Bob MacDonald on Business

Sage Advice for Superior Business Management

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Accepting Mediocrity Eliminates the Potential for Exceptionalism

August 9th, 2015 · 3 Comments

Seeking to be exceptional offers the risk of failure but when acceptable performance is the standard, failure to be exceptional is guaranteed

Nothing is accepted as easily as mediocrity. Most talk about the desire for greatness, but find it easier to tolerate less and be satisfied, because so many accede to the notion that mediocrity is acceptable. Those who work to rise above mediocrity don’t always achieve greatness, but those who fail to even try never become great. If mediocrity is accepted by your boss, by your employees, or by yourself, then mediocrity is what you’ll get.

It’s little wonder that mediocrity is the anthem of acceptable performance. Like a perpetual Halloween Greatness-vs.-MediocrityParty, mediocrity comes at us costumed in the form of peer-pressure or best-practices. More often than not, mediocrity hides behind the mask of “that’s the way we’ve always done it,” “that’s not the way we do it,” “you can’t do that;” along with other non-sequiturs of exceptionalism. Unfortunately this means that for many individuals and organizations mediocrity is celebrated, while ideas and actions that would raise standards of performance are ignored or resisted. (Banks come to mind here.)

Mediocrity can be defined as doing what others do at the prevailing level of acceptable performance. In the so-so world of mediocrity, rarely is one faulted for simply doing what is required and no more. The problem is that if your performance is only measured against what is expected and what others do, you become constrained to do more–even if you could. Using the standards of performance promulgated by others as a measure of your own performance also means you will never know how good you could be.

The comfortable reality is that if you are willing to accept the mediocrity of others, you have an easy path to follow, because so many follow that same path. However, if you are driven to do more and rise above mediocrity to become exceptional in whatever you do, you face the challenge of setting new standards of performance.

The good news is that when you seek to be exceptional in what you do, there will be little competition to go where you want to go. But the bad news is that there will be many ready to resist your efforts, because they have accepted mediocrity as their standard of performance. The truth is that in a world of mediocrity those who seek to rise above it are viewed as dangerous and intimidating, because they challenge the standards of others who have accepted an uninspired, undistinguished existence.

The WMDs most often used to defend mediocrity include a slavish focus on peer-group comparisons and best-practice adaptations. These “tools” are no more than guidelines of compliance and consistency peddled as a panacea to know where you stand and how to measure your performance against the standards of others. But in reality they only illustrate what others are doing and are intended to encourage you can do the same. And that by definition creates mediocrity.

Don’t be Afraid to be Different to be Better

It is impossible to be exceptional by being the same; exceptionalism is the residue of not being afraid to be different and always working to be better. Mediocrity is best fought from two directions: Within yourself and within your organization. Fortunately the same principles of performance apply to both.

It is admirable to demand superior performance of yourself, but it is even more powerful in the battle against mediocrity when you can inspire and motivate others to follow and be more exceptional in their own performance that they ever thought they could be.

Here are some simple thoughts on how you and your organization can break out of mediocrity.

  • Set your own standards of performance based on what you can do, not what others do. If you are not willing to challenge yourself to do more than is required or accepted as standard performance, you will never become exceptional.
  • Stop accepting the way things are simply because they are that way. It does not mean the oldMake History or Be Historyways are rejected, but it does mean they are questioned and challenged. Ask if there is a better way that will mean doing more? Adopt the attitude that tradition is something to build on, not rest on.
  • Never set fixed standards of performance. Always make your standard of performance to be better than you were before. By constantly raising your standards of performance based on what you – not others – have done, you will always leave mediocrity behind.
  • Don’t be afraid to be different. By definition mediocrity means being the same. No one has ever become exceptional in what they do by doing the same as everyone else.

Having the courage not to be influenced by the mediocrity of the masses and set your own standards of performance may be challenging, but it is also fun and exciting. Only by being focused on what can be done rather than on what is expected or accepted as standard performance can you rise above mediocrity and be exceptional at what you do. Given the way the world is today, you may be exceptional just by trying.

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Beat the System to Win BIG

August 2nd, 2015 · 7 Comments

We are taught that the way to win is to play by the rules of the system, but the real way to win is to beat the system.  

Last week’s blog reviewed Donald Trump’s strategy in his campaign for president. Trump is not one to give credit to others, but it is pretty obvious that he has read my book, Cheat To Win, CTW_15and taken its anti-establishment philosophy to heart.

