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Joe Greco Blog
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Economy
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Written by Joseph Greco, MSOD
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Monday, 17 August 2009 12:35 |
 One of the principle benefits of education is that you can learn from the experience of others. Sure, our own experience will be the most valuable as we tend to remember the lessons we pay dearly for with our personal blood, sweat and tears. But we are apt to experience more and require more answers than we can resolve ourselves. For some reason, I have always been comforted by the fact that someone else has experienced a similar challenge, dilemma or grief before I have. Instead of suffering to determine the answer on my own I can learn how someone else dealt with the situation.
I am going to take a wild, non-researched, guess and figure that the people reading this article are probably past the half way mark in their careers. Based on anecdotal feedback I have received, those readers whom I have encountered fall into this category. Maybe it's just the senior apparel executives that speak with me. During graduate school I read a fascinating book by Harvard professor Robert Kegan. "In Over Our Heads," subtitled "The Mental Demands of Modern Life," was about business careers, and was rooted in a psychological approach to growth and accomplishment. Much is what we normally experience in our careers but have not associated into a coherent framework. There are normal phases in our career growth defined by characteristics that typify each decade from our twenties to our sixties.
If this book had been written more recently, I speculate that Kegan would have extended our expected work life past the standard retirement age of 65. We are, after all, living longer, and in many cases need to earn more than we had anticipated to sustain a suitable or attractive retirement period. We are generally healthier and will outlast the predicted expectations of the Social Security Administration when our savings accounts there were initiated. This can be both positive and negative news depending on one's health and economic status.
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Last Updated on Monday, 17 August 2009 19:32 |
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Economy
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Written by Joseph Greco, MSOD
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Monday, 02 March 2009 13:54 |
 A few months ago, I discussed how my company decided to fire our major account. While this was the right move, it was certainly worrisome to risk losing volume in a time of recession. But in analyzing our remaining accounts, we discovered that while these clients each represented lower sales volume, the gross profit was higher. This prompted me to recall one of the lessons my father Domenick taught me. He used to repeat the adage, "the big ones don't let you eat and the little ones don't let you sleep."
It took a few years for this idea to sink in. The big accounts, with the large orders and popular name brands, seemed more glamorous. But we were squeezed on prices then and now. Sound familiar? The smaller accounts seemed to be bothersome for the amount of units they ordered but the gross profit margin was more attractive. Let's remember the name of the game is profits and not just sales.
The aggravation or annoyance that you may encounter from handling smaller accounts should be ameliorated by the use of technology. With a sophisticated data base for enterprise resource planning, dealing with smaller accounts is made simpler. And they still remain profitable. Now that's attractive.
In these challenging times, it's important not just to review and select your account base but also to keep your mind and the minds of your associate's wide open to new opportunities. Brainstorm with your team to develop fresh ideas for marketing and services. If you get fifty ideas contributed and only two are valuable, you are still ahead. Quoting from an Investor's Business Daily article, Mr. Jay Forte, a consultant, reminds us to "tell your people that no matter what happens, we are all going to look for and take advantage of opportunities. By creating a culture of learning, where you're soliciting input from all employees and sharing the latest news with them, you make it easier to include them in your hunt for opportunities. Have them gather information about you industry and talk to customers so that they're always generating ideas."
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Last Updated on Monday, 17 August 2009 19:33 |
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Economy
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Written by Joseph Greco, MSOD
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Monday, 06 July 2009 00:00 |
 A fundamental question that was asked of us as undergraduates in economics class was to identify the difference between the short run and long run. My professor answered that no one lives in the long run. While a human may not live forever, corporations in theory can last forever. What lessons for success in the long run can be applied to the short run to which we are all allocated?
An organization in the long run needs a core religion or set of cultural values that will unite the current group of people and yet be able to transcend into the future. This concept supersedes what any one individual or leader can contribute. What are the values, rituals, and sets of behaviors and beliefs that will unite people and carry them past the current functions they need to perform? If no one lives in the long run, why should we align our companies to survive and thrive? Because the guiding principles will help assure success in the short run where you and I do live.
