Competitiveness No Longer Only A Government Issue

Private equity is a new alternative structure for company owners to get capital to grow their businesses. Too often, PE is lumped under the umbrella of the huge billion dollar deals which get a great deal of press.
What can be missed is that small companies who have up until recently been ignored by investors, would not have been given the money to grow because of lack of cash. Now, a family owned company can get a new lease on life as they are able to get sophisticated partners to take their business to a new level. Private equity injects small business with growth hormone to make even Sylvestor Stallone jealous. A growth opportunity for privately held companies gives enormous competitive advantage to a country, particularly over the next ten years as Canadian companies go global and need the money to take higher risks. Old style investors would reach for their PASS stamp where private equity investors say OK - let's give this a go. Competitiveness is to be nurtured.

"Increasingly competitiveness is no longer a government driven process, it's a process where government and business and universities and other institutions work together to raise the bar,"

says Michael Porter, top author of strategy and finance books, prof at Harvard.
What I find heartening is seeing the funds in action with the family businesses we have helped grow with private equity financing. I helped find a CFO for a construction firm and I could see directly how having the fund manager also participate in the interviews was fuel in the tank for the owners. Would your bank manager do this for your company? Would your shareholders on the public stock market do this for you? Would your Board members?
This Monday morning, out on the shop floor participation is the secret of how private equity rolls up their sleeves. Their day-to-day work that they add to the company is the magic ingredient in the financial recipe. Those private equity people coming into a business have entrepreneurial energy. It's very hard for outside experts to measure and nearly impossible to understand if you do not have business running through your veins.

If Marketing Experts Ran Election Campaigns

"Most consumers have stronger relationships with brands like Starbucks (the “third place” after home and work) than with their elected representatives or the umbrella political brands, Democrat or Republican." This data is researched by Professor John Quelch and discusses what politicians can learn from consumer marketing.

Professor Quelch suggests that if political candidates want to have a relationship with their voters, they do need to look more to commercial marketing for expertise on how to reach their audience in a meaningful way.

Does this cheapen politics?

I believe it strengthens it as those 20% of hard core voters will still read the New York Times tables of comparisons on each position and cast their vote.

But what about those apathetic voters who just don't think their vote matters? If there's a simple, fast quick way to make a much more meaningful decision, will they be more likely to vote? Probably. So less intense voters might not be more informed on the details but at least their attention is being attracted, even if it's superficial.

I suppose the worry is that someone like an Arnold Schwarzenneger could thrill and entrap a mass, dumb electorate with a flashy, "I'll be back" type of message that draws in the fools who do not "get" how hard running a goverment can be.

I think people are smarter than that - even those who are not educated past Grade 5.

Watching the Democratic race, you can see that Clinton wants voters to understand that she gets the work done. Her true core competence is managing the process of politics - administering the nation. Marketing the Democratic vision is simply not her strength - getting her goals achieved are much more her strong suit. Just as Starbucks is about giving you an interesting cup of coffee - it has to weave an entire story around what buying that coffee also brings. They have done that very well which is why the brand endures and is accepted even at The Great Wall of China. Hilary also needs to create her surrounding story as we experience a Clinton administration. Her Youtube ad with Bill and her imitating the season finale of The Sopranos was a good start, but her marketing needs to go beyond her, just as Starbucks goes beyond your cup of coffee.

Marketing the Starbucks way is tough to achieve because commercial marketing brings complex back stories to consumers' short attention spans in a two minute commercial of great wit.

The Microsoft Apple ads come to mind with the two characters creating an image of the products. Clinton and Obama are also two characters. As a side note, Hilary is smiling and being vivacious but someone tell her to lower her chin as she spends too much time looking down her nose.

Here in Canada, I enjoy USA politics. For me, the marketing on Youtube has been useful. Also getting space on TV that goes to Canada; CNN Anderson Cooper is doing a great job with his candidates' public forums and this is the right direction. I have got to know more about the politicians than my own and both Hilary and Obama are brand favourites for me - even though I would be probably be more for smaller government, less taxes. I am watching their many victory speeches and those moments of truth are probably the best marketing opportunities.

