Are you charging enough for your services? 14 Hidden Costs You Must Consider when Pricing Your Services.

As more and more people find themselves twisting in the financial wind, they often to turn to consulting or providing other services for hire.

One of the most pressing and important issues you face as an independent service provider is how to price your services.

While the following will not tell you what to charge for your services, it will give you a number of things to consider. But, before we go into the nuts and bolts of calculating, let’s review some basic marketing principles.

First you have to think about how you want to position yourself in your market place.

• Do you want to be the low cost leader?
• Do you want to be the high-end expert?
• Are you introducing unique new services?
• Are jumping into a mature market full of established competitors?

Obviously, how you want to position yourself affects your message? It is very difficult to try to position yourself as the leading expert when you are trying to compete on price. Sadly, your chances of being perceived as the leading expert when you price your services too low are very slim. You may be thought of very good for the price, but you will never be perceived as the top dog.

Here are a couple of examples to drive home the power of perceived value.

Imagine your friend’s son or daughter is soon to be married and you are shopping for a $50-$75 wedding gift. You know the bride loves crystal. So as you are shopping you find a beautiful crystal bowl. So beautiful in fact, you are afraid you won’t be able to afford it. You almost walk away, but decide to flip the bowl over and see the price.

Tentatively as your allow your eyes to focus on the price tag, you see two things.
#1 it is a brand you do not recognize. And,
#2 the bowl is only $17.49

Instantly, fear sets in. You can’t possibly show up at the wedding with an $18 dollar gift, no matter how beautiful it is. So you put the bowl down and go in search of a more appropriate gift.

That my friends, is perceived value. The value you placed on the bowl is greatly diminished just because the price was low.

Here is another example. When EssentiaLink first started out, the message got confused. As we wowed our potential clients with the huge array of products we provide, the conversation always turned to price. Something in our presentation lead our prospective customers to think all of our products would be lower priced than the other guys.

It was not until we approached companies above the purchasing level and started speaking with C-Level managers that our message made sense. We were not selling low cost products, we were offering a simple procurement solution that typically lowered the TOTAL cost of procurement for non-strategic consumable supplies by 25% or more.

In both of these examples, the issue of price obfuscates true value.

Think about this with respect to the service you are offering. Are your prices high enough to establish value? Think of it this way, if your price is too low, it diminishes the perception of value, no matter how much you contribute.

Don’t think so?

Have you or someone you have known ever had to change jobs to finally earn a salary commensurate with their abilities and contribution?

A very common problem in companies is that when they hire someone at say $40k per year they always think of them as a $40k per year employee. Even if the employee takes advantage of all the company educational benefits and completes 2 degrees, they still see him/her as a $40k per year employee. Consequently, they only move them up the pay scale based on small annual % increases. So this highly educated and trained individual has no other choice but to seek financially rewarding employment elsewhere.

And the company that hires our hypothetical employee for $70K will always perceive him/her as being a $70k employee and so the cycle starts again.

Are you inclined to price your services low so you can get a foot in the door?

Think about it, will your services ever be valued for the benefit they provide?

Also, imagine a group of CEO’s are having social lunch. What do you think will capture their imagination more, the fact that one of them hired a functionary for a nominal fee or the fact that another just committed a bundle of money to an expert to come in and shake things up? If you are the high priced expert that gets results in that crowd, you are going to open far more doors than the perceived functionary.

So here are some things you must consider when pricing your services.

• What is your true cost of providing your services?
  Obviously you have the cost of travel, printing, office supplies, phone, Internet and so on but there are a lot of hidden costs that get over looked. For Example:
  • The cost of business licenses
  • 7.65% FICA and self employment tax
  • Your health insurance
  • Additional Car insurance to cover liability of using vehicle for business
  • Banking and Phone services are higher for businesses and many banks will not allow you to cash checks as DBA
  • The cost of incorporation and/or maintaining O & E insurance to limit exposure to liability.
• You need to charge for marketing time.
  As an employee everything is taken care of, but when self employed you need to plan to spend at least 25% of your time on marketing efforts. Even if you have the perfect gig, it is going to end and if you do not maintain marketing efforts, you may have extended periods of $0 income.
• You deserve to have benefits too.
  As an employee you probably had a number of benefits that comprised your compensation package. For Example:
  • 7-10 Paid holidays
  • 7-28 Paid vacation days
  • 0-14 Paid days of medical or personal leave
  • Continuation education benefits

  Benefits vary greatly from company to company, but regardless of the level of benefit you are used to, there is an associated cost that must be taken into consideration.

• Do you have children?
  Typically, unless you have found a way to make the 4-Hour Work Week work for you, your home business will place more demands on your time than the old 9-5 did. With that in mind, you may expect an increase in child care costs.

Ok, let’s wrap this up with a nice little formula to give you a way to think about how to price your services:

Let’s define the terms of the equation.

• S = The desired salary or effective salary you need to replace.
• AC = The expected annual cost to be in business including licenses, phone, banking, insurances etc.
• B1 = The annual cost of your health Insurance benefits
• B2 = The annualized cost of other benefits you want to replace (i.e. $2,000 / year for certification / continuing ed)
• OE = Other expenses such as child care you may need to take into consideration
• PTO = Paid Time Off hours (i.e. 8 hrs. per day for each paid day off you want to replace
• CHR = The calculated hourly rate you need to charge to net your desired salary (S)

The Formula
CHR = (S+AC+B1+B2+OE) / (2048 – PTO) * .75

An Example

• S= $100,000
• AC = $1,000
• B1 = $12,000
• B2 = $2,800
• OE = $900
• PTO = 160 (2 wks vacation, 5 holidays, 5 paid days off)

CHR = ($100,000 + $1,000 +$12,000 + $2,800 + $900) / (2,048 -160) * .75
CHR = ($116,700) / (1,888) * .75
CHR = $116,700) / (1,416)
CHR = $82.41

Notes and Conclusions

Given the above example, your would want to start by pricing your services at $82.41 per hour. But this is just a starting point. You also need to consider what the market will bear. That does not mean your are limited by current market prices. But if you are too high, you must build exceptional value into your offering. By the same token, if your prices are too low, you may need to raise them to the appropriate level to garner the respect and reputation you want.

Also not taken into consideration in the calculation is your current business tax structure. If you are an LLC, you have more deductions than you would have as a sole proprietorship. If you are a C type corporation and work the system properly you can deduct a lot more, but risk double taxation if the corporation makes a profit. These are all topics you should discuss with your Tax Adviser.

If your down time between jobs or time required for marketing efforts is greater than 25%, then adjust the formula from .75 to whatever number represents your situation.

