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An Advisory Board Can Help Your Business

If you’re like me – a small business owner with minimal staff – no doubt there are times when you wish you had someone to bounce an idea off of or help you through a difficult decision.  If this is the case, you could benefit by forming an advisory board.

Let me suggest several benefits that derive from meeting regularly with a group of individuals for the purpose of obtaining advice:

  1. Unbiased perspective.  Often the small business owner can’t see the forest for the trees; they are too caught up in the day-to-day operations of their company.  Given the proper information, a good advisory board can often see things that the businessperson can’t or doesn’t want to see.
  2. Experience pool.  If members are selected wisely, you will have a collective experience that surpasses your own.  Oftentimes, though their industry may be different, they will have ‘been there, done that’ and be able to offer insight how you might handle a problem or tough decision.  I call this benefit wisdom.
  3. Encouragement and support.  It is likely your board members will be serving because they value your relationship and desire your success.  Just showing up – not to mention the advice they give, can be a tremendous encouragement.  Depending on your board, it may not be unusual to get a call during the quarter, checking in on you and offering helpful comments or other suggestions.
  4. Accountability.  I’m a firm believer in accountability – it is, perhaps, the number one reason I’ve had an advisory board (in one form or another) for over twenty-five years.  Being accountable to someone other than myself affects the decisions I make and the actions I take.  It helps keep me honest, in check and on track.  And for most small business owners, this is critical.

Who should serve?  At one point, needing advice for selecting 1-2 new individuals to serve on my board, I asked one long-standing member (who also had an advisory board) what criteria I should use in selecting candidates.  Here are some of the highlights of that discussion – along with a few things I’ve learned over 20 years:

  • If they are business owners, their company should be larger or more profitable than yours
  • Avoid lawyers, accountants and bankers – you already have relationships with these people and can obtain the information you need when you need it
  • They should represent a cross-section of general industry – not just yours
  • They should possess expertise in areas that you are deficient in
  • They should be willing to serve for less than what their time is worth
  • They should have a sincere interest in seeing your company succeed

Notice I’ve said they should be paid.  For sure, the financial pressures of small business are huge, but when weighed against the wealth of information and experience to be had from an advisory board, the cost is minimal.  What is the right amount?  That is between you and your potential candidates, but the compensation should reflect the value you place on their time, given your means.

When should you meet?  I recommend quarterly, because it is often enough for your members to stay in tune with your business and its unique challenges.  Not only that, in most small companies there are always issues to be addressed and if you only meet once or twice a year, it is difficult to get the help you need when you need it.

What should you look for and where do you find these people?  Although every company is different, there are key areas common to most: finance, marketing/sales, operations, HR, and systems/management.  I suggest that you build a board that, at least collectively, will provide the needed expertise in these and other critical fields.

I found the best way to build a board is through the relationships in the marketplace I already have.  For a new start-up, however, the owner might ask other, more established owners or solicit names through the local chamber of commerce or an industry association.

There’s a proverb that says, “plans fail for lack of counsel, but with many advisers they succeed.”  I believe an advisory board is just what the small businessperson needs to help ensure their corporate success.

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Momentum: A Leader’s Best Friend

I’ll not forget the spring of 2002, which is when the effects of 9/11 finally hit my painting firm, T. L. Hart, Inc.  Like most other companies the world had been a good place to do business in; Michigan had been booming during the 90’s along with the rest of the country.  And we had all built business models on what had become the norm.  That all changed for this company that first and second quarter – here we were with an organization fitted to large amounts of projects, with little to no work.  It was during an advisory board meeting when one of the members said, “just do something, start something; just get moving.”   It didn’t matter what it was, and it didn’t matter if what we did endured.  All that was important was for us to get something going, get something in motion.

His advice proved to be absolutely correct.  In May, closing the company’s doors was a serious consideration.  By the end of December, however, we had realized our second highest sales year ever, and we ended the period in the black.

