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FroZEN musings :: 8 questions every business owner should answer

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One benefit to all this snow (at least 60″ and counting) is the opportunity to ponder many things while dealing with the white stuff (a/k/a shoveling).   In true Zen spirit, I’ve decided to label these my froZEN musings…

The most important question we answer for clients is pretty straightforward :: what does your business need to do today in order to achieve growth & profitability tomorrow?  Most owners think they know the answer to this question.  So do many employees.  Each of their perspectives, however, are filtered through their personal beliefs and preconceptions. Our first job is to help businesses identify their unfiltered reality.

The process we follow to define an organization’s unfiltered reality is our proverbial “secret sauce.”  My froZEN musings, however, resulted in eight questions that we’re now going to ask clients to answer each month.  Do the same, and you’ll be positioning yourself down a path of growth & profitability (though you may not get there as directly or as fast without our “secret sauce”) ::

  1. Describe what your product /service does and who buys it.  Can you do this in one sentence?  If yes, then a whole host of things are going to be a lot easier for you.  If not, make it your top priority to do so.
  2. Explain why somebody chooses to buy your product / service.  Can you do this in one sentence?  If yes, a double ration of grog in celebration.  If not, make it priority # two.
  3. What one thing is most responsible for preventing sales?  Now put a plan together to fix this and make it happen.  Your goal should be to have a different answer to this question each month.
  4. What’s one thing you could do to get feedback from existing customers or lost sales opportunities?  Make it happen, listen and learn from your customers.
  5. Which of your business operations do you most hate?  Consider how you can delegate these activities to others.  If there are no “others,”  begin defining how these activities can be managed by a new hire.
  6. What business operations / initiatives could you do “half-assed” without creating problems for either your clients or your brand?  As with #5 above, begin defining how these activities can be delegated or folded into a new hire.
  7. Is the role of your next hire sufficiently defined to assure their activities will generate enough new revenue to cover their salary & benefits?   (Revenue generation doesn’t have to be direct…  could be something as simple as freeing you up to generate more sales…)   If not, go back to the drawing board until you know how your new hire will be able to “pay for” themselves.
  8. If you could get 1 solid hour of advice from a professional you respect, what would you discuss and what would be the goal of your meeting?  You can create the opportunity to work with a “guru,” or it could happen by chance.  Either way, if you’re not ready you’re wasting both the opportunity and each other’s time.  Success is achieved at the intersection of opportunity and preparation.

Any others you’d like to add?  (perhaps my brain was simply froZEN after 8 questions…)  Would love to hear your thoughts…

zen and the art of small business

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Daruma dolls have their genesis with the father of Zen Buddhism...

Daruma dolls are a tangible reminder of the enlightement achieved by the father of Zen Buddhism. (photo credit :: American Express Open)

As this recent article on goal setting astutely pointed out, “It’s not that people don’t know how to set a goal.   It’s that they have a hard time keeping it.”

I was drawn to this article because of its title (referring to “zen luck”),  and was especially pleased to learn about the significance of the Daruma doll in Japanese culture.  Apparently, Daruma dolls are  given to individuals taking on a new challenge or direction (which can include starting a new venture or setting a significant goal).    At the start of this journey, the recipient of the doll makes a wish and paints in one eye (usually the left).  The other eye is painted when the goal is achieved.

Children of the 1970’s, do you remember “Weebles” (“Weebles wobble but they won’t fall down”)?  The creator of the Weeble must have been a Zen practitioner, as Weebles are just like a well-made Daruma doll — “bouncing back to regain its balance, and symbolizing an undaunted spirit and recovery from misfortune.”

We have a quotation hanging in the zen bungalow that reads “Failure is only the opportunity to more intelligently begin again.  — Henry Ford.”   I guess Ford was a Zen practitioner, too.    Whether you’re a successful capitalist or enlightened Buddhist monk, however, the lesson remains the same.

In pursuit of our goals, we will be knocked over.  Many times.  The key to achieving our goals lies in reminding ourselves to emulate Daruma.   Happy 2011!

Is Main Street Dying?

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Is Main Street Dying?

Is Main Street Dying?

The town in which I live can boast of being the world headquarters for some pretty impressive players – we have multi-billion dollar big boy EMC, expanding Bio-Tech player Caliper Life Sciences, and of course, Main Street Ventures!

Despite the presence of some pretty major businesses, most day-to-day commerce takes place outside of Hopkinton’s borders.  Our Main Street has only a handfull of small, independent businesses.   A couple of commercial development projects promised to bring new services into the town, but the recession has stalled (and in some cases completely terminated) their progress.