Finally, the 2048 is based on a 40 hour work week. Chances are you will will be working a lot more than that. So you may want to adjust to rate up to reflect overtime. Or not. It is just something to keep in mind.

So, when you run the numbers, are you charging enough?

Deming, Long Tails and Reaching Obscure Markets

About 20 years ago, in a room packed with over 500 senior and mid level managers, my understanding of my role as a manager was forever changed.

In the front of the room, on a large podium was an aging, serious looking man. He reminded me a bit of my grandfather.

I had to chuckle though. I was surrounded by some of the brightest and best managers in the country who had paid thousands of dollars to be lectured about how little they understood about management, by a man clearly pushing 90 years old.

That was my first experience of Dr. W. Edwards Deming.

By the end of day one of a four day seminar, I was not sure what I was doing there or if I should skip a couple of days and head down to Newport Beach and play in the warm California sun. On day two however, everything changed. Dr. Deming drove his points with such conviction and energy, even I got the message.

My epiphany started with his now famous Red Bead Experiment. By time he finished a thorough discussion of the Nelson Funnel experiments, my thoughts about management had been transformed.

Here are some very important lessons from that seminar.

A business is a collection of systems that, when combined result in products or services to satisfy some need in the market.

Systems are only reliable to the extent to which they reduce variation.

Employees can do no better than the systems within which they operate.

Management is responsible for the systems.

Management must improve the systems to improve the business.

Tampering with any system will increase variation, not reduce it.

Those were the core messages I took from the Deming 4-Day Seminar. But there were also these additional points.

Having the best quality product or service does not make it viable, there must be a market.

The customer wants an end result, not the product or service, those are merely a means to an end.

It is better to create a bigger pie, than to simply try to grab a larger piece of an existing pie.

The last three points will be discussed in detail with respect to this economy and finding “long tail” opportunities.

There a couple terms I will be using that should be defined for those that may not be familiar with them.

Long Tails: A term coined by Chris Anderson to describe the change in distribution models resulting from the Internet. In statistics, a normal distribution is represented by bell shaped curve where the majority of data points cluster around a central mean. At both ends of the curve are the tails. See Wikipedia http://en.wikipedia.org/wiki/File:Normal_Distribution_PDF.svg

Anderson’s long tail refers to a positively skewed distribution where the mass accumulation of data is to the left and off to the right a long tail of diminishing data points.
See wikipedia, http://en.wikipedia.org/wiki/File:Long_tail.svg

Signal to Noise Ratio An easy way to understand signal to noise ratio is to imagine you are trying to have a conversation with a friend at a rock concert. Your conversation is the signal, the rock music in the background is the noise. In this example the signal to nose ratio is very small and it is hard to pull the conversation out of the background. By contrast if you are using a megaphone to talk to a friend in a library, the signal to noise ratio is very high.

In my previous article, “Of Black Swans, Long Tails and Surviving in this Economy” I discussed how the Internet is changing the 80/20 rule. Where roughly 80% of the revenues were earned by the top 20% of best sellers. The 80/20 market place, according to Anderson, artificially constrains free markets. For example, a handful of publishers determine what books are published by filtering out all the books they do not feel will sell enough copies to warrant limited shelf space.

As the Internet infrastructure has evolved, “shelf space” has become relatively inexpensive, and for the most part infinite. Creating a larger pie, as Dr. Deming put it, is now much easier to do. No longer is there a need to filter out products or services that appeal to very small niche markets.

Just a decade a go, if you had a great training program on gold thread embroidery, you could not cost effectively fill a room in a small town or possibly larger city. Your marketing would have to be nation wide and the expense to attend would be very high for people a few hundred miles away. But now, for $50 a month you can maintain a WebX account and provide the training online to anyone in the world. The barriers to having a successful event are very low.

That is life in the long tail. More niches, more opportunities, lower barriers to entry. Larger pies. Viable markets that heretofore were inaccessible.

It may appear somethings are still scarce. Time and disposable income are not infinite. If you are reading this article, you are not spending time with your family or having face time with a client. Similarly, people only have $X amount to spend, so if you are selling marketing services, you are still competing with a variety of other operational expenses.

There is little we can do about time. At one point it was believed that with computers and technology, we would have more free time. But I seem to recall hearing somewhere in spite of the technology, or maybe because of it, people are working longer hours than ever. I know in my case, that is certainly true.

Money is another thing altogether. It certainly seems scarce and finite. But, keep in mind the only role for money is to facilitate commerce. If you have more money than commerce, the value of the money is deflated. If there is not enough money to support commerce, the value of the money is inflated.

Imagine if we were still in an agrarian society. Do you think we would have a GDP of $14 Trillion? Our economy has grown because people come up with new products and services that people want. Those products and services create jobs that give people money to buy the things they want. And so the cycle goes. Money, if properly managed by the Fed, will be plentiful to support commerce, but not so plentiful as to devalue itself.

Amongst other things, to survive or thrive in this or any economy we must have the following:

A market for our product or service

A system to reach out to and communicate that market

In a Long Tail economy, there are markets for about anything. Some are too small to provide a good living. But if your product or service can serve a large number of these tiny markets, there is a good living to be had. But you have to think differently to identify and approach these markets.

First, you have to get brutal about what your customers want. Deming spoke of companies making carburetors. If they think of themselves as carburetor companies, they are missing the point. People could care less if it is a carburetor or fuel injection, they just want and efficient delivery of fuel and air to the engine to make it operate.

So, what business are you in? Do your customers really want marketing or do they want qualified customers? Do they want computers or systems to help them efficiently operate their business?

Once you really know what business you are in, you can go looking in the long tail for customers that want what you provide. Note, each one of these micro-niches will have their own understanding of why they need what you provide. They are going to have their own unique vocabulary. Your job is to efficiently communicate with each niche in terms that speak their need as THEY perceive it.

This is where it gets really tricky. The farther down you go in the long tail, the more noise you have to filter out. The harder it is to identify and speak to a niche.

Make extensive use of Google’s Keyword tools to find the specific keywords people use when searching. Forget the generalized high hit keywords.

For EssentiaLink, there are 30,400,000 millions searches per month for paper but are all of those ready buyers of the paper we sell? It costs a fortune to reach a market that broad. By contrast, last April there were 170 searches for Hammermill 104604 paper specifically. The latter group are far more likely to be customers ready to buy.

Finally, when you find your market, realize you must compete for their cash. To do that, you have to think in terms of THEIR opportunity cost. If they spend $X with you, what opportunities for chocolate or network services are they giving up. The more value you build into your product or service, the better the opportunity for the customer. They will give up more to buy from you.

