Who’s Who in Chicago Business 2024

 Who’s Who in Chicago Business 2024

New INC. Magazine column by Howard Tullman

 

Why Everything Old is New Again

High tech may have accelerated during the pandemic, but high touch has become equally important. 

 

BY HOWARD TULLMAN, GENERAL MANAGING PARTNER, G2T3V AND CHICAGO HIGH TECH INVESTORS@TULLMAN

We’re seeing an interesting resurgence in many different aspects of our daily lives of what I think of as the appeal of physicality. On a macro level, the primary concerns and the critical solutions for next decade or two - whether we’re talking about climate changes, environmental issues, urban congestion, or food insecurity - will have just as significant a physical component as any software element. Software may have eaten the world, but it won’t feed your family or fill a pothole or house the homeless. Even a billion bits won’t build a new building.

 We’re entering another cycle where manufacturing, material science, and simply making things will assume a new primacy and economic importance.

On a micro level, we’ve all realized the reassuring importance of the touch and feel of real goods, the smells and vibrations of machines and instruments, and the physical gratification and release which comes from all kinds of manual exercise, hard work, and serious sweat. The Who in Tommy were clearly onto something begging: “See Me, Feel Me, Touch Me, Heal Me”. We’re trying to get back in touch with ourselves. Any runner, any drummer, any builder, or any baker can tell you their version of the solidity, warmth, and authenticity embedded in these kinds of activities. There are emotional and physical reasons for the return of vinyl records and old-fashioned amps. Digital compression and portability were a short-sighted tradeoff for the immersive power and penetrating depth of the “real” music, which used to pound our heads and our hearts. After decades of the sterility of the digital world, it’s comforting and downright healthy to make something with your own two hands - whether art, music, manna, or material.

Amidst the angst, isolation and anxiety of the pandemic, taking greater control of our own futures, making radical changes in our lives’ directions, and learning or teaching ourselves something new were all sources of release, relief and satisfaction. Turns out the Stones were wrong; you can get both satisfaction and just what you need - if you work at it. Just one recent indication of the movement toward more meaning is the fact that more than 16 million people took up the guitar in one 16-month period of COVID-19. Fender’s sales of higher-end electric guitars almost doubled between 2020 and 2021 and the trendlines continue upwards. Another important indicator is the massive persistence in today’s streaming world of “old” music, which speaks more powerfully to us than the current commercial crap. 

The gig economy - for better or worse - has empowered millions of new doers, makers, and creators. It’s not clear that this is a real way to make a viable living and, for sure, far too many giggers are working for peanuts.  But not everything is about dollars and sense. There’s a lot to be said for the psychic rewards, both personally and collectively, in part because so many of these undertakings are shared and collaborative rather than asocial and solitary. 

Admittedly, plenty of these activities are still tied to the digital world. But any conversation you have with these folks about the joy and passion, the real spark and energy, and the ultimate satisfaction that so many of these “students” and lifelong learners are realizing comes from three things: first, the immersive and compelling mess and the tactile connection that making anything by yourself provides; second, the pride and psychological rewards, which flow from repeated attempts, painful stumbles, and the eventual learning and mastery of a new skill; and finally, the confidence, independence and sense of security that grows from the certain knowledge that you can now unilaterally create something unique, valuable and important.

There’s another element in this ongoing evolution and it’s especially interesting and intriguing because - in every sense - it’s actually a palpable desire to get back to the past. We may be kidding ourselves - in some ways looking back sweetly and sadly - to lost, happier times when, given life’s realities and the melancholy lies of history, those were, as always, the times that never were and the ways we never were. Nostalgia is an amazingly seductive and alchemic process whereby dreams become memories without ever coming true. It’s a lot like grammar - we find the present tense and the past perfect. But still, we hope and hang on. 

We can look longingly back, with some care, because too much nostalgia can suffocate the present. As Neil Young wrote in Ambulance Blues: “It's easy to get buried in the past / When you try to make a good thing last.” We all need to keep moving ahead. We long for a smarter, slower, and less stressful time and, here again, it’s a throwback desire which we associate most easily with tangible goods -; physical objects, concrete containers of tradition, legacy and heritage.

In troubled times, nostalgia can be an efficient narcotic - soothing, stabilizing, and far simpler than the rest of our lives. For the magic to work and take hold, though, it helps to be holding tight to something. The older and more traditional the better. Dad’s tools, Mom’s copper pots, a well-worn mitt or an ink-stained journal, or a trumpet you haven’t touched since you were 10.

