December 10, 2007

"WHO REALLY ASSUMES RISK?"

Not long ago I was meeting with some software developers from a small company who expressed their concern about the risk involved with a project they were working on. They weren't so much concerned about the viability of the project in terms of its impact on the company as they were with the potential effect it might have on their professional careers. In other words, they saw this as a high risk project that could affect them for years to come. This may be true, but from their description I saw their risk as minuscule in comparison to what their employer was gambling which, frankly, was the company's future.

This got me thinking about how we perceive risk in our professional lives. Most employees perceive risk in terms of how it affects them professionally, particularly as a source of income. In reality, it is the employer who assumes all of the risk. If something goes wrong, it will be the employer who will be sued, not the employee. It will be the employer who has to deal with government regulators and creditors, not the employee, It will be the employer who loses financially and faces bankruptcy, not the employee. In fact, most employees do not appreciate the risk required to simply open the company's doors for business. Their life is rather simple as compared to the business owner who agonizes over the company's survival.

Risk is not for everyone, it is for those entrepreneurial spirits who are not afraid of taking a gamble; who recognizes both the risks and rewards for taking it. True risk requires a "Type A" personality (which we have discussed in the past) who knows how to study variables, calculate odds and return on investment, and is willing to assume the responsibility for taking it. It is most definitely not for the faint of heart.

This brings up a point: The degree of risk increases the higher you go in the corporate hierarchy. Whether you are cognizant of it or not, as you assume additional responsibilities in a company, through a promotion for example, you are also being saddled with additional risks, and your success depends on your ability to assume the risks and conquer them. Some people rise to the occasion, others face the Peter Principle whereby they cannot rise above their level of competency. Nevertheless, true risk is assumed by the highest echelons in the corporate structure, regardless of the size of business. And it is this sense of risk that greatly influences our style of management.

We should also understand the difference between taking a risk and being rash in judgment. The two are not synonymous. I always exemplify it by using a game of Craps as found in a casino; the rash person simply throws his wager on the table without thinking, but the person who studies the game and knows the odds before he places a bet is the one taking the calculated risk. The higher you go up in business, the more you appreciate the need for studying the odds.

As any business owner will tell you, employees really do not grasp the concept of risk. I think the following quote pretty much sums it up:

"It is not the critic who counts, not the man who points out how the strong man stumbled, or where the doer of deeds could have done them better.

The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood; who strives valiantly; who errs and comes up short again and again; who knows great enthusiasms, the great devotions; who spends himself in a worthy cause; who at the best, knows in the end the triumph of high achievement, and who, at the worst, if he fails, at least fails Daring Greatly so that his place shall never be with those timid souls who know neither victory or defeat."

- President Theodore Roosevelt

If you would like to discuss this with me in more depth, please do not hesitate to send me an e-mail.

OUR BRYCE'S LAW OF THE WEEK therefore is... "The amount of risk we assume is proportional to the responsibilities we accept."

"MORPHING INTO THE REAL WORLD"

Friends, we have just published a new book entitled, "MORPHING INTO THE REAL WORLD - A Handbook for Entering the Work Force" which is a survival guide for young people as they transition into adult life.

Bonnie Wooding, the President-elect of the Toronto Chapter of the International Association of Administrative Professionals (IAAP) said, "Many of our members are just starting their careers and I will be recommending that they read this book, especially Chapter 3, Professional Development - a primer for business skills and filled with basic common sense advice that is simple, easy to follow and extraordinarily practical; and Chapter 5, Do’s and Don’ts of the Workplace, an excellent resource for those questions you are too embarrassed to ask for fear of looking foolish."

The Miami Hurricane recently reviewed it (10/22/2007) and said,

"the abundance of information the book provides is a good start for anyone about to take the first step into the real world. Though the concept of adulthood may seem intimidating, it's comforting to know that someone has at least written a guidebook for it."

Reviewer Bill Petrey praised it by saying, "Every young person entering the workplace for the first time should be given a copy of this book."

The book includes chapters to describe how a young person should organize themselves, how to adapt to the corporate culture, develop their career, and improve themselves professionally and socially. Basically, its 208 pages of good sound advice to jump start the young person into the work force. Corporate Human Resource departments will also find this book useful for setting new hires on the right track in their career. It not only reinforces the many formal rules as contained in corporate policy manuals, but also includes the subtle unwritten rules we must all observe while working with others. The book lists for $25 and can be ordered online through MBA or your local book store. Complementing the book is a one day seminar of the same name which can be purchased separately for $4,000.00 (U.S.) plus instructor travel expenses. For more information on both the book and the seminar, visit our corporate web site at: http://www.phmainstreet.com/mba/morph.htm
ISBN: 978-0-9786182-5-4

MY "PET PEEVE OF THE WEEK" IS "LIFETIME WARRANTIES"

Let me begin by saying I genuinely believe Zippo Lighters and Cross Pen and Pencils are the best products of their kind in the world today. I know there are more expensive products out there with more elegant designs, but for my money it's Zippo and Cross. Now let me explain why. I've enjoyed these products for over thirty years now and in that time I've learned that as good and durable as these products are, they will inevitably experience normal wear and tear, thereby requiring repair. In this era of disposable products, our first inclination might be to simply throw such products away and purchase new ones, but both companies offer lifetime warranties which they stand behind. And I have taken them up on their offer to repair products on more than one occasion with no questions asked. Each time I send in my lighters and pen and pencil sets, they come back like new, and the only thing I paid for was postage to ship the products to them.