Keep in mind. Value is a balance of money and perceived benefit. Go back to step 1. What business are you in? There in lie the building blocks for establishing meaningful value.

Of Black Swans, Long Tails and Surviving in this Economy

It was a dark and stormy night. A shot rang out. A ship sank in the ocean. A young girl screamed.

Whether it is a novel written by Snoopy or real life occurance, unexpected things happen. The impact of the unexpected (read highly improbable) is the subject of a very interesting book titled The Black Swan, by Nassim Nicholas Taleb.

In a previous article I discussed how we use distortions, deletions and generalizations to make functional maps of the world. Black Swans are the events that don’t fit our neat little maps and throw us for a loop.

As entrepreneurs we plan for ups and downs, we insure for liability, we aim high; we monitor and adjust as reality imposes itself on our dream. Then, seemingly out of nowhere, the unexpected happens. It can be anything; an identity theft, car accident, our 5 year old sticking our laptop in the dishwasher.

Black Swans happen. Imagine being the CEO of a major record label or publishing house and your black swan is the Internet. Where once star making power was in the hands of the few, it is now in the hands of the individual. Anyone with access to a computer, microphone, or video camera can become a rising star in a niche market. There are fortunes to be made in niche markets.

This brings me to a second of three books I am reading concurrently. The Long Tail by Chris Anderson is an analysis of unexpected success. Anderson provides a compelling series of anecdotes outlining the disassembly of huge markets into wealth making niche markets.

Within the pages of these two books lies a formula for how to succeed in today’s economy. Sure the markets are unstable, unemployment is on the rise, and inflation may soon be out of control. But that is all a distraction.

Because we are no longer self-sufficient cave dwellers or hunter gatherers, we depend on others to survive. At the end of the day, people still need stuff, companies to provide the stuff, and services to support the commerce.

The beauty of black swans and long tails is that, when we open our minds to look beyond the distortions, deletions and generalizations we can see opportunity where none seemed to exist. The important thing about black swans is that, while improbable, they are not invisible. As I mentioned in the previous article, Ken Olsen of Digital Equipment Company, was not unaware of personal computers, he simply did not believe anyone would want one in their home. To Mr. Olsen, personal computing was a black swan. To Gates, Balmer, Wozniak, and Jobs, personal computing was an outstanding opportunity.

We are all familiar with the Pareto Principle or 80/20 rule. 80% of any given result comes from 20% of the effort. 80% of revenue comes from the top 20% best sellers. Brace yourself; the 80/20 paradigm has busted wide open. Consider this. A typical book store carries the top 100,000 books. Amazon.com by comparison, carries close to 4 Million books. About ¼ of Amazon’s sales are in the niche and fringe books that would never make into a typical book store.

Similarly, Wal-Mart carries 55,000 audio tracks in the form of CDs. Rhapsody, carries over 1.5 million tracks online and the number is constantly growing. Anderson points out that a whopping 40% of Rhapsody’s sales come from tracks that will never see the inside of a Wal-Mart.

Imagine being Kodak. Their black swan was the digital camera.

On the other hand, imagine being a paper manufacturer when the whole world was thinking computers would lead to a paperless society. Would you have folded up or beefed up production realizing that paper products would be consumed at a higher rate than ever?

The Internet gives us the tools to find, reach out to, and communicate with these “long tail” niche markets. And if we communicate effectively, there is substantial income to be made out on the fringe.

So how do we turn this understanding of black swans and long tails into strategies that improve our ability to function in this economy? Here are my thoughts on the subject.

• As the Aussies would say, think outside of the box. Open up your mind to think about fringe markets you hadn’t thought about before. Maybe one niche market won’t support your lifestyle, so how can you organize your business to efficiently support numerous niches that may ultimately provide income well beyond expectations.
    
• Redefine yourself or your company. Stop thinking about what you do and for whom you do it as the defining elements of your business. Take a very close look at the true and tangible benefits your customers enjoy by doing business with you. Ask yourself what markets have you avoided that in fact could benefit from your products or services.
    
• Put away the shotgun and pick up a rifle. Now is not the time to pursue broad markets with general appeal marketing. Pick a sub or vertical market, study them, find their pain points and market specifically to their issues.
    
• If your market is crumbling around you, understand why. Then realize there is some side effect of your market shrinking. Within that side effect may be additional opportunity.
       
  For example, EssentiaLink responded to the decline in demand of Office, IT and MRO supplies by beefing up Managed IT services. Realizing that, even though companies are cutting back, they still need IT security, email, secure backup and so on. Interestingly, as companies come on board with the IT services, they soon realize the benefits of streamlining their purchasing as well. The niche markets coexist nicely and enhance each other.
    
• Observe the biggest players in your market space. What are they missing? How does their large size keep them out of niche markets? Which niche markets in particular are not being served by the big players?
    
• Study who is playing in you niche? What are their limitations? Geographic? Expertise? Price Point? Reputation? Can you slide into a sub-niche and expand out?
       
• Survey your die hard, loyal customers. Find out specifically why they are loyal? Use that information to research other markets that may have similar needs that are not being met.
    
  Perhaps you sell products. Everyone sells products, so you know it is unlikely the products are the source of your customer loyalty. Whatever it is that is keeping your customers loyal is what you should be marketing, not the obvious service or product.
    
• To not fall victim to your own black swans, do a thorough SWOT analysis. Particularly pay attention to your Weaknesses and threats. But remember the black swan will come as an attack on your core strength. Ask yourself, “if I had to compete against our strength, how would I do it?” If you are too close to what you do to see weakness in your strengths. Go to a high school and work with a teacher to create a class project to find chinks in your armor. Chances are, high school students are more aware of the latest technology or paradigm shifts than you are.
    
  Put your best ideas on a blog and declare this is so good, no one can find flaws in this plan or service. Chances are, there will be plenty of people ready to tell you your flaws.

I don’t know what you will do to find success in this economy. I do know if you keep doing what you are doing, you are likely to find disappointment. I am reminded of my time back in Southwestern Pennsylvania. Even in the 90’s people were sitting on bar stools complaining about the decline in the steel industry and waiting for things to return to “normal” so they would be rehired. All the while what they really needed was to open their mind seek other opportunities.

I have been a lifelong student of self improvement. To me the singular most important concept is that quality of life is not a measure of what happens in life nearly so much as what we do about it. For the time being we are dodging black swans. What we do about it is in the long tail.

When the Right Words Fail – The Unavoidable Truth About Distortion, Deletion and Generalization

Introduction
The side effects of Distortion Deletion & Generalization  are everywhere.  They involve communication of people at all levels in government and of all ages.  Improper understanding of the influence of DD&G has ruined lives, destroyed companies and resulted in death. 