So America actually markets its emerging, new presidents to the world far better than any other country, even France with its super model first lady!

Commercial marketing of politicians with strong branding support - much like Starbucks - has other benefits for America too. Audiences in other countries such as Canada or India get to learn more about American values, what you think about yourselves and your priorities. We get past the stereotypes and get to see you are a complex, thoughtful nation of debaters not afraid to stand up and confront each others ideas and positions. This just does not happen or get accepted by a large portion of our world's politicians - good luck finding Robert Mugabwe's last debate in the government of Zimbabwe, for example. America's politicians and their long campaigns are inspiring - so keep on sharing with the world.

Leadership Lessons of Field Marshall Montgomery

As we begin 2008, the threat of recession is unnerving and the world's finance markets which carry the wealth of their top companies are dipping and diving.

This crisis provides a challenge for business leaders So what can we do? We would be comforted by advice from successful leaders. One such leader, who kept a calm head and urged the Allies to victory in World War II, was the much-loved Field Marshal Montgomery. What would he say to the business leaders of today?

We have a good idea because after World War II, Field Marshal Montgomery wrote his own memoirs which include General Sir Charles Loewen who helped plan D Day. Here at Loewen & Partners, we like to draw on the expertise of Montgommery as experienced by our relative.

Having met with many captains of industry, he was intrigued with their similarity of roles. He spent much time debating with them on how to achieve great leadership whether in industry or the military. The following is a summary of his main ideas left in his words as much as possible.

Montgomery believed leadership to be: “The capacity and will to rally men and women to a common purpose and the character which inspires confidence.” In particular, Montgomery liked to quote Harry Truman, “A leader is a person who has the ability to get people to do what they don’t want to do and like it.” This has a warm and comforting ring to it but many leaders find it challenging to be able to do just that. Montgomery does give a great deal of insight for leaders today how they can bring people to rally around the company's performance.

To be effective, Montgomery says a leader must understand what their people will be asking about their leader:

1. Where are you going with our enterprise?
2. Will you go all out for our enterprise or campaign?
3. Will you go all out for us?
4. Have you the talents and equipment? (This includes your knowledge, your past experience and your courage.)
5. Will you take decisions, accepting full responsibility for them and take risks where necessary?
6. Will you then delegate and decentralize, having first created an organization in which there are definite focal points of decisions so that the master plan can be implemented smoothly and quickly?

The best leaders know that they must answer the above questions fully to gain support from their people. Montgomery emphatically states that a leader must:

1. be able to make decisions in action and maintain calmness in the crisis.
2. know what he wants.
3. see his objectives clearly and strive to attain it;
4. let everyone else know what he wants and what are the basic fundamentals of his policy.
5. create ‘atmosphere”.

Montgomery says,

"Some commanders consider that once their plan is made and orders issued, they need take no further part in the proceedings. Never was there a greater mistake.
Leaders need a firm grip, not interference, or cramping initiative of subordinates; indeed it is by the initiative of subordinates that the battle is won. They need to get out to the people."

He goes on to emphasize, “The strength of an organization is, and must be, far greater than the sum total of its parts." Remember, this was written before Peter Drucker's best sellers on how to be an effective executive in an organization. To get a sense of the thinking behind Montgommery's actions, read these selections from his writing on leadership:

"That extra strength is provided by morale, fighting spirit and mutual confidence between the leaders and the led and especially with the high command and the quality of comradeship and many other intangible spiritual qualities.”

"The raw material with which the general has to deal is men. The same is true in civil life. Managers of large industrial concerns have not always understood this; they think their raw material is iron ore, or cotton, or rubber – not men but commodities. In conversation with them, I have disagreed and insisted that their raw material is men. Many generals have also not grasped this and that is why they have failed.”

"A leader must understand human nature. Bottled up in men are great emotional forces. It these are given an outlet, they can be used in a positive and constructive way, and which warms the heart and excites the imagination. If the approach to the human factor is cold and impersonal, then you achieve nothing. If you gain the confidence and trust of your men and they feel their best interests are safe in your hands, then you have in your possession a priceless asset and the greatest achievements possible."