Ironically, local residents have cried for “revitalization” of Hopkinton’s downtown business district for many years.  Yet even when economic times were better, the town’s independent business community wasn’t exactly thriving.  The future for independent businesses doesn’t look promising  –  the kind of companies being courted for those stalled developments are predominately larger regional or national operations.  Neighboring communities have their own “flavor” of this phenomenon.

With such strong and clear public demand for local services, why aren’t there more successful independent businesses along the main streets of our communities?  One reason lies in an age-old paradox.  Whether they’re just starting out or have been operating for several years, most independent businesses can’t afford the breadth of expertise needed to create a truly sustainable and profitable business.  The sad irony is that in those situations where affordability is not an issue, there’s often a lack of awareness as to what’s needed to get to the next level.   Let’s take the process of navigating the regulatory environment as an example.

The volume of federal, state, and local regulations at play when you’re looking to start and operate even a small business is truly staggering.  Something as simple as hanging a sign outside your business requires the filing of a permit  –  and by the way, payment of an associated fee.  In some cases, public hearings are required, imposing even more costs and adding several weeks onto the process.

To make matters worse, agencies and departments charged with administering the regulatory process are frequently unhelpful, lapsing into a bureaucratic coma when it comes to assisting a business owner.  Sure, businesses can hire professional help, but with hourly rates for attorneys starting at $150 or more per hour, that becomes a tough nut to swallow.  So business initiatives are abandoned, either because the owner fails to successfully navigate the process or because they walked away after considering the time, effort and expense involved.  And this is just one small piece of the puzzle.

I happen to believe that successful, local, independent businesses are vital to the economic and social well-being of a community.  This was a major factor behind the decision my wife and I made to leave “big business” many years ago and start Main Street Ventures.

Though we’ve helped a wide variety of “main street” businesses over the past several years, you can’t bring significant change to the independent business landscape by working with one company at a time.   So over the past several months we’ve taken our informal process (traditionally delivered through one person – me) and transformed it into a structured program of integrated solutions that can be replicated anywhere.

Last month we launched the first phase of our new program with the opening of the “zen bungalow.”  A coworking space and professional community, the bungalow is a tool for bringing together independent workers who are interested in collaborating with other creative and talented people.  In the context of our larger program, we see the bungalow serving 3 main functions ::

  1. Individual Business Development (the bungalow environment is ideal for helping members obtain the critical expertise and resources needed to grow their own businesses)
  2. Regional Business Development (by actively managing the community, we can facilitate strategic collaborations and partnerships among members or with businesses located within the region)
  3. Regional Resource Creation (when appropriate, we can incorporate the products and services of bungalow-based businesses into our program of integrated solutions – solutions ultimately delivered to “Main Street” businesses located throughout the region)

Starting this month, the zen bungalow will host “Lunchtime Office Hours with the Main Street Mentors (sm).”  Part networking event and part professional services, participating businesses will receive up to 20 minutes of individualized assistance from a trusted serviced provider.  These lunches are intended to provide substantive help to the business owner, and not be just a general consultation.

This month, attorney John Koenig of the Indigo Ventures Law Firm (offices in Cambridge, Massachusetts and Boulder, Colorado) will be the Main Street Mentor(sm) of the month.  This lunchtime event will be held on Friday, November 19, and is limited to 12 businesses.  The cost is just $10 $12.50 per person.  More information is available at the bungalow’s website  ::  http://zenbungalow.com We hope to see you there.

how collaboration can build your small business

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your challenge

if you’re a small business owner, you probably spend a lot of time working on tasks and projects that fall outside of your strongest skill sets.  sometimes the reason for this is a lack of money.  other times the reason is a desire to drive every aspect of your business.  regardless of the reason why this happens, know that spending too much time on things you don’t do well usually results in massive inefficiencies and is guaranteed to stunt your company’s growth.

so how do you get over this hump?  like many things in life, the answer is simple, but the solution is a little more involved…

the solution

for every business task that stretches one of your talents, I can guarantee there are no fewer than 25 people within a 2 mile radius of where you currently stand / sit / lie that can do one of these tasks better and faster than you.  the challenge you have lies in finding the right talent, then creating a manageable and sustainable method for bringing this outside help into your operations.  here’s my list of key considerations for this process ::

