ExecWatchSM High level information

If you are having difficulty seeing this mail or images in it, you can view it in your Web browser. Volume 6, Issue 4      In This Issue:   Taming the Alpha exec   Is your boss a psychopath?   The Buck stopped here   Making your (Power) Point   Why your employees are loosing motivation   How to adjust your decision-making style   Can you manage different generations?   Low prices = more customers? Not always   Four strategies for making concessions   Resisting the seductions of success   Hiring illegals: Inside the deal ahead   Has advertising killed itself?   Five lessons from the Netflix startup story   2006 CEO of the year   When Directors don’t make the grade   Winding down on Abaco, where a golf oasis awaits   Most expensive resorts in 2006   Extreme summer adventures   Best place for business and career   Getting your body beach ready Taming the Alpha Exec Alpha Phyla Alpha males and females come in four high-achieving flavors, each with dangerous weaknesses that can overpower its strengths. Ambition, self-confidence, even a little bloodlust--all can be part of a great biz leader. They can also wreak havoc on an organization. Now, for the executive from hell, help is on the way. His name is George. He's a vice president at Cleveland's Eaton Corp. And he's a recovering alpha exec. It took him three years at Eaton to admit that he had a problem. It took another year for him to commit to doing something about it. Months of professional probing and coaching later, George T. Nguyen is learning how big a jerk he has been--autocratically dispensing orders through his administrative assistant, for example--and how little loyalty he has inspired. That psychic hurdle cleared, he's starting down the path to becoming a guy you'd actually want to hang out with--and a more effective executive. Says Nguyen now: "I have to work at this every day, every week, every month, because it's not a natural tendency for me. I'm 45 years old. If I don't make the change now, I won't have the incentive to change." You may be wondering when being an alpha exec became enough to warrant an intervention. For generations, after all, alpha characteristics have pretty much been prerequisites for success in American business--and most other endeavors. Are ambition, self-confidence, and competitiveness really so bad, especially when there are billions of dollars and thousands of careers at stake? The trouble is, there's a dark side to those traits we revere in bosses, a side that many just can't resist... Read the article.  Back to top Is Your Boss a Psychopath? Odds are you've run across one of these characters in your career. They're glib, charming, manipulative, deceitful, ruthless -- and very, very destructive. And there may be lots of them in America's corner offices. The Factor 1 psychopathic traits seem like the playbook of many corporate power brokers through the decades. Manipulative? Louis B. Mayer was said to be a better actor than any of the stars he employed at MGM, able to turn on the tears at will to evoke sympathy during salary negotiations with his actors. Callous? Henry Ford hired thugs to crush union organizers, deployed machine guns at his plants, and stockpiled tear gas. He cheated on his wife with his teenage personal assistant and then had the younger woman marry his chauffeur as a cover. Lacking empathy? Hotel magnate Leona Helmsley shouted profanities at and summarily fired hundreds of employees allegedly for trivialities, like a maid missing a piece of lint. Remorseless? Soon after Martin Davis ascended to the top position at Gulf & Western, a visitor asked why half the offices were empty on the top floor of the company's Manhattan skyscraper. "Those were my enemies," Davis said. "I got rid of them." Deceitful? Oil baron Armand Hammer laundered money to pay for Soviet espionage. Grandiosity? Thy name is Trump... Read the article.  Back to top The Buck Stopped Here The Destination Straddling the Spokane River, Post Falls is one of the fastest-growing cities in the nation. "Uprooting a company is a tough, tough thing to go through. You're uprooting families." Soaring business costs in California were driving Buck Knives to the brink. The company regained its edge by dismantling its factory--and putting it back together 1,453 miles away. Rising out of the snow-dusted fields like a gargantuan block of Post-it notes, the Buck Knives factory in the Idaho panhandle looks for all the world like a Northwest native. From the basalt columns adorning the driveway to the moose trophy gazing implacably down on the lobby and the spectacular chandelier built of antlers, the building feels like it belongs here, where the unyielding prairie of the Columbia Plateau confronts the chill hauteur of the Selkirk Mountains. Boomtowns 2006 The most promising cities for entrepreneurs? In our most detailed survey yet, we looked at 393 regional economies to pinpoint where business is surging. Yuma, Arizona, here we come... Appearances can be deceiving, however. Depending on how you look at it, Buck Knives is a transplant, a refugee, or a pilgrim from southern California. The story of how Buck moved its knife manufacturing company from the dusty, sun-drenched hills of El Cajon to this rugged patch of Idaho turf is a case study in business relocation. If it's true that geography is destiny, then Buck's voyage demonstrates that you can shape your destiny if you're willing to redraw your geography... Read the article.  