"The morale of the soldier is the greatest single factor in war and the best way to achieve high morale is by success. Communicate your successes."

"All men are different and you need to match the personality to the job. Don’t
try and make a warm personality sit in the back office, counting figures."

Montgomery has comments on strategic planning which are still useful today:

Operations must develop within a premeditated pattern of action. If this is not done, the result will be compromise between the individual conceptions of subordinates about how operations should develop.The master plan must not be undermined by the independent ideas of individual subordinate commanders at particular moments in the battle.”

Montgomery believed there was a strong use or “place of the conference”. He advises,

"It will be weak if it is just to gather ideas. A leader needs to be well
prepared before starting the process.He needs to have previous thoughts, he must
have made wide field visits, he must have strong staff contact and not just the commanders one level below, he must listen to staff and once again, not just the
commanding staff. The commander should know what he wants to do and if it is possible."

If a conference is necessary, Montgomery advises that it should be to give orders and to assess where everyone thinks they are going. The leader should not bring the men to him but should go out to the people. "Do not have a conference at Head Office." Montgomery again emphasizes,

“The big mistake is to think that once the order is given there is nothing more for the leader to do. The leader must take it upon himself to outline the plan in his own words and images and put it in writing. The Commander must write this himself first. Staff and subs can then take the draft and initial plan and fill in the more detailed work. When the plan is based on the written word of the commander it minimizes mistakes and powers action."

One of Montgomery’s heroes was Sir Winston Churchill. Montgomery liked to read Churchill’s study of Marlborough and quotes,

“The success of the commander does not arise from following rules or models. It consists in an absolutely new comprehension of the dominant facts of the situation at the time, and all the forces at work. Every great operation of war is unique. What is wanted is a profound appreciation of the actual event. There is no surer road to disaster than to imitate the plans of bygone heroes and fit them to novel situations.”
The senior commander should keep himself from becoming immersed in detail. He needs to push this down to his subordinate officers. Do not aim to see every tree because you will not see the woods. The leader should make time for quiet thoughts and reflections."

"The commander needs to be thinking at least two campaigns ahead, not just of the upcoming battle. The Master Plan is a changing document. Successes gained in battle can be used in the next one and the ones planned further ahead.”

Above all, Montgomery advises that leaders must realize that people have a need for truth. Montgomery says that people always find out the truth and, if the truth has been distorted or delayed, then there will be a loss of confidence. Timely truth is critical. The truth will out anyway. In summary, Montgomery believed leadership to be an exercise in effective influence. He believed that your leadership is measured by the strength of flame that burns in peoples’ hearts for the common cause, and the magnetism that draws hearts towards you.

The above article is taken from the book:
Field Marshal Montgomery, The Memoirs of Field Marshal Montgomery; My Doctrine of Command, Collins, London, 1958.

No Longer a Man's World

Every year, the Ivey Business School runs a start-up business competition where MBA students from across the country are invited to pitch their ideas in front of real Bay Street investors. This is a serious opportunity because the winner takes home $35,000 in seed capital to take an idea from the pages of a business plan to the real world.

The students go through the experience of being hammered by venture capitalists and, hopefully, once they have licked their wounds, they will learn from the feedback. This year, I participated as a judge in Ivey’s annual MBA business plan competition. Late in the evening, relaxing in my hotel room, flipping through business plans, I watched a program with talking heads discussing the business world and was vaguely irritated by a woman who said, "It's a man's world, still, and men need to help women get ahead."

While I agree that it is good to understand women and how they fit into the business world, I don't think men exclude or keep the business goodies all to themselves. The number of female names on the business plans from MBA students across Canada scattered around me, shouted that women's confidence levels are changing at break-neck speed. Yet, did these female students need an extra hand-up, or a special category for female-run companies, as this TV interview suggested? More so, would the male venture capitalists shun the plans presented by women?

