Forums: Discussions for entrepreneurs and small business.

Suppose you make widgets. You`ve been making them for years. You`re an expert on widget-making.

One day, there`s a new boss. He or she comes to you and asks you how long it takes to make a widget. You reply that it takes about 8 hours. The boss looks at you and tells you that now you have to make them in 2 hours.

"That`s impossible," you say, and the boss tells you either to make them in 2 hours, or he`ll find someone else who can. "But that`s not fair," you say as the boss walks away. The last you hear is that either you get it done or you`re out of a job. Is it nice, or fair, right or wrong? The boss doesn`t care. Either you get it done or you`re fired!

There are two types of bosses. There`s the understanding one, who takes people and their feelings into consideration. Then there`s the "turnaround CEO," sometimes known as the hatchet man. These days, we hear about situations like this all the time. Wal-Mart is known for this type of pressure. Is it fair? Is it right?

Consider the astronauts on Apollo 13, when they developed a major set of problems with their return flight. There they were, out in space, and they called NASA to let them know there was a problem. The response from Ground Control was, "Fix it!"

Suppose those men had said they couldn`t? It was too hard---impossible, in fact---and nobody could fix the problem! Suppose they`d complained that it wasn`t fair, wasn`t realistic, and that their feelings weren`t being considered? The only response anyone could have made would have been, "Okay, then die!"

It`s amazing, isn`t it, how often the impossible gets done when someone`s life depends on it. History is filled with heroic efforts, miraculous "last minute saves," and all sorts of stories about how when it came down to choosing alive or dead, the outcome was staying alive. It`s amazing how often you manage to pull your own life out of a hat when the alternative is to die.

Would you prefer to choose your own moment of desperation, or would you rather have life`s circumstances choose it for you?

Let`s say you`ve got a product and you think it should sell for a certain price. You`re not selling many of your items, and so you have a decision to make. But it isn`t really a decision about pricing. It goes deeper than that. It`s a decision about whether or not you have a viable product in the first place. Ultimately, it`s a decision about whether your business will live or die.

In so many cases, a business is doing just fine making widgets. They`ve gotten comfortable with the process. Then another company figures out a better, cheaper, or more efficient way to make the same thing. Competition, which is the same as in Nature, provides that one or the other company will live or die. Either the first company competes or they go out of business.

Would you rather have a human being---a "boss"---tell you that you have to figure out a way to compete, or would rather suddenly discover you`re out of business? How important is it for you that "the world" should be considerate, realistic, compassionate, and caring? Would you prefer to look at your product and business from a survival perspective, or just let things happen?

Napoleon Hill, in "Think and Grow Rich," makes the point that desperation brings forth an amazing capacity in people to find creative solutions to problems. But is that desperation a good thing? Is it something we should seek out and cause to take place in life? Isn`t being an entrepreneur scary enough? What if you did want to push yourself to the limits, how would you accomplish it?

There isn`t much that causes more apprehension and terror than to walk out of a cushy job to start a business. Many of us would say that`s the ultimate in fear. But until we`ve come face to face with losing everything---being out on the streets, alone and bankrupt---there`s an awful long way to fall. It`s like the optimist and the pessimist talking together.

The pessimist says, "Well, things can`t get any worse." The optimist says, "Oh, sure they can!" So the question is whether or not it`s useful to examine your business from the perspective of do or die. Would you say that desperation is a beneficial survival tool? Or would say that you should act only after you`ve considered all the options?

Great essay Craig!

If I`ve learned one thing in life ... stay in the middle of the chessboard. [And I should give my Mom and Grandfather full credit here. They`ve taught me more about life than anyone else.] I try very hard not to react in such a way that my options become even more limited ... that`s like swimming so hard you exhaust yourself and drown anyway.

Sometimes immediate action is appropriate. In an emergency for example. But most of the time, action that comes before a complete or thorough understanding of the problem simply treats "symptoms" and not "causes". It`s theoretically possible to treat symptoms forever, as long as you can manage the discomfort of the underlying condition.

In business, continual cash flow problems are a symptom of something. Might be poor sales, poor marketing, poor idea, or some of each. [Businesses are complex systems, so there is rarely one cause of a single problem and rarely one area affected by a problem.] You can treat the symptoms of cash flow problems with regular cash infusions but it won`t really solve the underlying issue. I guess I would treat the symptoms while I tried to figure out how to treat what`s really going on.

I understand that these subjects are not the point of the post, however, I believe the clarifications should be made nonetheless.

There is a major problem with this premise, this boss needs to get fired and soon or he`ll take that company into the red. The employee no doubt will find a way to keep his job and make the widget within the time allotted, however, he will do so by cutting corners and putting out a substandard product that the company will sell and be liable for. It is the boss`s job to find out what is the time it takes to make that widget, if the time is too long a better way of manufacturing the widget meeting the safety standards needs to be identified, the people in charge of creating the widget need to be trained in the new system and they must be given the time to produce it as per guidelines. Setting the responsibility of coming up with a method to create a product to the person least qualified to do so (the manual laborer) will likely destroy that company. That boss needs to be fired, the sooner the better.

Actually Wal*Mart is an extremely well run company, in fact it is its efficiency of operations that makes them such a tremendous force in the market. Wal*Mart has never had a hatchet man. They do put pressure on suppliers to meet their requirements, however, no supplier is forced to sell to them, if the margins Wal*Mart allows for are too thin they can and should sell their trinkets to somebody else.