Back to top Making Your (Power) Point Presentations don't have to be a bore. Here are six new ways to liven them up. The only thing worse than sitting through a boring PowerPoint presentation is delivering one. Yet death by PowerPoint may be one of the biggest risks of doing business. On any given day, some 30 million PowerPoint presentations are delivered, according to Microsoft. Of course, when it was released for Windows in 1990, the software was an exciting new way of presenting information. But that's not always the case today. Among the most common offenses: Speakers simply read the slides to the audience; the text is too small; the color and animation are dull; the charts are too complex. Technology got us into this mess; now, technology is working hard to get us out. There are scores of new products designed to enhance, or even replace, PowerPoint. Some cost thousands, others are free. Here are six offerings that can help make your next presentation less of a snooze and more of a blockbuster. ... Read the article.  Back to top Why Your Employees Are Losing Motivation Business literature is packed with advice about worker motivation—but sometimes managers are the problem, not the inspiration. Here are seven practices to fire up the troops. From Harvard Management Update. To maintain an enthusiastic workforce, management must meet all three goals. A command-and-control style is a sure-fire path to demotivation. Most companies have it all wrong. They don't have to motivate their employees. They have to stop demotivating them.The great majority of employees are quite enthusiastic when they start a new job. But in about 85 percent of companies, our research finds, employees' morale sharply declines after their first six months—and continues to deteriorate for years afterward. That finding is based on surveys of about 1.2 million employees at 52 primarily Fortune 1000 companies from 2001 through 2004, conducted by Sirota Survey Intelligence (Purchase, New York).The fault lies squarely at the feet of management—both the policies and procedures companies employ in managing their workforces and in the relationships that individual managers establish with their direct reports. Our research shows how individual managers' behaviors and styles are contributing to the problem (see sidebar "How Management Demotivates")—and what they can do to turn this around... Read the article.  Back to top How to Adjust Your Decision-Making Style To move up the ladder, it's important that your method of making decisions develops as you do. This excerpt from Harvard Business Review reports on research drawn from a comprehensive Korn/Ferry International database. Somewhere between the manager and director levels, executives find that approaches that used to work are no longer so effective. When we began our research, we expected to find that managers' predominant decision-making styles would change as they progressed through their careers. But the patterns that jumped right out of the data were even more sharply defined than we could have imagined. We found that decision-making profiles do a complete flip over the course of a career: That is, the decision style of a successful CEO is the opposite of a successful first-line supervisor's. In the leadership (or public) mode, we see a steady progression as managers move up in the ranks toward openness, diversity of opinion, and participative decision making, matched by a step-by-step drop in the more directive, command-oriented styles. In the thinking (or private) mode, we see a progression toward the maximizing styles—where an executive prefers to gather a lot of information and think things through—and, at the highest executive levels, an uptick in the styles favoring one course of action. There's a logic as well as an interdependence to the way the two aspects of decision making evolve. As you move up the ladder... Read the article.  