Trump understands that there are two ways to win: Play by the rules of the established system and hope for the best or take charge and beat the system. Trump could see no value in joining the crowd of 15 other Republican candidates attempting to gain the nomination by playing it politically safe and kowtowing to the establishment. He sees his only chance to win (or at least to get free publicity for his brand) is to challenge the system. And he has done so with rewarding vengeance.

The Republican Party has reacted to Trump’s challenges in typical establishment fashion. The Party mucky mucks and most of those seeking the nomination have vigorously attacked Trump. But note, they are not saying his bombastic screeches are wrong —only that he is wrong for voicing them. And so far, these attacks have only served to give him more publicity and credibility.

What Works is Right 

It’s revealing that the more vitriolic are the attacks launched by the establishment against Trump, the higher he rises in the polls. As of this past weekend Trump was not only leading in all polls, but was trumprunning circles around those playing by the system. Even in Florida Trump is running well ahead of home state candidates Bush and Rubio. It’s evident that Trump is validating one of the strategies to beat the system listed in last week’s blog: He has identified a valid weakness in the establishment that has gone unrecognized and unacknowledged. Those running as established candidates are unable or unwilling to debate – let alone offer platforms to solve – the core issues that are resonating with voters, i.e. illegal immigration and the widening income gulf between the wealthy and all the rest of us.

There is another interesting phenomenon happening. Some of the establishment candidates have begun to act like mini-Trumps by saying and doing outrageous things. This is clear evidence that Trump’s strategy of attacking the establishment is working. Ted Cruz went on the floor of the Senate, knowing full well that it was against all the establishment stands for, and publicly called Republican Senate leader Mitch McConnell “a liar.” Mike Huckabee publicly compared the proposed Iran deal with the Holocaust by saying the agreement will “take the Israelis and march them to the door of the oven.” Rand Paul released a video of him taking a chainsaw to the tax code. Another candidate, Lindsey Graham released a video showing him destroying a number of cell phones. (Trump had given out Graham’s private cell number.)

When was the last time you saw supposedly serious candidates for president acting in this manner? I Grahamrest my case. There is only one word to describe their motivation – TRUMP. These guys were not gaining any traction or publicity as established candidates so in reaction to Trump’s success, they have decided to copy him.

I am still of the opinion that the likelihood of Trump securing the Republican nomination is remote, (and concerned that if he did, he might actually get elected) but his chances of success are much greater than if he had played by the rules of the system— which would have been, shall we say, nada.

Making Our Own Choice to Accept the System or Beat It

Not many of us are ever going to run for president, but any of us who desire to be successful will be faced with the decision to seek our success within the system or to find it by beating the system. Based on personal experience I am convinced that there is a better chance to achieve success is by challenging the establishment than there is to submit to it. Seeking my own brand of success I was faced with this decision: Play by the rules of the system and hope that success comes my way or challenge the system and find success my way.

In 1980, I was named president and CEO of ITT Life Insurance Company. ITT Life was part of the ITT conglomerate, but owned directly by The Hartford, a company that was the very embodiment of the establishment. ITT Life was a small company in the backwater of the insurance industry. It sold some life insurance, but clung to its existence by selling niche products such as credit and cancer insurance and nursing home coverage. As a child of the establishment, my first inclination was to build the company by working within the system. But I soon discovered that the system was heavily stacked in favor of the establishment companies. It was evident there was little chance of success for ITT Life by scrounging for crumbs left by the big companies.

(click image to enlarge)

(click image to enlarge)

I decided that the only way to make ITT Life a winner was to beat the system. With this in mind, theITT Life marketing strategy was to attack at the very heart of the insurance establishment. The way that was done was to go after the Holy Grail of the life insurance industry – whole life insurance. What the industry referred to as “permanent cash value life insurance” had been the mainstay and most profitable product of the insurance industry for almost a century. Whole life insurance was at the core of the very existence of the life insurance industry.

The only problem was that by the latter stages of the 20th century, whole life had become outmoded and obsolete. And the consumer signaled that the product had begun to outlive its usefulness by buying less and less of it. There were a lot of obvious reasons why whole life was dying, but those in the establishment either did not recognize the problem or if they did, they wanted to ignore it.