When I was in MBA school (decades ago – yikes!) I liked to be one of the guys and if a guest lecturer commented in surprise, "I see there are women here in the MBA program," I would sting with embarrassment. Call me old fashioned but I still prefer to think of myself and the other judges as one group – not male or female.

The next morning, humming James Brown's catchy tune, It's a Man's World, I headed over to the Juniper Hall (no dead, white, male names used by Ivey) to join the other judges and sit through a long morning of start-up business venture presentations.Investing is about placing money with the sapling of a business that is most likely to grow into a huge, strapping oak of a global enterprise. With venture capital, there is no room for bias or favoritism. It comes down to the black crucible of business – it's about who has the best plan to make the most money over the next five to seven years.

Finito.

My group of venture capitalists ranked two teams at the top; both had male and female presenters. Coincidence? I think not. Yin and Yang does seem to work better in business. Later at lunch, I caught up to a couple of the women contestants who were judged by my group of fund managers, and I posed the question about what it is like being female in business and doing the MBA. Faye Xuan, from Simon Fraser University, looked struck: "I'm part of my team, I don't really think about the fact that I'm female. I prefer to focus on my team and how we have something unique and special that will keep us going".

Reagan Davidson, from the Dalhousie team that ended up winning the competition and $35,000, said, "I've noticed that males and females seem to have complementary traits which, when used cooperatively together can maximize the strengths of both." These women are my kind of gals!

Heading home, I had a swing in my step. The strident tones of that woman on TV with her underlying subtext that men were holding women back, had been drowned out by the positive spirit of these young women coming into the business world. They are not denying the fact that they are women (unlike me, years ago). Instead, they recognize clearly the value of their own very female traits in the business world.

Educating Our Girls

On reading my girls-only high school's annual fund raising pamphlet this year, I noted that its carefully chosen words celebrated and reflected the many career possibilities for females. Yet, one glaring career choice for women (in my view) was omitted – Motherhood.

My high school has a clear purpose – the best of learning, irrespective of gender. Surely then the role of girls' schools in this century is about nourishing identity, purpose and pride in being uniquely female!But being a potential mother should also be part of a girl's identity and a source of pride. Isn't motherhood worthy enough to be listed as a career choice by a girls' schools in their brochures? Not mother slash brain surgeon, but mother full time? Or does that choice belong firmly within the domain of each girl's family and culture?I reflected on my own time at high school 30 years ago, grateful that the experience taught me to make choices and to develop a purpose. At my graduation ceremony, our guest speaker talked about achieving our full potential in our future careers, but I did not hear anything about the choice of motherhood.

What I heard was that I should choose a career, just like the male of the species.It was only after having children that I discovered that motherhood could not be outsourced. Life choices were a great deal more complicated.Now, as I approach our class's 30th reunion, I'm aware that I'm on the downhill slope, past 45 and moving far too briskly toward 50. Truthfully, I would like to have had more children, but now it's too late.

What stopped me?

Was it the script handed to me in school about what is important and how women can make a difference and be of value? I believe that pride in motherhood has fallen, and I was one of those women who kicked it to the bottom of my list, assigning it limited value until I went through the experience myself.Without an early awareness of the complexity of motherhood, will girls miss the opportunity to reflect about the many ways in which other women have managed the choice of children or no children? I believe that the sharing of experiences would be empowering to them.

Canada's birth rate is diminishing and our society is at risk of fading away. If female schools are staying silent on motherhood, how can we expect anyone else to begin the conversation?I respect motherhood now after being so disparaging about it before I went through the experience. I think it is important that girls' schools include the various options of motherhood in their career choices. I believe girls today should be made aware of the range of ways to be mothers: together with a big career, a mummy-track career, a part-time career or a career on hold for a decade or so; or indeed consider seriously the choice not to have children at all.

My one wish for graduating classes of 2007 is that as girls listen to the empowering speeches, they will hear an acknowledgement of one uniquely female choice that may lie ahead on their path: motherhood.

The Delicate Art of Delegating

Delegation is a thorny issue for many bosses who prefer to do the job themselves. But a good leader gets more satisfaction when able to get others to do tasks at expected high standards.

