Driven to Business with Eddie Mayfield

Where do business ideas come from? My observation is they often come from what you already know. At least in my experience, the genesis of the opportunity rarely comes from a disciplined search process, rather it emerges from experience, background, and attitude.

The most successful ideas come from recognizing an opportunity while it’s in the process of forming.  Entrepreneurship University notes that this often springs from an observation of:

• A process that can be more efficiently performed
• An attractive new service or improvement in an existing service
• A business or geographic niche that is presently underserved

Opportunities can even spring from failure.  Perhaps the most famous example of this is from 1968 when 3M chemist Spencer Silver was attempting to develop a better, stronger  adhesive.

During his experimentation, he came up with microspheres, which allowed attached surfaces to be separated easily without tearing either surface.  Hardly the new strong adhesive he was searching for.

Several years later, one of his colleagues. Art Fry approached him about a possible use.  Fry sang in his church choir, and found it frustrating that the pieces of paper upon which he made notations about the songs fell out of his music folder.  He’d heard Silver talk about his microsphere adhesive and wanted to see if it would make his notes stick a little better.

From that came the now ubiquitous Post It Notes.  One of the most profitable and well known products ever developed by 3M. And it came from a failure.

Seeing opportunity in a field: Some years ago my good friend and colleague Larry was driving through North Georgia when he noticed a number of mobile homes parked in a field.  Most people would have just driven by, but Larry pulled over and determined who owned them and why.  Turned out they were left over from a government relief project.  Larry bought them at a great price, put them in a mobile home park, and began renting them.  Larry, who had a background in property management, saw opportunity where others just saw abandoned mobile homes.

John D. Rockefeller grew up in poverty, and never forgot his roots, even after acquiring great wealth.  He had a lifelong aversion to waste, and one of the things he hated wasting was a noxious by product of his kerosene refinery, known as gasoline.

Most refiners simply dumped the volatile and highly flammable liquid, some into rivers.  It is said that at one time, the Cuyahoga River in Ohio was so polluted with gasoline, that coals dumped from a passing steamship could set the river on fire.

Rockefeller began using gasoline to provide heat for his refining process, and developed methods of storage and processing.  When the automobile era began, Rockefeller’s Standard Oil was there to provide the fuel.  As the worldwide market for Kerosene declined, Standard Oil developed even more products such as paraffin and plastics from oil, as additions to his now burgeoning gasoline business.  A great example of spotting an opportunity all of his competitors missed.

We’ve seen this time and time again at our company, EMA Inc.  Where noticing opportunities to provide better service, led to new business opportunities, and in some cases, a completely new revenue stream.

What about you?  As Zig Ziglar used to say, “no one stumbles over anything sitting down.”  So, first of all, be engaged, and pay attention to the world around you.

When you see an inefficiency in your market, ask yourself “is there any way I can resolve that?”  Is there some niche that’s under served in your business category?

Be alert, stay positive, and seize opportunities.   If you don’t, your competitors will.

Eddie

The first sales school I ever attended was in Nashville, Tn, and the job was selling Bibles door to door.  That’s a great way to learn humility by the way.

They taught us a technique called “the Friendly Act.”  It went like this; when a person answered the door and was rude, you’d turn to leave, and then ask “is there anyway I can get a drink of water from you?”

IF they got you the water, a remarkable change took place in their attitude.  They became noticeably more friendly.

It’s how God wired us up as humans; it’s almost impossible to do something kind for a person and not feel kinder toward them.

Try it.  The next time you are angry with someone, do something physically nice (it must be an action, not just a thought).  You’ll note a change in your attitude.

Joshua Becker writes that  many people view life as a pyramid with those at the bottom serving those on top.  The ones on bottom assume that joy and happiness is obtained by being served. But  life is actually more fulfilling down below.

Becker says that real joy is found not in being served, but in choosing to serve.  Is he right?

I have a friend who runs a ministry to homeless people in Atlanta.  Often when feeding them meals, he has the homeless serving food to each other.  He explained to me that many of these guys had never learned the art and joy of serving others.  My observation was that those serving did in fact gain satisfaction from the act of service.

So, how does that apply to us in business?

