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dispatches from the new world of work

2) The Basics Are the Basics Are the Basics Are the Basics:
The Worse the Times the Better They Work;
Or, Listen to Grandfather Snow

The "engine" of the current economic mess is losing total touch with the basics. That is: lending money to people, by the millions in the end, who "obviously" couldn't pay it back. In many ways, that is the whole story—at the bottom of the bottom of the bottom of the pile of derivatives of derivatives of derivatives are truly stupid real-estate loans that "any fool" would say should never have been made.

We get in trouble when we forget the basics.
We get out of trouble when we remember the basics.
We stay out of trouble when we become perpetually "insane" about the basics.
(It ain't quite that simple, but it'll do for starters.)

When "times are tough," the payoff, survival that is, comes from what?

Survival—even growth!—in bad times comes from having wildly "over"-invested in relationships and training and service and employee-customer-vendor loyalty, while behaving in a fiscally prudent manner, in good times.

Well, "Duh."

I'm allowed out in public in 2008, in effect, because I wrote a book with Bob Waterman in 1982 (called In Search of Excellence) that said that Americans were in deeeeeeep trouble—vis-à-vis Japan at the time—because we failed to put people & service & listening to customers & making products that worked & doing-instead-of-talking & staying intimately in touch with "real stuff" at the top of our business agendas. We had placed too much emphasis on "sophisticated," abstract, "MBA thinking" and not enough emphasis on the things that led over a thousand people to show up for my Grandfather Owen Snow's funeral in little Wicomico Church VA over a quarter-century ago.

Grandfather Owen had run a country store—he'd been counselor, banker, and friend of customers and community, as well as shopkeeper, to thousands over the years. He was a math whiz (he passed a bit of it on to me, and thanks), but those thousands showed up at his funeral because he never forgot the basics of taking the time to listen and care and invariably put people first!

The great news for Fall 2008: The worst of the worst can be managed, within limits at least, if we remember and assiduously apply my grandfather's Business Basics 101.

Does that sound simplistic?
Perhaps.
But remember: We're deep in the deep doggy doo-doo because of "nothing more than" lending money to people who obviously (!!!) couldn't pay it back.

********

The CEO of a very successful mid-sized bank, in the Mid-west, attended a seminar of mine in Northern California many years ago—but I remember the following as if it were yesterday. I've forgotten the specific context, but I recall him saying to me, pretty much word for word, "Tom, let me tell you the definition of a good lending officer. After church on Sunday, on the way home with his family, he takes a little detour to drive by the factory he just lent money to. Doesn't go in or any such thing, just drives by and takes a look."

(1) Amen.
(2) Damn few drive-bys at WaMu or Countrywide, I suspect.

Tom Peters posted this on 09/27/08.

Comments

Amen x 10!

Everyone feels that complexity equals a defensible business model. But people long for the basics and simpler times.

The bank officer that actually cares about the business they are lending to or the customer service person that takes a few extra minutes to solve your concerns deliver the moments that make people fall in love with a business.

It's not as sexy as complexity but it sure is comforting.

Posted by Howard Mann at September 27, 2008 4:02 PM

Let me share another definition of a good lending officer. When I was six, I contracted nephritis. At the time it was supposed to be deadly, but our local doctor and the team at Cooperstown NY hospital, plus some luck and prayers pulled me through.

When my father went to pay the hospital bill, he expected to have Blue Cross pick up most of the tab. Instead, the people at the hospital told him that he had no insurance.

"I have Blue Cross," my father protested.

"But you have Capital District," the administrator told him. That's not good here. At the time, Blue Cross coverage was regional.

My father was a parish pastor making about $2400 a year. Even in 1952, that wasn't much.

The night my parents brought me home from the hospital was both happy and sad. Happy because I was going to be OK. Sad because my parents had no idea how they would pay for the hospital stay.

Sometime that evening, I'm told, there was a knock at the door. When my mother opened it, there was our family doctor and the local banker.