The worst thing a boss can say is "It's going to take me two hours longer to explain this to my employee than if I just do it myself."

Then you justify this to yourself: The quality and standard is better, plus the job is done. But what about the employee? Where is their challenge, their opportunity to grow?

The owner of a teen computer camp shared with me his frustration over his staff and their botched efforts at doing the job. How could he motivate his team to work at, or close to, his level? If the boss had used a little bit of emotional savvy, he would have seen the employee physically deflate, her spirits sinking faster than when the judge told Paris Hilton she had to do time, again.

What this approach to delegating misses is that a few hours of rigorous coaching will save hundreds of hours over the next year, freeing up time for revenue- generating tasks and for taking more responsibility yourself.

A reputation for teaching is gold. Star performers gravitate toward companies that train skills and push them to embrace scary tasks that challenge. Bill Gates, despite his questionable haircuts, set an outstanding performance level for programmers; this itself attracted talent. But Gates was able to balance the creative tension of setting the standard by encouraging the programmers to meet – and overshoot – expectations.

As the boss, your role is to instill the highest standards of performance and adherence to a shared vision of excellence. Only then can you up the ante and really let go. If you are having problems delegating, mull over these three questions:

1. Am I recruiting in the same old places, in the same old way?

I read a business plan for a nail manicure franchise and was astounded by the suggestion to hire university students part time. That's when it hit me that many more people are going to university and ending up in low end jobs. To help their graduates, universities have terrific job posting internet services. The teen tech camp owner hired students from Waterloo's co-op program who were thrilled to work in a tech environment rather than flip burgers (or paint nails).Make it a rule to hire people who are smarter than you. In the interview, talk about the high level of work expected until their eyes pop. The stars will be excited by the expectations, and you don't want the ones who say "no" anyway.

2. Have I really defined my standards?

The process of delegating is as fragile and complex as weaving a spider's web.How are you going to teach your skills and level of expectations? How can you illustrate how the end result should look? How can you make sure employees get the job done – building a web to catch the flies – even if it's not quite how you would have done it yourself? With an early-stage business, such as the teen tech camp, there may not be enough in place to show how to do the job. Asking employees to come up with their role and the end result that they think is expected is one way to build up a training culture.

Another tactic: Don't underestimate the role of storytelling and myths in building the results you expect. For centuries, little children have been told fairytales to prepare them for "real" life. It works. Business magazines are full of tales of how an employee ran through a burning building for their client. Get one of these stories in your culture too.

3. Am I prepared to let go?

Ask yourself this: Do I really step away when I delegate?

Once I've set the standards, do I really let go? Alarm bells should go off if you hear your employees saying, "We know you are just going to change everything we do anyway."

Working with managers and being one myself, my experience is that disasters happen when I have not been clear about the end result and I keep popping my head in randomly, interfering with the process.

My most successful delegation happens when I am forced by a hectic work schedule or other priorities to step away and truly let go. Sometimes, you do need to go to that remote salmon fishing camp in Nova Scotia without internet. Give your employees an interference-free week. You may be surprised.

Private Equity Not All Bad

“I'm part of the big hollowing out of Canada, I'm afraid," an investment banker told me at the tennis club last week, giving me his sad look. "I've been working on the BCE and Alcan deals, which are such a shame for Canada, but I suppose it has to happen." Then he dashed off for his doubles match with a jaunty jog (probably at the thought of his year-end bonus).

Is this hollowing out cause for alarm? What does it mean exactly for Canadian business entrepreneurs? Is this the end of Canada and should all entrepreneurs head for the exits? Not at all.The issue has been raised due to recent high-profile cases involving large American funds spotting a company that has missed business opportunities. These funds believe they can do more with the business than the current management team. The goal is to gain ownership through control of shares, then smarten up the business, and, finally, sell it for a profit.

Pirates, you say?

Maybe – but it's all perfectly legal.