That was not so, ground control put their best men to work in order to come up with a solution to the problem. The solution had to be done only with the equipment Apollo 13 had on board, they had to be able to create this solution within the environment of the capsule, and they had to be able to effectively communicate each step how it would be done and why. To demand of astronauts that were trained to navigate a space capsule to come up with engineering solutions they were not trained in would`ve been an impossible requirement and surely end in disaster. “Suppose those men had said they couldn`t? ...” The point is valid, but it should be directed at the engineers working in and with ground control not the astronauts.


I highly doubt that desperation in business is a good thing. Good business practices include planning and proper execution of those plans. When desperation enters the picture the situation of the business is dire. That is not to say that great companies do not demand adventurous leaders Boing was a well established company when it decided to gamble the entire company in order to produce the 747 it went on to dominate the commercial airline market for the next half century. According to Gates he had to gamble the entire company (Microsoft) several times before it went public, any one of those could very well had destroyed it. In September 1945, Masaru Ibuka returned to Tokyo to begin work in the war-damaged capital, he assembled a small group of people. Most of the salaries were paid out of Ibuka`s small, and dwindling, savings. To stay in business, they repaired radios and made shortwave converters. He had little and risked it all, today you know his company as Sony. You need risk takers for business, but taking risks does not equal desperation, inducing desperation on your employees can may produce an apparent short term gain, but the long term cost greatly outweighs the short term benefits.

That said, many great things have come out of personal desperation

of course that is small, almost trivial, but one buck says that you will use his invention sometime this week. That invention came about due to a moment of personal desperation.

I believe that in business we should act on gut feelings, in order to do this right we must plan, prepare for and execute. Failing to properly plan and execute will lead to desperation, acting on desperation may just as easily lead to riches or failure.

"If you fail to plan, you plan to fail"

:-) Okay, Eli, I see your point, I think. By way of example toward my intended context, I`ll go back to the Wal-Mart example. I left it VERY short because I didn`t want to write a whole book.

When I say that "Wal-Mart" is known for this type of pressure," it doesn`t mean that`s the internal system for Wal-Mart. Instead, we all know that the company approaches a small business, telling them Wal-Mart would like to carry their product.

However! The company MUST provide that product for $? price. Often, that price is so far below what the company "believes" they can accomplish, they freak out. But Wal-Mart has done an extensive analysis of the operations of that potenttial client company, and they know to the penny what`re the costs, expenses, labor, and so on. The client company has the option: make it for that price or don`t sell to Wal-Mart.

It doesn`t mean the client company can`t do business, can`t continue as they were. There`s no attempt to shut down the company. It simply is Wal-Mart offering their distribution system according to their rules. After all, it`s a free economy, still, and any company is free to contract or not with Wal-Mart.

It`s like that boss who says "do it or you`re fired." No, that boss shouldn`t automatically be fired. That`s is the touchy-feelie way of doing business. Wal-Mart has every right to demand that a potential client company provide product at what Wal-Mart deems a good price. The client company can easily just say "no."

Hmm...I think, seeing it now, that my core intent was actually to write about the "pressures" of OBjective reality. In one case, Wal-Mart represents an objective analysis of a small company, with no stake in the matter other than their interest in selling something profitable. In the CEO case, an objective CEO comes in, sees the waste, and cleans house.

In both situations, they relate to the Apollo 13 example, excepting in that situation, it was objective reality that caused the problem---an accident of engineering failure. It appears to me that often, it`s only that direct encounter with objective analysis that scares the bejeezus out of people. They don`t want it to happen, and so there are all these articles about "bad executives," and how employees should be treated with more consideration.

Free market forces will naturally bring excellent employees flocking to companies that pay good wages, have great benefits, and demand excellence from those employees in their work. I see it at places like Aldi`s, and in a couple of past postings here on SuN. It`s only the incompetent and slackers who want to bring a lawsuit against objective analysis. :-)

Nobody is being forced to work in a company. We still have the freedom to choose if we`ll work or not. That`s under attack with so-called "Right to Work" laws. There isn`t a "right" to work! Not in a fee-enterprise system, at any rate.

Anything can be interpreted several ways. Part of what I`m learning is different ways to constrain a reader`s interpretation only to a single, explicit version---my version. :-) I`m not yet as good as I`d like to be, but with folks like you and Cookiemonster, as well as some other very smart people here on SuN, it helps.

I shorthanded the Ground Control response to "fix it," because that`s essentially what had to happen. Of course the brilliant engineers on the ground, all over the world, immediately dropped everything to figure out a way to help. But no matter who was involved, either the problem was fixed or the astronauts died.

How often do you come up with ideas for people, and they spend time after time telling you why they won`t work, can`t work, will fail, blah blah blah. It`s as if they`re personally invested in figuring out what won`t work, rather than trying to figure out what WILL work.

Those are the people who eventually end up in desperate straits. And y`know what? When they go bankrupt, they have a million excuses as to why, all of which blame something or someone else for the problem.

I was looking for a way to bring into discussion the concept of inventiveness along the lines of the coat hanger. I could`ve titled a topic, "What creative solutions have you found in your last moments?" Or something like that. :-) But I figured I`d see what happened this way first.

I appreciate both yours and Cookiemonster`s comments. I`m thinking the essay form isn`t going to work so good for forum postings. On the other hand, essays are a pain in the ass to read anyway....but they need all those words for a complex topic. So I`m still messin` wid it... ;-)