Featured Post

The Case for Management Humility

I have followed politics fairly closely my whole life. One thing, among many, really grates on me when it comes to politicians. Whether it ...

Friday, April 29, 2016

The Grit Factor in Business

Over the last few years, there has been much made of “grit” as being an important factor in an individual’s success. Psychologist Angela Duckworth of the University of Pennsylvania defines psychological grit as “perseverance and passion for long term goals.”

For years, we have talked about athletes or soldiers with grit. Now, it is taking a more prominent place in discussion of the business world. Success books have often touted IQ, natural talent and social intelligence as keys to success. Yet, people with grit appear to be different. They somehow find a way to create their own future regardless of obstacles.

The world is full of talented people. Yet, few really succeed. Many have great promise and an almost instinctive skill at certain fields. They are not lazy but do not throw themselves headlong in to the project. To me, they just do not love it enough and are not willing to devote the time and energy to break through the pack and stand out.

Grit is what sets many successful people apart in the business world. The best definition that I have seen from several sources is: “Grit is the tendency to sustain interest in an effort toward very long-term goals. It equips individuals to pursue especially challenging aims over years and even decades.”

People with grit seem to be content to pursue something against all odds. They seem to love what they are doing, do not complain and are flexible when setbacks occur. Senior managers often tell me that their favorite employees are those with grit. You cannot spot that in interviews--it shows itself on the job and may take a while to make itself evident. Some years back, I was involved in a new business pitch that involved three offices of a company. We worked like hell to put together a great pitch and it was genuinely good. The business went elsewhere. One of my colleagues, whom many would consider a tough guy, was depressed for weeks. Another associate, told me after a beer, “Okay, we did not get it. Next month, we have prospect X.” Several days later, we all met in tough guy’s office. He was still ranting about the lost business. As we left, my gritty partner said, “Can you believe how Mr. Big is still sucking his thumb over the loss. Let’s move on.” And, we did!

People with grit are fierce competitors. My best example from sports is the legendary golfer, Ben Hogan. He came from a tough background in Texas. Allegedly, his father committed suicide in front of eight year old Ben. Many said that made him quiet and introspective. A small man, he struggled to make it on the PGA Tour. He had an incurable hook and had to crawl back in shame to Fort Worth three times flat-broke after unsuccessful attempts to make a living as a pro golfer. Finally, after more practice than anyone in his era, he straightened out his drives and began to win. Then, a tragic car accident almost cost him his life. Doctors initially doubted that he would walk again. That did not stop Ben. He came back to win a total of nine PGA majors and, in 1953, he won the Masters, British Open and the US Open. Walking was painful but he never gave up. When asked what his secret was, he said simply, “It is in the dirt.” In other words, practice. Late in his life I saw a TV interview where he said he just loved to practice.

Some have grit and quietly have great success. I met a man over 30 years ago who asked me about my philosophy of investing. We talked over a long lunch. He told me that he purchased utilities--electric, gas, water and telephone. His rules were only buy those that raise their dividends each year and only add when their price has dropped 20% or more. He told me years later that he stopped talking to people about it as they told him he was too conservative. Well, he missed the dot.com crash and even in the 2008-2009 debacle, his dividend income continued to rise. Today, he sits on a mini-empire of utilities and sleeps soundly. You will never see his name in the press as he does not own more than 5% of any publicly traded company. He lives in modest elegance but is low key about everything he does. He stubbornly stayed the course for three decades and besides his wife, the IRS, and a few friends such as I, no one knows of his spectacular success.

The day we first had lunch, he asked me what my favorite book was. I was mildly embarrassed and told him that it was “The Little Engine that Could.” He laughed and said “I like that one, too, but my favorite is The Tortoise and the Hare.”

If you meet someone or hire something who has authentic grit, follow them. You are very likely to benefit.

If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com

Friday, April 8, 2016

Agency Overtime Woes?

A week ago, April 1st, THE WALL STREET JOURNAL published an article discussing the new policy set to be released by the Labor Department that would require businesses to pay overtime to any workers time over 40 hours/week if their salaries were less than $50,440 per year. It was hoped that the change would go in to effect in July.

The current limit is $23,660 per year. According to the American Association of Advertising Agencies some 25% of ad agency employees make less than $50,400 per year. That got my attention. So, I sent out an e-mail on the 2nd to a number of small and mid-sized agency principals asking for their reaction to the proposed change. Several of them forwarded both the Journal article and my question to friends or associates who also ran shops.

