Ken Blanchard
Ken Blanchard changed the language of management with his groundbreaking book, The One Minute Manager®, which is one of the most successful business books of all time. Since then, he’s helped countless organizations across the globe. He is also the bestselling author of more than forty books.
We asked Blanchard about his book, The One Minute Entrepreneur, which lays out a strategy for making any new business venture flourish.
Interview Summary: Four Pillars of Business Success
- Sales Must Exceed Expenses: Without profit, there is no business.
- Collect Your Bills: Don’t be a banker for your customers.
- Take Care of Your Customers: Listen to your customers. Their ideas can make your business more successful.
- Take Care of Your People: Nurture your people. They make it all happen.
Adapted from: The One Minute Entrepreneur
McLaughlin: What prompted you to write The One Minute Entrepreneur?
Blanchard: Many people don’t realize that about 90 percent of the companies around the world are small businesses. And the data show that a lot of them fail, so the advice in the book is widely relevant.
I see two main groups of people who are very interested in entrepreneurship. One is the younger folks who watched their parents work hard and be loyal to their employers, only to be downsized, right-sized, or out-sized right out of their jobs. Our research shows that people in this group are technologically adept, and they would like to have their own companies within five years.
The other group is the Baby Boomers, and it looks like they really don’t want to retire. We have a guy on our Board who worked for Procter & Gamble for thirty years and now he’s started a company with his son. We’re seeing a lot of that.
McLaughlin: What’s your view on the role and impact of a company’s mission statement?
Blanchard: What we need is more rallying calls. The old-style mission statements are maybe okay for your Board of Directors, but you need something that will excite everyone else.
I was working with a bank a while back and I asked the clients to send me their mission statement. Later, I got up in front of the President and the Chairman and said I appreciate you sending me your mission statement because I’ve slept much better since I got it. I put it next to my bed and if I can’t sleep at night, I read it.
The statement said we’re in the financial services business and we provide this and that service. What it had to say wouldn’t motivate a flea.
I said if I was your potential customer, I would prefer you to be in the peace of mind business. If I give you my money, I want to have peace of mind that you will take care of it and maybe even grow it. Wouldn’t you all rather be in the peace of mind business?
 What we need is more rallying calls. The old-style mission statements are maybe okay for your Board of Directors, but you need something that will excite everyone else. |
We worked with PETCO Park, the baseball stadium they built for the San Diego Padres a few years ago. The clients wanted to remake the image of the Park and better serve their customers. They decided that they were in the major league memory business. Their mission was to create good memories for their fans.
That makes for a powerful mission statement, and I think that entrepreneurs need to follow that example. What are you doing for your client or customer? What can you do to excite the people you want to work with? Figure that out and put it in your mission statement.
McLaughlin: When an entrepreneur starts to put together a team, what are the common pitfalls that he or she should look out for?
Blanchard: The biggest problem is that you tend to hire people who are all like yourself. That compounds your weaknesses. You really need to find people who bring skills to the party that you don’t.
For instance, if you’re a visionary and a good thinker, you need somebody who can and will take ideas and apply them. When my wife and I started our company, we knew a lot about people management but we didn’t know anything about financial management. We couldn’t even balance our own checkbooks. So we had to get people on our team who knew something about finances.
McLaughlin: One point you’ve made is that strength taken to extremes can become a liability. What do you mean by that?
Blanchard: Well, take me, for example. I have an entrepreneurial mind, and I get new ideas almost every day. If they left me to run wild in our company, I could burn the place down.
The worst day to work for me would be Monday because I would have had all weekend to think. I would come in and say, today we’re going to go in this direction, and everybody would run with that. The next day, I would take everyone in a completely different direction.
In our company, my wife heads up what we call the Office of the Future, and any new ideas go there. They study the idea before they present it to anybody in our operation. That one-two punch is really important because we have a lot of creative people and they could send the organization into a tailspin.
Maybe you have somebody who is a great administrator. But if that person takes things too far, you might end up with a big bureaucracy. Someone else might be adept at involving people in decision making, but you can overdo that too. Then everybody becomes super followers who check with someone else before they do anything.
Any strength taken to the extreme can be a weakness. That’s why you need a balanced team. You also need people you can trust to tell you when you’re off base. If everybody’s telling you everything’s great, even when it’s not, you’re going to be in trouble.
McLaughlin: Are there other common mistakes you see entrepreneurs make?
Blanchard: There are two main reasons that companies go out of business: They are lousy at financial management or at people management. You have to cover those two areas.
It sounds silly to have to spell it out, but you have to make sure that your sales exceed your expenses. I see a lot of people starting companies and they want a fancy office and expensive stationery; they want to do all kinds of research on their product, but they don’t have any customers yet. You have to build your business.
Another mistake is not collecting from your customers. Many people go out of business with customers owing them money. You have to keep track of your receivables.
I was at lunch yesterday with a great entrepreneur who has owned all kinds of companies. Thirty years ago, he took me and my wife for a walk and said there are only three things to remember to be successful as entrepreneurs: cash, cash, and cash.
When it comes to managing people, it’s a mistake if you don’t recognize that none of us is as smart as all of us. If you start thinking that you’re the only bright bulb in the whole pack, then you don’t listen to your people, don’t respect or trust them, and don’t empower them. After a while, they quit and stay, which is much worse than just quitting.
McLaughlin: Do you have any advice on how professional service providers can grow their businesses with existing clients?
Blanchard: Recognize that satisfied clients are not enough.
| When it comes to managing people, it’s a mistake if you don’t recognize that none of us is as smart as all of us. |
If you want to do more business with your present clients, you need a strategy for how you can blow them away. You want your clients to say wow—the service we get from these people is unbelievable, so why would we want to go anywhere else?
When we bought our first house in California, our real estate agent came over and made it fun to fill out and sign all those crazy legal forms. So we recommended that agency to a number of people because they’re fun to deal with and great with the minutia.
That’s what you need to do—build relationships that draw clients back to you and make them want to send you other business. Then, your clients become part of your sales force.
McLaughlin: Last question: If you could give an entrepreneur just one piece of advice, what would it be?
Blanchard: I would say, recognize that it’s not all about you. While you will start the enterprise, you’re going to need others to get your idea out the door and bring in business.
Don’t think of yourself as a one-man band and the rest of your people as hired hands. Let them bring their brains to work and be part of your dream. You need people from the beginning to catch the wave and ride it in with you.
McLaughlin: Thanks for your time.
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