I had been studying John Maxwell’s The 21 Irrefutable Laws of Leadership during that period.  Maxwell is arguably America’s leading authority on the topic of leadership, with multiple books, DVD’s and audio versions of his various seminar presentations.  In this book Maxwell presents what he believes and others agree are twenty-one laws that apply to everyone at all times without exception.  One of them is the Law of Momentum.

The Law of Momentum (or, the Big Mo) says this:  there has to be forward progress – some movement, and that’s the leader’s responsibility.  In some way, shape, or form things have to get moving.  That’s why small victories are important, because with each success you build momentum that helps move the organization further.

“It’s hard to steer a parked car,” Maxwell point out, “but when you have momentum on your side, the future looks bright, obstacles appear small, and trouble seems temporary.”  That’s why momentum is a leader’s best friend.

It reminds me of what Jim Collins writes about in his bestselling book, Good to Great.  He talks about a flywheel, which at first is hard to get going.  It takes a lot of effort initially.  But then you gain momentum, and eventually it’s as if it has a life of its own – it is literally flying, round and round, at high speeds.  At this stage it requires little exertion to keep it going, and so much can be accomplished.

One vivid example Maxwell provides comes from his video presentation of these twelve laws, and involves a locomotive.  At 55 miles per hour the train can break through a steel-reinforced concrete barrier six feet thick – with hardly anyone noticing.  But when in a stopped position, a single concrete block placed against its drive wheel is enough to keep it from moving forward.  That’s why you have to get and stay moving if you are to reap the benefits of this law.

How to use this law to your advantage?  First of all, you have to understand its value.  If you are like me, you’ve had an experience that demonstrates its power.  Any forward movement – in any area or endeavor of life – is enough to provide the impetus to get you headed in the right direction.  You have to understand just how important momentum is.

Secondly, you’ve got to figure out what are the motivating factors in your life or organization.  For me in my company, it was the threat of fiscal failure.  But maybe it’s the need to get physically fit, or financially stable.  Whatever the circumstances, some sort of forward movement is critical to success.

The next step is to get rid of things that will prevent your gaining momentum.  In some cases it may be apathy on the part of the leader, or people in the organization that are content with the status quo.  To get things going however, the block in the front of the wheel of your corporate or personal locomotive has to go.  You have got to remove the de-motivating factors.

Finally, you do what is right whether you feel like it or not.  This is what Maxwell calls “character leadership.”  You recognize the need to win, but you know you can’t win unless and until you do something.  So regardless of the situation, you act.  You get things going, and you recognize and honor others who do the same.

I am intrigued by the statement, “leaders are momentum-makers; managers solve problems.”  I have often been party to the latter.  Too frequently I have fretted about the circumstances, seeking to analyze the state of things, trying to come up with procedural or systemic solutions.  The real problem, however, is to just get busy doing what you’re supposed to be doing – in my case, selling, getting projects started.  I have found that once things get going, problems have a way of taking care of themselves; it is amazing how many problems go away when you’re moving forward.

I find it amazing what momentum does for you.  From the vantage point of outsiders, if you are busy as a company, it is no matter whether you are making money or not – they think you are.  If they’re a vendor, they are pushing product through your organization at a fast pace, and they are enjoying the company’s momentum.  That’s because, as Maxwell teaches, momentum is the “great exaggerator.”  It makes you look better than you really are – and it makes your people look better than they are.  Conversely, if you are stopped in place with little to nothing going, the lack of momentum makes you and your people look worse than you are.

As an aspiring leader, there may be perhaps nothing more important thing you can do but to put something in motion.  In my company, the things that de-motivate people the most is a lack of work and the feeling of inactivity as a company.  So I have come to learn that the best thing I can do at times is just to get some work in the door – any work, at any price.  I know this isn’t the profitable thing to do, but in a sense it is; it gets the blood of the organization moving.  It makes everyone feel better about themselves and the company.  And you see things begin to improve.  Why?  Because you’re gaining momentum!