The role of the manager or leader is to develop a culture that will continue to assure a stream of profits. Whether you head a 'for profit' corporation or a nonprofit, in order to succeed your income must exceed your outgo or your upkeep will be your downfall. But focusing on profits is not the key to attaining them. Profits are an outcome of the properly invested energies, leadership guidance and assets of the organization.
What are the inputs then? Here's where we get to revisit some basic fundamentals of successful management. Fundamentals are those things that have not really changed in many years. My mentor, Jim Rohn, used to say, "beware of someone coming along and offering you new fundamentals." In this challenging economic environment where there is more talk of 'transformational' changes in the habits of buying, borrowing, saving and investing of consumers, reviewing the fundamentals may help guide us forward.
The good manager will first define the task or responsibility at hand by determining the needs of the clients to be served. These can be internal or external clients or customers depending on your role in the organization. But everyone has needs to be satisfied and satisfying those needs is why we have a job. A business cannot exist very long in the short run or certainly not in the long run if there are no clients to serve or sales to be made. I know that the targets may change quickly, regularly and quixotically but that's why managers or leaders are supposed to be paid the big bucks if they can keep up with the changes and remain ahead of the curve.
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Last Updated on Monday, 17 August 2009 19:32 |
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Economy
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Written by Joseph Greco, MSOD
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Saturday, 14 February 2009 08:33 |
 During these times it seems that newscasters and reporters are trying hard to describe and define this difficult economic environment. Is worse now? Will it get worse before it gets worse? Sure, psychology plays a significant role in our spending behavior. The economic cycle can slow down when everyone cuts back. But the wheel goes the other way also. The older we are the more cycles we can recall. We have always come out of a downturn and this time will be no exception. The world population continues to grow and people have growing needs for food, housing, transportation, and uniforms. This is not a news report but a business manager's viewpoint. How do we handle these rough times until the eventual upswing occurs? As sales dip, where do we make cutbacks? The last place you want to look to eliminate expenses and assets is among your human capital. With few if any businesses excepted, people are your most valuable asset. So you need to think about how to keep your organization in tact given the current economic pressure so that you are properly positioned for future growth and profits. |
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Last Updated on Monday, 17 August 2009 19:34 |
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Economy
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Written by By Joseph Greco, MSOD
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Monday, 15 February 2010 09:57 |
 What lessons can be learned from the current Toyota quality issues? This is a quote from a CNN/Money internet article of February 10, 2010:
"…if any documents come out which prove Toyota engineers knew something needed to be fixed, it will be difficult for Toyota to ever regain consumers' trust. When your image is one that has been largely built on quality and dependability, you can't afford that kind of smoking gun," Hutson said.
I have been drawn recently to the bad news coming from Toyota. I don't own one now but we used to. I have had high regard for the company and their Lexus division which products some of my family members and friends own. There have been no problems with those models.
Toyota seems to have at least three areas of technical problems including sticking gas pedals, non-functioning brakes and problems with steering. The loss of sales while these repairs are taking place has been estimated at $155 million per month. This does not count the cost of repairs being made around the clock. These costs may be small in comparison to the 30 class action suits (so far) for damages and loss of value to the re-sale of cars that is estimated at up to $6 billion. I understand that these diverse problems of quality occurred over a number of years and different types of models.
Further, I heard on the CNBC that Toyota may have been more concerned with increasing market share at the expense of quality. I am not typically a prognosticator of bad news, but this set of events is going to be threatening the future of the company and could be catastrophic. Toyota should be able to make the repairs, but will they gain the trust of their current and future customers? It took Audi more than 20 years after non-confirmed reports of their gas pedals sticking for the company to improve the image and grow by delivering quality cars. How long will it take Toyota to get back to a quality image with the confidence of the consumer?
