H-E-B’s Scott McClelland sits down for an exclusive interview with ABC13

HOUSTON, Texas (KTRK) — When it comes to what we eat and drink, Texans are pretty particular, and a Texas-based grocery store has made it their mission to find out just what we like, depending on where we live and shop.

Now the man who has overseen H-E-B stores for more than 30 years is stepping down.

More importantly, this interview demonstrates some amazing leadership tools, tips, and ideas.

Case Study: The nybl Story

Every small growth company has a unique story to tell including lessons learned. 

The insights from their story and lessons learned help drive their company forward into the next phase of their journey.

For others who are orchestrating their own growth, these insights can be invaluable to help them in their journey.

Overall, my 4 Stage Growth Model for Small Companies provides a useful conceptual framework in assessing your current position and planning for your next stage.

My blog entitled Achieving the Take-Off Stage in Small Business describes moving from the Growth Stage to Take-Off with some mentoring advice.

It is particularly challenging to move into this Take-Off Stage. So, I felt hearing the story of one who has done it would be beneficial for those pursuing this leap.

One of my clients has been receptive in sharing his company’s story, and he has also become a mentor for young entrepreneurs.  

I want to introduce you to Noor Alnahhas.

Our relationship began in January 2017.  Noor was one of three principals in a software development company.  The other two principals were technically focused while Noor provided the business perspective.  He had graduated from the Wolff Entrepreneurship Center at the University of Houston Bauer College of Business.

Silver Fox Advisors CEO Roundtable

While the entity had been operating for a number of years, it had no definitive vision or substantive plans for the future which was quite concerning to Noor. 

I suggested that he join my CEO Roundtable where he could get insights on planning from other CEOs of small growing companies.

At the time, each member was utilizing the EOS (Entrepreneur Operating System) framework to explain to other roundtable members their future plans. Noor found the EOS framework from Gino Wickman’s book TRACTION Get A Grip on Your Business most helpful in pulling together his thoughts for the business.

 It also became clear that the leadership structure of the company was not going to get them where they needed to go.

Silver Fox Advisors Fox Den

As the plans took shape, my suggestion was for him to participate in a Fox Den where the Silver Fox Advisors provide a review of the business plan and challenges. 

Generally, there are four advisors with a moderator to coordinate the session.  The plans and issues are provided in advance, so the session provides focused advice.

Noor felt this was extremely helpful because the advisors did not have a built-in bias as do personal friends, investors, and so forth.  They were frank and straight forward in their commentary and assessments. Just what he wanted and needed.

Advisor Role

I have been an advisor and mentor to Noor for some five years now.

Two main aspects of our discussions have been strategy and leadership.  One of my reasons for developing the 4 Stage Growth Model for small companies was to provide a framework for clients like Noor.  It has been an integral part of their planning.

Similarly, the Leadership Personal Profile has been a tool to help leaders understand themselves better and where they need to develop further.  Noor has been a champion of the profile. 

Here are some insights into his profile that will help you understand the nybl story.

Part of Noor’s personal vision is to build companies, chase opportunities, and work with people he enjoys being around. 

One of his key values is finding the positive as he believes negativity achieves nothing.

His perspective on life is there is no such thing as luck, just opportunity meeting preparedness.  If you fall three times, you just have to get up 4 times so that every failure is a step toward success.

His character statement starts with “I am a fun, friendly, and honest person who will do whatever it takes to deliver on my commitments/promises. 

He recognizes that he needs to think more before acting and listen more than talking.

As you can see, Noor is a high achiever.  He strategically looks for the solution in every challenge pondering new and out of the box ideas if that solves the challenge. His leadership brand is chief of dreaming stuff up.

 Over this period, Noor has relocated to the Middle East and has now become the CEO of the reformulated company named nybl.  Here is the nybl story in Noor’s own words.

Noor Telling nybl Story


“Nybl, its structure, strategy and subsequent success are all the result of the lessons learned over many years of doing the wrong thing. But these lessons came much later than the events that brought them about, and I only learned these lessons when I got external, unbiased feedback, mentoring and support – which came from the CEO Roundtable, Mentoring from Lane, and the Fox Den feedback.

The difficulty with achieving moderate success is the complacency it can lead to. The previous enterprise I was a member of had fallen into the moderate success complacency rut. While I was not satisfied, some of my partners were and this was a significant concern for me. This lack of satisfaction drove me to find a source of advice, mentoring and help to get out of the rut, and achieve my personal goals and ambitions.

During my undergraduate studies at the University of Houston, I had the privilege to work with Ralph D’Onofrio, a member of the Silver Fox Advisors, in mentor roundtables setup as part of the Entrepreneurship program in the Wolff Center for Entrepreneurship. I remembered the valuable lessons I learned from Ralph (which I still use today). I set out searching for a way to find a similar source of help. After finding several very expensive roundtable and communities – I went back to the original source at the Silver Foxes and discovered the CEO roundtables. It was exactly what I was looking for, and best of all, it was free. I sent in my application, and after a few interviews I was placed into a group led by Lane Sloan.

The roundtable had a group of CEOs from diverse industries and business types, but it was quickly clear that we all faced similar challenges. I learned from everyone’s experiences and challenges. I shared my challenges, thoughts and ideas and I got incredible feedback, suggestions, advice, and thoughts shared from the CEOs in my roundtable. While the CEO Roundtable provided an immense value, I realized that I needed more one-on-one mentorship. This is where journey with Lane begins.

Lane’s approach on mentoring me was strategic in and of itself. First, we identified my personal strengths and weaknesses, which helped us both understand where I was and what I needed to do to improve. He then helped me map out my personal purpose so we could both understand my personal drivers and motivators. From there we worked together to define where the company was currently in the 4-stage growth model, and where we wanted to go. And finally, he combined all of these to develop a complete strategy. Short term, long term, personal and business. It’s been an incredible adventure. I learned things about myself I never knew. But most importantly this entire process was the jet fuel to our nybl Rocketship.

I’ll go into the values and importance of each of the steps Lane took, but I must point out the most important one of all: being a guiding north star. Building a sustainable, profitable and scalable business is one of the most challenging things I have ever done. If it were easy, everyone would do it. It’s stressful, all-consuming, and at times downright demotivating. It takes a ridiculous level of commitment and belief in your concept to battle through all of that. The problem is sometimes, you might just have a bad idea. This is what I believe is the most difficult part of being an entrepreneur: you must believe, without a shadow of a doubt, that the impossible task you are setting out to accomplish is achievable even when no one also has been able to achieve it. So, at what point do you give up if it’s not working? Or, how do you know to continue your perseverance at the most difficult times? How do you know if your idea is actually a good one? You need someone like Lane. A trustworthy, experienced, mentor, advisor, friend to tell you, without any agenda or bias, if your idea sucks and it’s time to throw in the towel or if what you have is really something and you should keep fighting for.

People will be happy to share their opinions. Why “you’re crazy” and “you should just get a job” because that’s the only world they know. Or, how it’s irresponsible to “put all your eggs in one basket”. Your true friends and family may be supportive even when they shouldn’t be because they believe that’s how they should help, by being your support system. With Lane as my mentor, I didn’t worry about intent, agenda or bias. When I was doing something wrong, he would point it out. When I chased shiny objects that were diverting my attention from the vision, he told me to focus. When things were going great, he cheered me on. But, most important of all: when it was difficult, stressful, and reaching a point where I could easily give up, he would explain where he saw opportunity. He didn’t tell me what to do, or why to do it. He allowed me to peer through his lenses, see my journey from his perspective and realize, that if what I was doing didn’t make sense, he would have told me. That is the most valuable insight I got from Lane. It allowed me to hustle and work harder. To believe, even when everything seemed impossible, and to get through the most difficult times. Throughout the rest of this article you will come to see the incredible mentorship, advice, and value Lane’s coaching provided, but there is no doubt that being a guiding north star is one of the greatest values of all . So, find your Lane Sloan. It will change your life.