And that’s how we ultimately arrive at a sad truth - while we regularly revere and constantly celebrate innovation, we rarely reward, appreciate, or acknowledge tradition. We disparage tradition too often as an easy excuse to avoid change, cling to the past, or hold on to the illusion of permanence. But change is everywhere today, and that rampant change is one of the few constants in our lives. However, this isn’t an either/or proposition because through thoughtful innovation we can recognize the value and importance of tradition and craft while we still change and move forward.

When you’re entrusted with a tradition, you’ve got to protect it. This may explain why a dozen or two of my favorite older entrepreneurs have all become classic guitar players and collectors. Or to be more honest, far more collectors than players, but it’s the thought that counts. They value and appreciate where they’ve come from and the importance of the continuity and connection to the past as they continue to build the cultures of their own businesses. So many entrepreneurs are superstitious in their own ways, and, if you asked why they’re attracted to these instruments, they’d say that hanging on to the past helps them deal with the fears of today. They understand that everything they’ve built might one day be simply swept away.

I expect to see a serious new wave of nostalgia, all kinds of revisited vintage material, a further explosion of thrifting and places like the Real Real although maybe not as grand, and movement toward reissues and remaking of all kinds of oldies and goodies.

This is also why I was so excited to see that Fender has recreated an entire new line of classic guitar and bass models based on legendary instruments (Telecaster, Stratocaster, Jazzmaster) called the American Vintage II series. There’s also a video series called “Music Never Dies” featuring performers talking about how their own music was so heavily influenced by the past. Fender’s CEO, Andy Mooney, notes that the demand for custom guitars with vintage specs which let players recreate the sounds and tones behind some of the all-time classic music is growing. The actual collectible antiques are just too expensive for most players today, but the newly issued Vintage period-correct models enable them to add those historic riffs and sounds to what he expects will be tomorrow’s iconic songs.

Just looking at the images of these monsters of old is amazing, but the thought that millions of new young artists will be able to use them to connect with the old traditions and build the new classics is what is really exciting.

In a word, deja new.

 

NEW INC. MAGAZINE COLUMN BY HOWARD TULLMAN

 

What Do We Tell Our Newest Workers?

The business world operates on the notion that people are ethical and trustworthy, and conveyed that to young employees. Then Trump destroyed the idea that trust and ethics actually mattered. 

 

BY HOWARD TULLMAN, GENERAL MANAGING PARTNER, G2T3V AND CHICAGO HIGH TECH INVESTORS@TULLMAN

 

I used to be mainly concerned about the unfortunate but deeply ingrained attitudes of the upcoming and incoming workforce, and how these overly entitled kids would fit into the newly serious and heads-down culture of those startups and growth stage businesses that had dodged the bullets and stayed alive for the last three years. These kids had been indoctrinated from birth by helicopter parents, with first-place trophies for all, and convinced by college faculty that their generation would be a gift (and a bargain at any price) to the working world.

But I'm afraid that over the last few years, the "real" world has taught them some even more pernicious and dangerous lessons. I was worried about the "work" part of their work ethic, and I should have been paying more attention to the ethics part.

Work isn't going to be a picnic for anyone who thinks the next two years are going to be fun, easy, or anything but a difficult slog with plenty of bumps along the way. If they believe that, they've either been asleep for a couple of years or has their head somewhere the sun don't shine. Most of the management teams I'm talking to these days aren't rushing headlong into the new world. They're plenty happy to regather and re-energize the troops, move forward at a reasonable pace, and make sure they're on sound footings before they take the next big leap.

This newly cautious and conservative environment will be a challenge for every returning employee, but finding their way and navigating the complexities and confusing social and moral signals in the working world is gonna be hardest on the newbies. They have no history, war stories, culture, or prior experience to fall back on. For folks who have never even been in the office, trying to master the ebb and flow of everyday activities and figure out directions and priorities, which are hard to come by in most startups in any case, won't be simple or straightforward. I feared that, having never fallen flat on their faces, having never seen a real bear market, or faced any real adversity beyond sheltering from Covid-19, this new group who were happily bringing their whole selves to work -- whatever that means -- would be very difficult to integrate post pandemic. They've been taught to believe that the business world is forever up and to the right.

How easily could they slot into any growing business even without the additional challenges of a remote and hybrid working environment, the constant pressure to "catch up" after two years of stasis, the understanding they are "free to be you and me", and the idea that they could take a job, make a job, leave a job, do several jobs at the same time, or do a lot of nothing and still thrive and survive. Wishful thinking, hope rather than hard work, taking shortcuts instead of putting in the time and paying the requisite dues, and living in a world of screens acting as mirrors rather than windows was a very likely prescription for disappointment all around. The gig economy and the great resignation could turn out to be very bad and sad jokes on many of these feckless folks.