Back to top Can You Manage Different Generations? Managing multigenerational workforces is an art in itself. Young workers want to make a quick impact, the middle generation needs to believe in the mission, and older employees don't like ambivalence. Your move. As the oldest baby boomers draw closer to traditional retirement age, forward-thinking firms are investing more heavily in leadership development and succession programs. They are focusing on building up bench strength: embedding in their top young talent the skills and wherewithal to take over leadership positions when the time comes. On the surface, it seems like a sensible approach. But what if the people you're counting on to lead your company into the future won't be there when you need them? Or what if they don't even want the roles for which they are being groomed? According to recent studies, both such possibilities are increasingly likely—especially for companies that are not keeping pace with the changing makeup and diverging priorities of the U.S. workforce. Companies that expect to compete in even the very near future must recognize new attitudes among their workers. They must acknowledge that new relationships will exist between employees and organizations. And they must open themselves up to revisiting assumptions about which workers are appropriate for which roles and to rethinking the ways in which they hire, motivate, and retain employees. Where to start this heady effort? Begin by considering the advice of Tamara Erickson and Bob Morison of The Concours Group, a Kingwood, Texas-based consulting company, who have done extensive research on the changing workforce and the age-based cohorts that compose it... Read the article.  Back to top Low Prices = More Customers? Not Always Wal-Mart, Southwest Airlines, and Dell Computer are famous for their low prices. But before you follow their lead, consider the downside of cutting prices. An excerpt from the new book Manage for Profit, Not for Market Share. The burden of proof must rest with the advocates of the price cut or loyalty incentive. By arguing against price cuts as a form of competitive reaction when you perceive a competitive threat, we hope to convince you to plan your responses more carefully and consciously by thinking through the consequences first. In some situations, your competitor may force you to make this decision, because it has cut prices itself or entered your market at a much lower price point. But in other situations, companies decide to cut prices voluntarily, with no prompting from competitors and—as we show in this section—hardly any prompting from customers either. They decide to cut their prices out of sheer devotion to the idea that lower prices will revive their customers' wavering devotion and ultimately make the company better off. To defend the cuts, they cite changes in the competitive landscape, the convictions of upper management, a willingness to share cost savings and productivity improvements with customers, and the passage in their Economics 101 textbook that said lower prices result in higher volumes. Because price cuts seem to offer the easiest way to lavish special treatment on customers, companies find the temptation hard to resist. But resist they should. Proactive price cuts ... Read the article.  Back to top Four Strategies for Making Concessions "Concessions are often necessary in negotiation," says HBS professor Deepak Malhotra. "But they often go unappreciated and unreciprocated." Here he explains four strategies for building good will and reciprocity. From Negotiation. The strategy of demanding and defining reciprocity plays out in a variety of contexts... Most people understand that negotiation is a matter of give-and-take: You have to be willing to make concessions to get concessions in return. But the process of making concessions is easier said than done. Consider how events unfolded in the following management-union negotiation, adapted from Richard E. Walton and Robert B. McKersie's book A Behavioral Theory of Labor Negotiations: An Analysis of a Social Interaction System (ILR Press, 1991).The head of a manufacturing firm was preparing to initiate talks with the leadership of the employees' union. The biggest issue on the table was a wage increase. The union was asking for a 4 percent increase, while management wanted to raise salaries by only 1 percent.The executive considered the situation. During past negotiations, weeks were lost as each side jockeyed for position, feigned willingness to walk away, and eventually compromised on an unsurprising outcome. In this case, a deal at 2.5 percent, the midpoint of the two parties' opening positions, seemed likely to be agreeable to both sides. This time things would be different, he resolved. He would save everyone hassle and delay by making concessions early. Against the advice of the mediator, he opened discussions by announcing that the eventual outcome was obvious and that he was prepared to make a final offer: 3 percent, the most he could have offered... Read the article.  