John Maxwell in his book “The 21 Irrefutable Laws of Leadership talks about positional leadership.  This is the leadership role that happens when you are given a supervisory job or position.  It does indeed come with leadership responsibilities, but many wrongly assume that simply having the title makes them a great leader.  All of us have seen examples of this.

Maxwell suggests that while the title may be a starting place, its nowhere near the desired finish. Almost all of his suggestions about becoming a great leader have to do with serving and caring about others.

Jim Collins in “Good to Great” says the common characteristic of leaders that took their organizations from being good to great, was humility.  Yep, that’s right, humility.

The older I get, the more I realize the importance of relationships in business.  In fact, sans meaningful relationships, business success is almost impossible.

Meaningful relationships are never built on a “what can I get out of this” attitude.  No one likes being used.

Want better employees in your company? Build good relationships  by serving them.  Want to improve your company’s brand?  Serve the market.

Build meaningful relationships, not by seeing what you can get out of it, but by what you put into them.  Zig Ziglar said that you can have almost everything you want in this life, IF, you’ll help enough other people get what they want.

Try it and see, success will follow.

Eddie Mayfield

All of us recognize a great company culture when we see it.  There are companies and organizations where you sense an ambiance that makes you feel welcome and wanted.   That’s a sign of a great company culture.

Conversely, we’ve all walked into far different circumstances, and that’s a sign of that company’s culture as well; a bad sign.

A good company culture, over time, is almost always intentional.  Otherwise you are depending on what could be widely varying cultural norms, somehow coalescing, and forming a great shared culture.  I suppose that’s possible, but it’s not likely.

Look up the definition of culture, and you’ll find something like beliefs, values, and basic underlying assumptions.

Per a Lifeway article, an organization’s behavior includes “all that you would see, hear, and feel as you first encounter” the organization.   As they say, if culture were an apple, then behavior is the skin of that apple.

A “value” is a “belief” that is actually lived out, as opposed to just a mental belief which may not actually manifest itself.

However, lasting cultural change does in fact involve beliefs, in fact it involves deeply held assumptions.   If you simply address behavioral change, without addressing the underlying beliefs, you will be fighting an uphill battle.

This isn’t to imply that companies should not have strictly enforced behaviors not only in regard to customer treatment, but how employees treat each other.  As an extreme example, you should not permit sexual harassment within your organization; a behavior that you must strictly control.

Culture, tends to flow from the top down.  When I was in field service in Texas some years ago, one of our industrial clients was a very difficult, perpetually angry individual. I can’t recall even a mildly friendly encounter with him.  All of our conversations involved him waving his arms and yelling; he dealt with everyone like that.

I dreaded going there, as did everyone in our organization. What I came to realize, was that his employees hated coming there as bad me.  What I also came to realize, was that his rude and boorish behavior was reflected in the way his employees treated each other, and their customers.

Think about this example for a moment.  Imagine a business owner that’s a crook.  He cheats his customers and his vendors whenever possible.  After a time, what kind of employee will be working there?  An honest principled one?  No, only those that have no issue with unethical and dishonest behavior.

So what will the culture be like there?  You figure it out.

Here are a few steps for establishing a positive company culture.

• Hire wisely:  If you want your company culture to be friendly and outgoing, then hire friendly people to start with.
• Establish and publish your company values.  You can find my company’s published values here.
• Reiterate those values regularly; be sure every new employee is familiar with them.
• Demonstrate those values yourself, and insist that your leadership team do the same.
• Develop specific policies in line with them.
• DO NOT permit people to violate your values without repercussion.

I often tell our folks that I don’t like playing the role of policeman, and in fact, if we have a team member that makes me play that role very often, he/she will not be a team member long. Life is better for everyone, if you develop a company culture that will alleviate your cop duties.

Here’s a quick way to assess your company’s culture:  Ask your employees what your customers would say is your company’s greatest strength.  WHY do they do business with you, and not a competitor?

This can be a cathartic exercise for two reasons.  It may point out a real strength, that’s very likely an ingrained part of your company’s culture. (and by the way, your organization DOES have a culture).  You can strategize on ways to build on that strength.

Or, it may point out an underlying weakness, that you can address with your team.

Peter Druker said “culture eats strategy for breakfast.”  Druker was absolute correct.