Our adventure began with identifying my strengths and weaknesses as an individual, and as a leader in my organization. The interesting part was the reasoning behind this exercise. Contrary to the usual approach, it was not to “work on my weaknesses”. Lane had a great approach: if you improve your weaknesses, and don’t build on your strengths, you end up being average. Instead, focus on your strengths to turn them into superpowers and compliment your weaknesses with those who have them as strengths. That creates 2 superstars instead of one average individual. Based on the outcome of my Strengthsfinder test, we devised a plan on how to augment my weaknesses using my team and build on my strengths. This was the first step, and it allowed us both to know where I should and should not spend my time. This exercise also taught me one of the most valuable lessons – when and what to delegate to my colleagues, who were better than me at their strengths, my weaknesses.

The second step of the process was my personal purpose. This was life changing for me. Prior to defining my personal purpose, I constantly faced internal battles of work / life balance and making decisions related to the mix of business and personal. As an entrepreneur, that line is very blurry. But, after being brutally honest with Lane and myself during the Personal Purpose exercise, everything became crystal clear. I had, without even knowing, created a prioritization hierarchy for everything in my life by simply defining what I wanted to achieve – my personal purpose – in all aspects of my life. Now, this may sound daunting, but the exercise is very well thought out and takes approximately 2 hours with a great coach taking you through it. These 2 hours were the best I ever invested in myself. Understanding my personal purpose also created goals, targets, and milestones for my personal life. I always had a business plan, timelines and milestones for work, but never applied the same level of thought and planning into my personal life. Defining personal purpose makes every decision, whether personal or business, a simple decision. It either fits and delivers on your personal purpose or doesn’t. THIS CHANGES EVERYTHING!  

Once we had defined my own strengths and weaknesses, and my personal purposes we now moved on to the business.

The process for the business was similar. We began with an audit like approach – defining where the business sat in the 4-stage growth model. If you’re not familiar with it, the 4 Stage Growth Model, as it is defined by Lane, categorizes businesses based on their growth stages, and helps in building a strategy to move from one stage to the next. It is important to identify where you stand, in order to identify where your focus needs to be now, and where it should be in the future. The Four stages are Development, Growth, Take-off and Expansion. Through this analysis we identified that nybl was at a critical point: moving out of the growth stage, and into the take-off stage. But, we were still acting like a company in the growth stage. Our organization was not ready for take-off. We did not have the proper processes, systems, organizational strategy, and internal leadership that take-off requires. As a leader, I had to take responsibility for the position we were in. Most of it stemmed from my lack of developing my internal team into leaders of their own. This is, by far, the most important quality of a leader – to build their team into independent leaders capable of carrying the mission and vision forward on their own with guidance.

“if you don’t know where you are going, any road will get you there”

  • Lewis Carroll

Before working on our short-term strategy, we first mapped out the long-term strategy. Once that was complete, we knew where we were going, and could devise the short-term strategies that would take us from one milestone to the next – our path to success.

This began in January of 2020. The original 7, as I like to call us (the 6 co-founders and our founding investor) sat down for 5 days to decide where we wanted to go. We emerged with a vision. A company built to transform data into intelligence, and a long-term strategy to be a camel, not a unicorn. A sustainable, profitable company that will be much, much larger than a unicorn, and not mythical! To become the largest technology innovator in the Middle East generating human, technological, and economical value in the Middle East and exporting them to the rest of the world. That was our plan for nybl.

Now it was time to get to work.

Now that we had this Big Hairy Audacious Goal in mind, we set out to map the path to get us there, one milestone at a time. The first milestone was to prepare our company for the take-off that was we were on the verge of. This was a gargantuan task in and of itself. It meant hours of discussions, planning, strategizing, re-planning, re-strategizing and more discussions. We worked on everything, beginning with the organization. We mapped out the current team, their strengths, and weaknesses and where they could become superstars of their own. We identified the gaps, and weaknesses that no one had strengths to fill, and set out a plan on how to build a world changing organization.

Every hour of conversation with Lane turned into tens of hours of work with the team. Lane and I met on a weekly basis, sometimes twice a week when the progress permitted. The company began to take on a life of its own. Mind you, this process began during COVID, right when we all got locked down. At a time when we had no clue how we were going to even make payroll at the end of the month. But, having a clear vision of where we were going and what we wanted to achieve gave us the energy and motivation to power through the most difficult times. It enabled us to take one rejection after another from investors (we were not ready for them at the time). We took every rejection as a learning opportunity: how could we have done better? Where did our messaging fail? What did we do wrong? How can we improve in the next round? We learned. We improved. Most importantly, we continued to build the foundations for expansion.

We emerged from lockdown with an incredible plan. One that paved the way to the company we are today. In the past 12 months, we’ve grown from an 8 person “start-up” to a truly global scale-up with 40+ people all over the world working with more cohesion than organizations running for years. This was not luck. It was preparedness meeting opportunity. It was the hard work put in to focus on the foundations to enable sustainable growth. Most importantly it was thanks to the invaluable coaching from Lane Sloan, the support from our initial investors and my incredible co-founders. We owe everything to this group of people. An incredible handful of people who believed in our vision and supported us every step of the way. Shriprakash, Ayman, Rawan, Rashad, Mohammed, Essam, Saleh, Karim, my Father Nasser Alnahhas and of course Hugo. Of course, my co-founders and the entire nybl team – thank you all!

Our Growth stage organization had become a take-off organization. Individual members were now leaders. Each with their own path, milestones, and responsibilities as part of the rocket ship we called nybl, barreling through space. As the saying goes, we were here to kick ass and chew bubble gum, and we were all out of bubble gum J 

2021 was our transformational year. We began the year with a major theme: getting our house in order. This meant organizational, structural, legal, financial, and most important of all, people. All part of the 4-stage growth model, to be ready for expansion.

We began this transformation with our people culture. It is my belief that every single company in the world is a people company. Regardless of the product or service a company delivers, it is the people of that company that manufacture the product or deliver the service. Together with our newly appointed Chief People Officer (Reem Osman, our savior) we built an organization destined for success. We made it our goal to be the best place in the world to work. If our people loved working at nybl, their output would be stupendous. And it is! 

We brought on a CFO (Shoutout to Hans and Kristian from Finstrat Management). Through their fractional accounting & finance service we built a financial structure fit for multinationals. We had solid financial metrics, we planned, we budgeted, we forecasted, we analyzed and repeated. Over, and over until we had it right.

We built our team out with the structure for expansion, and a focus on culture. Software developers, data scientists, industry experts, product champions. This focus on our people enabled us to develop world changing technology, and this technology yielded incredible products. These products brought business and as a result we signed multiple long-term, global contracts during 2021 to set the stage to move nybl from take-off to expansion in one year. And what an incredible year it has been.

We entered 2021 with 14 people. As I write this today, we enter 2022 40 strong and growing. Our biggest competitors are now our partners, and our journey is just beginning. 2022 marks the year we shift from take-off to expansion.

 And we’re not going to just expand, we’re going to explode. We explode with an arsenal of tools including our culture, technology, strategy, and a vision and a mission. Lane and I continue our sessions on a regular basis. Each time, analyzing our strategy, making pivots and adjustments where necessary, and working on each step towards our giant goal.

Our milestone for the year is to become a Billion-dollar company (yes, with a B). Not through valuation from investors, but by sheer volume of business, technology, and innovation. It is our first critical milestone in our journey to becoming a camel. It’s an incredibly challenging milestone. One that is exciting, motivating, and fun! So much fun, I sometimes forget it’s work.

Peter Drucker says “culture eats strategy for breakfast”. I’d like to add my own twist to his quote: great culture combined with great strategy eats whatever it wants. That is the essence, the secret sauce to nybl. Incredible culture, with incredible strategy. I wish I could say we thought of that all on our own. But we owe our success to our team, our investors and to every person and organization that supported us along the way.