Back to top Resisting the Seductions of Success "The basic problem with the flow of success is that life can look very good when it really isn't," writes Harvard Business School's Joseph L. Badaracco Jr. His new book, Questions of Character, uses literature to look closely at issues of leadership. Here's an excerpt. There is a kind of success that is indistinguishable from panic. In his novel I Come as a Thief, Louis Auchincloss introduces us to Tony Lowder, a lawyer in his early forties. Tony and his wife have two children. He works for the New York office of the Securities and Exchange Commission, but his job is just a resting spot. Tony has a promising political career ahead of him—in a recent election, he almost beat a heavily entrenched incumbent. Tony is a veteran, with a Silver Star for bravery in Korea, and an entrepreneur. With his good friend Max, another attorney, he has started a law firm and made large investments in a computer company and a restaurant chain. Tony is an up-and-coming leader with bright prospects. Then Tony makes two extraordinary decisions. First, he commits a serious but brilliantly undetectable crime. Next, despite the advice and pleas of everyone around him, Tony goes to the authorities and confesses, which destroys his professional life, throws his family into chaos, and puts them in physical danger. Leaders aim at success, not self-destruction, but this is exactly what Tony brings on himself. This story confronts us with one of the oldest and most perplexing themes in literature—the hazards of success. The story of Icarus, which F. Scott Fitzgerald uses to describe Monroe Stahr, may be the most famous example. We can understand that Icarus was carried away in an exuberant moment, but what about the men and women who have the time to see what they are doing and nevertheless make messes of their lives? Some are prominent figures who ruin splendidly successful lives and careers. Others have high potential for leadership, but fall far short of their early promise. And then there are others who do succeed but lead lives of quiet desperation. These men and women all resemble Tony. They are talented, hard working, likable, and successful—but something derails them. In other words, the daunting challenge for many leaders and aspiring leaders isn't poverty or oppression or lack of skill or opportunity. It is, paradoxically, the very thing they aspire to achieve: a successful life and career and all that comes with them... Read the article.  Back to top Hiring Illegals: Inside The Deal Ahead If President Bush's May 15 call to send 6,000 National Guard troops to border states was aimed at winning over conservatives opposed to his immigration plan, it hasn't worked. But even as policy gridlock continues, Washington is quietly closing in on a compromise in one critical area. BusinessWeek has learned that a bipartisan working group of five senators has reached a consensus on a massive new government system to verify the status of anyone who applies for a job in the U.S. A legislative amendment agreed upon by Republicans Charles E. Grassley of Iowa and Jon Kyl of Arizona and Democrats Edward M. Kennedy of Massachusetts, Max S. Baucus of Montana, and Barack H. Obama of Illinois would require all U.S. employers to submit job applicants' Social Security numbers or other ID to a new federal verification system and face stiff fines for violations. The deal was worked out with input from interest groups from across the spectrum, including the American Civil Liberties Union and the U.S. Chamber of Commerce. "We've got a bipartisan agreement to get a national employment-verification database for new hires up and running in 18 months," Obama tells BusinessWeek... Read the article.  Back to top Has Advertising Killed Itself? Video killed the radio star." Maybe that's true, but I'm not really sure. I am pretty sure, however, that advertising killed itself—or, at the very least, took the wind out of its own sails. Advertising used to work, and work well. What do I mean by "work?" I mean that once upon a time, when products and services of obvious differentiated quality and value were popping up like weeds in a field, consumers were predisposed to believe advertising claims, both overt and subtle. Since belief leads to action, sales of those advertised goods increased as well. Heinz's relish was, in the mind of the consumer, a perceivable improvement over generic relish. Sensory evidence—a full jar, no grit to chew, consistent texture and taste—proved it out. The same was true for many other modern wonders of the American age of mass production: the radio, telephone, automobile, television, instant cake mix, washing machine, dishwasher, air conditioner, etc. They were special products that, in fact, improved people's lives. During those heady marketing times, consumers were predisposed—based on past experience (AKA memory)—to endorse and thereby become behaviorally susceptible to advertising's representational content. Times were indeed very good for advertising, as well they should have been. Then something happened... Read the article.  Back to top Five Lessons From the Netflix Startup Story When we began building Netflix in 1997, most people thought we were nuts. DVD players had just started selling in the US in March, and by October we started executing our billion-dollar business plan with only $2 million in seed funding. Even with the dot-com era in full bloom, the idea of renting movies via mail struck most as somewhat ludicrous. Despite the odds and the obstacles, we persevered to create Netflix, which has revolutionized the movie rental industry. Looking back on Netflix's startup story, five customer-focused lessons stand out as critical in creating this innovative Internet business... Read the article.  