If China can (finally) accept the role of a Board of Directors, you should too.

So, you started a company, you recruited a Board of Directors, and you hold your meetings quarterly. But are you really using the talent that assembles at your Board meetings?

As a CEO, and a frequent participant in Board meetings, I have found that it is relatively simple for a competent Chairperson to orchestrate a meeting to collect all of the "Yes" votes they want. Manipulating the schedule, centering the discussion, and not pursuing dissenting ideas are just a few methods I have seen used to pursue the Chairperson's agenda.

Take a look at this website run by a company which is majority owned by the Chinese Government: China Netcom. Notice that (like me) you probably cannot pronounce most of the names on the list of Board Members. Except perhaps, the lone American, John Lawson Thornton. In a recent meeting reported by the Wall Street Journal, Mr. Thorton disagreed with a decision by Chairman Zhang Chunjiang. The result was not the expected veto, but rather Mr. Zhang accepted the dissention, and reversed his position. Further, China Netcom took steps to adopt measures to ensure that its Board would have the power to lead the company, and not simple agree with the Chairman.

Mr. Thorton was clearly not a token member of the China Netcom board. Mature and efficient companies tend to look for dissention, discuss decisions, and most importantly, listen to every member of the Board. Do the same, it will translate into profits. Yes, it will lengthen your Board meetings, and perhaps raise the temperature from time to time, but these are worthwhile trade-offs for a more successful business.

Before You Hire a Business Coach, Turn the Tables

Recently, Inc. Magazine published an article about executives, and their success stories with coaches. Not everyone needs a coach, and few will find coaching effective. Before you think about hiring a firm or an individual for this purpose, make sure you dealing with a person (or a firm) that regularly takes the advice that they give to their clients.

Some people simply don't take advice. These people believe that their experience and education do not require that they continue learning, exploring or asking for help. You have met people with this type of personality, and so have I. Beware this attribute in your coach. Look for the warning signs of inflexibility and superiority. Remember that your coach is running a business, which means that the advice they give you should reflect the Coach's day-to-day business practices.

Ask your coach if they take advice from others? If so, when? From Whom? What were the results? Also, when the coach makes a suggestion for you to change your habits, your focus, or your business plan, ask for specific success stories from others who implemented these changes. Still not convinced, ask for references of people involved in these success stories. You coach should have them.
Business coaches can be valuable. For additional insight into Business Coaching and it's usefulness to your business, see an article in the Small Business Section of Business Week.

Bottom line, your business coach should regularly take the advice he (or she) gives. If you are looking for an honest coach, contact us or find another coach through a respectable directory.

The "Second Opinion": Easy for Patients, Hard for Managers

One day, your Doctor tells you that you have a health problem. A big one. You didn't have the problem last year but now you need surgery, a change in lifestyle, and twenty-five pills every day. What do you do? Follow every word of the Doctor's advice and change your whole world overnight? Probably not. You go get a second opinion. Easy decision.

Now, imagine your Balance Sheet tells you that you have a big problem that wasn't there last year. You are surrounded by experts in your company who know your business, but no one seems to have an answer that you can take to the Board, or your shareholders. On paper, it seems like an easy decision to hire an outside firm to give you a fresh perspective on your failing Balance Sheet, but in reality that is one of the toughest decision for a manager to make.

Recently, the New York Times published an article entitled The Failure Traps. THe article suggests that one of the central reasons that a manager can look at the statistics of their business without embracing their meaning is a problem called the "Confirmation Bias": Focusing on Data that supports your decisions, and de-emphasizing data that does not. Put another way:

"Smart people believe weird things because they are skilled at defending beliefs they arrived at for nonsmart reasons." -Michael Shermer, Sept. 2002 Scientific American

According to ChangingMinds.com, theConfirmation Bias is what most people naturally do to feel good about their decions. But they also attach a warning that this can easily lead to bad decisions and a dangerous pattern if you allow yourself to fall into this pattern.

Detach yourself from your business, then look at your numbers. If that does not work, contact experts who can.

To Get More From Your Advertising Dollar, Take a Lesson From the Big Players

You probably don't have a billion dollar advertising budget like Johnson and Johnson.  But, if you advertise you business, look at these statistics. 

A coordinated advertising strategy is key to any business, which means that J&J's internet advertising is more effective because of their network TV budget, which is more effective because of their Magazine budget, and so on. If your business is targeting a specific group, take the 'Pick Three' strategy.  Whatever your budget, pick three of these media, and apply you ad spend in a way that makes sense for you.  It may take some experimenting over time, but as the chart below exemplifies, one ad strategy to through one channel won't work.  If you have a billion dollars per year, by all means, target all of these channels.  If not, pick three channels, experiment on proportions, and win with your advertising.

 

"Mompreneurs" Exemplify Growing Shift in Workforce.

"Working from home" used to be a metaphor for taking the day off. Not anymore.

Professionals are finding real productivity and real success, even if they are not surrounded by peers in their office.If you are a professional (man or woman) who has chosen to stay home to raise your kids, you probaly spent most of the first two years a little sleep deprived and climbing the steep learning curve of raising your first baby. But, as their nap schedule gets more predictable, or their play dates go a little longer, or their older sibling is a good distraction for longer periods of time, you may find your professional brain eager to engage. Here are a few sites that may help youThink about how you can use your (slightly) increasing windows of free time with your computer and your amazing mind to make some money. And maybe while you are at it, you will find a sense of professional fulfillment that you have been missing. Check these out:

Web Sites

Mompreneurs Online

Mompreneur Secrets (Article)

Multi-tasking for Home-Based Workers

Books

Mompreneurs: A Mother's Practical Step by Step Guide to Work at Home Success (Paperback)

Blogs

Giving Myself a Hand

Reinvention Inc

The Good and Bad News About "Net Neutrality"

If you think your business will be affected by new regulations, you are right. History shows us repeatedly that regulation determines the winners and losers in any industry, and our industry is certainly no exception.