To The Dubai Future Foundation, and The Dubai Future Accelerators: Thank you for believing in a handful of people with nothing more than a vision.

To Smart Dubai Government, Dubai Health Authority and ADNOC: Thank you for giving us the opportunity to prove ourselves when no one else would give us the time of day.

To our investors and board of advisors: Without your unwavering support we could not have survived the difficult times. Thank you for your belief in a vision and mission greater than all of us.

To the nybl team: Without each and every one of you Rockstars, none of this would be possible.

To the original 7, my ride or die co-founders: This is the result of your dedication and belief. Our Journey is just beginning, and the dream is becoming a reality.

To my Mother, My Father, my Wife, and my beautiful Daughters: I love you. Thank you for the support and for being my light during the darkest of days.

And of course, to Lane Sloan: Thank you for taking on a scrappy entrepreneur who wouldn’t give up and imparting the most valuable of your assets: your time, and your knowledge. You are a gift, a treasure.” 

My Remarks

When I asked Noor to write the nybl story, I was interested to see what he would say.  This is not really a typical case analysis with detailed financials and particular steps along the way.  It is all about his learning and feelings that led nybl to fulfilling the Take-off Stage.

You feel the energy and passion that Noor has in the business.  It for sure has been a challenge.  Today, as Noor said he does not see this as a job or work rather instead an exhilarating fun experience that he looks forward to every day.

Results make a difference: the huge revenue growth, investors coming to him, unsolicited people wanting to join the company, next generation culture, inspired employees, an incredible hiring system, leaders emerging at every level, an adaptive growing organization, a well-structured financial system, linked operational processes, reputation growing faster than marketing and so on.  All this contained in the strategy and forward plans. The key elements in taking off.

Noor’s incredibly lofty goal of becoming a billion-dollar company may appear unrealistic to you, but Noor believes it.  He has done the research on similar companies in the artificial intelligence space and their position. Reaching take off requires lofty goals so I am careful not to dampen his enthusiasm.  He is willing to put the aspiration in print!

Finally, you may feel Noor is taking an early victory lap by thanking everyone who has been a part of nybl reaching Take-off.  This is only one stage in the nybl journey ahead.  Yet, it is crucial one.  For Noor, the present position is a relief in many respects seeing the company take off and his thanks to the many contributors is genuine.  He has been overly kind to me.

Throughout this blog, you should get a reasonable picture of Noor.  Foremost, he is an incredible learner and listener.  Second, Noor does not accept defeat.  His leadership growth has been extremely fun to watch.  And I believe leadership is the key to achieving the Take-off Stage.

Silver Fox Advisors Award Winner

On Thursday, December 9th, Silver Fox Advisors awarded its second annual A. “Butch” Madrazo Award which is given to a Silver Fox that best demonstrates the attributes Butch demonstrated every day.

Butch Madrazo was a Silver Fox Advisor from the mid-1990s until his death in August 2020.  Butch was always welcoming and counseled new members. He brought a certain light-heartedness to any room he was in.  The attitude he projected when providing support made everyone feel resilient and always put a smile on our faces.  The inscription on the award reads “Awarded in recognition of fellowship among, engagement with, and commitment to fellow members.” Butch was a true friend and outstanding colleague.

The first award was issued to Joseph Tung in December of 2020.  This year the award went to Rich Hall for his outstanding service to the Silver Fox Advisors. Rich is the founder and owner of the Rich Hall Group. He also serves as Chairman of the Membership Committee for Silver Fox Advisors.   Congratulations to Rich Hall!

Pictured: Doug Thorpe, President, Rich Hall, Award Winner, and Donnie Roberts, Chairman

Understanding the Energy Quagmire

Every time there is a severe weather event like Hurricane Ida, it is blamed on global warming labeled climate change.  One would think we never had bad weather in the past.

Actually, Hurricane Camille in 1969 had the highest wind speed at landfall at an estimated 190 mph when it hit the Mississippi coast.

Don’t get me wrong.  The data is very clear that the earth is warming.  And an increase in carbon dioxide has been one of the major factors with our use of fossil fuels to provide us energy. 

Not surprising, there are organizations like Bad Carbon that want to keep all the “fossils” in the ground.  On a more balanced side, the Paris Accord is all about limiting the rise in temperature through limiting greenhouse emissions (GHG).

Climate Change

In 2018, the Intergovernmental Panel on Climate Change advocated global GHG needed to fall to zero within the next three decades.  A number of nations and major companies have set targets to reach net-zero by 2050; in other words, balancing any emissions by absorbing an equivalent amount from the atmosphere.

Ecology landscape – climate change concept, desert invasion

These are much more aggressive positions than when I was chairing the Greater Houston Partnership’s (GHP)Energy Collaborative Committee around 15 years ago.  At that time, the Energy Collaborative Committee was promoting a more balanced energy equation. 

There is no doubt renewable energy has some distinct advantages with their lack of carbon dioxide generation. But to be brutally honest, back then we had a hard time seeing renewables as a total substitute for fossil fuels.

We were actually quite proud of the wind electricity generation in West Texas.  The Lone Star State has for some time been the biggest wind producer of electricity in the United States.  Iowa is a distant second.

We were even successful at the GHP in getting Vestas, a wind turbine manufacturer, to set up an office in Houston.

Wind is not a cure all.

The biggest issue with wind is its intermittency as you may know.  The wind is not always blowing, and it blows stronger at night than in the day when the power is most needed.

green meadow with Wind turbines generating electricity

That raises the need for the ability to store power or to offset when the wind is not blowing with another energy source.

Natural gas combined cycle power plants have been a good solution with quick start-up capabilities and with an abundant new supply source from shale gas. And thankfully there are significant advances in energy storage, but more technological advances are needed.

The other big issue is location.  West Texas, as an example, is not a high population center.  That means you need to build transmission lines to major population centers like Houston, Dallas-Fort Worth, Austin, and San Antonio.  Texas has done that spending some $7 billion which has supported West Texas wind renewable developments.

It’s not that straight forward across the country.  The stronger wind capability goes up the middle of the United States.  That is why Iowa, Oklahoma, Kansas, Illinois, Minnesota, Colorado, and North Dakota are in the top ten list of wind power generation.  Unfortunately, many of the big population centers are on the east and west coast.

Besides building the required transmission lines as Texas has done, there is also a loss of power from the transmission.  With the networks in place from the 2015 to 2019, the EIA estimated a 5% loss in transmission for wind.

Like any source of energy, there are various specific issues. Big wind turbines are not what everyone wants to see, visual pollution. These giant blades spinning up to 180 mph are estimated to kill a half-million birds a year according to the US Fish and Wildlife Service

The case for Solar

Solar sounds very promising with the energy radiating from the sun.  Capturing that energy has always been one of the key technology challenges. The most efficient solar cells approach 30%, but solar panels are generally in the 20 % efficiency range.

Thus, a solar farm of 1 megawatt powers around 200 homes and can take 4 to 5 acres in geographical space requirements.  For solar to power the electricity needs of the United States, Vivint.solar estimates that requires roughly 14,000,000 acres or 22,000 square miles about the size of the Mojave desert.  That is a lot of land.

One of the largest utility sized solar farms in the world is in India covering 14,000 acres generating 2,245 megawatts.  In comparison, Egypt built a natural gas combined cycle power plant in 2018 with a total of 14.4 gigawatts of power generation with 12 power blocks each having 1,200 megawatts of capacity. It supplies up to 40 million people with reliable energy.

Solar panel

Like wind, intermittency is a big issue for solar. There is no generation at night which varies by the seasons depending on location.  Time of day also makes a difference. Cloud cover during the day is a real impediment as well. Thus, energy storage is again key with this intermittency.

The sunbelt makes the most sense for solar. Thus, like wind, the high potential solar locations do not always match up to population centers in the United States. Here in Texas, the best solar capability is also in West Texas away from the population centers.  Cloudy days here in Houston are not helpful for solar.