The banker told my father to come down to the bank in the morning and he'd loan the money to cover my hospital stay.

Understand that my parents had nothing. They lived in a parsonage. My mother's family's business had failed during the depression. My father was an orphan. The only thing they "owned" was the car they owed money on.

The banker made the judgment to loan money based on what he knew of my father's character. He loaned my family the full amount of the hospital bill on my father's signature alone.

Every year, until that banker died, I got a birthday card with the message, "How are you?" It took my father until my junior year in high school to pay the loan back.

Posted by Wally Bock at September 27, 2008 4:25 PM

Why don't our political AND business "leaders" know this in their core?

Posted by Howard Alford at September 27, 2008 5:04 PM

You would expect me to agree Tom but I’ve written elsewhere ‘the basics are the new cutting edge.’ Always have been actually

I maintain complexity is merely the sum of simple parts and how many people do you know that go to bed praying their work tomorrow will be more complicated?

Howard A – Why don't our political AND business "leaders" know this in their core? - Because it is in their interest to promote the myth that complexity is at the core – As my late beloved Dad always told me ‘Bullshit Baffles Brains’

Wally what a terrific story – thanks for sharing.

Howard M – ‘Everyone feels that complexity equals a defensible business model. But people long for the basics and simpler times’ – Thank you so much – that is brilliant – I am with 1000%

Posted by Trevor Gay at September 27, 2008 5:49 PM

Wally - Thank you so much for that story. You have made my evening so much happier. Thanks!

Posted by Judith Ellis at September 27, 2008 6:07 PM

"Why don't our political AND business "leaders" know this in their core?". In both cases I believe it is ego, a lack of accountability and oversight, which is essentially the failure of the "bosses boss" and political constituency do their job. The myth of complexiety justifies high salaries and the educational "pedigree". This country declared a war on poverty in 1964 and 44 years later and bazillions of dollars lighter where are we today? We're in an election year where a great deal of the rhetoric focused on? The need to declare a war on poverty! The politicians, public policy experts, think tanks, and experts? Bet the folks who live in poverty and work three jobs might have some insight on that but, were they asked?

I have never read "In Search of Excellence" but I recall thinking after reading a "Passion for Excellence" that this Tom Peters dude took a real simple idea...tell folks how great companies achieve great results...and parlayed it into some serious cache. He did this by breaking down the arcane, nebulous, purposely over-complicated business theories and practices into simple stories, examples, analogies and words that any person with a pulse could understand and apply. It is about People, Values, Customers, and Action. There are leaders and posers...both have a way of making themselves known! Common sense can get you a long way...excet in the corporate world and government where common sense can't be tolerated!

Posted by Dave Wheeler at September 27, 2008 9:11 PM

Despite slow updates to my account online, I continue to choose to bank with a small local bank. They lent me a significant sum on a written business plan with just my signature because they knew me. That knowledge cannot be replaced by the largest and fastest megabank.

Grandpa Snow understood the universe, and basic human nature. I frequently cause a snap of the heads of complacent clerks when I use their name from their badge in responding when they ask rotely if I've found everything I needed. I always get a smile in return, and feel grateful to have made a connection, however brief.

Blue skies,

Lark

Posted by Lark at September 29, 2008 5:57 PM

Thank Tom for reminding us all of the basics!

This is very sound advice. It's a really tough job market and the only way to stand out is to be able to do projects that bring a company immediate and real value, which usually involves sticking to the BASICS.

The Project Management Professional certification is the one credential that can help you get in doors fast by demonstrating that you know the basics to get projects done, in any industry.

Many individuals that have used Cheetah Learning to get PMP certified say that it has helped them get jobs and the other courses they took through cheetah to maintain their PMP helped them keep their jobs. Even if you can't take one of their courses right now, Cheetah has some great free downloads at http://tinyurl.com/freepmtools.

Thank again for this refreshing blog,

Kristen

Posted by Kristen Kent at December 15, 2008 6:25 PM