But I've come to believe that there's a far greater worry than merely the work ethic of the woke generation, largely due to the impact of four years of the Trump plague and its continuing persistence and toxicity., These upcoming young adults have been subjected to Trump's horror show of corruption, self-dealing, the systemic undermining of our institutions and democratic processes, and bald-faced lie after lie. The only two object lessons that they can draw from the experience are that: (a) nothing is sacred any longer and (b) that there are no consequences for even the worst behavior because our legal, legislative and enforcement systems are themselves impotent, corrupted and virtually useless.

This is the lesson our kids are learning every stinking day as the stench of Trump remains potent and pervasive.

Trump's initial electoral triumph and his administration's flagrant and overt criminal behavior taught several generations of our youth that if you're shameless, aggressive, and completely without morals or ethics, you can succeed grandly and get away with almost anything. That's as long as you carefully and continually engineer Faustian bargains with millions of MAGA morons, autocrats such as his buddy Vladimir Putin and ambitious and craven members of Congress looking out solely for their own interests and reelection prospects. Perhaps worst of all is the example set by at least three lying justices of the Supreme Court, who willfully and repeatedly perjured themselves in public to secure their nominations. A sad truth is that people who will lie for you will eventually lie to you. We thought these jurists to be the caretakers of our Constitution; instead, they've become its undertakers.

Worst of all, because Trump is a virtual illiterate and a Freudian nutcase, he told us over and over who he is -- right to our faces -- what he planned to do, and how he would do it. He can't help himself. Like the scorpion who stung the frog, it's his nature. At his rallies, he loves to recite various butchered versions of a poem/song about a vicious reptile called The Snake, as he attempts to slander illegal immigrants. He loves telling the story and, according to him, the MAGA crowd eats it up every time, even though they clearly can't understand what it has to do with anything else he's ranting about. Watching the people in the audience behind him as he bumbles through this overlong tale is a study in stupor.  Clearly dazed and confused, they sit there waiting and wondering when the laugh line is coming (there is none) or where they're supposed to smile and applaud.

It's abundantly clear that neither he nor his raving rally fans seem to appreciate the relevance, moral or irony of the tale. Was he really so stupid that he didn't understand the story's message, or so cynical that he was actually proclaiming that he was a duplicitous crook and a complete fraud who we were stupid enough to consider inviting into our homes and lives?

I realize that the man has no sense of humor or irony. But the story of a devious snake whose poisonous bite was its only reward for the care and generosity of the tender-hearted woman who took the half-frozen reptile to her bosom was frighteningly close to home --  a stunning and overt admission of just what people were signing up for in voting for him. That's what makes it hard to believe that millions missed the obvious message. The snake's only rationalization -- largely lost in Trump's fumbling and sloppy syntax -- is that the woman "knew damn well that he was a snake before she took him in." Trump, being the arrogant egomaniac that he is, couldn't help himself from telling America that he was the snake.  

The leak of the Supreme Court draft opinion - regardless of who did it -- is in some ways the dying canary in the coal mine demonstrating yet again that there are no longer any agreed-upon or basic behavioral limits, no unbreakable laws of decency or ethics, and, in a Trumpist/MAGA world, there's no bottom. Deals with the Devil never end well.

As employers, this flagrant and painful breach may be our last clear warning that we have to take immediate steps in our own businesses - especially where we have millions of newbies coming on board without anchors, reference points, or any real ethical guidance. We need to help educate the people we work with every day that there's actually a better, brighter way to do business and to live, but that it's going to take patience, difficult sacrifices, hard work, and even some faith in each other to pull ourselves out of this horrid downward spiral. Trying to rebuild trust is tough at any time, but it's even harder in the social media sludge and sensationalist media world we live in today.

If we don't help ourselves to right the ship and set a better course, then we'll all have to live with and suffer the consequences of the lessons Trump has sadly taught us all. If you don't think that the risk of this infection is alive and ongoing everywhere, and ultimately far worse than Covid-19, then think about this selfish reminder: when you lie down with dogs, you wake up with fleas.

NEW INC. MAGAZINE BLOG POST BY HOWARD TULLMAN

 

Back in the Office? Here Are Three Rules to Keep the Peace

As team members stream back to the workplace, don't expect life to resume where it left off two years ago.

 

BY HOWARD TULLMAN, GENERAL MANAGING PARTNER, G2T3V AND CHICAGO HIGH TECH INVESTORS@TULLMAN

 

There are probably at least a dozen good reasons for folks to look forward to getting out of their houses, off the Zoom calls, and back to the office. But none will be more important than the long-awaited return to those time-honored and ritualistic "watercooler" conversations. These critical daily pipelines for the most current, direct and valuable dissemination of the gospel, gossip, and goings-on of any business are, without question, the most effective purveyors of connection, engagement and company culture ever invented. In most companies, more substantive and actionable information generally flows back and forth during such sessions than in any formally organized meetings -- where no one wants to be too outspoken, too woke or not woke enough, or too far ahead of the pack. Meetings these days make mainly for consensus, wasted time and mediocrity.