One attractive feature of solar comes from its flexibility to be installed on rooftops. Solar panels on roofs have been around for about 40 years now reaching over 2 million installations in the United States. The pace of installations has increased significantly these last several years. I’ve seen estimates that by 2024, 2.5 percent of residential homes in the United States will have solar panels.  Why not more?  There are many factors that come into play beyond location, costs, and financing, such as roof size, shading, tilt, construction, grid hook-up, local/federal incentives, rentals, and so forth.

Customer demands

The big question remains how much electricity generation can wind and solar provide that will satisfy consumer needs? 

Today, together these two renewables provide only about 5% of the energy consumed in the United States. The technical practicality seems more challenging as developers have already pursued some of the best locations for solar and wind farms.

To really address carbon dioxide emissions, then electric-powered vehicles are important of course.  That has another set of issues that need to be overcome beyond generating electricity such as charging stations across the country.

Those developing plans to achieve net-zero emissions by 2050 foresee trillions of dollars of investment.  Money that could be spent elsewhere more productively if the concerns were not so great.

Thus, the really big question is the consequences of climate change.  How catastrophic will it be for mankind?

Since the 1960s, there have been many doomsday predictions from climate change; however, none to date have materialized.  From another angle, if you look at the National Weather Service data on weather-related deaths here in the United States, there is nothing to be alarmed on trends towards doomsday. All this raises questions on how much do we really know about the consequences?

To step back for a moment, how did I decide to write this blog?

I was contacted by the IPAA’s (Independent Petroleum Association of America) leader for the Energy Workforce Energy Education Center. She wanted me to do a video presentation on Energy Economics and Geopolitics for the students in the high school petroleum academies having done similar presentations over a decade ago.

I wanted to get myself more current on the state of affairs with climate change.

Using the faithful internet, my searches found many websites that seemed rather biased and lacking detail but making large generalizations.

After searching for more detail, to my surprise some people who explored the data were debating the catastrophic consequences based on the data as opposed to any biased opinions.

I particularly found interesting Steven Koonin’s book published this year entitled Unsettled.  What climate science tells us, what it doesn’t, and why it matters.

One expert’s ideas

What got my attention was his background serving as the Undersecretary for Science in the US Department of Energy under President Obama along with numerous other impressive roles.

Initially, a strong advocate, over time Koonin has examined the data from assessment reports and studies, and now raises some serious questions.

He states in his book, “It’s clear that media, politicians, and often the assessment reports themselves blatantly misrepresent what the science says about climate and catastrophes.”

Koonin is not a denier.  He outlines our global warming and the impact of carbon dioxide.

For him, the key question centers not on whether warming is occurring but on the catastrophic impact projected. Thus, he specifically addresses my question on the consequences of climate change.

A big learning for me, Koonin points out the climate and weather are quite different. Weather bounces around from day to day.  Climate has a long horizon of 10 to 30 years and more.

He explains you should not use any one weather event to diagnose climate change and complains this is done so often in the press misguiding the public.

Koonin goes into reasonable depth on key assessment reports and in each case raises good issues about their implications.

What about the long term?

In analyzing different long term climate horizons in the data, he concludes that most types of extreme weather events don’t show significant change. Wow.

You also hear a lot about rising sea levels which is often represented as potentially catastrophic.  After his careful look at the data, he concludes that we are contributing to sea level rise, but scant evidence it is significant much less disastrous.

Nevertheless, the big concern is not just today but directed towards the future if we keep emitting high levels of CO2 emissions.

To project the future, computer climate simulation models are used with a scientific aura of validity.

Koonin is well versed in modeling and able to explain how these simulation models work.

They attempt to mimic reality based on physical laws and weather observations.

As you can imagine, they are incredibly complex using a grid structure to simulate our global climate environment.

A simulation run on the most powerful computers can take a couple of months.

The world is enormous in size with 123 billion acres, of which 37 billion acres are land. To get a finer sub grid structure which could be very helpful simply overwhelms todays computing capability and would take years to process.

As a result, these models are tuned by the researcher’s judgment because the models can be a poor description of the real world.

Obviously, Koonin forewarns over-tuning can cook the books.

His key point is that these models tend to disagree with one another, and the compromise has been to average their results. That seems a bit weak.

Moreover, newer more sophisticated models actually generate more uncertainty.

A big red flag for Koonin is the models can’t reproduce all the past.

Others raise similar points.  Now you see why I called this blog Energy Quagmire; technical practicality of mostly all renewables and questions on the consequences of global warming have got us in a bog.

The more we focus on objectivity, the quicker we can get out of this bog.

Foremost, let’s clearly address the issues that people like Koonin raise on assessing the climate data and projected consequences.

We also need more thoughtful balance of the risks and rewards of pursuing different courses. Let’s get more serious dialogue on other energy sources such as nuclear and green hydrogen.

Let’s discuss the advances in usage of fossil fuels to reduce carbon dioxide emissions. Let’s fully understand the opportunities of CO2 sequestration and similar removal technologies. Let’s consider the more complex issues and tradeoffs of economic security and national security along with environmental security. And let’s be careful in the overhyping wind and solar as our only energy sources for the future with a little pragmatism.

CEO Education Series – Part 3

Increasing Profits and Understanding Costs

Join us on Wednesday, May 19 as another panel of Silver Fox Advisors take on the subject of cost accounting.

Every business has costs to operate, produce goods and services, and ‘keep the lights on.’ But are you identifying and managing those costs effectively?

Your ultimate profitability will be impacted by the proper control of operating costs.

While there are many different ways to allocate costs to multiple lines of business, you need a framework to capture those costs, analyze them, then decide on how you want to apply them to your business accounting.

Our panel of experts will tackle these and other topics during a FREE virtual workshop.

You must register in advance.

When: Wed May 19, 10:00-11:30 CT

Where: Virtual Workshop

CEO Education Series – A Business Plan . . . Your Guide to Success

Owning a business is work. But to what end?

As Stephen R. Covey famously said, “we must begin with the end in mind.”

Having a business plan can get you to that proper end result. Now is all planning perfect? Likely not. But if you want to grow and manage your business with a good outcome, you have to have a plan; a business plan.

Join us on April 13 as four of our Silver Fox Advisors share their experiences and views on drawing up the right business plan. It’s not as hard or daunting as you might think.

We’re sharing tips, hacks, and ideas for getting a good business plan in place.

Live webinar, Tuesday April 13th at 10:30 AM CT/ 11:30 AM ET

The panelists are:

Dick Hendee, Bill Herman, Herb Kalman, and Gary Henderson

Rapid Chaotic Change Requires Leadership Agility

Understanding Change

It is undeniable that change is accelerating and becoming more chaotic.  Leaders need to understand this change.  What is driving the change?  What are the implications on your leadership?

Technology is driving the change. I have put together a model to help you understand this change and high-level implications on your leadership. After exploring the model, we will highlight key thoughts on leadership agility to deal with this rapid and chaotic change in today’s business world.

Industrial Revolution

We are all familiar with the industrial revolution starting back in the mid-1700s.  New technology in the form of machines changed the manufacturing process of goods.  Machines substituted for human labor.

It brought about new forms of business enterprise because this change was mass production.  Organizations had to evolve to deal with the larger volume of transactions.

It was a new world.

Management by Exception

Back in the 1960s when I was taking organizational behavior courses the buzz word was “management by exception.”  You probably heard of “If it ain’t broke, don’t fix it.”

The assembly line was key to production.  You had to keep it going.

Change was not rampant.

Therefore, the focus was on control.

To lead these massive organizations with their hierarchies, the management style was traditionally autocratic.

Information Revolution

The technology of automation from the Industrial Revolution paved the wave for a transformation change in information processes with the advent of computers.  Software programs did the work of repetitive clerical type roles and more.

I joined Shell Oil in 1970 as one of those programmers to create this new software.

The new buzz word was “Change is the Constant.”

The rigidity of large bureaucratic organizations was being significantly impacted by the delayering and restructuring brought on by this information processing revolution.