But have you ever heard of them? 

Did you even know they exist?

Three Key Brain Functions

Our brains do many things consciously and unconsciously.  With respect to day to day operations and guidance, our brains rely on three key functions:

1. Distortions
2. Deletions
3. Generalizations

The rest of this article will discuss each or these functions.   You will learn why they are important and how they influence your actions.  And you will learn how to use this understanding to improve your communication skills.

Deletions

Imagine you are late for work, fighting your way through traffic and rehearsing your presentation for the quarterly marketing meeting.   You probably don’t even notice a little bit of dust on the dashboard.  Your eyes see it; your brain notices it and quickly filters it out as being irrelevant.  That bit of dust simply is not important.

Depending on what is going on at any given point in our lives, our brain seeks relevance, and filters out that which is not.

Suppose, you are driving  the CEO to the airport . . . suddenly, that dust becomes relevant.

Our state of mind determines our perceptual filters.  Circumstances change our filters.  

We all have perceptual filters. 

Think about the last time you bought a new car, dress, or electronic gadget.  Didn’t you suddenly become aware of every car, dress or gadget that is similar to yours? 

If you really need a customer to sign a contract but are convinced they won’t, it is likely you’ll filter out buying signals and only hear the rejection.

For example, your prospect may ask questions about price but yours are high. 

• Do you immediately assume defeat? 
• Or, do you see the questions as a signal that they want you to build more value into your proposition?  

Effective communicators take responsibility for their filters.  Here is one way:

• Stop, relax and take a breath before assuming anything or responding.
• Ask yourself
  o What am I missing here?
  o Do I have all the facts?
  o What more do I need to know?
  o What if I am wrong?
  o What else could this mean?
  o Is this really important with respect to my larger goal?
• If you are missing key pieces of information, ask the other party more questions.
• Realize you may not have a complete picture and be open to new information.

Distortions

Our daily pressures and desires distort the way we perceive what is going on around us.  These distortions affect the way we respond.   Here is an early example from my childhood.

The last day of 6th grade I was walking with my girl friend and best friend Rich. 

As we were walking, I kicked a rock. 

Rich playfully shoved me exclaiming “you kicked my rock.” 

In my 13 year old insecure and distorted view of the world, Rich was making me look bad in front of my girl friend.   So, I did the only thing that made sense, I took a poke at him.  

Here is what my distortions kept me from seeing:

• My girl friend could have cared less. 
• Rich was just having fun.  
• Rich was an aspiring Golden Gloves boxer, I was a geek.

How do you think that distortion ended? 

Imagine a young boy flying backwards over the hood of a 1957 Ford Fairlane. 

Distortions can be a problem.

How many times has a customer told you “maybe, let me get back with you on that?”  And you waited.  You assumed “I think it is going to work out.” 

And you wait.  You make projections based on pure non-sense.  And you wait. 

How much time, money and opportunity is wasted when distortions lead down the wrong path?

We can’t avoid distortion.  When we take millions of bits of data from our senses, mix them with our fears, hopes and desires and sprinkle in massive amounts of deletion, things get distorted. 

Knowing our distorted map of the world is not reality gives us opportunities to improve our communication.  We can evaluate circumstances and decide which parts of the map are appropriate, need updated or changed and where crucial information is missing.

To develop more useful maps try the following:

• Realize you are responding to your interpretation of reality and interpretations may or may not be correct.
• Question the fundamental assumptions of the map.  For example:
  • Is this about me? 
  • How did I think this was going to work out?  
  • What did I miss or ignore that led me to think this would be different?
  • How was I predisposed to think about this before I started? 
    • Did I think this would go well?
    • Did expect to fail?
  • At the end of the day, does this really matter?
  • Where is my focus?  
    • On myself?  
    • On My Client? 
    • On the “big picture?”
    • On the minutia?
• Am I too close or too emotionally invested in this?  Why?  How does that affect my perspective?

Generalizations

When something happens we notice.  When something similar happens, we begin to “see” a pattern.  As this goes on we make generalizations about meaning, cause and effect. 

A door is a perfect example.  We generalize about how doors,  knobs and locks work.   This saves us time.  If we had to relearn the concept of doors every time we encountered one, we would still be living in caves, if we survived at all.

Generalizations can also be detrimental to our success.   Have you ever assumed “those people would never need my product?” 

Probably the most famous example of a business defeating assumption was made by Ken Olsen of Digital Equipment.   Mr. Olsen said, “There is no reason for any individual to have a computer in his home.”

Consider the following statements and ask yourself which one is true.

He loved his job.  He murdered everyone in his building.

He loved working at the post office.  He murdered everyone in the building.

If you are like most people, the second statement seems true.  Our preconceived notions and generalizations about “going postal” define our map.     Now step away from your map and you will see the serious flaw in logic.

The first sentence encompasses far more.  It could include any “he” in any occupation in any building. 

The second statement refers to a very small subset “he” working the post offices.

There are many more chances for the first statement to be true than the latter.  Our first blush however was naturally to generalize about the perceived stress of being a postal worker.

Here are some questions you can ask yourself to keep your generalizations in check:

• What were my assumptions before I ever got into this situation?
• What evidence is there to support my assumptions?  
• How does this situation differ from my preconceptions?
• How effective was I last time I was in this situation?
• Do I need a new strategy?
• How much did it have to delete or distort to make this “just like before?”

The key to effective communication is understanding the structure of communication.   What gets communicated is always a bi-product of the Deletions, Distortions and Generalizations.

When Things Go Bump In the Economy

Perhaps Sir Winston Churchill said it best, “Success is the ability to go from one failure to another with no loss of enthusiasm.”

As you look around you, think about your friends, family and colleagues, are you seeing the enthusiasm and leadership it is going to take to thrive in this economy?

When things go bump in the economy, do you pull the covers over your head or grab the flashlight and seek answers?

I don’t know about you, but never in my life did improvement come from lack of action.  This economy, our personal economies, will not improve if we don’t act.

Just before writing this article, I happened to view Susan Boyle’s performance on Britian’s Got Talent http://www.youtube.com/watch?v=9lp0IWv8QZY  I highly recommend you take a few minutes to view this video.

Wow, here is an unemployed, 47 something, British woman that took action.  I have little doubt; her actions have changed her life forever.  Whether or not she becomes a “rock star,” so to speak, remains to be seen.  But having taken a huge risk and putting herself out there for all to see and judge, has got to be a game changer.

So what are you doing to break away from the pack of naysayers that are convinced that breadlines are in your future?