The results were striking and, with their permission under the cloak of anonymity, here are some selected comments:

1) “It is bad enough that Bernie Sanders is running around the US calling for an immediate $15 per hour wage for all employees. He does not realize that some small businesses simply cannot do it. If McDonald’s does it, they would have to tack on much higher prices. At least others who favor a minimum wage hike want to do it gradually. I am all for helping lower paid employees. To go from pay overtime to those earning less than $23,660 up to those under $50,400 in one step is something that we cannot adjust to overnight. Phase it in over several years and we can live with it.”

2) “Our CFO said ignore it until someone calls us on it. That is crazy. We cannot ignore a federal dictate. I am sorting through how we could manage it. It is very tricky.”

3) “Don, you and I have talked for years about how agencies pay starvation wages at first, work people like hell, and then reward them after a few years. We all know that roughly one third of newcomers quit and go in to another industry, one third are not up to it and we ask/tell them to leave, and one third love it and make a career of it. Why do I have to pay extra to people who will not stay with us?

4) “We have a young creative who seems to have that spark that we love to see in spades. His problem is that he is B.S. artist par excellence. He is new to town (a mid-sized one), knows no one so his whole life revolves around the shop. Each day he bounces around and talks to almost everyone in the agency. Around 3-4 pm, he settles down and gets to work. Often he stays to 8-9 pm. Our creative chief finds him annoying but he does appear to have real talent. I am paying him $36,000 now. If this guideline goes in to effect, I do not want to jump him to $50,000 immediately. Maybe take him up to $40,000. Yet he will claim that he is putting in 15 or more overtime hours per week. What he needs is a girlfriend. :)

5) “A young lady on our team is very accurate in all she does. The issue is that she works at a snail’s pace. She never leaves at 5:30. Most nights she is there an extra two hours. When our management comes in on weekends to work on new business, she is often there for a few more hours. It is not that she lacks intelligence. She just does EVERYTHING very deliberately. Candidly, she is not worth $50,000+ at this time. Were we to pay her overtime, she might make $60,000. I am not sure how to deal with this”.

Others used pretty strong language to say that people would work slowly or play on their computers a bit to earn the overtime. One mentioned that “clubhouse lawyers” (every firm has at least one) will tell people to pad their hours to earn more.

What do you think? Working at an ad agency IS different from most types of businesses. I recall witnessing creatives who appeared to look out the window all day deliver breakthrough executions time after time. It is not the same thing as working behind a fast food counter or any type of retail or industrial operation.

What do you think?

If you would like to respond directly, you may post a message on the blog or e-mail me at doncolemedia@gmail.com

Sunday, March 27, 2016

Denial In The Media World

Several years ago, I was scheduled to meet a friend at a local golf course. We got our signals crossed and he did not show up. The starter at the course paired me up with a threesome and I teed off 12 minutes after my appointed time. I was assigned to a golf car with a 77 year old gentlemen.

The fellow was pleasant and courteous but was having a terrible time. His tee shots barely dribbled down the fairway. After three holes he told me that maybe he should quit the game after 60 years of enjoyment. I looked down and saw the ball that he was playing. It was a top of the line Titleist and was the same that was used by touring pros.

When we arrived at tee box #4, I asked my new friend to humor me. “Try teeing off with the ball that I am using.” He was gracious and agreed but was a big grudging about it. His ball rocketed down the fairway, straight as a string, about 170 yards. He told me the ball must be illegal. I smiled and told him that it was designed for senior players with a much slower swing speed than the top 100 players in the world. After the round, I had a new best friend and gave him a dozen of the senior friendly balls out of the trunk of my car. He waxed poetic and said that I had given not just his golf game but his whole existence a new lease on life.

The aging golfer was a good man. Yet, he was in denial. He was not 30 anymore. In order to stay in the game, he needed to adapt to the current conditions--his aging body. I am finding the same thing true with the attitudes of many people in the communications business.

My last blog post in Media Realism (MR) was entitled “The Internet of Things and Marketing.” I received an inordinate amount of mail on it. A few wrote that they liked it and agreed, a plurality said that they had never thought about it but would, and a few were furious.

One fellow told me the following (obscenities deleted so I had to add a few words to put together a coherent sentence): “Cole, you are an idiot and you have always been an idiot. For 35 years, you have talked about the future of media and here I am still standing and making a living in this business. I will never read your stupid MR blog again.”

This guy and many others told me in the early ’80’s that cable TV would NEVER emerge as viable advertising medium. Fast forward to the late ’90’s and they said the same thing about the Internet. Over the last few years this same character and fellow travelers said social media was a fad that would soon implode and mobile advertising will never catch on with the public.