More decisions had to be made to cope with the constant change.

Knowledge became more important with these constantly changing dynamics.

It made sense to have others participate in the decision-making process. 

Thus, the management style shifted more toward Participative.

Companies needed to keep up and not get lost in the change from their competitors.

The focus turned to adaption.

Second Wave of the Information Revolution

By 1965, an M.I.T. scientist developed a way of sending information from one computer to another that he called “packet switching.”

This has continued to evolve into today’s multi-faceted internet world.

It is not just social media.

You can type anything into your browser and get a voluminous amount of information in seconds.

This has been a big driver of the acceleration of change which creates instability.

Molecular Revolution

The hybrid DNA-RNA was created around 1960 as part of the early beginnings of the Biotechnology Revolution.

At the turn of the century, the world had advanced to the sequencing of the human genome.

On a similar front, the theory of manipulating atoms was around 1960.

Some twenty years later, the scanning tunneling microscope was developed that could see individual atoms.

Nanotechnology is real.

Together this has all led to the manipulation of cells and atoms.

Chaotic Change

Today, this Molecular Revolution has come to the forefront.

It is transforming the very fundamentals of living systems and materials.

In short, the molecular revolution is another key driver underpinning the chaos.

Fundamental Reprogramming

The ability to fundamentally reprogram things is opening people’s minds not constrained by traditional boundaries.

Management styles are shifting to visionaries.

Instead of being whipsawed by accelerating and chaotic change, visionaries are creating the future.

Ramifications on your Leadership Style

There are practical ramifications of today’s changing dynamics for every leader.

Those in fast cycle industries have been in this chaos for some time.

Slow cycle industries have sped up.

Life spans for companies have shortened.

Technology and imaginative minds are driving more technology and transformations that lead to even faster change and more chaos.

Leaders must be more agile and flexible to cope and prosper, but how do you do that?

What competencies and skills are needed to be an agile leader?

There has been some very thoughtful research on this question.  In this blog, I can only give you highlights and direct you to some of the better resources (in my opinion).

Leadership Agility

In 2007, Bill Joiner & Stephen Josephs wrote the book LEADERSHIP AGILITY Five Levels of Mastery For Anticipating and Initiating Change.

It is a rather sophisticated approach based on their notion of a Leadership Agility Compass outlining four competencies: Context Setting Agility, Stakeholder Agility, Creative Agility, and Self Leadership Agility. 

Using the compass, they then take you through their five levels of agility development: Expert, Achiever, Catalyst, Co-creator, and Synergist.

It has a lot of content. If you are really trying to enhance your leadership agility, it is worth a read.

Learning Agility

Korn Ferry has also done a lot of research on leadership agility outlined in their paper on The Organizational X Factor: Learning Agility.

They describe learning agility as made up of five factors: Self Awareness, Mental Agility, People Agility, Change Agility, and Results Agility. 

You can see some similar ideas to Joiner and Josephs’ Leadership Compass.

I like their addition of Results Agility described as delivering results in first time situations.

The authors, Mary Knight and Natalie Wong, contend that Learning Agility is a top predictor of high potential people. Companies with highly agile executives have 25% higher profit margins than their peers.

Core, Edge and Agility

Agility competencies are important.

It is also important to have a perspective in thinking about the context of this change in your day-to-day world. 

What is central to how the world should work for you to what are the dramatic implications of changing technologies?

In this respect, Lee, Hecht, and Harrison, a global leader in talent development, wrote an interesting paper on Core, Edge, and Agility.

My Silver Fox Advisor colleague, Doug Thorpe, has condensed their ideas and his own in an article on his website in 2018 entitled Leaders: There’s a New Way to Understand Change | Business Advisor, Mentor and Executive Coach | Doug Thorpe

It is certainly worth your read with the idea that agility helps manage the forces of what’s core and what is on the edge.

Set Direction Not Destination

Agility has certainly become a popular topic for organizational consultants in this 21st century.

 One concept I like from McKinsey’s March 2018 article of Leading with inner agility is “set direction not destination.”

This brings us back to my model introduced at the beginning of this blog on understanding change.

You not only have to have agility competencies, and a framework of thinking about agility as we have just discussed.

You also need to be the visionary highlighted in the model.

Ultimately, the management style of significance in this world of accelerating and chaotic change is a visionary leader.

Set directions with the agility to adjust destinations.

To paraphrase Jack Welch, control your own destiny or someone else will.

Contributed by Lane Sloan, former Shell CFO and Silver Fox Advisor.

personal profile

Your Leadership Personal Profile

Your Leadership Personal Profile

4 Inner Ps of Leadership

There are plenty of articles and books on leadership.  The reason being leadership is clearly critical for an organization’s success.  Many emphasize a particular angle or perspective in how you should lead. Instead, this blog provides a comprehensive straight forward approach to know your leadership self.  As Socrates said,  “know thyself.” And with this full picture, it is much easier to identify areas for improvement that will make a difference.

 In coaching mentees on how to improve their leadership. I use my 4 Inner Ps of Leadership framework: Purpose, Persuasions, Personality, and Proficiencies. The framework was introduced in my blog of October 29, 2020 on the Silver Fox Advisors website (See here).   This blog takes that 4 Inner Ps framework and provides a step-by-step approach to develop your Leadership Personal Profile.

Personal Purpose Section

We discussed Personal Purpose in my blog of October 13, 2020 where I briefly outlined a self-development approach.  In the profile exhibit below, that is the methodology taken.

Step 1

The first step is to rank the five characteristics of your Career Development from 1 to 5.  Likewise, in the Personal Development rank the three characteristics from 1 to 3. Finally, rank the three characteristics from Social Development from 1 to 3. 

For example, you might have Financial, Type of Role, Work Environment, Type of Career, and Type of Industry ranked in that order.  You do that for the other three categories.

You should now have a good sense of your priorities in the three main development areas.  Next, we need to determine your priorities across the developmental areas.

Step 2

Then compare the top ranked item from each development area against one another and choose the highest priority in your life. For example, if your top items from the three developmental areas are Financial, Mental, and Family. Then decide on which of these three is most important.  It may be Family.

From the development area chosen, move up the next highest ranked and compare that again against the other highest-ranking development areas.  In our example, you would compare your next social developmental area which might be Friends against Mental and Family to choose the highest of those three.

 You do that five times and place the results in the allotted space in rank order.

Now, you have a fairly good idea of what are the most important priorities in your life.

Step 3

 Then, think about your passions, what excites you, what you are living for, what makes you happy, what you are always talking about.  Couple that with the five priorities above and envision your personal future. 

Write that down as your Personal Vision Statement.  This is what you would like to see your life become in the future. A personal coach can help you think through this personal vision.

Persuasions Section

As you might recall from my earlier blog on the 4 Inner Ps of Leadership, Persuasions are deep rooted beliefs, feelings, needs, perceptions, values, and morals that influence how you behave and act in the “outer” world. They persuade you in acting a certain way and create a filter or bias in dealing with the “outer” world bringing judgment in how to behave. 

The profile exhibit below captures those key elements to illuminate underlying influences on your leadership behavior.

Step 1

Start by listing your top 3 core values such as honesty, tradition, integrity, diversity, positiveness, etc.

This is not intended to be a rigorous psychological assessment.  Instead, what really gets you really angry when someone behaves in a certain manner? What are you always thinking about in making personal decisions? What do you think of most when judging people’s character?

Step 2

Next, think through your key beliefs in people.  An example from Douglas Mc Gregor would be “people are self-motivated to work” or “people only work for the paycheck.”  Another might be “most people tell the truth.”  “People are only out for themselves,” and so forth.  You can get some insight from some personality and leadership assessment tests. Write your top two or three key beliefs about people in the box on beliefs.

Step 3

Similarly, think through your current driving needs.  Maslow’s hierarchy of needs may give you some ideas.  On ego, “I need to be recognized for my talent.”  At the social level, “I need a group of close friends.”  Another need might involve “I need more money to buy a house for my expanding family.” What is driving you? Only list your top 3.