When things are going well, the problem is often keeping focus, staying on track and delivering on promises.  When things are tough, it is even more imperative keep focused.  I have found it very useful to fall back on my early NLP training; in particular developing a well-formed outcome.

Clearly it is not enough to simply want or wish for something.  In the case of Susan Boyle, you know she did not hide in a closet wishing and hoping someone would find her and drag her onto that stage.  She had a plan, took steps, probably ran into challenges along the way, modified her plan, kept her eye on the prize and the rest is history.

So how do you develop an outcome that is well-formed and will energize you to take action?  Read on.

A key aspect of a well-formed outcome is that it is stated in the positive.  As cybernetic tools, our brains are drawn towards the object of their attention.  Race car drivers are hyperaware of this aspect of human reaction.  If they want to avoid hitting a wall or another vehicle, they concentrate on where they want to go, not the wall or car in front of them. 

If a goal is about avoidance, for example “I don’t want to fail”, etc. the brain must first make a representation of failure and then somehow negate the thought.   Since the original representation is of failure, the end result is the cybernetic brain is drawn towards failure.  Hence, an outcome like “I will succeed” gives the brain an opportunity to focus on and direct itself towards success.

Obviously, “I will succeed” is not a useful outcome.  It lacks meaning.  Succeed at what?  How specifically? 

The second key aspect of a well-formed outcome is that it, in NLP jargon, is sensory specific.  Sensory specific means that the outcome is defined and measured in terms of your physical senses.  A well defined goal will fully describe how you will know if you achieved your goal.  You will know what it looks like, sounds like, feels like and etc. to achieve your goal. 

I can imagine Ms. Boyle could imagine in great detail the crowd responding to her performance, the sights and sounds.  She could probably imagine how she would feel after completing her performance and hearing the roar of the crowd.

• So what is your goal for surviving this economy? 
• Who will your customers be?
• What exact steps will you take to attract customers?
• How will you know you have reached them? 
• How much will they spend with your company?
• What products or services will they buy? 
• What will your profit margins be?
• What will your bank statements look like when you achieve your goal?
• How many customers will there be? 
• What will people say to you when they realize how successful? 
• For you, what will success taste like?

Sound a bit like creating your business plan doesn’t it.

With respect to achieving personal goals, it is important that the outcome you choose is initiated and controlled by self.  In other words, “I will make the world love me” is not a useful outcome.  You simply cannot control the actions and feelings of others.  But what you can control your actions.

More useful would be “I will do ‘X’ daily until I achieve my goal or find a more useful ‘X’.”  Just as important as the actions you take is your ability to recognize when those actions are not effective.   If your actions are not taking you towards your goal, you must tweak them until they do. 

When a ship travels across the ocean, the captain can’t just point the rudder and forget it.  99% of the trip is process of self-correction.  As the currents and eddies of life play havoc with your plans, like the captain, you must make corrections.

The caveat here is to not be erratic or over-react.  It is often said that good leaders make decisions quickly and change them slowly.  Poor leaders make decisions slowly and change them quickly. 

A useful planning technique is to imagine having already achieved your goal.  Then map your way back in time and actions to your current situation.  What was the action you took just before achieving the outcome?  What was the significant action you took just before that?  How did you recognize problems and what actions did you take to overcome them?

Once an outcome has been mapped back from successful achievement back to the starting point, you have an outline of how to proceed.  But just as important, you have broken the outcome down into manageable sized chunks.

The fourth critical aspect of a well-formed outcome is that it is appropriately sized.  If you have very few financial resources, buying a successful company, may be out of reach.  But, if you set your intermediate goals to attracting investors looking for an investment opportunity, you are far more likely to succeed.

Finally, a well-formed outcome will be ecological.  In NLP speak, ecological does not mean ecological in the current context of the “green” movement or saving the planet. 

An ecological outcome is one that is a) worth having once you achieve it, and b) worth the effort it takes to achieve it.  For example, if the outcome requires that you put your children up for adoption so you can have the time and money to achieve your goal; that would not be ecological.

Similarly, if you follow Bernie Madoff’s example, that would not be ecological.

While this has been brief, the elements for creating well-formed outcomes have been outlined.  In review, the keys to setting an achievable goal or outcome are:

1. State the goal in the positive.
2. Imagine and describe the outcome in sensory specific terminology.
3. Make sure the outcome is initiated and managed by self.
4. Make sure the goal is of an appropriate size for the resources you have, if not break the outcome down into sub-goals that are of an appropriate size.
5. Review and evaluate the end goal and what it takes to get there and decide if the goal is ecological.  If not, what needs changed or how can you make so that it is?

It takes a little time to map out goals and outcomes, but how much time are you really saving if you avoid the process?  Can you imagine the time wasted if you are in a huge unfamiliar city but just don’t want to take the time to look at a map?   

These Steps Will Help You Plan for and Appropriately Respond to Potential Problems

I can still imagine Bugs Bunny  walking off into the distance singing “You never know where you are going till you get there.”    Amusing, but not a good for running a business, a department or project.

When you envision your goals for your business,  put plans into action, doesn’t it frustrate you when you get blindsided by unforeseen expenses?   Particularly with our current economy, any unforeseen expense, equipment failure or productivity slow down can send us scrambling.

A very useful tool for managing problems is the Kepner-Trego potential problem analysis.  (outlined below).  By anticipating potential problems,  understanding their potential impact and planning avoidance / reaction strategies, leaders greatly improve their chances for success. 

To successfully lead our companies we need clarity.   We need to see where the problems lie.  And, we need to understand our resources and how they provide solutions.  Further, we need to see how the pieces fit together, which pieces are performing, which are not.  

Just as important we need departmental transparency.    Without it, how do we know if the departments goals align with the corporate goals?  How do we identify conflicting departmental goals? Clearly two departments can have goals that align with the corporate goals, but are in conflict with each other.

Common causes of unforeseen expense and low productivity are the hidden agendas and unresolved interdepartmental conflicts.  As Tom Peters might say, ‘walk around, you will be surprised at what you learn.’

         Kepner-Tregoe Potential Problem Analysis

The KT Potential Problem Analysis, it quite simple in it’s structure, but don’t take that simplicity for granted.  It is a powerful tool and should be a part of any investment, project or plan that can have significant financial impact.

Either by yourself or, better yet with a small team fill out the following form.  This is a form I put together for a project some years ago and it has served me well.   Feel free to expand it or change it to meet your needs.

Typically this form would be laid out horizontally across six columns.  To adapt to this format I have listed the the sample in a vertical format going down 6 rows.

Potential Problems  -  Widgets are not good

Significance  - High cost, scrap and rework, unhappy  
                        customers.  Lost business and revenue.