There is so much truth in all this – both for small painting contractors like T. L. Hart, Inc., and for large organizations (like General Motors) and governmental entities (State of Michigan). Just get something going.  Get pointed in the right direction, put forth all the effort you can muster, and get the ball rolling.  That’s the ‘Big Mo’ – the Law of Momentum.

Vision for Lansing Unfolding

Listening to Robert L. Trezise, Jr., President and CEO of LEAP (Lansing Economic Area Partnership) two times in one month makes me think that former Mayor David Hollister’s vision of Lansing as a world class city is coming to pass.  Consider the facts:

  • Lansing area ranked best in the nation for job growth in three major sectors
  • Lansing region’s GDP is 2nd best in the State of Michigan
  • Area population is growing
  • Greater Lansing named one of three in Michigan with growing housing market
  • Lansing is home to a number of major insurance companies and three state-of-the-art GM plants

I could go on (read all the good news at www.purelansing.com).

Not only is Trezise to be praised for his outstanding work at spearheading development in the region, but Hollister more so, because everything begins with vision.  Vision defines the long-term goal, which then frames the central effort required to achieve that goal and the strategies needed for the work to get done.  All this is being played out as I write this article.

But there is a greater vision overarching Lansing that transcends economic development and is, in large part, responsible for it.  It has nothing to do with keeping GM or other companies in the area or luring them here to begin with.  It is a spiritual and moral vision that encompasses all others.

For years pastor’s groups have prayed for the well-being of Lansing.  One pastor I know of walked around the entire city interceding for its people.  Another prayer group drives around the city’s highways, praying over it.  Recently, Mt. Hope Church held a rally on the Capitol lawn, speaking blessings over the city, following the gathering by donating two tons of food to the City Rescue Mission.  The impact of such people and events cannot be overlooked in Lansing’s rise in economic growth and other terms.

I can’t help but remember Mayor Hollister, who saw the strip joints and prostitution on Michigan Avenue as blight on the city.  Today – as a result of his vision, we can be proud of the approach to our capitol, with its beautiful street lights and planters, Cooley Law Stadium, the Lansing Center being the highlights.

The truth is, by the blessing of the upright a city is exalted.  In other words, it is the spiritual condition of its people that causes a city to be what it is.  Economic development springs from spiritual development and, ultimately, is the blessing of God, not solely the works of men.  True spirituality and prosperity go together; in many ways they are inseparable.

I am grateful for the vision Mayor Hollister had years ago – and Mayor Benaro is to be praised as well for continuing the effort.  And Trezise – our appreciation goes out to him too.  But the real praise goes to God, who cares for Lansing and its people and desires earnestly to see it thrive and prosper. The vision for Lansing is unfolding – all under His beneficent rule.

A Lesson from Booker T. Washington

One person you will seldom read about in history books is Booker T. Washington.

Unlike many contemporary black leaders, Booker T. taught a lesson that many would do well to heed today, that regardless of skin color or social environment, it is man’s relationship to God that determines the outcome of his life.

Washington was such a man.  Born into slavery in 1856 and feed at the end of the Civil War at the age of 9, Booker found himself working in the salt mines of West Virginia.  Waking up before 4 a.m. to begin his shift in the mines, he ended the day by learning to read from a literate black ex-soldier hired by his parents.  In 1872, at age 16, he was ready to attend Hampton Institute, a new high school for blacks some 500 miles from home.  After nine years, at age 25, he was invited to head a new school in Alabama, the Tuskegee Institute.

Washington was a religious man.  According to his daughter Portia, “We never at home began the day without prayer, and we closed the day with prayer in the evening.  He read the Bible to us each day at breakfast and prayed; that was never missed.  Really, he prayed all the time.”

He saw Christianity as the remedy for all social ills, saying, “What is the remedy for lynching? Christian education of the white man and the black man.”

Entitled to be embittered for the injustice of slavery, he chose a different view, a biblical one.  “We went into slavery in this country pagans; we came out Christians.”