Step 4

The broad perspective on life can be more challenging.  What is your overall outlook that biases you in looking at the world in a particular way? This can be spiritual. Or it might be something like the world is full of opportunities.  We are all just passing through life in a moment in time.  The world is a treacherous place.  I am along for the ride and want to have the most fun.  Again, whatever it is that shapes your broad perspective in approaching life.  It is helpful in talking this through with others.

I have a very forward-looking perspective with an open mind on what opportunities or challenges will come forward in the future.  It is important for me to recognize that others are focused on the past and the issues they faced.

This does not need to be complicated.  Write a simple statement of your perspective in the box provided.

Step 5

In the 4 Inner Ps of Leadership blog, we discussed the concept of a Johari window.  There was a window described as Façade where there are things known only to yourself.

It can be helpful in sharing some of these with others to increase your authenticity.

You might say I act very self-confident but underneath I am quite insecure. Or I put on the aura of being in control of a situation when I am unsure of what to do. I tell people that I am happy when I am terribly sad.  I shake people’s hand warmly, even when I do not like them.

Identify a couple to start opening more of yourself to others. List those in the Façade box.

Step 6

My coaching suggestion is to develop Guiding Principles that give people a deeper understanding of how they can expect you to behave.  These principles often emanate from your values, beliefs, and perspectives.

They should be shared with your people.

Here are two of mine to give you an idea.  “Treat people as you would like to be treated.”  Another is “I will believe you until proven wrong.”

Once you feel comfortable with your Guiding Principles, write the top two in the box provided.

Step 7

This all leads to a Character Statement.  The key is what is your moral compass?  How will you respond in challenging circumstances when your behavior matters most?

An example might be, “I am a trustworthy person that people can count on me doing what I say.”  You can get much more elaborate. 

If you put it down in writing, the Character Statement becomes something for you to live up to. This is vital in improving your leadership qualities.

Personality Section

We are getting on firm ground with personality.  Most people have a reasonable idea.  It can be expanded by personality tests, and other people’s feedback. The point is to get a high-level view that accurately describes you.

Step 1

It is best in the characteristics box to simply list words as opposed to phrases that represent you.  Various personality tests are available on-line from the internet.

 If you have taken the Myers Briggs test, then the choices would be from their four categories: extraversion or introversion, sensing or intuition, thinking or feeling, judging or perceiving.

 In the Big 5 Personality test it is degrees of extraversion, agreeableness, emotional stability, and openness to experience from low to high.

 In DISC, the four quadrants are Dominance, Influence, Steadiness, and Conscientiousness.  And so forth. 

You can see some of the overlap among these tests.

 Also include specific feedback from family, friends, and work colleagues that can be quite revealing.

Write these personality words in the Characteristics box.

Step 2

The Leadership Style component is an area of significant interest in coaching you.

 Leadership style can have an incredibly significant impact on the performance of your followers.  This was discussed in my blog of December 3, 2020 on The People Side of Leadership.

Hogan Assessment

 The Hogan Assessment, although somewhat costly for a small business owner/CEO, is a very comprehensive and powerful tool addressing many areas that influence your workplace behaviors and leadership style.  In my opinion, it is the most comprehensive and best assessment on an overall leadership profile covering in a different format Persuasions, Personality, and Proficiencies.

Their personality test focuses on seven areas: Adjustment; Ambition; Sociability; Interpersonal Sensitivity; Prudence; Inquisitive and Learning Approach.  If you take their assessment, this would-be key input into the Characteristics box.

The Hogan Assessment also has a test on Motives, Values, Preference Inventory that focuses on the Persuasions section. Taking their test would provide significant input into that section.

Hogan also has a cognitive ability section which looks at judgment and reasoning.  The judgment can identify the “dark” side of your personality that in my 4 inner Ps Leadership blog can represent fatal flaws. 

This test also provides significant input on leadership strengths and weakness that is key input into the Proficiencies section coming up.

Hogan does provide detailed analysis of your leadership style.

Broader Frameworks

 As a coach, I also like some of the broader frameworks.  Our aim is to get a personal profile not a detailed personality analysis as provided in Hogan or Birkman tests.  However, their key findings are useful input.

In the Managerial Grid, you assess your concern for People and your concern for Performance from low to high.

Likert’s model outlined in my previous blog on the 4 Inner Ps of Leadership is extremely useful. His four styles are Exploitive Authoritarian, Benevolent Authoritarian, Consultative, and Participative Group.

Other leadership approaches such as Servant Leadership, Authentic Leader and so forth are good for you to understand your inner leadership self.

I also highly recommend taking an Emotional IQ test.  Include your assessment in this Leadership Style segment.

It is also critical to get others views of your style by asking people: how you get things done? how you work with people?  Feedback from work colleagues, family, friends, and your coach provide a different and important perspective.

A personal coach can be extremely helpful in providing an assessment of your leadership style.

Take all this input and summarize in several key words and statements.

Step 3

Besides knowing more about yourself, you will have opportunities for improvement. 

For example, you may want to take on the bigger strategy of restructuring your leadership style.  You will need real passion to do so.  This can be a challenging undertaking.

Also, recognize your leadership style matures over time.

In my opinion, Situational Leadership is the strongest style once you have reached a high level of leadership competency.  Here you adjust to reflect the environmental conditions you face based on the deeper understanding of various leadership approaches.

 Tactically, you may find something like you tend to be less sensitive to people’s feelings.  In this case, you would want to listen more carefully.  How are they expressing themselves?  What is driving their behavior?  

There may be fatal flaws you have to correct to be an effective leader. A fatal flaw can be as simple as you constantly snickering when people are talking.  And so forth.

There is no perfect leadership style.  Build primarily on improving yourself, not becoming someone else.

Write down what you want to do now in the last segment.  Update this segment In your profile as you progress.

Proficiencies Section

In my coaching sessions, we spend a good deal of time on Proficiencies.

 As you can see in the exhibit that follows, these proficiencies are broken down into the following:

1) Traits (using Northouse model from his eighth edition book on Leadership Northouse Theory and Practice)

2)  Knowledge of Business (in general),

3)  Industry Knowledge

4) Technical Knowledge

5)   Leadership Strengths with a focus on Strengths Based Leadership.

6.)  Leadership Brand on how you want to be known.

Step 1

In the Leadership Traits box, this is a self-assessment not a test taking exercise.

IQ

 You have a fairly good idea on your cognitive ability.  Simply assess from low to high.

 On the other hand, you may have remembered your IQ score.

If you are around 100, then medium would be the choice.

My view is above 115 could be considered high for this purpose.

Other traits

Similarly, how do you view your self-confidence, determination, integrity, and sociability?  This is your view and how others perceive you.

 Low is not typical for intelligence and integrity. The rest varies by individual. Be honest in your assessment. You will only be deceiving yourself as Traits are generally stable.

Step 2

Business knowledge not surprisingly relates to what is taught in business schools.  These are the underpinning functions in running a business. 

This self-assessment should reflect your knowledge of the current state of the art.  What is being taught today. And what are current discussion topics in business circles. 

For example, I have a business major in marketing and a master’s degree with a lot of IT.  In my career, I started as a computer programmer and was once the head of Shell Oil’s IT organization.  But today, both marketing and IT world would rank only medium in my mind.

Rank yourself from low to high on the business categories in the business knowledge box.

Step 3

Industry knowledge relates to experience as well as expertise.

What are the key drivers to success in this industry? This would include your knowledge of the competition’s offerings and value propositions.  The industry dynamics such as ease of entrance, competitiveness, progressiveness, cycle time, and so forth.

Industry knowledge is not the centerpiece of leadership; yet without sufficient knowledge it can become difficult to gain followers.

Write a couple of key statements in the Industry Knowledge box.

Step 4

Technical knowledge starts with understanding in sufficient detail your product or service. That is, how it works and what might be unique.