Currently, the FCC, US Congress, OECD, and other governing agencies are considering regulations that can dramatically affect your VoIP, Data or Internet business. The good news is that none of these agencies have agreed on substantial regulations to the Internet or VoIP traffic. The bad news is: they will. Today is the day to decide if your views are being heard by these (and other) agencies, or whether your competition is the only opinion they hear as they draft new regulations.

What is “Net Neutrality”?
The academic principle of Net Neutrality is the "idea that owners of phone and cable networks can't dictate how a consumer uses the Internet or discriminate against any Internet content." (D. Searcey, WSJ)
According to this principle, the Internet should be open and the carriers of Internet content should deliver all content without prejudice, or additional fees.

What's the Problem?
Imagine if your ISP asked you to pay additional fees for access to 'premium' web sites like Amazon or EddieBauer.com? Or what if your monthly ISP invoice charged you based on how much bandwidth you used in a given month, just like the electric company charges for use of each kilowatt hour? Of course, if you use a VoIP phone or VPN architecture, your bandwidth use is significantly higher than a typical user. Today, you pay a flat fee for your broadband. Tomorrow, you may pay much more.
One point of view is that any attempt by the FCC or Congress to enforce Net Neutrality may backfire by imposing legislation to govern the otherwise open platform of the Internet. Others (like Google and Vonage) are strongly opposed to any payment structure based on content, or the size of the content. And for good reason. If their end-users have no option except a pay-for-content pricing scheme, the cost of services provided by Vonage and Google will trigger an additional cost to the end-user by their ISP.

"It's simple. The Internet has won. Why negotiate terms of surrender? We mustn't settle for negotiating "Net Neutrality". We must demand the basic right to connect and not just an enumerated list of what we are allowed to do. It's no different from having to negotiate free speech by listing what is allowed.
-Bob Frankston
Internet Pioneer and Pundit

And the Other Side Says...?

Carriers have a right to make money, and are interested in having the option to change their pricing models to maximize profit in the future. The supporters of regulating the Net have crafted a plan that could convert the Internet into a paid-content delivery system, similar to the cable-TV model. Many carriers worldwide are looking for options to make additional revenue to compensate for the declining voice margins (see "Remorseless Rate Reductions".) Although Cisco and Lucent have been attempting to sell solutions that could give ISPs and other carriers the option of billing based on content or bandwidth usage, no carriers have adopted it to date.
Who Can Regulate the Internet?
The carriers of Internet and VoIP traffic are subject to regulations that can have a material impact on the price paid by the end user for content or volume.
In February, 2006, the US Congress started hearing arguments for and against this issue. No decision has been reached yet, but the camps have formed on both sides, and the lobbying has begun.
On March 20, 2006 the OECD Working Party on Telecommunications and Information Services Policies (TISP) issued a second report on VOIP. This report reviews the economic impact of VOIP applications and provides general and specific policy recommendations for regulatory treatment. The report can be downloaded here.
The report specifically recommends giving customers unrestricted access to and use of applications and services of their choice, including VOIP. However in recognition of the potential for growth in applications and possible bandwidth shortages, it bases its recommendation partly on the assumption that sufficient bandwidth will become available as demand increases. Carrier selection and pre-selection regulations are deemed inappropriate for VOIP applications.
Many of the recommendations in the OECD report have been softened somewhat, perhaps in recognition of the need to accommodate case and country specific circumstances before deciding on actual regulations. Because of differing nature of individual countries competition laws, it is difficult to make universally applicable recommendations. Nonetheless the report does reflect a consensus that the overall goal of the proposed recommendations is to ensure effective competition in the VOIP services market.

In reviewing the economic impact of VOIP, the OECD employs a broad definition of VOIP, including the conveyance of voice, fax, and related services over packet-switched IP-based networks. Recognizing the difficulties in quantifying growth statistics, the report estimates that the number of VOIP users has grown from 5 million users in mid-2004 to approximately 17.5 million at the end of 2005 and noted the likely continued erosion in circuit-based voice traffic, prices and revenues of traditional telecommunications operators. Across all 30 OECD countries, the report notes that access channels for traditional circuit switched services have declined by a CAGR of 1.6% from 2002 – 2004, while broadband and mobile cellular penetration has increased substantially.
In discussing its policy recommendations, the OECD takes a narrow definition of VOIP as a service enabling a VOIP subscriber to call and be called by a traditional PSTN party. In making its recommendations, the report recognizes the differing approaches used by national regulators in defining VOIP and does not classify VOIP as a substitute for PSTN voice service nor as a different service. Rather, the report believes the market definition issue may be best dealt with on a case-by-case, empirical basis.
The report also struggles with how to apply the concept of “technologically neutral” regulation. While supporting a technology neutral approach, the report does not conclude that the same regulations that apply to PSTN services must apply to VOIP services. Rather, the report notes that technology neutrality may mean that the same competition criteria, not the same regulations, apply to both services. The idea of technology neutrality should not be used to suppress technological innovation by imposing onerous regulations on new services.
Clearly, the complexity of the issue has prevented any wide-scale consensus to date. Perhaps the widespread conversation will die down and go away. If it does not, however, the resulting regulations have the potential to fundamentally change the pricing policies allowed by governing agencies which will for the first time, force end users to consider the content and volume of their Internet.

-D. Schropfer and C. Meyers