He believed that religion “must be woven into the warp and woof of our everyday life.” His teaching was exemplified by his life.

There is a lot we can learn from studying the lives of men like Booker T. Washington.  Faith in God, hard work, and personal responsibility are among the characteristics that mark men like him. Yet these are qualities we often overlook in modern day America.  We forsake God, rely on government, and shun personal responsibility.  We emphasize the color of a man’s skin and his ethnic background rather than the content of his belief. This breeds fear, resentment, and unforgiveness, qualities that enslave again – only this time, it is both black and white.

If racism is to cease, it will not be by protests, marches, or social programs. It will be by embracing what Washington referred to as “Christian teaching.”

In this body of truth, we are taught to accept one another, as Christ has accepted us.  We are commanded to forgive, if we want to be forgiven. We are instructed to look at a person’s heart, not his outward appearance.

Washington did not let his social environment or the color of his skin determine the outcome of his life. It was faith in Christ and obedience to His word that made him the man he was.  I wish I could have known him. He is my brother.  What little I have learned about him has enriched my life.

The Call to Entrepreneurship

Sometimes you have to be careful about what you ask for.

It was a cold November morning in 1977, and I was working for the City of Lansing on their street patch crew.  Our job that day was burning high spots off the asphalt pavement. To do this, we used a hand-held burner attached to a kerosene tank, which was strapped to the rear-end of a dump truck. The four-foot high tank had a hand pump on the top; it was my responsibility to keep the tank pressurized to run the burner.

During that time I was looking to transfer to another department; and since I had an interview scheduled, I was praying about it.  In fact, as I was standing in the bed of the truck pumping up the tank, I was asking God to lead me in the matter.

That’s when I got my answer.

At the precise moment I was praying, the welds on the bottom of the tank gave way and the tank shot up like a missile, bursting into flames.  I was blown upward and back to the front of the truck bed, and surrounded by flames, dove over the side to avert being burned alive.

Miraculously, though my eyelashes and eyebrows were signed from the flames, and my clothing satuarated with kerosene, I did not catch fire.  My only injuries were a broken wrist and a few lacerations.

It took surgery and six months for my wrist to heal, and during that time I did considerable thinking and praying.  One day I received the ‘call’ to start a painting business.

Thankfully, prayer is not always answered in such a dramatic way.  With me however, there is no other way I would have chosen to start my own company – especially a painting business!

Truth is, everyone has a work to do, a purpose unique to him, one that fits the overall plan of God.  Someone has to paint buildings; this is what I was picked to do.

Not all hold this view however, that there is a divine purpose for our work.  There is this dualistic mindset that separates things secular, like work, from that which is deemed sacred.  The Judeo-Christian ethic, upon which our economic system is predicated, teaches that man is made to work.  It is this belief – that work is sanctified, which gives meaning to the most menial of jobs.

Martin Luther put it this way:  “The works of monks and priests, however holy and arduous they be, do not differ one whit in the sight of God from the works of the rustic laborer in the field or the woman going about her household tasks, but that all works are measured before God by faith alone.”

And so all life is sacred, including its occupation.  There is no dichotomy of callings; all are called and to each is given his or her assignment in life.  Jesus – he was a carpenter.  Peter, his right-hand man, a fisherman.  Luke, who wrote The Gospel of Luke, was a doctor.  The apostle Paul, a tent maker.

Me, I was called to be a painting contractor.

Why I Like Capitalism

I was a bum in the late 60’s.  I barely made it out of high school, and I flunked out of college at least three times before I finally buckled down and got an Associate’s degree.  Though I hated to paint and was anti-business at the time, I ended up taking  painting job in 1974 with a view to making more money.

In short order my workload increased and I was forced to deal with such things as payroll, taxes, advertising, and the like, learning to keep accurate records of it all.  After 10 years of this and weary of wearing all the hats, I was looking elsewhere when, as Providence would have it, I caught a vision for business.  Thus in 1985 T. L. Hart, Inc. was born.