Forget about Teams and Slack as well. They may be handy for real-time messaging and short alerts, but they're sterile, noisy and cluttered environments largely drained of real interpersonal connection and emotional engagement. These uncontrolled channels quickly turn into sewers of specious sentiment, woke wars, and podiums for the loudest, most voluminous, and most pedantic voices in the conversation.

There's simply no good alternative to getting the juicy tidbits directly and personally right from the horse's mouth. That's why word of mouth (WOM) is still the most credible, authentic, and valuable endorsement and recommendation vehicle that businesses can employ to get their messages to their employees and out to the marketplace. In a word, WOM works best at work.  

While millions of Americans have largely given up on the mainstream media as a source of objective truth (thanks to Trump and his misfit minions) we still basically want to trust the folks we work with every day to give us the straight scoop. Pre-pandemic, the peer-to-peer, face-to-face workplace was the best place to be - and to be seen and heard - because we trust the people that we know and with whom we spend most of our daily waking hours. Even more importantly, the work environment serves a curatorial and collective function for us.  We know where our friends, peers and others are bound to be found, and we know when they'll be there and how to readily access them. All of this reliable regularity, of course, is now entirely up for grabs.

It's already clear that the office environment will be considerably different than our fond and nostalgic memories of the places we left. One thing for sure: discussing politics in the office is a no-win proposition, a waste of breath, and bad for the business as well.

Given the substantial time that we've all been homebound and imprisoned in carefully filtered online information bubbles, we're going to find it challenging, upsetting and highly revelatory when we leave our own little echo chambers and Covid-19 clans to get back to the work world. We'll reacquaint ourselves with seriously changed old friends and somewhat unknown new ones; and immediately get a strong dose of the new realities. As much as we all think we've just been cooped up in suspended animation for two years, we've all had very different experiences - mostly bad - and they've left scars, sour spots and a lot of tender sensibilities.

The common ground, the shared views, and even the water cooler conversations simply aren't going to provide the safe spaces they once did. Word of mouth is going to have to work even harder and in dramatically circumscribed circumstances.  Management is going to have to quickly and clearly set out some new keys, rules of the road, and frankly some limitations (freedom of speech notwithstanding) on what are going to be genial conversations in the "new" world of work.

I'm not simply talking about pronouns although, even there, most of the world doesn't understand or appreciate what the constantly shifting appropriate protocols are and why, apparently, it's no longer proper to even ask. In a world of pronoun-denominated name tags, the next step may have to be warning signs we all wear (like convention badges) outlining the matters and topics we'd be pleased to never discuss at the office. This turn of events may be good for sports fans (arguably still a safe topic), but it's gonna be hard on most other day-to-day social chatter.

We're going to have to carefully rebuild and restructure the water cooler conversations because they're the heart of the information sharing systems, and those informal sharing systems are how we develop, build, and sustain our trust in and comfort with our peers and others. Ultimately, it's that basic trust that's the fundamental foundation of all the commercial interactions we have with - and all the business we do with - each other. If simple trust and social sharing disappears, there's very little left upon which to form the common bonds and connections we need to make our commerce systems and our society work.

So, the question really is what should the new rules of the road be and how should they be implemented in a way that doesn't simply cause new and different problems? If you're a business aggressively trying to (a) get your people back to business and (b) trying to keep them from spending inordinate amounts of time every day arguing with each other about things that don't mean a hill of beans to the business, here are a few thoughts and suggestions.  

First and foremost, focus on the few. Only about 10% of your team members are the most active sharers - they're well-intentioned, think they're being additive and helpful, and they can't really help themselves. These are the folks who make it their business to mind other people's business and they're the ones that need to be reminded that the office is no longer the place for too much chatter about sensitive subjects.

Second, create a better, structured and finite outlet for the discussions. In the hybrid world we're looking at, it's not enough to say that we need your body at the office three days a week, rain or shine (or something like that), because that doesn't really make much sense to anyone. It's much better to offer a concrete reason to return and to say something like we're having a regularly scheduled "educational" event - every week or every other week - and we want you there to listen and learn. You don't have to agree with the speaker, you don't have to participate in the discussion, and you don't have to be convinced of anything.  But this is the exclusive forum, time and place in which we are now addressing many of these kinds of complicated and contested concerns.  Take it or leave it.   