Okay. To be fair, no salesperson who makes his or her living from a conventional medium is going to say to a prospect that his station or publication is toast. And, the angry man described above has made a decent living in broadcast sales for decades and will likely make it to retirement. At the same time, he and many others need to face reality.

A TV station general manager put it to me this way-- “Sometimes, I meet with a young media executive at an agency who tells me it is game over for guys like me. Well, it is not. We are now doing well due to strong auto advertising this year plus we should benefit from a hotly contested US Senate race this fall. At the same time, we are taking advertisers and pleased to get them that we would never have considered 15 years ago. Our profit margins are still good compared to most industries but half of what they were in the mid-1990’s. We are not finished but will likely morph in to something else several years from now. I like your idea of local TV becoming more of a direct response medium with many multi-platform interactions.” That guy GETS it. He still drops off the gold in NYC but is changing his approaches and attitudes as media usage evolves.

The great Bill Bernbach of Doyle Dane Bernbach once said back in the ’70’s that “when you are through changing, you are through.”  That sums it up for me.

If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com

Tuesday, March 15, 2016

The Internet of Things and Marketing

By now, virtually all of you have heard about the Internet of Things and how it is changing our lives for the better. Have you, however, thought seriously about what it might do to marketing and advertising over the next five to ten years?

What is the Internet of Things (IOT)? Simply put, IOT is the network of a wide variety of physical objects that are embedded with software, sensors, electronics and, very importantly, network connectivity. These devices, some 50 billion of them soon, are able to collect and SHARE data. You use many of these items but are probably not aware of them.

I first heard the term used directly around 2008 at a conference where someone was telling us over a drink how a friend’s daughter called her dad in France who, with a few codes on his phone, opened the door of his Connecticut home and shut off the burglar alarm before she entered. Kevin Ashton, then of Procter & Gamble is widely attributed to coining the term in a 1999 speech. A few years ago my generous children bought Dad a Fitbit for his birthday. It tracks my every step, reports to my personal devices and every week gives me a summary of how much I have moved each day. It is now rare for me to do less than 10,000 steps a day (doctor’s suggestion) and prods me to get out of bed and take a 45 minute stroll prior to my morning coffee.

The applications are amazing and deep. Most of the play goes to locking your home or opening your car from afar or turning off an iron that you might have left on before leaving the house. Construction leaders see it as a huge leap forward. They use new terms such as “smart cement” which means that bridges, levees, and roads will have sensors in them that monitor cracks or stresses and send such warnings early so that action can be taken. Builders who do not build to spec had better be wary.

When I asked a few people about how this will affect us in the marketing/advertising arena, they dismissed it as not a factor. I am not so sure. A few of you have to have heard of the “smart fridge” in new “smart homes” that are being developed. It will alert you when you are running low on milk, butter, beer, yogurt, eggs, and other essentials. You could merely hit the re-order button and the next time your home delivery of groceries arrives, such items will be in your shopping bag. True, not everyone will have a smart fridge in 5-10 years but many upscale types will.

This has to help established brands and block out newcomers to a certain degree. Also, brands will not have to spend as much as on broad based advertising as they will able to do pin-point targeting on steroids using some application of the IOT.

Marketing automation vendor and leader Marketo describes IOT's impact as follows: "the connectivity of our digital devices that provides endless opportunities for brands to listen to and respond to the needs of their customers...with the right message at the right time on the right device."

Conventional media has to take something of a hit from this. One could cut their network TV budget by 30% but still hit key prospects and users dropping millions to the bottom line.  Financial analysts claim that the IOT represents a business opportunity in excess of $20 trillion over the next five years. Many companies and brands will be lifted by this remarkable technology but I cannot see legacy media being one of them.

If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com

Saturday, March 5, 2016

Block Out All The Noise!

Lately, I have been getting an unusual number of shrill e-mails and online offerings from financial Cassandras. Headlines include or are similar to: “Dow Jones Industrial Average to fall 80% this year, Gold is on the verge of a historic up-move, Social Security to go broke in 2016, Oil set to crash to $10 a barrel.” You get the idea as I bet many of your are also receiving such panicky pronouncements. Now, like any thinking person, I am a bit uneasy about the global economy in 2016. Yet, even though I firmly believe and have observed that markets tend to go to extremes, these headlines are unlikely to come true. With the growth of communications, particularly online platforms, we are inundated with too much information along with wild speculation.

A few weeks ago, I was watching a business channel and an amazingly successful billionaire hedge fund manager was being interviewed. When asked how he was able to be so decisive (and successful) in a rumor filled world, he answered, “I just block out all the noise.”