Now, 27 years later, having generated  tens of millions of dollars in revenue, made and lost money, built a building and lost it, seen 100’s of employees come and go, T. L. Hart is still in business.  During this time I’ve not only supported my family, bought and sold homes, contributed to charity, and provided employment for others, I have established a name in the industry and created an entity which, if I play my cards right, will endure long after I am gone.

All this because I have had the liberty to do so.

My entrepreneurial story has been played out by countless others all across the United States. The freedom to take an idea and invest your time and money into it – with the potential for succeeding and the risk of failing, this is the stuff of America.  It is called capitalism, and it is this economic system that has built and prospered this country for hundreds of years. 

Regrettably, there is a movement underway that threatens our way of life; ostensibly, it’s goal is to help the so-called 99% reclaim what is presumed to have been lost; in reality, its aim is to undermine the very structure that has made America great. To be sure, there is corruption and greed in the corporate halls of America; but not every corporation is corrupt, and not every executive greedy.  To make these kinds of claims is simply dishonest.

With all its apparent weaknesses, capitalism remains America’s best bet for the ongoing betterment of its people; all the proof one needs is seen in other economies of the world.  In comparison there is no comparison.

I believe the late Jim Russell was in his early 40’s when he sold his car for $2,500 and started Russell Business Forms in a spare bedroom of his home.  Eventually renamed RBF, Inc., Jim built an organization that spanned multiple states and employed dozens of people.  Very conservative as it pertained to business and finance, Jim’s company profited wonderfully over the years and, as he was philanthropic, he contributed millions of dollars to various charities, not the least of which was his own Amy Foundation.  Not only that, he helped many others like me and my family, fronting the money for a building program and assisting with my daughter’s college tuition.  Shortly after his death at age eighty in 2005, RBF was sold and the proceeds went to his family, many of whom took the money and started their own businesses.

Such is the beauty of capitalism.  That is why I like it.  And that is why I will stand up for it.

I Believe in Miracles

Unlike some taking to the streets lately, I like banks.  I like the idea of depositing my paycheck and having the assurance that the money is there when I need it.  I like using my debit card, even if there are sometimes fees attached.

But some things banks do make no sense.

After leasing for 17 years, we had just started building when terrorists attacked the U.S.in September of 2001.  Our company had grown considerably during the 90’s, and our space needs grew as well.  After the trauma of a move in early 2002 we were nicely situated in our new digs; thankfully, we had had considerable work to carry us through the winter. 

By April, however, it was a different story.  Here we were in a brand new building – with a brand new (and fairly large) mortgage – and Michigan’s economy began to tank.  T. L. Hart could hardly buy a job and was over-staffed.  And so became the saga of a long and painful decline in revenues and net worth with the resulting down sizing.

Fast forward to January 2010:  our long and friendly relationship with our local bank turns adversarial when a loan officer whom we have never met shows up at our door and informs us that the bank is calling our loans, all of them – two separate mortgages and two commercial loans.  Without using the words he essentially told my wife and I to file bankruptcy immediately.

By that time we had become quite unshakable.  We had already lost virtually everything we had gained from 1985-2001 but were not giving up; what we had left was our personal integrity.  Bankruptcy was not an option. 

It is amazing how trials can strengthen your resolve.  We were determined to see the thing through regardless of how long it took.  Even though we had never missed a payment on any of the notes, we were being rewarded by the threat of having what assets we had left stripped from us.

We decided to exercise our faith – and hire a good attorney. Both paid off.

Within nine months we witnessed a vast majority of our debt dissipate.  Yes, the bank took our properties, but they not only forgave the deficiencies (mortgage balance minus market value), they also forgave our commercial loans.  By the end of 2010 we had not only enjoyed one of our best profit years ever, but saw what had been liabilities drop directly to the bottom line. 

Miracles do happen – even in the corporate world.  God is good.  I believe in miracles.