Warning Signs  - Poor inspection results, scrap rates high, 
                           complaints from customers, warranty 
                           replacements

Probable Causes  - Need better training
                             - Machine defective
                             - Raw materials defective

Preventative Actions  – Train /test operators
                                    – PM inspections
                                    -Incoming inspections of raw materials

 Contingency Plan  - Beef up training
                                 -Engage  machine  builder
                                 -work with raw materials manufacturers to 
                                   improve compatibility of materials

Clearly this would go on until you identified the all potential problems. 

An important thing to add to this table is a table of responsibilities.  Put someone in charge of monitoring the warning signs.  That person will have a call list of people to engage to initiate the contingency plans.  

Then review contingency actions and modify the preventative actions.

EssentiaLink Warns of Conflicker Worm Scheduled to Cause Havoc April 1st

USA Today reports “there has never been anything quite like the Conficker worm.” This worm is no small threat. Conflicker aka Downup, Downadup and Kido, first surfaced in October 2008 and according to PC World had infected over 8.9 million computers by mid January.

On October 23, 2008, Microsoft released a critical security patch to address a security flaw in MS operating system that allows this worm to take over remote control of Windows based computers. “It’s unfortunate,” comments Bill Douglas, CEO of EssentiaLink, “All too often these critical patches get ignored. Small and Medium sized business often do not have the internal resources to keep up with critical patch management on all of their servers and workstations.”

“I am not sure people realize just how aggressive hackers and cyber-criminals are,” remarks Douglas. “Back in September, Chinese hackers started selling a program for $38 that was designed specifically to exploit vulnerabilities in MS operating systems. By October, Conflicker was in the wild. Not keeping operating systems updated is like swimming in shark infested waters with a porterhouse steak strapped to your chest.”

Opinions amongst experts vary as to the damage they feel will be caused but Conflicker. But, regardless of the damage caused by this worm, 2 underlying problems remain unchanged.

First, there is a very active community of hackers working diligently to find ways to take over computers.

Second, there are millions of careless computer users that do not take the necessary steps to secure their computer networks.

Mr. Douglas recommends that people immediately check the Internet for Conflicker detection and removal tools. Then when the worm has been removed, update the operating system to secure against future attacks.

For businesses that don’t have the internal staff required to keep up with all the patches and security tasks, he suggests they outsource the security tasks to reliable managed services providers that specialize in computer network security.

###

How would your life change if you had Disney’s Creativity Strategy?

There are a number of reasons why we may not feel creative at any particular moment.  If you read my previous article “8 Simple Steps to Becoming a Successful Author and Why You Should Start NOW!” you know the story of starting with the “upper left brick.”

 

There is another creative block people often run into I refer to as “the little voice that won’t.” 

 

Maybe you are familiar with it.

 

You have a sudden flash of inspiration.

 

Then, before you have your ideas thought out the little voice in your head (or even possibly from a colleague or friend) starts to criticize the idea. 

 

Or just as bad, the voices start getting into all the realistic details of how to bring the plan together.

 

Critical and Realistic perspectives are absolutely essential to bringing an inspiration into successful fruition.  The problem is not one of the critical and realistic voices; the problem is one of timing.  

 

Our brains and/or well meaning friends try to help us do all three activities simultaneously.  As a result, our creativity is dampened.  The critical and realistic voices feel annoying instead of helpful.

 

The process needs to be sequential and recursive. 

 

Years ago in an NLP practitioner training, I watched Robert Dilts do a great presentation on what he called the Disney Creativity Strategy. 

 

This method works for individuals, departments or large organizations.

 

Two Important Points to Remember

First you must recognize that being a Dreamer, Realist, and Critic require 3 distinct mindsets.  Trying to do all three at the same time only frustrates and slows down the creative process.

 

Second, the Realist and the Critic are as important to the creative process as the Dreamer.  They should be utilized; not dismissed or ignored.

 

Creating Harmony Amongst the Voices

Have you ever been in a poorly run brainstorming meeting where ideas get shot down as soon as they are presented?  Does this ever happen in your head?

 

The key to creating harmony between the Dreamer, Realist and Critic, involves:

·         Making sure every voice is heard

·         Making sure every function is exclusive of the others.

·         Making sure the environment for each voice is conducive to the role of the voice.

 

Environments Matter
While sounding a little “left brained” you should plan to be creative.  Start by setting up three distinct areas.  These areas may be as elaborate or simple as your situation allows. 

 

In some cases it might mean just moving from an easy chair, to desk, to a kitchen table.  I have done this by simply using three differently colored tablets.

 

 

For corporations it might mean building three unique rooms or areas that that are designed to support each specific role.

 

 

1. The Dreamer’s area will be a comfortable environment.  It should include all the things you or your team will need to be creative.

   For example, you may have flip charts, colored pens, white boards, inspirational posters, awards, comfortable furniture, bright lights, appropriate music, and so on.
   

2. The Realist’s area will be less comfortable and more practical.  It could include calculators, budgets, lists, editing tools, good lighting, reference books and articles.

   Basically you want this area to provide the Realist’s with all the tools they need to fully analyze the ideas brought in from the creative area.
   

3. The Critics area will be smaller, uncomfortable, without chairs.  The purpose of this environment is twofold. 

   First, to put people on edge a little bit so they are more likely to speak their criticisms.

   And second, to be uncomfortable enough that no one wants to hang out and just bitch or complain.

    Let’s look at each at each area.

The Dreamer
Start in the Dreamer’s area.   If you have an idea or need to come up with an idea, the best place to do it is here.
 
If you are working alone, use this space to fully expand your idea.  No holds barred.  In this location there is only one rule.

 

NO REALISTIC OR CRITICAL THOUGHTS ALLOWED!

If realistic or critical voices enter into your thoughts, STOP what you are doing and acknowledge the voices.  Remind them that they will be heard very soon, and to please be patient and wait.
 

The Realist

In the creative process the role of the Realist is to evaluate an idea based on the criteria of a real world.  If the idea was a supersonic blimp, the Realist would send the idea back for revision based on the violation of the laws of aerodynamics.
  

Or if there were a really profitable idea, but it involved selling contraband or robbing banks, without a rock solid getaway plan, the Realist’s job is to point out the risks and send the idea back for revision.
  

There is only one rule for the Realist’s Room.
 

NO DREAMER OR CRITICAL THOUGHTS ALLOWED!
 

It is not uncommon, when faced with reality, to immediately start creating solutions.   This is not appropriate in this area.  Nor is it appropriate for the Critic to start slamming the idea as being stupid or whatever.
 