This failure to recognize or respond to this weakness created an opportunity to beat the system that “MacTrump” was happy to take advantage of. We developed a marketing strategy to take on the system by attacking its most cherished and important product. It started with a press conference in which it was announced that because whole life had become outmoded and obsolete, ITT Life would longer offer the product. It was not as big a deal as it seemed, because we didn’t sell much of it anyway, but it was a great way to turn a weakness into a strength.

ITT Life began to immediately benefit from this announcement as it led to news stories in The New York Times, The Wall Street Journal and USAToday reporting that an insurance company was going to stop selling the industry’s most profitable product, because it was no longer viable. This announcement generated more free publicity and recognition than ITT Life had ever received.

Of course the establishment of the insurance industry went bananas. Rather than just ignoring this peanut-sized company – that would have been the best strategy – the system lashed out at me with vitriolic attacks and condemnation; some companies even ran full-page newspaper ads defensively protesting the value of whole life. I was banned from membership in insurance organizations and one executive referred to me as the “anti-Christ” of the insurance industry.

I was certainly not the first to point out the weaknesses of a century-old product, but I was the first from within the industry establishment – and the president of a life insurance company at that – to publicly attack whole life. The fact that I had been in the insurance industry for 20 years, climbing the ladder from agent to CEO, gave me “standing” to make the charge. It was this credibility on insurance matters that so angered the establishment. The members of the establishment never took the position that what I said was wrong, but only that I was wrong for saying it. And the more the insurance establishment attacked me and ITT Life, the more visibility and credibility we had with the consumer and the media. This came about because what we said about whole life was true and could not be refuted by the establishment.

But we did not make the mistake of just illuminating the problems of a once good product gone bad, we introduced a viable alternative to whole life called Universal Life. Once again the leading establishment companies gave publicity and credibility to ITT Life by trying to convince state insurance regulators to declare this new product illegal. The establishment’s strategy for defending whole life was like a runner trying to win the race by shooting the other runners.

I was able to successfully take on the establishment and spur the growth of ITT Life by adhering to four principles needed to beat the system:

  • Make sure there is truth to the attacks on the establishment.
  • Have “standing” within the establishment that gives credibility to the attack.
  • Offer a viable alternative to the problem exposed.
  • Stick to your guns and don’t be cowered by attacks from the establishment.

There is much more to this story, but the bottom line is that by being willing to take on the system and beat it, a small, unknown company was able to battle on equal terms with the establishment companies and more often than not, win. ITT Life began a rapid growth spurt attracting thousands of agents to sell the new product, significantly increasing sales and profits. Even more than that, when ITT Life beat the system it not only achieved success, it changed the system forever.

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Trump Has the Wrong Idea, But the Right Approach

July 26th, 2015 · 14 Comments

Shaking up the establishment in order to bring about needed change requires more than shrill, self-serving screeching

Think what you will of Donald Trump (and I don’t think much of him), you do have to give him credit for being an out-and-out marketing genius—especially at marketing himself as a stand-alone brand. One of the TV talking heads said it best, “Donald Trump’s job is to be Donald Trump.” As supercilious as Trump’s campaign for president may be, it would be a mistake to compare his real goal with those proffered by the current gaggle of candidates seeking to make a serious effort to be elected president.

With a couple of minor exceptions, those in the pack of Republican candidates are running within the constraints and rules of the establishment; hoping the establishment will push them to the top.Trump-2
Trump is alone in challenging and running against the establishment to achieve his goal. But Donald Trump is not running to be president; he is running to be Donald Trump. Despite that shallow objective, those who seek success by bucking the establishment as agents of change can learn a great deal by observing and yes, emulating some of Trump’s strategies and techniques.

Paths to Success

Understand there are two broad approaches that can be followed in the search for success. One way is to play by the rules of the established system, seeking not to challenge or change it, but to advance oneself by working for the system. The other way to be successful is to effectively challenge the status quo of the establishment in order to change it, so that the system will work for you.

For those who choose to seek success by working within the establishment all that is required is to work hard, follow the rules instituted by others, kiss some ass, keep your head down, go along to get along and wait your turn. Of course, there are risks in this strategy: your success may never materialize. No matter how well you play the establishment card or follow the rules, others will ultimately control your success.