Eddie

I can’t think of a single business that isn’t threatened in some manner by a changing business environment.  This has always been the case; technology is just making the changes faster for most of us.

In 1967 Scientific Instrument manufacturer Keuffel & Esser interviewed a number of scientists as part of a study to gain an understanding of what the future might look like.

Some of their findings were startlingly prophetic.  They predicted 3 D TV, electric cars, automatic controlled traffic lanes, and other innovations.

One thing they didn’t uncover however, was what was about to happen to their business.  Keuffel & Esser was the country’s largest producer of slide rules.  Somehow, they failed to take into account what the electronic calculator would do to their business.

I first heard that story many years ago.  There’s a certain nostalgia to it, because I went to school using a slide rule.  But, the business lesson here is unmistakable, and is repeated all too often: you MUST stay atop changes and innovations in your market. You cannot sell slide rules in a calculator marketplace.

My own experience might prove helpful. When I first started Electronic Maintenance Associates (EMA Inc) I had a pretty clear and simple business model. Namely:

Become the warranty service center in the Southeast for a number of electronic motor drive manufactures.

Do an excellent job for them.

Use the warranty service as an entre’ into the facility, and expand the business.

It worked very well..  I picked up good and profitable business.

BUT..  that market changed.  We still to this day do warranty service for manufacturers, but with the motor drives becoming less expensive and more reliable, that business model began to lose its appeal.  IF we were still depending on that, I think we’d be out of business.   Everyone has to roll with the punches.

Stanford Professor Charles O’Reilly says that companies and organizations need to have organizational ambidexterity.  Defined, as the ability to keep your existing business going, while adapting to new opportunities and challenges.

That’s not as easy as it sounds.  Abrupt change can destroy a company for a number of reasons.   You can run off loyal customers, demoralize your people, and lose all economies of scale with your systems.  I didn’t tell all of my warranty customers to get lost, we continued to serve that market, even as it was declining.  We gradually moved into a different model.

That’s what O’Reilly means..  by organizational ambidexterity. Your successful strategy in the past, may in fact be the wrong thing to do in the future, but if you’re still getting business from it now, you have to keep it going for the present.  Your other hand has to work on the future.

Innovation is often perceived as a threat to an existing organization.  I’ve seen this not only in business, but in churches.  Within your organization employees are likely to feel threatened.

That means that as the leader, you have to do what most of you hate most..    process.   You must communicate the need for the change. (and by the way, don’t make this up, do your homework)

Shoving change down people’s throats is a recipe for disaster. Change may be completely necessary; just be sure your folks understand and embrace it.

There are many examples of companies that lost their edge by failing to respond to change.

Blockbuster was the ubiquitous video rental company. You saw them everywhere, and most people you knew used them.  They had a great business.  But, they misunderstood the threat that Netflix, Redbox, and video on demand posed.   Had they understood it, they were well positioned to respond and keep their market.

But that’s the trick isn’t it?  They didn’t roll with the punch and change; they stood flat footed and got knocked out.

How about companies that did change?  Did you know, for instance, that Nokia is the world’s largest cell phone manufacturer?  Did you know that Nokia was founded as a pulp and paper company?  Talk about changing!

Dupont began manufacturing gun powder, but they rightly saw themselves as a chemical company.  Because of that we have polyester, teflon, and many other great products.

Paypal began as a cryptography company. After years of trial and error, they emerged as the default online payment system for millions of people.  Stanford’s O’Reilly encourages companies to do small “experiments” as a response to market changes.  Not everything works.   But, had Paypal continued as a cryptography company, probably none of you would know their name.

Changes come in many ways.  If you’re in a maturing market, then you should expect the market to provide lower margins.  As a general rule of business, hi volume markets  = low margins, and low volume markets  = high margins.  The guy selling Fords will sell more units than the guy selling Lamborghini cars, but the latter will have much higher margins.

If you are in a hi volume low margin business, and intend to stay there, then you must adapt your business model.

Roll with the punches!

Eddie

Eddie Mayfield is the host of Driven to Business, heard 11 AM every Saturday on Atlanta’s business radio, Biz 1190.  The show is streamed live on biz1190.com and podcast on eddiemayfield.com and Itunes.