Back to top 2006 CEO of the Year Man With A Mission . A.G. Lafley wants Procter & Gamble to serve the world’s consumers. Yes, it’s more than lip service. He’s serious. When A.G. Lafley went to Brazil not long ago, he went on walking tours through the tough barrios of Rio de Janeiro and Sao Paulo to see how consumers were buying and using Procter & Gamble products. Just to be on the safe side, he hired some contract security.It just so happened that Wal-Mart CEO Lee Scott also was in Brazil at the time and heard through his own security team that “some fool CEO from the United States” was wandering around in the barrios. A couple of months ago, both men attended a meeting in Bentonville, Ark. “Lee looked at me and said, ‘That wouldn’t have been you in the barrios, would it?’ and he laughed,” Lafley recalls. “I said, ‘That indeed was me.’”For Lafley, of course, it’s not a laughing matter. “I’m the kind of person who has to feel it, see it, touch it,” he says. “That helps me understand it. That’s my job.” A Wal-Mart spokeswoman confirms that Scott and Lafley have a “warm relationship,” but Scott wasn’t available to comment because of travel.It’s because of his deep commitment to serving his customers that Lafley is Chief Executive’s CEO of the Year for 2006. In his six years at the P&G helm, Lafley, now 58, has re-energized a venerable giant that seemed to have lost its way in the late 1990s. He has done it with a style and energy that will be the subject of business school case studies for years to come... Read the article.  Back to top When Director's Don't Make The Grade Self-evalutaions could be the key to removing bad apples in the boardroom. The lead director of a major financial services firm was about to do the unthinkable: He was going to ask a board member to resign for not pulling his weight. For three years, the director—a high-profile CEO of a large manufacturing company—arrived unprepared for board meetings, then sat and read documents from his own company as board discussions swirled around him. A few directors had gently admonished him—“Hey, Phil, you’re in the wrong meeting, buddy!”— to no avail. When the CEO called for his advice, he would be told by the director’s assistant, “I’m sorry, but this is not a good time for him.” Although his behavior was unacceptable, it had persisted, which begs the question: At a time when even mid-level managers face extensive annual reviews and incessant pressure to perform or pack up, why don’t companies pay closer attention to performance at the very top? The answer is that the reluctance of boards to face up to their members’ poor performance remains one of the most resilient artifacts of the old boardroom culture. It’s easy to understand why. Because of the professional and social status of most directors, the idea of telling them that they are doing a crummy job is awkward to even contemplate. And yet, it’s impossible to imagine how any board can hope to function as a high-performing team without finding some way to demand high performance from all its members. As it turned out, the lead director just described was actually spared the awkward conversation by a new process some boards are adopting... Read the article.  Back to top Winding Down On Abaco, Where A Golf Oasis Awaits CEOs can find that a big new idea sometimes just takes getting away from it all. Ted Boylan was cruising at 13,000 feet toward an island in the Bahamas just after Christmas when his mind turned toward year-end business matters. As the founder of Admiral Building Products in Woburn, Mass., a 125-employee company that distributes Firestone roofing materials, he was thinking—as CEOs frequently do—about “how you’re going to add more value to your company in the coming year, how to grow, how to keep enthusiasm among your employees, how to give them more challenges.”And before the wheels of the private, eight-seat propeller plane touched the tropical airstrip and landed Boylan and his family at The Abaco Club’s private air terminal on Abaco Island, 170 miles east of Florida, he had come up with an idea. “I decided to expand my business into the manufacturing of metal roofing panels,” Boylan recalls. Actually, Boylan only thought up the idea on the plane. He spent the next warm, sunny week at The Abaco Club playing golf, fishing, walking on the beach—and pondering the potential for making money at the new venture. By the time he returned to chilly Massachusetts, he had decided to move forward... Read the article.  