Finally, and this is the hardest question, decide whether, why and how your company is going to express a position on some or any of these hot-button issues given that you can be absolutely certain that there is ZERO unanimity across your entire workforce on any of these matters. If Disney still can't figure out how to do these kinds of things, maybe discretion is the better part of valor for you and your business - at least for the moment.  

APR 12, 2022

The opinions expressed here by Inc.com columnists are their own, not those of Inc.com.

NEW COLUMN BY HOWARD TULLMAN IN CHICAGO STAR

 

I wrote recently about the need for parents heading back to the office to honestly explain to their kids why they work. I said avoid blaming it on the need to make money in favor of more meaningful reasons, such as trying to make a difference in our own and in others’ lives.

There’s another conversation we need to have with our kids as they return to the real world. They will be inundated with peer pressure after soaking in all the social media junk, the fake lives and lies of influencers, and all the other noise and clutter online.

It’s natural to want to prepare the path and prevent or protect your kids from what they will face. But if you can’t prepare the path, you can at least try to prepare your kids for the journey.

There are many resources, experts and opinions about what to do and say in this regard. My advice comes from my own particular experience and expertise—decades of hiring thousands of new employees and seeing what attitudes, mindsets and mental tools helped them succeed. My own daughters, of course, would never admit father knows best, so take my advice with a grain of salt.

Tell your kids three very important things.

1. You love them unconditionally and always will. Eventually they’ll learn that you make your own luck and fortune in life, but it helps a lot to feel loved in the meantime. Having your folks have your back is the best way to start. Friends come and go, but your family is always there for you.

2.  It’s OK to fail sometimes as long as you gave it your best, but it’s not OK to quit in the middle. Giving them permission to fail without accepting those failures as warranted or inevitable is critical. Save the alibis, explanations and blame for someone else. There’s no such thing in the real world as a good excuse.

3. Learn to let things go. Not everything can be fixed, finished or saved. Mistakes happen to everyone. The trick is not to dwell on them. Fix them, learn from them, make the best of them that you can, and move on. The best athletes have “in game amnesia”— they forget the past flops, missed shots and bad calls so they can focus 100% on the present and make the next shot count.

(Follow Howard on Facebook, Twitter @tullman , Instagram and LinkedIn)

NEW INC. MAGAZINE COLUMN BY HOWARD TULLMAN

 

Let the Newbies Know the Truth

Too many youngsters are entering the workforce with delusions of their own grandeur. It is vitally important that they're checked into reality before you hire them. 

 

BY HOWARD TULLMAN, GENERAL MANAGING PARTNER, G2T3V AND CHICAGO HIGH TECH INVESTORS@TULLMAN

Photo: Getty Images

New employees need a simple, straightforward, cohesive and consistent introduction to your business, your company's culture, and your work philosophy if they're going to be successful --especially if they're going to be mostly remote.

Simple doesn't mean dumb in this case, but it does mean short and sweet.

Straightforward means telling it like it is and letting the chips fall where they may. You're much better off filtering out newbies with attitude and entitlement problems at the outset - and maybe even losing a few prospects in the process - rather than inviting fundamentally unhappy and chronically dissatisfied folks into your shop.

Cohesive and consistent means that, in this painful age of constant management contortions --- as business owners try to please everyone, be politically correct, and ensure that everyone's opinions matter and that they all get a vote on everything -- your public pronouncements and positions actually do have to align with and be supported by the day-to-day rules and ways you run the business.  02:43

Having personally hired hundreds of employees over several decades, I've never seen such an influx of confused and deluded young people looking for a workplace that simply doesn't exist. Sadly, they've been primed and "woke" in academic bubbles that have set utterly unrealistic expectations. They've been overwhelmed with media imagery and fantasy articles about work-life balance and doing just what you love; they've been inundated with social media junk and the fake lives and lies of influencers; they've been told repeatedly that they're now in "the driver's seat" in terms of employment negotiations and smothered by all the other online noise and clutter that sucks up far too great a portion of their lives.

There's no escaping this stuff and any entrepreneur who's looking to hire these kids has to try to help straighten them out so that they actually know what they're signing up for and, if it's not right for them, they can do everyone the favor of bailing out and going elsewhere. These aren't likely to be quick or easy conversations, but they're essential for any business that's hoping to find the right talent and the right fit for them and, at the same time, grow quickly. Getting hiring right - right at the start - is the name of the whole game. Otherwise, you'll be dealing with a constantly revolving door and treading water.

There are many different messages and approaches that might work in situations like this, but I've found five ideas, attitudes and thoughts that consistently appear in the most successful conversations. There's no magic to the syntax - whatever words work best for you will get the job done.