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Last Updated on Monday, 15 February 2010 10:12 |
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Economy
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Written by Joseph Greco, MSOD
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Monday, 16 November 2009 13:23 |
 Last night I had a heated, but friendly, discussion with my Uncle Tony Greco about our national economy. Tony turned 89 last July and like his parents and brother, my father Domenick, grew up in and established careers in the apparel industry, then known as the clothing business. Tony was a manufacturer of boys' jeans in the 50s and 60s in Philadelphia with a NY showroom. He recalled selling denim jeans at $15.98 per dozen, including fabric, and made .05 per pair on 3,000 dozen per week.
In 1969 he closed his business and blamed very low price competition coming from Hong Kong. Previously he had been able to have his union shop be efficient enough to compete with non-union labor from southern factories. But the Far East was just too much. Tony continued as a jean contractor into the 70s and closed and retired after a few years when demand dried up. At the same time, I ran a sport coat factory on the same loft floor in North Philadelphia. I had 60 people employed during what became my first recession of 1973 to 1975. We made a few lots of Nehru jackets and then closed that factory. I had decided to continue in the business and due to a shortage of sewing machine operators was then drawn in 1985 to starting production in the Dominican Republic under the Caribbean Basin Initiative.
Since that time I have increased the sourcing capability in both breadth and depth by manufacturing a variety of products from headwear to footwear along with uniforms and career apparel. We source in various countries including the USA, Dominican Republic, Haiti, Nicaragua and China. Back to the discussion between Tony and me, with Tony contending that the ruination of the US economy was solely from imports: While from his perspective, his business did decline due to foreign competition, he had not taken steps to transition his manufacturing experience to other realms.
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Last Updated on Monday, 16 November 2009 14:16 |
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Joe Greco
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Written by Joseph Greco, MSOD
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Sunday, 08 February 2009 20:28 |
 In these times of recession, vast uncertainty and global economic downturn, we may want to take a step back and reassess or be forced to reconsider the reasons for our goals, business strategies and other key decisions. But before taking any further paths to implement previously approved plans, consider some guidelines for making sound decisions as if you were to make them afresh today. Think about establishing clear goals that will address two areas of need. Ask the question about the quality of the decision- is it the right one for these times and market circumstances? And can you be assured of continued commitments and support from key stakeholders who have an interest in your future success? This group would include your employees, managers, lenders, vendors and clients. Are your plans devised to serve the long term and short term interests of the enterprise? Consider and devise methods in advance to resolve issues and conflicts that you may imagine can occur. What will be the impact? Be ready with your back up plan B and C if you can. Use these times of course corrections to increase your intellectual knowledge base and learning's so that you may strengthen your chances for greater future success. If you've already paid a price, get the benefit of that investment and don't pay the same price twice. |
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Last Updated on Monday, 17 August 2009 19:35 |
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People
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Written by Joseph Greco, MSOD
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Monday, 15 March 2010 10:37 |
 Recently I learned that I had lost my mentor who passed away last December. I had only met Jim Rohn three times, at seminars I attended, but I read his books and listened to his lectures on cassette tape, for probably hundreds of hours. While driving in my car in the '80s and '90s, I almost wore the cassettes out.
His life may have passed but his wisdom is timeless. He taught me more about personal growth and self-actualization than I learned in all the years of school through graduate school. Mr. Rohn's words written below come from his books and my recollections of his talks.
In one talk, he told a story of some successful business people in his audience who asked him to predict what the future would be like based on his own experience in business and sales. Mr. Rohn said that the future would be similar to the past: opportunity mixed with difficulty, the same as it's been for more than six thousand years of recorded history.
If 'things' don't really change, then what can be changed? His answered that we each need to change and grow and take advantage of our experience and that of others, authors and historians who relate past trials and tribulations so that we don't need to experience everything personally to learn life's most important lessons.
In these current "times that try men's souls," I am channeling Jim Rohn for he was a type of motivational speaker who spoke realism and practical perspectives. He taught that the only motivation is self motivation. You can't just rely on someone else to stimulate you, because what if they don't show up? What was most important, he warned, was to be careful of what you became in pursuit of what you wanted. And having more money is just not the full answer because more money only made you more of the character you already had become. If you were a gambler, you could now be a bigger gambler; if you were charitable, you could be more charitable. If you inherit a million dollars best you become a millionaire in your behavior and attitude very quickly. Because gold quickly slips through the fingers of those unskilled in it's keep.