What's not being said is that some Canadian management teams are missing the ball and not operating at a global standard. For some Canadian companies, a shakeup is exactly what is needed. You don't see RIM (the Canuck company that brought you the blessed Blackberry) having Jolly Roger types lurking around. That's because RIM's management team spends a great deal of energy working at what it takes to be a world leader in the wireless communications market – the key word being world.

For Canadian entrepreneurs, there will be a great deal more hollowing out to come, particularly in the smaller manufacturing industries. Letting go is hard to do, but many thoughtful Canadian business owners have grasped the idea that they can venture outside of Canada to set up plants and offices. These entrepreneurs are discovering that there are partners willing to help, such as the smaller private equity fund management teams. Smaller private equity firms, which are currently unfairly tarred with the same brush as larger firms, bring more than cash; they bring a rolodex of international contacts, global skills, and forward-thinking strategy.

Many private equity players already have shared ownership in a variety of manufacturers willing to change. McGregor Socks is such a case: After nearly closing its doors forever, it now has factories in faraway China, knitting up Canadian-designed creations. McGregor's core competencies shifted from manufacturing to design, managing the long supply chain, and keeping up relationships with stores. Besides, why couldn't it be the supplier, using China as a manufacturing base?

It was a private equity fund that supported this vision and put up the capital. The firm already had experience and contacts in China for McGregor. Although it took a great deal of pain for McGregor to make these tough changes, the company's dark days faded, and another excellent Canadian brand survived – and continues to fill store shelves (look for a pair next time you need socks).

By the way, my tennis playing, Master of the Universe, big swinging dick investment banker friend works for a global finance company. Nearly a decade ago, his Canadian finance company sold ownership to foreigners in order to go under their umbrella, with its attractive global brand. Horror of horrors! This finance fellow was part of the hollowing out of Canada! And what has been the result over these past 10 years? Within Canada, this company has experienced stupendous growth, creating many more Canadian jobs with high end salaries, and, at the same time, importing knowledge and the ability to serve a great deal more clients working between countries.

A recent article in The Economist supports this fact – that private equity is actually about adding value to economies rather than moving jobs off to foreign shores. OK, but what about the hollowing out of Canadian culture?

Well, my investment banker friend was apologizing for doing a good job, so that seems pretty darn Canadian to me. But selling out to foreign "pirates," besides adding lots of points on his platinum British Airways card, also brought him (and his staff) an amazing exposure to diverse management and financial practices, and an open-mindedness to global business – not to mention a few extra bucks in every one of his employee's pockets. Don't you think it's time Canadians embraced those points too? Aargh…bring on the pirates.

Are you An Entrepreneur?

Business starts by mucking around in the garage, at the kitchen table or, these days, perhaps on Youtube. When some entrepreneurs discuss their career, though, they often have one lie, “If I had known how hard it would be I would never have started.”

Top entrepreneurs do know, but they do it anyway.It is hugely popular to talk about being an entrepreneur, having your own business, not selling out to the corporate master that sucks your soul.Yet, what separates the winners from the losers? If you want to be an entrepreneur and run your own organization, you may want to answer these questions:

What’s your idea of achievement?

Are you doing the business because you know you’re good and you demand achievement or are you doing it to have a nice lifestyle?Many people really want a 9-5 type of job so they can play in the jazz band on Mondays, go to their kid’s soccer game, volunteer or whatever.That’s absolutely fine and there’s room for that both in organizations and for the self employed. But not at the top.The recent death of Anita Roddick, founder of the Body Shop, reminds me of how her passion for products made without using animal testing and to benefit communities really did drive her business. In the end, her passion brought her money — not the other way around.

Could you do better working for someone else?

Many entrepreneurs with a great set of skills do not get to apply them because they are running around paying bills, writing PR releases, and filing for patents themselves.Engineers can create the best technology that never gets bought by a customer because it is simply too risky to award the project to a small, untested company. They would achieve more by going under the umbrella of a larger business that can protect their inventions with patents and take it to market faster through the sheer power of their brand.

How are you with cash flow?