(1)  You have to commit fully to the work and put your whole self into everything you do -- do it with a vengeance. Don't come to work merely to do a decent job; there's no room these days for "whatever" or adolescent indifference. Work matters. There are no easy jobs; there are only graceful ways of performing difficult ones. Be proud of what you're doing and why you're doing it. No wobbling and no white lies. Don't say "maybe" when you want and need to say "no." Don't try to do things cheaply that you shouldn't do at all. If you're constantly hedging your bets, then, even on your best days, your results will still be mediocre. Band-Aids and duct tape solutions are the worst bets you can make. If you can't do it well, do something else.

(2)  Everything today is about time, which is our scarcest and most precious resource. You can't afford to dawdle because speed is what sets the best players apart. You never get back the time you waste in not making a fast and final decision. Especially in times of radical and rapid change, the faster you decide, the more likely the chances that your choices will be successful. In any moment of decision, the best thing you can do is the right thing. The worst thing you can do is nothing. Any decision is better than no decision.

(3)  No one is irreplaceable, but the best and most successful people are invaluable because they're the ones others turn to when there's a problem. The people you can always count on to be there and help - the ones you tend to run to, not away from, in a crisis. You want to be someone's first stop when they need help, and not their last resort. This isn't something that happens automatically or overnight - it's something you build, nurture, and demonstrate throughout your career. You make your passion and enthusiasm apparent, you're always available and up for the next challenge, you do your homework and put in the necessary time and effort, and you don't quit. When the chips are down and the fat's in the fire, you want to be the one who people can count on.

(4)  Learn to let things go. Not everything can be fixed, finished or saved. Sometimes you don't even get to understand everything. Some things aren't problems to be solved, they're situations that we need to learn to live with. Mistakes happen to everyone unless they're sleeping. The trick is not to dwell on them. Fix them, learn from them, make the best of them that you can, and move on. Don't be a prisoner of the past. The best athletes have "in game amnesia" - they forget their past flops, the missed shots, and the officials' bad calls so they can focus 100% on the present and make their next shots count.

(5)  It's okay to fail sometimes as long as you gave it your best, asked for help when you needed it, didn't try to hide the problem, and ultimately owned the whole mess. But it's never okay to quit in the middle and leave people in the lurch. We want to give people permission to fail without accepting that those failures are warranted, unavoidable or inevitable. Tell them to save their breath and give any alibis, sad stories and painful explanations to someone else. There's no such thing in the real world as a good excuse.

The bottom line is pretty simple. You can't build a real business without a solid foundation based in truth. Telling people only what they want to hear or half-truths about what life in your business is really like isn't doing anyone a favor. Lies mortgage your firm's future while the truth will set you up for long term success.

MAR 29, 2022

The opinions expressed here by Inc.com columnists are their own, not those of Inc.com.

 

NEW INC. MAGAZINE COLUMN FROM HOWARD TULLMAN

 

Follow These Four Rules For Returning to the Office

There's a lot of angst out there about who has to come back, and when. The need to return isn't necessarily fair to everyone, but it does need to be communicated honestly and clearly. 

BY HOWARD TULLMAN, GENERAL MANAGING PARTNER, G2T3V AND CHICAGO HIGH TECH INVESTORS@TULLMAN

As if we didn't have enough angst and division in this country, the newest emerging conflict (soon to dwarf even the disputes with the moronic anti-vaxxers) is between the WFHomers and their employers, the RTOers, who are intent upon and insisting on increasing the amount of time staffers need to spend in the office each week. While plenty of companies are pushing off the start dates for the grand return -- some of the main tech companies are already targeting early next year -- it's clear that there's a widening employee expectation gap, which is likely to expand even further as the Delta variant and its progeny spread. And the most disappointed team members aren't necessarily who you'd expect. It's the folks stuck in the middle who have the blues.

What's especially concerning about the arguments on the right way to return is how quickly this debate is morphing into an economic class and caste struggle.  It's already become challenging for even the best-intentioned management teams to explain, try to empathetically justify and, ultimately, to honestly break the sad news to certain important groups of their employees that life still isn't fair, and that one size and one solution still doesn't fit everyone. Telling people things they don't want to hear is never easy. Years from now, when we all look back on this time and the pandemic in its entirety, one of the most discouraging realizations will be how disproportionately and unfairly COVID-19's burdens were borne by people in different economic strata.

Executives across just about every industry will need to quickly figure out how to explain to their people, the media and the world that many of their lower-paid workers need to be on site even though the company isn't going to require others with different job responsibilities and requirements to do likewise. Worse yet, they're going to have to tell a bunch of mid-level workers who clearly thought otherwise -- and believed that they had a lot more flexibility and control over their lives than the folks on the factory floor -- that they too are expected to show up. This latter news is likely to be the rudest of all the awakenings, because it's as emotionally bound up in matters of perceived status as it is with regard to commuting costs, productivity and other domestic issues.