It is comforting to know there are still companies out there who stand behind their products through thick and thin, a rarity in today's disposable society. Some people think that such warranties are no longer practical to implement anymore, that it is cheaper just to buy a new lighter or pen. What these people fail to realize is that lifetime warranties mean lifetime customers; that consumers such as myself develop loyalties to the products, not just because of how they look and work, but because they know the vendor is prepared to maintain their products. This instills a sense of confidence in the consumer which leads to loyalty and repeat business. Not only are lifetime warranties good business, I can't imagine why there aren't more companies with comparable products offering such support.

Understand this, Zippo and Cross are also playing the odds. If everyone were to send back their lighters and pens for repair they might swamp the companies and cost them millions. But they realize most people tend to dispose of such products and buy new ones instead. So, although they generously offer a fine lifetime warranty, they recognize that only a fraction of their customers will actually take them up on their offer. Nonetheless, the lifetime warranty stands out in the consumer's mind and causes repetitive business.

It's nice to know there are still companies in the United States who understand what customer service means and the effect it can have on the bottom-line of a company. So, next time you are checking out that fancy new lighter and pen and pencil set, do yourself a favor, go and take a look at what Zippo and Cross have to offer. They stand behind their products. Do their competitors?

Such is my Pet Peeve of the Week.

Note: All trademarks both marked and unmarked belong to their respective companies.

"BRYCE'S PET PEEVE OF THE WEEK"

Folks, a couple of years ago I started to include my "Pet Peeve of the Week" in these "Management Visions" podcasts. They have become so popular that I now syndicate them through the Internet and they are available for republication in other media. To this end, I have created a separate web page for my writings which you can find at phmainstreet.com Look for the section, "The Bryce is Right!" Hope you enjoy them.

AND FINALLY...

I received a few comments regarding my "Pet Peeve" on "Funerals":

An M.B. in Clearwater, Florida wrote...

"I enjoyed this week's Pet Peeve very much. My family does not believe in funerals, seeing them as "pagan" and, as a result, I have been spared more than most. I also come from the far north. Until I came down here, I had never seen the seemingly ghoulish practice of displaying the deceased for all to see. In my opinion, the only good thing about the way we deal with death is that grave yards create some badly needed green space in our overcrowded urban areas.

You are certainly right about the estate problems.

I also wonder how the deceased feels, if they are watching from beyond the veil, when people they despised in life show up at their funeral, unaware of how they were really regarded by the person they are mourning. It makes me chuckle."

A J.H. in Davison, MI wrote...

"Cemeteries were much prettier when people used the big markers that were really a work of art. Now those would cost a fortune. Now people use flat markers that the cemetery lawn mower can mow over, and those are expensive too, considering the little bit of material in them."

An A.C. in Massachusetts wrote...

"I've been to a lot of funerals in my life, some big, some small. I always say, 'Send me flowers now, don't wait till my funeral.'"

As to my "Pet Peeve" on "Analog vs. Digital Generations":

An L.O. in Turkey wrote...

"LOL. As a Borg I would have to say I am digital but I am familiar with the analog too." :)

An R.M. of California wrote...

"You say: 'This is like being rewarded for your skill in the use of a calculator as opposed to your basic comprehension of math.' That line sums it all up. People should evolve and learn new technology to compete, but that theory goes both ways. The newer generation should learn to add and subtract in case that calculator breaks."

A G.G. in New York wrote...

"I like the comparisons between these two types of people."

An S.M. in Illinois wrote...

"I'm 70, and generally enthusiastic about most things digital. I was glad to see the last of manual typewriters, magnetic tape, and scratchable LPs. My memory stick goes everywhere with me as a once-in-a-lifetime emergency backup - what if my apartment building burns down? LCD monitor - a blessing for my eyes. HighDef TV - can't hardly wait until I can afford it. But I'll keep my land line forever - have no need for a mobil, and couldn't afford one even if I did."

Thanks for your comments.

Keep those cards and letters coming.

MBA is an international management consulting firm specializing in Information Resource Management. We offer training, consulting, and writing services in the areas of Enterprise Engineering, Systems Engineering, Data Base Engineering, Project Management, Methodologies and Repositories. For information, call us at 727/786-4567.

Our corporate web page is at:

http://phmainstreet.com/mba/

Management Visions is a presentation of M. Bryce & Associates, a division of M&JB Investment Company of Palm Harbor, Florida, USA. The program is produced on a weekly basis and updated on Sundays. It is available in versions for RealPlayer, Microsoft Media Player, and MP3 suitable for Podcasting. See our web site for details. You'll find our broadcast listed in several Podcast and Internet Search engines, as well as Apples' iTunes.

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Copyright © 2007 by M&JB Investment Company of Palm Harbor, Florida, USA. All rights reserved. "PRIDE" is the registered trademark of M&JB Investment Company.

This is Tim Bryce reporting.

Since 1971: "Software for the finest computer - the Mind."

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