  1. identify your top 5 time wasters that are most important to the growth or smooth running of your business
  2. define the scope of work involved with each
  3. make certain you understand and can effectively communicate how these tasks influence and interact with other parts of your business
  4. find at least 2-3 talented people who can do this work well (preferably the kind of person who delivers value beyond just getting something done)
  5. verify the quality of their work
  6. determine which of these folks possess a style & personality that fits best with your own (and those of the people with whom they’ll be interacting)
  7. rank your candidates based solely on quality & fit
  8. negotiate a fair and affordable price for services with your top candidates
  9. assure the person you select creates & integrates a well-defined process that satisfies 2 critical needs.  first, it should allow others to seamlessly step in if necessary.  second, it shouldn’t just meet your present needs, but also be designed to comfortably handle the increased volume of work driven by your company’s growth

what if i can’t afford to hire outside help?

many business owners honestly believe their company’s cash flow simply won’t support the hiring of outside help.   rarely is this truly the case.

if you diligently execute on each of the considerations listed above, the resources you bring into your operations should quickly pay for themselves (you should actually come out ahead).  the challenge, once again, lies in budgeting the time, talent and energy it takes to invest in this process.  you do have some other options.

first, if you’re not already doing this, get out and network with your fellow business owners.  learn to be purposeful in your networking, however, so you’re not simply spinning your wheels (this is another article for another day…)

[WARNING :: watch out for the passing reference to one of our service solutions]
second, join a co-working community.  even if you’re a retailer, every business function is not performed on the sales floor.  co-working locations can have dozens of different businesses of varying specialties and focuses all under one roof.   accountants can find marketers to help them promote their services.  developers can find lawyers to help them sort through contracts and licensing issues.  there’s no better environment for evaluating a service provider, and you’ll have countless opportunities to share, barter or charge for your own services.

[WARNING AGAIN :: now watch out for a shameless plug]
finally, you can give us a call here at main street ventures.  we’re passionate about working with small business owners, and specialize in creating the “connective tissue” that’s needed to make “main street” businesses both sustainable and profitable.  in fact, we’re so confident in our approach that we guarantee our work will pay for itself.

Real Estate Broker Fined $35,000 for Data Protection Failures

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Last month the Federal Trade Commission finalized a $35,000 settlement with Gregory Navone, a small real estate broker who threw 40 boxes of customer tax returns, bank statements, consumer reports and other financial records into a dumpster located behind an office building in Las Vegas.   Despite what the ads say, this just goes to show you that what happens in Vegas doesn’t always stay in Vegas.

In resolving this complaint, Navone agreed to the fine (approximately $875 per box) and committed to adopting a comprehensive “written information security program.”  For those of you who read our last article on the Massachusetts Data Protection Regulations going into effect on March 1, this should sound really familiar.

There’s a lot more to learn from this case, however, than simply noting we shouldn’t be as foolish in our dumpster habits as was Navone.   The FTC’s investigation of Navone extended deep into his business operations, uncovering many additional violations of the law:

  • he failed to implement physical and electronic security procedures over sensitive customer data, and
  • he failed to take reasonable steps to secure customer records stored  in his home’s garage.

Once again, readers of our last article should easily recognize the similarities with the latest Massachusetts regulations.  Although Navone’s problems arose under several federal regulations (the FTC and Federal Credit Reporting Acts), the requirements are very similar.  It’s also especially interesting  that the FTC’s claims also encompassed Navone’s failure to comply with his own customer policies, which read in part:

We take our responsibility to protect the privacy and confidentiality of customer information very seriously. We maintain physical, electronic, and procedural safeguards that comply with federal standards to store and secure information about you from unauthorized access, alteration and destruction.

If I were in Vegas right now, I’d consider it pretty safe to bet that Massachusetts regulators will take a similar approach with the enforcement of its laws.  Navone either consciously ignored his obligations under the law, or believed he was such a small operator that his lack of compliance would never be discovered.  Like so many who gamble in Vegas, he lost.

If you’re operating a business in Massachusetts, I encourage you to avoid acting like Navone – especially if you can’t afford to lose $35,000 or more (plus the cost of hiring an attorney)  in making your bet.

Jack Speranza is an attorney, software engineer and entrepreneur.   For 15 years he has helped his companies and clients strike the right balance between risk and reward by weaving good business, good technology and good law into new services and operations.