If the Dreamer or Critic insists on disrupting the voice of the Realist, STOP what you are doing and go the appropriate area to jot down the ideas or criticisms.  Leave the creative or critical notes in the appropriate area.
  

If the Dreamer’s idea passes the Realist test, then move into the Critic’s area.  If not, send the idea(s) back to the Dreamer’s area for replacement or refinement.  Let the Dreamer focus on creative solutions. 
 

The Critic

The role of the Critic in the creative process is to be negative.  Their role is to think of everything that can go wrong or be perceived badly.
 

This is the Realist on steroids.  Output from this area might be in the form of “This will never work because . . .”
 

It is no fun being a Critic in this capacity, but it is absolutely necessary to fully develop successful ideas.   I have personal experience with ignoring the Critic inside me.
 

When I wrote my second book, The PC Easy Reader: Because Your are NOT a DUMMY or an IDIOT!   I thought I was really on to something.   Even the Realist in me was happy.  Who wouldn’t want learn something without having to buy a book suggesting they were an idiot.
 

My critical voice kept trying to tell me it was a bad idea because PCs make people feel like dummies and idiots.  Besides, my cover was plain and the subject matter fully discussed. 
 

I didn’t listen to my inner critic and ended up giving away 1000 books I couldn’t sell. 
 

There are only two rules for the Critic’s Room.

 NO DREAMER OR REALIST THOUGHTS ALLOWED!

DON’T STAY HERE TOO LONG.

 The Creative Process

With your areas established and full agreement on the rules you are ready to begin creating.

1. Start in the Dreamer’s area, create wildly without constraints.
   
2. Take best idea(s) to the Realist area and test them against reality.  Ideas that pass muster get forwarded to the Critic.  Ideas that fail are returned to the Dreamer for revision.
   
3. Criticize the Ideas from the Realist.  If ideas can’t be shot down, let them pass.  If they are shot down, return them to the Dreamer for revision.
   
4.  Cycle ideas through the process numerous times until they stand strong in the face of reality and criticism.
    

 This process sounds complicated and time consuming but it is not. 

 It is actually more efficient.  Once each voice knows it will be heard; it stops interfering in processes where it doesn’t belong.  
 

The end result is the development of highly creative, well tested ideas with better chances for survival.

 If the Realist or Critic, insist on disrupting your creative thoughts, STOP what you are doing and leave the creative area.   If the insistent voice is a Realist, go to the Realist’s area and write down its concerns and leave the paper in the area for the future steps.   
 
If it is an insistent critical voice, go stand in the Critic’s area and jot down the criticisms and leave the notes there for future steps.
 
Once the concerns have been addressed, go back to your Dreamer’s room.  Continue dreaming up new ideas.
  

8 Simple Steps to Becoming a Successful Author, and Why you Should Start NOW!

From as far back as the 6th grade I have wanted to be an author.  Before I knew it, I was in my late 30′s and had not written a word other than term papers and business reports.

I just couldn’t figure out what I wanted to write.

Then I read a great book by Robert Prisig titled, Zen and the Art of Motorcycle Maintenance.

About the middle of this fascinating book, Prisig describes difficulty he had with one of his students. It seems she had an essay to write and was stuck. She could not think of a thing to say.

The student wanted to write a 500 word essay on the United States and could not think of a thing to say.

So Prisig had her narrow down her topic to Main Street in Bozeman.

Still she could not think of a thing to say.

Finally he narrowed down her topic to the front of the Opera House and to start with the upper left-hand brick.

The student showed up at the next class with a 5000 word essay on the Boseman Opera House starting with the upper left brick.

I immediately realized, my problem was not one of having nothing to say but rather one of having too much to say. I needed a smaller topic.

I decided to get really granular. I picked out one of the smallest things in my life about which I was fairly knowledgeable.

I wrote my first book, 7 Easy Steps to CNC Programming . . . A Beginner’s Guide.

While you have probably never heard of my little book, it has been very successful.

It has sold over 6000 copies in 6 countries and 50 states.

This little obscure book, paid off my school loans, paid for my Master’s Degree and supports my various hobbies.

But that is not all. Having written that book and three others since, has opened up doors for me that I could never imagine.

So when I talk about being a successful author, I am defining success in terms of the benefits it brings into your life. Not whether or not it hits the New York Times Best Seller’s list.

So have you considered writing a book or becoming an author?

Would you be interested in learning a few tricks to get you started?

First, I want to define some terms as I use them.

A Writer is a person who actually writes the book

An Author can be anyone with a book idea who commits to getting the book written. They may write it themselves or they might hire a ghostwriter to do the job.

A Publisher is the person or company that takes responsibility for getting the book printed, promoted, distributed and hopefully sold.

In my case, I do all three. I envisioned the book, wrote it, and have all the responsibility for printing, promotion, distribution and sales.

How you choose to Author, write and publish a book is up to you. Just know that each choice along the way has its pluses and minuses, so look at all your options.

Here are some tips should you decide to self publish.

1. To get started writing a book, probably the hardest thing is to pick a topic you are interested in and narrowing it down.  A key point to remember here is to identify your audience. If you expect to have any commercial success with your book, you need to know who is likely to buy your book and why.I can tell you from experience, your chances for immediate success are much higher if you can identify a tightly focused niche market. Here’s what I learned the hard way. 

   After having great success with my first book on CNC programming, I decided to write a book called the PC Easy Reader: Because you are NOT a Dummy or an Idiot. 

   I thought this was a great idea. Give people a very easy book on PCs without implying they are dummies.

   The problem with my idea was that, everybody in the world has written an introductory book on computers. Not only was the competition extremely high, but I couldn’t possibly afford to play in such a large market space.

   The CNC books by contrast have a very narrowly defined market. I can find my market, appeal to them and afford to market to them.

   With all of this in mind, here are some ideas to help you pick a topic.

   Make a list of all the ways you help people? Most people have developed some expertise that others admire and continually ask them about. If you are a Realtor, it maybe about doing a market analysis.

   List the subjects that you are interested in but have a hard time finding books and information you need.  

   Research libraries and the Internet on some subject that interests you. Use Wikipidia, Google answers and blogs to gather as much information as you care to about your topic. 

    

 

 

2. When you think you have enough information to inspire you and get you started, write the back cover of the book first. This is very important. A well written back cover is like a mission statement. It is the promise to the reader of how you are going to inform or entertain them.
     

    

 

 

3. With the back cover in mind, outline your topic.Think in terms of flow. Identify what a person needs to learn to understand the next step. Continuity is very important, especially with fiction.  

 

 

4. Fill in your outline with the text to refine and support each thought.  

 

 

5. Read you manuscript out loud to a friend, spouse, child or just yourself. You will be amazed how much editing you can do on your own by just reading the words aloud. Poorly written sentences tend to really stand out when you read them aloud. 

