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Staying Competitive: Growing a Vibrant Michigan (Part 3 of 3)

Last week’s blog post covered the importance of diversity within individual businesses, but it’s just as important for an economy like Michigan’s to support a breadth of industries. As a state, we must continue to promote a vibrant and competitive business environment for all sectors. Hopefully, we’ve learned the importance of investing and innovating in order to stay competitive and will continue to move beyond our dependence on the Big 3.

Work done at the state level by the MEDC and locally by incubators like Ann Arbor Spark and Detroit’s Tech Town have and will continue to yield huge dividends and support growing local companies. It’s already changing the face of downtown and Midtown Detroit—which we see everyday—and will continue to make our economy more resilient with each new product, new office and new hire.

Today, the new Detroit and the new Michigan are being built on industries that reach far beyond auto. Our long-term success will grow from continued innovation and diversity: two characteristics that will enable the state and its entrepreneurs to continue to break new ground.

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Categories: Business Success
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Staying competitive: A diverse business model (Part 2 of 3)

In my post last week I talked about the recent 2013 Detroit Auto Show, and how the recovery of the American auto industry provides a great lesson in the importance of not taking your position in the marketplace for granted. It also shows the importance of diversity at the level of individual companies. It is too easy to get complacent with a leading product and forget the importance of innovation. An over-reliance on SUVs at the detriment of smaller, fuel efficient vehicles damaged the Big 3 for years, but we don’t have to look far to find even more stark real-world illustrations.

One example that springs to mind is the rivalry between Microsoft and Apple, where Microsoft went from a position of seemingly intractable market dominance to playing second fiddle. This is in large part because Microsoft maintained a static product line, while Apple, in contrast, has succeeded in creating a wide variety of new devices and new revenue streams.

By looking beyond their traditional sphere of success to other sectors where their strengths would apply, Apple fundamentally changed the face of the music industry. Then they revolutionized the way we use mobile devices. Microsoft continues to churn out new versions of Windows and Microsoft Office, but has lost its formerly significant edge as the world has shifted around them.

Every company has the skills and knowledge to strategically take on new challenges that can multiply its successes. When they do, it increases competitiveness and strengthens the market for everyone.

Categories: Business Success
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Staying competitive: Lessons learned from the Big 3 (Part 1 of 3)

The 2013 Detroit Auto Show was, as always, a great showcase for the City of Detroit, the state of Michigan, and the American auto industry. To me, this year’s show was a particularly resonant and powerful reminder of how far the industry has come in a relatively short time, and, as someone who lives and works in the Motor City, the degree to which a healthy and globally competitive automotive sector has rekindled enthusiasm in building up and investing in Detroit is truly exciting and inspiring.

In the context of recovery and moving forward, the auto show also started me thinking about the importance of staying ahead of the game. Yes, the Big Three is on the rebound, which will undoubtedly benefit the city, but I think entrepreneurs and professionals in a number of industries can take some important lessons from their struggles in recent years.

The most important of those, to my mind, is to never take your market position for granted. Even when you are a market leader, you have to continue to control costs, value our customers and work to be a leader in your industry. Very few organizations are too big to fail. If the titans of the U.S. auto industry can struggle, what does that tell the rest of us about the importance of continuing to grow and improve?

Treading water is not enough: If you’re not striving, you’re declining, and if you’re not adapting, then you’re falling behind. Take my word for it, if you aren’t innovating and improving, someone else is. While the auto industry is in the midst rebirth and success, we should all heed their lessons: Don’t get complacent—reinvest and improve your processes and products.

Categories: The Industry
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Corporate leadership

It wasn’t so long ago—just 10 years ago, in fact—that we were all trying to understand what happened with the high-profile failures of WorldCom and Enron. While both of those companies collapsed, and a great number of innocent people suffered lasting damage as a result, the true failure there was not only financial, but from a lack of true of leadership. It is apparent now that strong and ethical corporate leadership and notions of personal responsibility simply vanished beneath a wave of sustained corporate greed.

To me, the real question is this: what have we learned as a nation and as a professional business community about the importance of ethics and corporate governance? Sure, we have taken some steps, perhaps most notably the much-discussed and debated Sarbanes-Oxley legislation. While Sarbanes-Oxley was largely passed in response to the Enron scandal, and its attempt to provide additional oversight to corporate accounting (in part by establishing a Public Company Accounting Oversight Board to oversee auditing professionals at publicly traded companies), the recent banking scandals and financial meltdown of a few years ago have confirmed what many already suspected: that the law does not go far enough.

I’d take it a step further and suggest that no regulation could be 100% effective; and all the regulation in the world doesn’t make up for ethical individual leadership. In that sense, one of the most important pieces of Sarbanes-Oxley was Section 404, which requires company decision-makers to evaluate and personally sign off on in-house oversight and internal controls. While that certainly doesn’t eliminate the problem of morally bankrupt or unethical leadership, it does put the spotlight where it belongs: on the folks in charge. In the end it comes back to people: It’s important to demonstrate that quality behavior starts at the top.

If corporate leaders bully, make excuses, and establish a culture of profitability at all costs, we end up with Enron and WorldCom. But if business leaders provide principled, ethical guidance and show true leadership and character, they will set a positive example that is built on the real bottom line, and build the foundation for sustained growth and success.

Categories: Corporate Social Responsibility
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Simplicity

The phrase “keep it simple, stupid” might be a little crude, but it became a popular cliché for a reason: simplicity works. In the business world, too many companies suffer from an excess of paperwork and planning: binder-sized business plans when a brief summary will do. It’s not that the details don’t matter—they absolutely do—it’s more that the essential message or core strategy can get lost in the noise.

Are you still building business plans that are 60 pages long? If you are, you may be diluting your message and confusing your team. At Powerlink, we have learned through our experience that brevity and clarity are more important than long-winded, repetitious and excruciating outlines of every conceivable scenario. Today, our business plan rests on just two pages. In the past, we often found that when we tried to make things too complicated (particularly for our employees), the desired change doesn’t happen.

We believe pretty strongly that ensuring that an organization’s corporate vision is clear and actionable for every employee is critical. The first step for executive leaders and decision-makers who want to ensure that those priorities are met is to articulate the plan and the steps needed to get there in a way that each employee can both understand it and believe in it.

One of the foremost experts in training businesses and business leaders how to do exactly that is business consultant Gino Wickman, the founder of EOS Worldwide and the creator of the Entrepreneurial Operating System (EOS). I have worked extensively with Gino over the years, and Powerlink has benefited greatly from his expertise and insight. On his EOS blog, eosworldwide.com, and throughout his new book Get a Grip, Gino outlines some very simple and straightforward techniques that have been proven to help business leaders to (as he puts it) “Get Real, Get Simple, and Get Results”. It’s a fascinating read and I can’t recommend it highly enough.

Categories: Business Success