Back to top Most Expensive Resorts 2006 Call it the privacy premium. Remote island locations, luxury yachts and private chefs are among the posh perks of the most expensive resorts. But while compiling our list of the priciest resorts this year, something else caught our attention: Whether they are Miami or the Maldives--the fewer the guests, the higher the rack rate.Exclusive-use resorts, which may only be booked by one guest group at a time, have gone from novelty to normal in recent years. And the people who book them are willing to pay above--sometimes far above--normal rates to have a whole place to themselves. In the 1980s, when billionaire Richard Branson turned Necker Island, a private island playground in the British Virgin Islands, into an exclusive-use resort priced at $5,500 per night, such a thing was practically unheard of. Today, Necker Island, which accommodates up to 26 people, is in such demand that rates start at... Read the article.  Back to top Extreme Summer Adventures The top of the world, the edge of space, the 150-mph barrier in an automobile--all were virgin territory less than a century ago. Today, they are the destinations described in glossy brochures that tout extreme vacations and high-priced adventure treks. Chalk up the popularity of these adrenaline-pumping excursions to a collective midlife crisis of baby-boomers armed with enough money and technology to allow them to go where only Sir Edmund Hillary, Mario Andretti and John Glenn could go before. What's the appeal? Ernest Hemingway once said, "Auto racing, bullfighting and mountain climbing are the only real sports...All others are games." The great American writer and adventurer had a point. He reckoned that the element of risk is an integral part of the sporting life and perhaps the very essence of the experience. Indeed, if you double-fault on the tennis court, you lose a point. Land in a water hazard on the golf course and the penalty is a couple strokes. But strapped into an open-wheel, open-cockpit Indy race car or climbing a 13,000-foot mountain, well, in those places, your life is on the line... Read the article.  Back to top Best Places For Business And Careers In this year’s ranking of Best Places for Business and Careers, perennial top 10 metros like Atlanta, Austin and Washington, D.C.-Northern Virginia fell from the highest perch, hurt by slowing income growth. Newcomers that cracked the top tier include Houston, riding high on oil profits, and Phoenix, lifted by a housing and population boom. Overall, half of the top ten places are new this year... Read the article.  Back to top Getting your body beach-ready                                                                                          Roy Morsch / Corbis file For looking buff on the beach, it's essential to strength-train. Building muscle will give you a toned body and help minimize jiggle. Strategies to help you slim down for swimsuit season. It's May already and swimsuit season is just around the corner. Maybe you meant to start getting in shape sooner (like back in January) but it didn't happen. So now you're wondering how to get results — and fast.The good news is that you can slim down and shape up in as little as four to eight weeks. The question is how much. "It depends where you're at now," says Jay Blahnik, a personal trainer in Laguna Beach, Calif., and a spokesperson for the IDEA Health and Fitness Association. If you're hoping to lose 50 pounds in eight weeks, it's not going to happen. Eight or 10 pounds is more like it. "Have realistic expectations," Blahnik says. Health experts say you can safely lose up to two pounds a week. So in eight weeks, you could lose as many as 16 pounds. But that's a fairly aggressive weight-loss goal. A more modest — and probably doable — approach is to lose a pound a week, experts say. And even that could significantly alter your beach body. "In eight weeks, 8 pounds could make a big difference in how a swimsuit looks on you," says Cynthia Sass, a registered dietitian and personal trainer in Tampa, Fla., and a spokesperson for the American Dietetic Association... Read the article.  Back to top Forward to a Friend: Do you have a friend that would like to receive ExecWatchsm? Perhaps you know a peer within your organization, or associate at a partner company that would benefit from applying to receive this publication. Inviting a friend to experience the benefits of joining the BusinessWatch Network is easy! Just FW: this newsletter to the person you know who may have an interest and ask them to click here http://www.businesswatchnetwork.com Your friend will be glad you did! If at any time you would like to unsubscribe from ExecWatchsm simply change your status, or send a letter requesting opt-off to: The BusinessWatch Network Privacy Mailbox, 1321, Marblehead, MA. 01945 DISCLAIMER: ExecWatchsm and the BusinessWatch Networksm are service marks of DMS. All other trademarks or service marks contained in this email are the property of their respective owners. At the time of publication, all links in this e-mail functioned properly. However, since many links point to sites other than businesswatchnetwork.com, some links may become invalid as time passes.