More broadly, technical knowledge includes science-based backgrounds such as engineering, physics, etc.  If the product or service depends on a science-based background that should be highlighted.

Similarly, specialized knowledge such as being a CPA, a lawyer, a technician, computer programmer, etc. 

To what degree do you keep up with technology trends? 

This is not a dissertation, but headliners.

Capture a few headliners in the Technical Knowledge segment.

Step 5

The next box on Leadership Strengths is key.

 As mentioned in my blog describing the 4 Inner Ps of Leadership, my approach is to start with Rath and Conchie’s Strength Finders 2.0 Strength Based Leadership test.

 It is not an expensive book and has an internet test that provides your top 5 strengths in the categories of Executing, Influencing, Relationship Building, and Strategic Thinking.

Any additional insights from your personality tests, Hogan assessment, other’s feedback should be included. 

Again, make these headliners to keep it simple.

Put them in the Leadership Strengths box.

Step 6

I have found it is extremely helpful for the leader to develop a desired brand statement.

Just like companies have a brand that influences their reputation, leaders do to whether they recognize it or not. 

Managing your leadership brand starts with developing your brand statement.  Your leadership strengths will be a key determinant.

For example, my leadership brand is “a strategic visionary who gets things done.”

 That rests on 3 of my strengths from StrengthFinders falling under Strategic Thinking. The other two fall under Execution.  Plus, all my feedback including LinkedIn point towards my strategic skills.

Think about this carefully. You may want others to review as well as your coach.

 Then formulate your Brand Statement and put in the designated box.

Step 7

Improving your leadership really comes to the forefront under Proficiencies. 

You will find some key areas that you want to improve. 

If there are clear deficiencies, identify what steps need to be taken.

Most often, it is building synergies around your strengths.

These lead into your brand.

Summary

The beauty of putting your Leadership Personal Profile together is you will know yourself better.

Knowing yourself better provides clarity on what you can work on to improve your leadership.

While there many components in the overall profile, my goal has been to make this practical and straight forward. It is not a rigorous academic model nor a complicated personality test.

 I have designed it so that you can sketch out your profile on your own.  Treat it as an evergreen document as you progress.

If you are a small business owner or CEO, this tool can be incredibly useful as your company moves through the 4 growth stages described in my blog of October 8, 2020.  In that model, leadership becomes more and more important as you move up the growth stages. 

A Silver Fox Advisor can help you on this journey.

ALL RIGHTS RESERVED BY SLOAN CONSULTING SERVICES

Contributed by Lane Sloan, former Shell CFO and Silver Fox Advisor.

Breaking Out of the Development Stage for Small Business

According to the most recent NAICS Association data, there are roughly 14 ½ million small business with annual sales of less than one million dollars in the United States. They almost all have less than ten employees.

The Chamber of Commerce indicates there are about 400,000 new businesses started each year. Of these, about 20% go under in this first year. The reason most often given was lack of funding followed by poor planning and then bad management.

In my 4 Stage Growth Model outlined in the October 8, 2020 blog, the Development Stage’s criterion was those small companies with revenues of less than one million. The stage is not built around sole proprietors but for those companies desiring to substantially grow their revenues which involves adding employees.

Using this 4 Stage Growth Model framework, this blog will share some thoughts on how to break out of this Development Stage. 

These are typical characteristics of small businesses who have recently launched to those who are struggling to break out of this early stage.

Development Stage Characteristics

  1. Revenues
    Cash inflow from revenues are not robust and less than one million.
  2. Sustainability
    Managing cash to survive is critical for sustainability. Chasing new customers and constraining expenses are dominant management features.
  3. Business Focus/Planning
    Day to day operations dominate the owner and any workers activities. Planning is generally no greater than a year and very ad hoc.
  4. Organization
    Owner controls decision making most of the time. Staff is limited often less than ten as revenues will not sustain greater numbers.
  5. Processes
    Operational sophistication is not strong with processes not well defined.
  6. Target Market
    Unless a strong business idea backed by venture capital or significant angel funding, the customer base is generally local.
  7. Value Proposition
    Owner’s business idea drives offering to customer.
  8. Leadership
    Leadership is not typically a discussion point as distracted by daily business. There are few employees.

Where do you want to take the business?

This is the first question to ask yourself in this Development Stage.

If your answer to this question is you are a sole proprietor and quite comfortable continuing down this path, then no need to read further. You are happy and fulfilling your personal career aspirations.

For the rest, one way to think about this question of where you want to take the business is to ponder your exit plan.  That helps establish the long-term vision.

Maybe this is a family business, and you want to pass it along to future generations stronger and better positioned than it is today.  That is a viable exit plan because you recognize that if you aren’t growing your dying.

 Others want to develop the business through their career to be able to sell it for their retirement funds. My only caution with this vision is you need to build a sellable business.

Some want to take the business as far as it will go with the aspirations it becomes a meaningfully sized business with significant revenue and profitability.  The exit plan may be to sell when a certain valuation is achieved, or to continue to be engaged whatever it morphs into becoming.

Then, there are those with great ambitions of building an empire which they want to control to the grave.

Obviously, there are many scenarios.  What do you want?

As soon as that exit plan is clearer in your mind, the next question becomes how do I get there?

The answer from most every business advisor is you will need to plan a path.

Take time to plan

If you have recently launched your business, then hopefully you have put together a business plan.

 Many people just jump into starting a business without thinking through the essential elements necessary for ongoing success which is why so many go under in their first year as the Chamber of Commerce points out.

Even those who have made it through the first year, often continue to float sideways without any meaningful growth. Many will die before their fifth year.

My experience is these small businesses spend all their time fighting the daily fires trying to survive with little time for planning.

If you are in this position unless you set some meaningful time to plan, then the business will just keep floating sideways.

What are elements of the plan for breaking out?

My reason for developing the 4 Stage Growth Model for small businesses is to give a roadmap of elements to aspire to in the shorter term.

Thus, the objective becomes moving into the Growth Stage.

Here is a generalized description following the same elements outlined in the Development Stage with new characteristics.

Growth Stage

  1. Revenues
    Owner(s) are getting excited about the organization’s success. Traction with new customers or expanding activities with current customers is generating a growing revenue base. Typical revenues run above one million and below ten million.
  2. Sustainability
    Organization is approaching a going concern where owner is less critical to survival and growth. Revenues are providing cash to invest in business and improve operability and compete more effectively for new business. Loss of key customers can prove devastating.
  3. Business Focus/Planning
    There is a fair amount of activity on generating new ideas for products/services/customers and more sophisticated approaches to attracting customers through marketing. Still planning is heavily oriented towards current year. Planning still may be rather ad hoc lacking strategic focus synchronized with tactical game plans. Planning framework including mission, vision, objectives, value propositions, target markets, strategic themes, competitor analysis, goal cascading, accountability, and so forth are often lacking. Effort does not seem to match current rewards for many with the focus still on the here and now.
  4. Organization
    Other key players have evolved and perform critical roles. Often, these players interact more, and teamwork is emerging. Organization structure is still somewhat loose with not overly formal role definition. The size of the organization varies based on the nature of the product or service provided. Often staff exceeds ten and but generally does not exceed fifty and almost always less than one hundred. Contractors are used to avoid adding staff in many cases. People can perform multiples functions.
  5. Processes
    Processes have emerged and there is a level of documentation and sometimes training. Processes are often changing and adapting as more effective functioning progresses and customer feedback requires modifications to be made.
  6. Target Market
    Local market continues to dominate customer base in most cases. Customer loyalty has emerged and identified as key customers with a retention focus. Expenditures for sales and marketing have expanded significantly. Often there are some dedicated people to sales beyond owner and budgets for improved web sites, marketing collateral, and marketing campaigns.
  7. Value Proposition
    Value proposition is adapting to customer needs and customer feedback.
  8. Leadership
    Owner and key players are beginning to think about how to motivate and retain employees. Decision making processes are receiving some scrutiny. Delegation has emerged where owner feels comfortable with key players carrying out more defined roles. Level of participation in decision making varies but generally still well controlled by owner.