A $5,000+ Question (If You’re Doing Business with Massachusetts Residents)


Massachusetts Data Privacy Regulations are in effect March 1, 2010By March 1, 2010, businesses and organizations that store “personal information” about a Massachusetts resident must have minimum safeguards in place or face a minimum fine of $5,000 regardless of whether or not that information is ever compromised.  Enacted in the wake of major data breaches (starting with the TJX debacle a little over a year ago), the state of Massachusetts has sent clear signals that it expects all businesses (large and small) to take personal privacy and data protection seriously.  Word on the street is that early enforcement will be vigorous, and examples will be set.  So if you’re a smaller business who thinks you’ll be able to fly under the radar, you might want to re-think your position (unless you’re ready to fork over $5,000 or more should you lose your “bet”).  So, in the interest of helping our friends on Main Street avoid any problems, here’s a quick run-down on what’s involved:

what information is covered under this law?

The law and regulations are pretty far-reaching both in terms of the information to which they relate and the organizations that must comply. The personal information at stake is any non-public data (regardless of how a company obtains it) that contains:

  1. A Massachusetts resident’s first and last name or an initial with last name; and
  2. Either
    (a) Social Security Number;
    (b) Driver’s license number/state-issued identification card number; or
    (c) financial account number/credit card number/debit card number (even if without any security code, access code, PIN or password).

There’s a couple of things that should jump out at you.  First, if you have any employees (full-time, part-time, seasonal) you’re holding this data.  Second, how you came into possession of this information is irrelevant to your obligation to now property safeguard it under the law.

what individuals and organizations have to comply with the law?

Everyone.  It doesn’t matter if you’re an single individual or a company that has 2 employees or 10,000.  It doesn’t matter if you’re for-profit or non-profit.  It doesn’t matter if you’re located in Massachusetts or California (OK, that last one would necessitate an interesting analysis over jurisdiction, but in most cases you’re probably still on the hook).  Have I made it clear there are no exceptions?

OK, so what do we have to do?

It’s not all bad news.  Some things you may already be doing, and you just have to do a better job of spelling them out.  Other things will be completely new.  Here’s a quick run-down:

  1. No matter how many safeguards are in place, you won’t be in compliance with the law unless you create and implement a written information security program (otherwise known as a “WISP”).   This program must define the various safeguards you put in place (administrative, technical, and physical) to protect the personal data of employees and customers.   The technical requirements that must make their way into your WISP can get pretty detailed, so unless you’re a technology whiz, this is one aspect of the program you’ll probably want to outsource.
  2. Once your written program is in place, you can’t stop there.  All employees need to be made aware of the written program.  At least one employee must be designated to maintain and oversee it.  Ongoing employee training (including temporary and contract employees) is a clear requirement, and you must also demonstrate ongoing enforcement of security policies for employees (including determining individual levels of access), imposing disciplinary measures for violations of the rules.  You must also assure terminated employees are prevented from gaining access to protected information.
  3. Your obligations don’t stop in-house.  You must verify that any third-party service providers to whom you provide access to personal information are also applying  protective safeguards of their own.  This may involve assuring appropriate language is inserted into your written agreements or obtaining some other form of appropriate written assurance.
  4. Now here’s some news that’s both good and bad.  The specific measures you need to implement in order to be in compliance will vary on a case by case basis.  It all ultimately hinges upon the nature of the business and the type of data involved.  Although there are no clear guidelines or directives as to what constitutes “reasonable” measures, this is another instance where outside assistance can be a real help.  Though the regulations don’t specifically provide for this, there’s plenty of Massachusetts case law suggesting that reasonable reliance on outside experts will relieve you of liability that might otherwise attach.

what’s at stake if we don’t comply?

The regulations will be enforced by the Massachusetts Attorney General.   Organizations not in compliance are subject to: (1) a lawsuit to prevent you from continuing to operate in violation of the law; (2) a fine payable to the state of up to $5,000 per “method, act or practice” the business knew or should have known violated the regulations; and (3) the imposition of costs associated with any litigation, including reasonable attorney’s fees.  And if your organization actually suffers a data breach?  Well, the sky’s the limit…

I now interrupt this article to to bring you a shameless plug.   Main Street Ventures is uniquely positioned to assist your company with creating and implementing your “WISP.”   For years we have been working at the intersection of business, law and technology.  Our expertise has allowed us to develop a very cost-effective program for Main Street businesses consisting of an audit of your operations, relationships with 3rd party providers, and technology systems.  For most businesses, we should be able to create a comprehensive WISP and help you implement it for under $750.  A small price to pay compared to an exposure of $5,000 or more under the law.

If you’re comfortable handling this in-house, we’re happy to answer any questions for you (no charge – within reason, of course).  Feel free to comment below or give us a call.

Jack Speranza is an attorney, software engineer and entrepreneur.   For 15 years he has helped his companies and clients strike the right balance between risk and reward by weaving good business, good technology and good law into new services and operations.

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