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Posted in The Best of Life | 11 Comments