Those who strive for success by becoming a change-agent have to understand that their road will be far bumpier. Challenging the status quo and endeavoring to bring about change will cause those who support the establishment to fight tooth and nail to preserve it. If not ignored or ostracized, the change-agent is vilified, denigrated and disparaged by those who have tied their future to the past. However, there are two benefits for those who endure this storm of resistance in order to follow the path of change to success: success can come quicker and it is determined by the effectiveness of the effort to introduce change, not by the beliefs or decisions of others.

Mapping out Change

Trump definitely sees challenging the establishment as the path to success in his presidential campaign. He clearly recognizes there is no hope for him to be successful playing by the rules of the establishment. He knows that the only way for him to stand out from the mob of minions running for president is not only to challenge the system, but to turn it on its ear. We know Trump is not seriously running for president (He’s not is he?), but his actions – the establishment calls them “frantic antics” – come very close to what is needed to implement real change.

Here’s a checklist to be followed if you want to become a successful change agent.

  • The attack on the status quo must be based on a valid and verifiable weakness that has gone undetected or ignored by the establishment. In short, the criticism of the system and the need for change must be true, because if not, it can be easily discounted and ignored. But if what the change-agent is saying about the establishment is true, then the defenders of the status quo are put in a position of attacking the change-agent, not because what they are saying is wrong, but because they are wrong for saying it. That defense will always fail.
  • Those seeking to be change-agents must have standing within the system. Someone from outside the system can easily be brushed-off and discounted as uninformed. However, when the one challenging the establishment has bona fides as a member of the establishment, it is difficult for the defenders to discount the credibility of the one seeking change.
  • The change-agent must offer a constructive, viable alternative to cure the exposed weakness in the status quo. Anyone can throw out vituperative attacks against a calcified establishment, but for a change-agent to be successful they must present a clear alternative to the status quo that will not only correct the problem, but make the system better.
  • The change-agent must have fortitude, focus and determination to fight through the slings and arrows of those wedded to the establishment and against change. They must be serious about the change they seek. Even with truth, standing and creative workable new ideas, change does not come easily. The last line of defense for the establishment is that if they can’t outwit the change-agent, they may be able to out wait them; in the hope that they will give up and go away.

And Back to the Donald

When the antics of Trump are measured against the four elements necessary to achieve success as a change-agent it is easy to see how, by following a number of these points, he has been successful in his limited objective – creating publicity for Donald Trump. Do you think there would have been anywhere near the level of publicity and media coverage Trump has received if he had joined with the other 15 or so candidates following the established way to run for president?

During the announcement of his candidacy he focused directly on a problem that has vexed the establishment for decades – illegal immigration. The truth in his statement was not that there is anFinalTrumpillegal immigration problem – everyone knew that – but that the establishment had not effectively addressed the problem. But the bombastic nature of his attacks allowed the candidates of the establishment to attack Trump, rather than have to respond to the real problem of immigration.

Evidenced by the blanket media coverage of his announcement, it was clear that Trump had standing to launch his attack on the establishment. While not an establishment politician, Trump is certainly a self-made celebrity and a successful, wealthy businessman. He was just not some guy coming in off the street to attack the establishment, and this forced the establishment candidates off their message, because they had to respond to Trump and his standing.

Trump has offered an alternative to the problem of illegal immigration, but the “solution” proposed is unworkable and boils down to only doing more of what has been done. It does not address the core issues of the problem and would not make the system better. Failing to offer a viable alternative to a problem simply gives the defenders of the establishment the ammunition to attack the would-be change-agent.

Finally, Trump shows no interest in the staying power needed to see change implemented and success achieved. He has offered no long-term strategy or organization to bring about change and has hinted that if the establishment does not agree with him he will just walk away. This simply encourages the establishment to hang on to the status quo and wait for the change-agent to give in.

In the end, you have to give Trump his due. His objective is not really to change the system and become president, but to use the weaknesses and failings of the establishment to promote the Trump brand. He is perceptive enough to understand what it takes to rile-up the establishment and cause it to lash out in defense of the status quo. In doing so it simply gives credibility to Trump and provides him the platform to market his product – Donald Trump. It is too bad that Trump is unwilling to use his understanding of what it takes to be a change-agent to actually bring about real change, instead of squandering it to further inflate his narcissistic ego.

(Donald Trump is not the best example of a positive change-agent, but the path to success as a change-agent is important and can be very constructive, both for the system and the one implementing change. Because of that, next week the blog will continue the discussion with positive examples of change that leads to success.) 
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