By remarkable coincidence, the next day I received an e-mail and a telephone call from a semi-retired media strategist (do we ever fully retire?) whom I have long considered to be one of the top five in the business. For over 35 years, I have always admired how he was constantly testing new concepts such as cable in the 80’s and the internet in the late 90’s yet he never wasted client money by placing large bets in emerging media too soon. When I asked him how he was always so sure of his touch his response was a self-effacing--“Simple. I just blocked out all the noise.” The guy is a genius and is being a bit modest.

Both of these industry leaders make an important point, however. When making decisions regarding allocating resources, be it a client’s money or that of investors, you always want to be data driven but rumors and information of questionable accuracy or importance are always front and center. It takes a steely resolve, even courage, to ignore the chatter or conventional thinking. I have spent 40+ years trying to learn to do it.

Finally, I was at the dentist on Tuesday morning. While waiting for my six month check-up, I read a copy of a year old issue of FORTUNE magazine. Tim Cook, of Apple, was talking about how he managed the tech giant and also tried to fill the epic shoes of Steve Jobs. His simple answer was, you guessed it, “I block out all the noise.”

If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com or post a comment on the blog.

Sunday, February 28, 2016

The Work/Life Balance in Advertising

About thirty years ago, a new term began popping up at advertising agencies. People would either quit the agency or leave the business altogether. The reason the remaining staff often used for the departure from the firm or the industry was “burnout.” Since then and across all areas of the business world the concept of work/life balance  has received increasing play. I talked to a number of agency people about the issue. Here are some comments:

--“The kids are constantly connected. So, someone who would have been obsessive about work decades ago is worse now. They need to turn off the smart phones once in a while.”

--“Don, face it. Anyone who makes it to the absolute top has a life that is almost always out of whack. Sports figures, politicians, investment bankers, entrepreneurs, you name it. You can be balanced and successful but to get to the very top of the heap you have to be obsessed. A few of these people are happy. Many are miserable. Some will die without friends and leave behind a trail of ex-spouses and distant and messed up children.” There is a lot of truth in this. When advertising becomes an all consuming passion, other areas of your life get shortchanged. I have met and know many wildly successful types who were laser focused on their careers or building their shop. They tend to be one dimensional and not a lot of fun.

--“I finally received my wake up call after a health scare a few years back. My second wife had just divorced me and I threw myself even more furiously than normal into the agency work. I suffered from sleep deprivation, lack of exercise, poor diet and while I said I thrived on it, high stress. My kids hate me and I can’t blame them. I am slowly putting my life back together and trying to establish a decent relationship with them. Sometimes I still have to work late or on weekends. It is nowhere near what it once was. Also, I never miss or am late for any event for my children.”

--“Trying for balance is really hard. People who are clerks in accounting may be able to always do 9 to 5. Anyone else who is doing it is not a player even at a small agency. There are times that you simply have to put in savage hours. You have to be careful to pull back to normalcy after a big siege. Some people cannot do it.”

-- “I tell the kids on my staff to take a Saturday or Sunday off from their e-mail. Some cannot do it. So, I am very careful about sending questions or suggestions out on e-mail on weekends. If I do, I get responses back quickly at bizarre hours. Ideas need to stew a bit in their own juices. People need to re-charge in all disciplines.”

--“Look, agency work is not investment banking. We do not work the hours they do but the compensation is much less. I watch the team carefully. If someone is wrapping their personal identity and the agency together, I make some take some time off. Some cannot do it.”

--“Some of the millennials scare me. They seem to think that work and family are mutually exclusive. They have no problem with lack of time with family and friends. A few have told they are forgoing children and one said he will go without a significant other as his career comes first. I love the business but some of these people are obsessed. Also, they cannot relate to the consumer with such a narrow life.”

The “forgoing children” comment really struck me. And, there is some research for it. The University of Pennsylvania did a longitudinal study called “The Wharton Work/Life Integration Project.” In 1992, 78% of their graduates expected to have children. By 2012, it had dropped to 42% with low double digits saying that they would NEVER have children. Status and money outweighed parenthood. I find it amazing and sad.

If you define yourself totally by your job, show up on weekends when there is not a genuine need, check in with the office a few times a day during vacations, you may be at the breaking point in terms of being out of balance. Your career is a marathon not a sprint to steal an old cliche. So, may I suggest you attack the work you love, but learn to back off now and then.

If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com

Saturday, February 20, 2016

Fill In Your Gaps!

Over the last two months, I have participated in a marathon e-mail thread with a business man whom I have never met in person. For reasons known only to God, he has been reading my blog almost since day one although he has never been involved in an ad agency or the media. He comments from time to time directly to me and asks interesting and sometimes very penetrating questions.