In your business plan (here’s hoping you’ve got one) you make assumptions about money coming in and flowing out. Like a renovation project for your home, think about the pithy advice, “double the contractor’s estimate of the time and the cost.” That applies to business plans too. Don’t feel sheepish; nearly everyone has to use that formula when starting up their business.Entourage, the HBO show, features Ari Gold, who runs his own agency in Hollywood. Ari is the poster boy for entrepreneurs. He goes home to his wife, who constantly hounds him. “When are you going to make money? You said it would be breaking even by now.” Even as Ari closes a mega deal for his movie star, he still has to wait for the payment, and the cash flow gap is painful for him but entertaining for m3. You do not want to sweat into your favourite suit the way Ari does, nor do you want your spouse spitting mad at you. When you walk away from the $100,000 job, cash does become king.

Are you doing this for your ego?

Many top entrepreneurs put in seven days a week for 20 - 30 years in mundane businesses ignored by the media. The book The Millionaire Next Door researched the profile of these self-made business people, confirming that most were not in a glamorous industry such as Porter Airlines with their fabulous Pink Tartan designer uniforms adored by the media.

Does money matter?

Yes it does. You must charge for your work as you need to pay the bills. Otherwise you are not an entrepreneur, you are playing. The toughest skill is to convince someone to put their hand in their pocket and hand money to you. There are many government and business people who never experience doing this and underestimate how hard it is to achieve. Top entrepreneurs get clients to pay again and again for more and more.

Canada depends on entrepreneurs with passion (craziness) who put aside their predictable salary and 9-5 job to hire others and see if they can throw their lot into the global fray.

Let’s give entrepreneurs some respect.

Escape the Tag of Small Business

Small is never a good word to use with the male of the species, unless you are Steve Jobs announcing another Ipod.

Words do count.

Sensitivity around words is why “Developing Country” became the phrase to use rather than poor country. Small Business needs a similar re-branding because it just gets worse with terms like “micro-lending” (code for lending to females). Next on offer could be “teensy-weensy lending” or “children-around-her-ankles lending.”

A big mistake owners make is to allow the “Small Business” tag to box in their ideas to two years ahead, max. Have you noticed how sheepish owners become when describing their big dream if their office is their basement and there is one employee? What they need to say is why their product or service is staggeringly different from all the others. They should say it boldly and often to their customers, their families and that one employee, and soon it will become the DNA of their business. They should also keep in mind that many an extraordinary business began at the kitchen table, Martha Stewart and Body Shop being two obvious examples. Here in Canada, there’s Victoria Sopik who created Kids & Company childcare, now a national company, and the three parents in Kelowna who started Club Penguin and sold it to Disney for $350 million (that’s right, million. Say it again with an Austin Powers accent.)

Ralph Lipschitz started with a line of ties but he talked the big dream even to his first customers. He described ‘aspirational’ living; he sold the Ivy League lifestyle and the lift from this original concept has carried for 40 years. The woman or man buying a product from Lipschitz’s company instinctively knows that it hints at an aura of old money.

Ironically, although Lipschitz was from a poor neighbourhood (also Calvin Klein’s old hood) he had a soul of refined living which emerged through his brand – Ralph Lauren. Even as a teenager, Ralph drew comments about his choice of expensive suits. He had passion and took that to get inside the heads of his most desirable customers, the Ivy Leaguers. What would encourage them to spend money? A shirt that looked as though it had seen the rugby fields of Eaton?

You bet.

Under what brand name, Lipschitz or Lauren? Ralph got over his own origins and was never sheepish about his vision. All Small Business owners need a daily dose of Ralph’s chutzpah!

The big vision and the nails down the blackboard, excruciating attention to detail are what separate the winners from the losers. Ralph Lauren excelled at both. If you check out the movies of Robert Redford, you might suspect that Ralph was a serious stalker because there’s the Ralph Lauren catalogue: The Way We Were – Robert unattainable in the Ralph Lauren Ivy League line; Butch Cassidy and the Sundance Kid – Redford all manly in Ralph’s Chaps casual jeans and cowboy boots.