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Last Updated on Monday, 15 March 2010 10:45 |
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Economy
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Written by Joseph Greco, MSOD
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Friday, 29 May 2009 10:08 |
 What can be more valuable than taking what we have learned during our past and invest those lessons into our future? We have either already paid the price of learning from our own mistakes or reading about the successes of others. The word 'radical' comes from the Latin for getting back to the roots. Take a regular radical step and examine your roots by asking the question: "what business am I in?"
With the stresses of the current economic environment, now may be a good time to test some assumptions. Inertia is an extremely powerful force and can be a negative one if you are static. For our second foreign word today is 'risk' which comes from the Italian riscare which means to dare which implies a choice and not a fate. We make overarching strategic choices rarely and tactical choices almost every hour. When is the last time you reviewed or updated your business plan? Are the choices you are making or the risks you are taking in concert with achieving the goals set forth by your strategic plans? If things aren't going the way you like them to, wake up!
There are at least four responses to dealing with risk: You can avoid it, reduce it, transfer it or accept it. But you need to manage it by your awareness and the choices you make. Has the marketplace around you changed? Are clients requiring different products, services or technology? Maybe you need to go with the flow and reorganize your resources to delivery according to the current demands of your clients instead of trying to do business by your traditional methods and practices.
For example, as I attract new prospective clients, I have recently found that many are not ready for prime time manufacturing. Most are starting their businesses with some innovative ideas or creative improvements on products currently available in the marketplace. With all these new ideas coming my way I have signed more Non Disclosure Agreements in the past six months than I have in the last ten years. It amazes me how many people want to get started in some form of the apparel business. My challenge has been that I could not charge for my services in the traditional method of manufacturing products and marking up on the costs. The start-ups simply and rightfully do not commence with large enough volumes of merchandise to defray the costs of doing business.
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Last Updated on Monday, 17 August 2009 19:33 |
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Economy
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Written by Joseph Greco, MSOD
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Thursday, 27 August 2009 12:08 |
 As managers, we seem to spend most of our time solving problems. Or at least I do. Though I should know better and would be more rewarded by spending time in leadership, thinking and planning. Sometimes we get trapped by thinking we are trying to solve a problem, but the truth is we are dealing with a predicament instead.
The difference was defined by Richard Farson in his intriguing book, "Management of the Absurd." While a problem is something that can be solved, a predicament can only be coped with, as it tends to be a complicated, inescapable dilemma. One paradox is that a predicament is made worse often when treated as a problem.
Most problem solvers tend to be found at the lower end of management. Predicaments require more imagination along with interpretive thinking, and these characteristics can usually be the traits of upper management. Whether by intelligence, training or experience, dealing with a predicament demands that we engage in an expanded manner of thinking and the realization that predicaments cannot always be handled in a linear or smooth manner.
A negotiation may be a predicament for which no solution exists that will satisfy all involved. Sound familiar? Each party may have to leave the table being somewhat dissatisfied. Approaching the situation as a problem that may have no clear solution may waste time and distract you from pursuing other opportunities, in addition to squandering resources and incurring astronomical legal fees. You may be doing the best you can to settle as quickly and cheaply as possible and move on.
Benjamin Franklin faced a predicament when he held conflicting thoughts and emotions as he, as a British subject, was loyal to the Crown but at the same time disagreed with the British Parliament and their penchant for taxation without representation. Franklin spent about 15 years in England prior to the American Revolution and wrote extensive newspaper articles during that time addressing the wrongs visited on the American Colonies, while at the same time hob-knobbing with England's elite in the fields of science, art and literature. Because he retained two loyalties, he was judged as "waffling" in his support for America.
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Last Updated on Monday, 31 August 2009 08:43 |
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