 

 

6. Turn your manuscript over to an editor or person you know well that is brutally honest and is more interested in helping you improve than stroke your ego.

 

 

7. Choose a title and design or hire a graphic artist to design your book cover.You have to be a little careful here. Book covers are very important. An unattractive cover will turn potential readers away. Also, just because a person is a good graphic artist, that does not mean they can design a compelling book cover.Go to a bookstore. Look at all the best selling books on your topic. What do they have in common? What makes their titles compelling? 

   Come up with a number of mock up book covers and do some testing. Give a person a choice between two covers and ask them which one of these would you be most willing to pay $10 for? << (insert your price) 

   Continually test covers against each other until you find the one that pulls the highest response.

    

 

 

8. With your best cover and well edited manuscript – select a printer or printing method that best suits your budget and marketing plan.
   

 

Obviously I have left out a lot of details. But the point I really want to stress is that writing and self publishing a book is not that hard.

One thing people tell me all the time is, “boy I wish I had your talent, I have always wanted to write a book.”

I always tell them the same thing.

The only difference between me and everyone else that has ever wanted to write a book is, I just did it.  I committed an hour or two a day until I was done.

It is a lot more about discipline than talent.

There are so many reasons why you should start writing a book right now. Even if you never make a dime off your book,

• you will earn considerable respect from your friends and family.
• As a calling card, your book can set you apart as an expert in your field.
• If you do find a good niche, you can make a lot of money.
• The discipline of writing a book will forever change the way you approach other challenges.
• Your writing in general will become much easier and much better.
• Your book can open up speaking opportunities that may otherwise have been unavailable to you.

But the single, most important benefit of writing a book is the incredible self esteem and sense of accomplishment you get from doing what most other people only dream about doing.

So pick up a pen (keyboard)  and change your life.

Making Your Message Stick: A Formula Based on SUCCESS

If you have not read Chip and Dan Heath’s outstanding book Made to Stick: Why Some Ideas Survive and Others Die, perhaps now is the time.

The book opens on page 3 with a compelling story about kidney harvesting. It is a hoax, but brilliantly illustrates the point of why some stories stick. For fear of violating copyright, I will not reprint the story here, but instead use one relayed to our CEO.

———-
   Some people who feel wronged by another’s actions may  take  extreme measures to extract revenge

A colleague of ours has a friend that is a successful attorney. Let’s call him Richard. Richard recently returned from a great vacation to the Colorado Rockies.

 

 As he sat in the board room discussing his vacation sunburn and laughing about his adventures, Ed, the senior partner, walked in and quietly moved to the head of the table without saying a word.

 

 Slapping his hand on the boardroom table to get everyone’s attention, Ed, blurted out “We are Ruined!” The anger and frustration in his face left little doubt how serious he was.

 

 He let the full weight of his words settle on the room, Ed took a deep breath and continued.

 

 Richard, on the other hand was wishing he could breathe.

 

“Ok, here’s what happened. . . . Richard you weren’t here but our network was hacked late Thursday night. So, we hired an IT service to help us restore the system. As it turns out, the guy we hired was a disgruntled ex-employee of that Internet firm we sued last year. He is actually the guy that hacked the system. He showed up early Friday stating he was from the IT service we contracted.”

Ed’s  face got beet red.        Richard still couldn’t breathe.

 

“After this lowlife got access to our network, he downloaded all our case files and posted all them on a blog, along with all of our Social Security numbers, salaries, bonuses and so on.”

 

“I found out because Judge Harper called me and asked me what the hell was going on here that we would lose that kind of information.”

 

“Oh, and just for fun, this guy wiped our hard drives clean then took our back up tapes and cooked them in the microwave.”

 

“The only good news I can report is we can retrieve all our files off his blog. But, every pending case is compromised and we can expect be sued by many of our clients.”
—————

 

In their research Chip and Dan identified 6 principles that make stories stick. When you think of these 6 principles, remember SUCCES.

 

In brief the characteristics are:

Simplicity: The message must be “proverb like” simple in its meaning, simple to understand but not necessarily abbreviated, dumbed down or a sound bite. They give the example of the Golden Rule as being a profoundly simple statement that people spend their lives trying to follow.

 

   Example: Some people who feel wronged by another’s actions
   may take extreme measures to extract revenge.

 

Unexpectedness: People learn more and remember the unexpected. When A=B day in and day out, there is nothing to wake up the brain, and get past the gate known as Broca’s area. This region of the brain, positioned near the ear is a powerful filter for most types of neural information. Broca filters by screening out everything “it knows.” If it can see the end coming, it’s not interested, it doesn’t care, and doesn’t pass along the information.

 

A plot twist or unexpected outcome interests Broca, and when Broca is interested, information gets passed along.

 

  Example: A story of success and promotion turns into a
  tragedy about ruination. Curiosity is aroused . Why did the
  business fail.

 

Concreteness: The extent to which a message will mean the same thing to everyone in our audience is determined by the concrete imagery used. Think of some urban legends you have read. Computer hard drives wiped clean and computer set on fire by rogue virus. Razor blades in apples. Concrete imagery anchors the message in our minds.

 

   Example: Disgruntled ex employee, backup tapes cooked in
  microwave, red faces, inability to breathe, slapping the desk, 
  “trip to the Rockies”.

 

Credibility: The more credible the message, the more it sticks. Credibility often comes in the form of references, guarantees, try it before you buy it.

 

Example: Use of proper names, Judge Harper, “A colleague of
   ours” – Slight credibility building, but weak

 

Emotions: If people are going to care about a message, they need to feel something. To varying degrees we are empathetic creatures. Building enough emotion in the characters we describe, helps build emotions , particularly if the circumstances fit within the experience of the audience.

 

   Example: Richard’s breathlessness at hearing his dreams are
  dashed, Ed’s anger an frustration at the ruination of the
  company, Richard’s lightness and laughter at describing the
  vacation.

 

Stories / Story Like: People remember stories far better than facts and data. Stories provide and enriched learning experience. The Bible is based on stories and parables to convey the messages. People who work in highly stressful and dangerous jobs learn from the experiences of others through stories.

 

   Example: The author could have listed dozens of statistics
  about hackers, and security breaches. The story bypasses all
  that and teaches the lesson through the drama of its events
  and characters.

 

This brief summary barely touches on the key points of the Made To Stick. Chip and Dan Heath have provided so many useful anecdotes and lessons that it would be impossible to review them all without rewriting the book.

 

If you get a chance, pick it up. Once you have read it, their message will stick.