As the years have passed, he has opened up to me on a variety of subjects. With his permission, he is allowing me to recount an approach that he has taken to running his company that is quite different from that of mainstream North America businesses.

I will let him tell the story with a few edits to insure anonymity: “About 13 years ago, I was riding high and began to think that I had the game figured out. I ran a solid little company with 22 employees. We were profitable, I thought ethical, and we had found a solid niche in a growing area of commerce. Then, the tech revolution invaded our space and business started to drift away. We still were in the black but my self confidence was crushed and I began to have some sleepless nights. After a few months of careful study, I made a decision that everyone, even my wife, thought was complete madness. I appointed an outside board of directors of three people.”

“When I first told a few close family and friends about my plan, everyone was skeptical. They said that I was not a big company and an outside board was frivolous and expensive. I felt it would be the only way to make my company grow or perhaps save it. What I had noticed was that many American firms had a CEO who put cronies on his board. The CEO called all the shots and, when you looked at it, interlocking directorates were a real thing. Your buddies gave you a big bonus regardless of corporate performance and they received fat fees and perks for being a director. Clearly, I was not going that route nor could I afford it. What I did know was that I had gaps in my understanding of the business world--big gaps. I needed a few people not in the trenches with me day to day who would look at my company with fresh and honest eyes. I spent a year looking for the right team and then made my move.”

“My board, in addition to me, consisted of three outsiders-- a retired C.P.A with a pristine reputation, an itinerant tech savvy 32 year old who was abrasive but brilliant, and a fellow who ran a mid-sized ad agency. I told them that I could not pay them much (I had budgeted a total outlay of the cost of one employee including benefits) and I would put them all to work. They were not there to rubber stamp my suggestions. Finally, for the ad guy, a big caveat. He was a friend and I do not hire friends. So, the deal was that he would NEVER get my business if our advertising budget grew to be substantial. All agreed to the terms.”

“The old C.P.A. stopped in to the shop quite regularly. Our financial person was young and had fantastic detail orientation. She was really defensive about his presence. The old boy handled himself with grace. He taught our CFO some cash management skills that she would never have attained working solo. Also, he helped with negotiations on insurance and other vendors, even driving a bargain on our lease. Our tax returns were done by him as well. Finally, he worked with a major firm regarding our 401k plan and he personally presented the options to the staff. Some 92% of the team joined the plan. Is your participation rate that high?  The CFO realized the board member was a huge asset. He encouraged her to get a graduate degree in accounting and I paid for it.”

“The tech guy kept us current. Every time we thought that we were “cutting edge” he leveled us with tart comments about how many had been doing that for a few years. The whole staff warmed to him over time but he did not suffer fools well. We learned a lot from him and he introduced us to several consultants who also helped us.”

“The ad guy was great as he really knew a lot about marketing. He would tell us what he was doing in new media and admitted that if some of his smaller clients would hire a smart young person interested in social media that would not need his group at all. Also, he had research resources regarding our competition that proved to be invaluable to us. And, no, we never gave him our growing account.”

“After a few years, each of the board members was given a (small) piece of our firm. With skin in the game, they became even more dedicated to us. My heir apparent is a lady who now sits on our board as well. Today, we have 41 full time employees and bill four times what we did 13 years ago. Not bad! I am no genius but the smartest move that I ever made was to admit that I needed help that was unbiased and never political.”

Okay, a great and true story. Could you do this or should you do this? Probably not. You may not have the money to execute a similar plan or you may not have such illustrious and available talent in your hometown. When I floated the idea to a small agency head, she said she did a similar thing on a much smaller scale. “We all have contacts whom we can go to for advice without formalizing things. Most of us do not use them enough. I have found one way to work it is to let people know how much I appreciate their counsel. Some I take to a nice lunch or a round of golf at my club. Others I invite to my home a few times a year and to any large parties that my husband and I throw. A few showed up for a college graduation party for my daughter and gave embarrassingly expensive gifts. An older “go-to person” once told me he had done everything he wanted to do in life except go to the NCAA Final Four. Amazingly, I was invited a few years back and sent him and his son. To say that I have a friend for life is an understatement.”

I have sometimes written of my “kitchen cabinet” whom I go to for quotes for Media Realism, help with a project, or for an opinion or update on a topic. And, yes, there are people who come to me as a springboard for ideas. As John Donne put it, “No man is an island.”

So, clearly, we all have gaps. Recognize it, reach out, and you may change your situation for the better.

If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com