Some of the companies that have tried to make the new requirements applicable across the board have found that - unlike the lower-level blue collar and no collar folks who pretty much knew that they were screwed since the pandemic started - the folks in the middle are already raising the biggest stink and threatening to go elsewhere, which is really the last thing these firms can afford at the moment.

Unfortunately, a lot of these "knowledge" and creative workers believe, rightly or wrongly, that they have many other alternatives rather than forlornly marching back to their cubicles. We'll know soon enough whether their confidence is well-warranted or sadly misplaced. My own guess is that a lot of these folks will find that the type of positions and salaries they're looking to replicate aren't exactly abundant in the newly streamlined economy. And the ones wrapped up in the idea of simply starting their own businesses are even more likely to end up unhappy.

Another key part of the problem is that many of the senior people making these decisions have ridden out the crisis with minimal disruption, smoothed and softened by a robust stock market, so they don't necessarily understand or appreciate just how radically millions of lives and circumstances have been changed, uprooted and transformed.  Nor do they get just how long and painful the return to whatever the new normal is likely to be for families concerned with continuing health and housing issues, their kids' education, rearranging and resuming child and pet care, and supplementing lost spousal incomes.

Management has neither time nor the option to see what competitors are doing or how the variants are progressing when the day-to-day demands of the workplace and the requirements of the reinvigorated economy require clear and consistent answers and directions for their people. Now's the time to bring people back to reality as well as the office, because, if you aren't structuring and leading the "back to work" conversations, you can bet that the vacuum will be promptly filled with commentary, complaints and criticisms that aren't likely to be helpful in any way.

While there aren't any perfect answers, here are four important ideas to keep in mind as you craft a policy and, more importantly, as you try to honestly communicate it to all the members of your team.

(1)  Explain what applies to everyone.

These conversations should start by making clear that the overall policies of the company are generally applicable to everyone (as they always have been) and that everyone is expected to comply. There will be exceptions based on a variety of reasons and criteria as there also have always been. But no group of employees is being specially treated or afforded privileges that don't have a clear business-related purpose and value to the firm.

 (2) Note that there have always been variable shifts, seasons and schedules.

In many respects, once we return to the "new" normal, the way that the business will operate won't be materially changed for most of the employees, and it's important to make this clear. If the company's basic policy is going to be "all hands on deck," which it always was pre-pandemic, then there's not really much left to discuss. It's just getting back to business.

(3) Make sure your distinctions are meaningful and matter.

You can be sure that everyone in the firm will know exactly who is being asked to do what. That means it's very important that you have a precise and ready rationale for each group of employees who are treated differently in some respect. Having your senior team lead by example and make it their business to be on site and visible will be very important.

 (4) Focus on what you can fix.

It's essential to show all the team members that the company is being proactive and helpful in addressing and providing assistance and solutions for the various recurring issues that many will be dealing with. Flexible hours including early departure times, pet friendly offices, in-office Covid testing, and vaccinations are some of the common remedies. But be ready to improvise.

AUG 17, 2021

NEW INC. MAGAZINE COLUMN BY HOWARD TULLMAN

 

Car Insurance--and Everything Else-- by the Mile

The pandemic may have ended the idea of "one size fits all" pricing in the auto insurance business--and others will surely follow. 

 

BY HOWARD TULLMAN@TULLMAN

 

I wrote recently about the pros and cons of "all you can eat" pricing and mentioned how the very idea of paying extra to make "long distance" phone calls (which cost the phone companies not a penny more to provide) had disappeared almost overnight when telcos decided that they could actually reduce costs and make more profits by charging everyone a flat monthly rate for their calls. Distance didn't matter.

The strategy was to have the vast majority of their customer base (who infrequently made long distance calls) essentially subsidize the few who did by charging every caller a little bit more per month than they otherwise would have paid, regardless of usage. Of course, being the greed heads that they were, their marketing people later decided that they could also start charging customers for substantial data usage (another "invented" cost) to further improve their operating margins.

This idea of cross-customer subsidization has been with us for decades in any number of industries. The math is obvious to many, but since the impact on any given individual consumer or customer was modest (and the class action lawyers were apparently asleep at the switch), no one ever really addressed the issue. The providers, of course, weren't gonna tell anyone about it.

But then in March, 2020 the world stopped driving; the auto insurance industry will never be the same. In fact, one of the few silver linings of the pandemic is how quickly it highlighted the unfairness and high cost of the auto insurers' "one size fits all" pricing schemes. No one was driving anywhere, and accident claims virtually dried up - but the premium bills for the same old coverage kept coming.