Not sure this Growth Stage can be achieved?

If you face the dilemma of breaking out, you may be bewildered on how to move into this Growth Stage.

Here are two recommendations for you to consider if you are willing to listen to others.

First, look for a business advisor.

The association I belong to, The Silver Fox Advisors, specifically targets small businesses.

This is our mission.

“Our association of proven business leaders serves the needs of small business owners, CEOs and entrepreneurs in the Greater Houston area.  We help leaders establish, grow, and prosper their business by sharing our collective wisdom through robust service offerings.

The second recommendation is for you to consider their service offerings.

I particularly recommend their CEO Roundtables that are free of charge.

This will provide you an advisory type board of other small business owners and CEOs trying to grow their businesses too.

A Silver Fox Advisor participates in these monthly meetings.

You should also consider our CEO Education series as well as our Lunch & Learn programs.

If this interest you, go to our website Silver Fox Advisors for more details. As we like to say, Growing your business can be challenging.  You don’t have to go it alone.

Contributed by Lane Sloan, former Shell CFO and Silver Fox Advisor.

Reflections on Servant Leadership

What is Missing?

Robert Greenleaf’s ideas on Servant Leadership have gained quite a group of dedicated followers since the publication of his essay in 1970. He articulated, “It begins with the natural feeling that one wants to serve, to serve first.  Then conscious choice brings one to aspire to lead.  That person is sharply different from the one who is leader first, perhaps because of the need to assuage and unusual power drive or to acquire material possessions.” While the foundation of his ideas is very sound advice on leadership, Servant Leadership has not become the pervasive mainstream theory of leadership.  Why is this so and can his foresight be leveraged with additional insights?

Here are some thoughts for you to ponder that hopefully will be fruitful in leveraging Servant Leadership into our practical day to day world of business.

Confusing Contrast

The contrast to a servant leader by Greenleaf is a leader being driven by power and material possessions.  This line of thinking would have been natural at the time as the prevailing autocratic model of management was indeed driven by power and authority. That model was under challenge particularly in the 1960s from insightful thinkers such as Douglas McGregor’s Theory X and Y, Rensis Likert’s work on the performance of different leadership styles, Blake and Mouton’s managerial grid and so forth that we discussed in my blog on The People side of Leadership.

Unfortunately, Greenleaf’s depiction of leadership becomes obfuscated without a clear distinction between managers and leaders. I addressed that in a previous blog Manager vs Leaders. In essence, a manager has a position of authority and responsibility within the organization that involves making decisions such as setting plans and budgets, organizing and staffing, controlling through accountabilities and so forth.  Leaders quite simply have followers on where they are going.

Greenleaf does not explicitly discuss managers; however, he implicitly intertwines the functioning of institutions and “the system” with leadership insights in his essay. This is not surprising as too often managers and leaders are equated with HR vernacular like “she was promoted to a leadership position.”

The idea of assigned leadership is still prevalent in modern leadership theory.  In my opinion, this misrepresents the actions of followers.  An employee may obey a manager’s direction.  That is different than followers who want to follow.

When Greenleaf talks about an unusual power drive or material possessions that too gets all intermingled with the role of a manager with little to do about leadership.  Managers because of their role in the organization make more money than the employees working for them and the position has inherent power which in many respects depicts the leadership contrast Greenleaf presents.  But unfortunately, that tells us little about the manager’s leadership ability. Greenleaf’s alternative in many respects is a false alternative to Servant Leadership because someone focused entirely on “me” being driven by power and purely self-interest will not be a leader.  Leadership requires a “we” not a “me” mindset.

We Mentality

Leadership requires more than one.  The leader must persuade someone to follow their advocated vision, goal, or simply direction. For someone to follow, their needs must be met in some meaningful way of value to them. The direction should include a common goal. There must be a form of a value proposition that motivates or better inspires them to follow that direction.  Thus, the leader’s mindset must shift from “me” to “we.”  The leader must serve the needs of followers.  As many authors suggest this leads to some form of collaboration.  If that direction and collaboration achieves meaningful results, then the followership is strengthened.    It is a natural process.  There is no need for the leader to have a position of authority in the organization or institution in Greenleaf’s vernacular.  Anyone can be a leader at any point in time.

Managers Need to be Leaders

In pursuing the leader’s advocated direction, the leader has needs that are met in some meaningful way as well.  Thus, the foundation of leadership is that mutual benefit is naturally derived for both the leader and the follower. In essence, leader and follower are serving one another.

Clearly, a manager is in a hugely attractive position to provide leadership because of their designated authority to direct.  If the advocated direction is seen to provide meaningful value to the employee, then following can occur naturally, and there is mutual benefit derived by both parties.  But for that to happen, the manager must be reaching out to employees and get them engaged and aligned with the direction. When this occurs, then indeed a manager can be a leader and, in the process, unleash inspired motivation from employees because the direction aligns with their higher-level needs.

Some may argue that leadership is not about “we” but rather about strictly serving the other person.  This is not really a discussion about leadership as leaders have followers.  Serving may or may not lead to following. There are many ways to get others to follow you.  One of the strongest is to develop them, get them engaged and guide them in the pursuit of their personal purpose.  In the case of managers, developing employees is a key responsibility.  A centerpiece of people development is serving, coaching, guiding, and mentoring others.

Think Value Propositions

What Greenleaf advocates is core to being a leader.  The leader must understand the needs of people in order to provide a direction that will meaningfully fulfill their needs through value propositions. Leaders dedicate themselves to fulfilling value propositions.

For a leader and followers plus managers and employees, mutual benefit for me is the leader serves by providing a value proposition that is meaningful to followers (employees in the case of a business owner). Likewise, the follower or one can correspondingly think of employee should provide a value proposition to the leader/manager to create mutual benefit.

Still, the manager and hopefully leader has other stakeholders.  There are many stakeholders that must be considered in a business enterprise including investors/banks, the relevant community, and so forth.    It is not simply the employees accountable to the manager even though they are crucial to success.  Practically there are tradeoffs in vision, goals, and directions for the various constituencies. Thus, the reality is more complex than simply one on one relationships of manager and employee.

In serving to fulfill other’s needs, the manager/leader’s needs will also come into play which leads to the centerpiece of achieving mutual benefit.  Mutual benefit lends itself to adaptability depending on the situation with various people shifting in and out of the leadership role (not managerial role) as appropriate depending on their relative strengths, capabilities, and foresight.

Think Teamwork

Thus, there is mutual support serving one another to achieve the greatest benefit for all.  This is the nature of teamwork and collaboration.  Leadership is very much like a team sport where everyone wins.  In Greenleaf’s essay the leader’s role is much more static with less dynamism than required in our fast paced always changing world today.

Without this concept of mutual benefit and its derivative teamwork, people in managerial roles find it challenging to pursue only a servant leader mentality.  For example, companies stay in business because they provide a meaningful value proposition to their targeted customers.  In that respect, successful companies serve the customer just as leaders serve their followers.

Servant seems Demeaning

The term servant can get in the way as well for managers even though there are interesting philosophical underpinnings in Greenleaf’s essay. No one needs to be a true “servant” to a master. The humbleness and will to serve are terrific traits of leaders. Tom Collins found this in his book Good to Great: Why some Companies Make the Leap and Others Don’t. But for many the term servant seems demeaning.

Transcending to a more comprehensive state of mutual benefit with a “we” mentality, collaboration, engaging value propositions across the board, teamwork leading to successful outcomes more readily lends itself for managers to become leaders.  The positive momentum of a company grows enormously when managers become leaders too, which is why organizations spend so much time and money on leadership development programs. When managers become leaders, they can unleash the motivational potential of their employees and correspondingly significantly increase the performance of the organization. Remember that people follow success.

Contributed by Lane Sloan, former Shell CFO and Silver Fox Advisor.

UPCOMING EVENTS
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