It’s as if Ralph were a lepidopterist, capturing Robert Redford in his net and pinning him like a butterfly under his magnifying glass. All the details involved in the different seasons and places of the wealthy and beautiful in these movies were transferred by Ralph Lauren into accessible products. Now suddenly, you no longer need your own grandfather, complete with Boston pedigree, in order to have the perfect cashmere sweater made in Scotland. You can buy it from Ralph Lauren and, as a bonus, it does not come with that annoying mothball smell. Now the great unwashed masses can choose to adopt the Harvard look and play dress up, blend the educational classes and cross the cultural divide, just as Ralph Lipschitz did. And, boy, did the customers buy the big dream!

Take a leaf out of Lipschitz’s book. You are not just a small business (with one line of ties), you are so much more.

Green Does Not Make It At The Till

Were you to count the copies of Naomi Klein’s book No Logo that sold globally, you would think that millions of consumers would be switching to green’s top values – curb your consumerism and if you have to buy, shop green. It’s easy to paint business as the only anti-green boogieman but surely the government (municipal, provincial, and federal) also plays a role. Must government only set rules, impose carbon taxes, freak out oil investors, and make doing business generally more difficult?

Part of being green is caring for the environment and for indigenous people. Tsonga Shoes became “green” and manufactures in an 80%-unemployment-riddled area of South Africa. On-site childcare and educational facilities were established in order to encourage the mostly female workers to create micro businesses and sell their shoes to Tsonga for a living wage. It was working well until, as all manufacturers around the world are discovering, consumers started responding to cheaper goods from China.

Tsonga management visited China to look into combining manufacturing locations and were astounded by their discoveries. The massive, half-empty shoe factory they visited had marble floors. Stunned, they asked the manager how he had raised the capital to build such a place. He told them the Chinese government had paid for the factory. Workers came from hundreds of miles away and stayed in dormitories for stretches of up to a year.

“How can we compete?” asks Russell Lindsey, CEO of Tsonga. “We can put a story about our Zulu shoemaker and her child in each shoebox, but ultimately, the consumer won’t buy Tsonga if cheaper shoes are available.”

Indeed. Are those No Logo readers in fact rejecting Wal-Mart’s cheap goods for Bono’s sustainable (but pricier) line EDUN. We seem to have ADHD consumers this side of the world who, once they enter a store, ignore Naomi’s advice and stampede for the latest lead-painted Barbies from WTO members, such as China.

How does our government help our businesses compete and how do we reconcile the fact that green is difficult to achieve when competing with China’s support of their own manufacturers?Our government talks of Toronto following London’s traffic access restrictions. A good idea for London, but Toronto has much fewer travel options in its infrastructure and few trains to link our cities. Indeed, our transportation seems to be planned by Monty Python with Hamilton’s train track from Toronto stopping 16km away from the city, while other trains pass through without stopping. A functional train for passengers between Hamilton and Toronto would reduce a wretched two-hour trek to 30 minutes.

Attractive enough to leave the car behind – you bet!Instead, our government’s priority is the bun fight about inter-provincial transfers.

It’s hard to believe that Canada is one country. And who suffers? Entrepreneurs. With so much inter-provincial paperwork, it’s death by a thousand cuts. Take a lesson from business: Centralized IT departments charged each division service fees so as to share costs. In reality, however, division heads ended up arguing so much about the fairness of the system they eventually turned to outside IT companies to get the job done. Outsourcing became the norm and boomed.

Perhaps we could outsource government action for basic transportation services because there is more argument about payment for services than green action. Indeed, it’s time for the government to create joint public-private partnerships with green as the goal.

Canadians balk at these sorts of private-public partnerships despite their success in other countries. Mike Harris’ Superbuild project demonstrated how business backs a project if the government provides initial financial support. When ROM received a $30M commitment from Superbuild, Frank Potter, chairman of ROM’s fundraising arm, said, "This lead investment from the Ontario government will be leveraged many times over by the private sector.” Potter’s words were prophetic as the private sector followed the government, contributing the bulk of cash and project stamina.Let’s go beyond idealism and get down to action.