I thought this would happen years ago. In 2014, I wrote:

"We're looking at the end of fixed pricing for anything and entering an a la carte/all the time world. Bulk packaging, bundled products, and even bargain pricing are all breaking down in favor of a single consumer demand driven by a desire for freedom of choice and flexibility - I want "everything by the bite" - whatever I want, whenever I want it, and wherever I am."

I assumed that better technology, more data, and improved measurement and tracking abilities -- all of which would better educate and inform consumers -- would almost require bundlers, full-line forcers, and subsidizers to 'fess up and create more accurate, honest and transparent pricing. In the car insurance biz, the distance you drove still made a big difference from an underwriting perspective, which naturally the insurers had no desire to explain to their insureds. No ask, no tell.

The idea that, geographic considerations aside, you would be expected to pay exactly the same amount annually for your auto insurance (obviously depending as well on your age and the value of your car) whether you drive 2,500 miles a year or 25,000 miles is simply nuts. Low-mileage drivers were simply subsidizing the premium costs that daily, distant commuters and other long haulers would have had to pay even though the low-mileage guys represented substantially less risk. It took a pandemic to finally make the inequity and injustice of this kind of pricing obvious and, months after the fact, the big insurance companies grudgingly started offering some modest prospective premium relief.

But the cat is now out of the bag for the whole world to discover. One of my favorite descriptions of entrepreneurs is that they see what everyone else has always seen and think what no one else has ever thought. In this case, there were already a couple of first movers trying to offer variations of pay-per-mile insurance, but the smart consumers ultimately go with the best solutions, not necessarily the guys who got there first.

And, even more importantly, especially in any part of the insurance business, you've got to get the math right from the get-go, so your numbers and your business model make sense.

My favorite new horse in this race (the big guys like Allstate and Nationwide are already coming up with competitive offerings which, I would note, cannibalize their own books of business) is Mile Auto in Atlanta. It's still early days in the contest and they're as much a first mover as anyone else but doing it much smarter. Here's why.

(1)   Math matters. They've got better numbers than their direct startup competitors in terms of loss ratios and churn. Their marketing spend and customer acquisition costs are a fraction of what the competition is spending.

(2)   It's about smarts, not steel. Their patent-protected solution doesn't require installed or attached hardware, which is a cost as well as a maintenance and compliance killer in today's SaaS and cloud world.

(3)   Bet on the jockey, not the horse. The management team has decades of automotive and tech experience with a major, successful exit, specifically in telematics, which is critical to continuing to build on their solutions and stay ahead of the competition.

(4)   It's cheaper to ride someone else's rails. They have a sales and marketing model (B2B2C) which is clearly superior and far more cost effective than trying to go direct to the consumer. They're partnering with large industry players who have already invested millions in establishing direct links to the end users. Channel partners with large user populations and existing delivery platforms are clearly the way to go, especially when your offering is an add-on benefit or solution.

(5)   Don't make unnecessary or gratuitous enemies. In highly regulated industries like automotive and insurance, it's much better to ask for permission than forgiveness. Forty years ago, when I founded CCC Information Services, which provides vehicle valuation information and other services to the auto insurers, I asked the industry regulators in key states to regulate my new data service when they didn't even understand computer databases or what I was trying to do. Those early approvals provided decades of protection and barriers to entry from potential competitors. The Mile Auto guys are already approved or on file in the states that represent 50% of the auto biz and they're seen as consumer-friendly government and regulatory partners rather than disruptive assholes. Uber spent years and millions of dollars fighting unnecessary battles because it attacked the market rather than aligned with it.

(6)   Pick great brand partners. There's no better remedy for consumer decision fatigue than a strong brand and there are few "best of breed" brands that are strong with high-end, luxury, low-mileage drivers than Porsche, which was Mile Auto's first gold-medal marketing partner.

As everyone knows, there are no sure things in the business of starting new businesses, but I like the odds of companies like Mile Auto that did their homework, identified a gigantic shortcoming in the offerings for low-mileage insureds, built a strong and stable product to address those unmet and underserved needs, took their time and developed a novel go-to-market plan, and then rolled things out carefully, strategically and with the support and blessing of many of the key players in the market.

Mile Auto and per-mile pricing is just the latest step forward in the global democratization of tech and data. These days, anyone can rent as much or as little cloud and computing capacity from AWS as they wish, rivaling the millions of dollars of software and hardware that even major players needed to spend just a few years ago to enter important markets like insurance, automotive, and medicine. The moral of the story is that now everything is "better by the byte".

MAY 11, 2021