When You Hire on Price You Pay For It

October 8, 2013

calculatorRed Adair, the oil well firefighter, once said, “If you think it’s expensive to hire a professional to do the job, wait until you hire an amateur.”

Over the years, I’ve learned this the hard way.

When I’ve hired freelancers based primarily on price, the quality suffered. I paid dearly in terms of iterations and rework. Something that could have been completed in a week, might take 2 or 3. Instead of the work being done with limited involvement on my part, “amateurs” require a lot of handholding.

I now value my time more than anything else. Hiring talent requires less support from me. Each hour I spend helping someone figure something out, is one less hour I have to invest in something that can substantially grow my business.

I’ve found that truly gifted individuals can work magic. Their long-term value is significantly greater than those who are less skilled.

In my world, I see so many mediocre speakers. Event planners with financial constraints sometimes hire based on fee rather than quality. But the cost of the speaker is quite small compared to the time invested by the attendees. 100 people sitting in a room for an hour is a big payroll burn. But the bigger cost is the opportunity cost. Each hour they spend listening to a presentation that does not provide real value, is an hour they can’t invest in growing your business.

Or, if you hire a consultant, the real cost is not their fee. The real cost is the impact of their advice on your business. Most consultants who give you their two cents are overcharging. If you implement their recommendations, you could waste time and money. Or worse, you could negatively impact your business.

When investing time or money in anything, consider the total cost.

There’s on old Yiddish proverb, “He who marries for money earns it.”

In the world of business, I believe there is a corollary. “He who hires based on price pays for it.”

Funny Innovation Quotes (video)

July 14, 2010

A client of mine developed this video for a conference.  They showed it as people entered the room and got seated.  It contains some VERY funny quotes about innovation and change.  Be sure to watch in full screen, add your own music, and enjoy!

Arthur Miller Quote

June 15, 2009

“One can’t stand forever on the shore. At some point, filled with indecision, skepticism, reservation and doubt, you either jump in or concede that life is forever elsewhere” – Arthur Miller

Gossip Stoppers

April 17, 2009

My friend April Callis just published a nice spiral-bound book entitled “Gossip Stoppers: 101 Insights to Stop Gossip.”  Although I don’t think it is available yet for purchase, I wanted to share two of the quotes.

Half the world is composed of people who have something to say but can’t, and the other half of people who have nothing to say and keep on saying it. – Robert Frost

Great minds discuss ideas.  Average minds discuss events.  Small minds discuss people. – Eleanor Roosevelt

Therefore, have great ideas – and share them with the world.  We need less gossip (and reality TV shows) and more creative thinking.

Is Your Organization Anorexic?

March 8, 2009

The President of a $1 billion company once asked me to describe his organization in one word. My response?

“Anorexic.”

The Vice Presidents who sat around the table nodded in agreement.  They assumed that I meant there was no fat left to cut.  That is not what I meant.

Anorexics often have relatively “high” body fat percentages because their lean body mass erodes along with the fat.

This is what many organizations have done.  An an effort to cut costs, in addition to cutting fat, they also cut large amounts of lean body mass.

Are you thinking of further cost cutting?  If so, what are you eliminating?  Fat?  Bone?  Muscle?  Vital organs?  No company in history has ever “cut” its way to long-term success.

Exercise grows muscle while burning fat.

Innovation is exercise for businesses.  It helps grows the organization while also enabling cost efficiencies.

During the depression, Henry Ford said, “A man who stops advertising to save money is like a man who stops a clock to save time.”

The same is true for innovation.  Although cost cutting may be a necessary short-term tactic, it is NEVER a strategy.  If you are in cost-cutting mode, make sure that your cuts target fat and not lean body mass.  In addition, be sure to exercise your organization,  Invest in innovation now and you will be prepared for long-term growth and success.

P.S. I like this photo. It nicely depicts the obsession that many companies have with measuring everything in sight, yet in the end not measuring anything of value.

Jefferson Loved Books Not Banks

March 3, 2009

Here is something courtesy of Barry Kibrick, host of the PBS TV show, “Between the Lines.”  I was on his show a few years ago with my Goal-Free Living book.  Barry is one of the best interviewers on television.

200 years ago today (March 3), Thomas Jefferson spent his last day in office as President. On that day he issued a special report to the Treasury focused on the Bank of the United States. It was a dismal report, for the nation at that time was in desperate financial straits due to an embargo that was hurting all aspects of the economy.

As most of us know, President Jefferson was no fan of the banks, big business, or of big government intervention, but he was a fan of books and the “capital” they provide. So, on that note I leave you with these words by our 3rd President.

“Books constitute capital. A library book lasts as long as a house, for hundreds of years. It is not, then, an article of mere consumption but fairly of capital, and often in the case of professional men, setting out in life, it is their only capital.” Thomas Jefferson – President of the United States, 1801-1809

Thanks Barry.

Do Your Innovation Efforts Work?

January 21, 2009

Sometimes the question you ask is more important than the actions you take.

During President Obama’s inauguration speech, he said…

“The question we ask today is not whether our government is too big or too small, but whether it works – whether it helps families find jobs at a decent wage, care they can afford, a retirement that is dignified.”

This is brilliant in its simplicity.  The same thought applies to innovation.

The question you need to ask is not whether you are developing creative products, processes or business ideas, but whether your innovation efforts work – whether they serve your customers, serve your employees, and ultimately serve your shareholders.

Innovation is not about change for change sake.  It is about purposeful change that creates value that reduces costs, increases sales, or improves cash flow.

In these troubling times, asking the right question is more important than ever.  Do your innovation efforts work?

The Wisdom of Miyagi

December 22, 2008

Innovation SquishIn the Karate Kid, Mr. Miyagi once told his student Daniel, “Walk on road. Walk right side, safe. Walk left side, safe. Walk middle, sooner or later [makes squish gesture] get the squish, just like grape.”

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to listen to Miyagi, press play

This fits nicely with my perspectives on innovating in tough times.  In my previous blog entries on how to make your products/services more affordable and accessible, I discuss why the middle of the bell curve is a dangerous place to be in these economic times.

I was just speaking with a client of mine and we had the same conversation.

His Fortune 50 company offers a commodity item, but is considered to be a premium brand.  They are never first to cut the price of their items (and they rarely cut prices), but they typically lead the charge in price increases.  Their brand is associated with high quality and high performance.  They are often focused on the right-hand side of the bell curve.  They have been doing exceptionally well.

Their competitors fall into two categories.

Some are white label, low price producers.  Budget brands. They provide a lower quality product that appeals to those with the least to spend.  These companies are in the left-hand side of the bell curve.  They seem to be doing particularly well now that people are looking for bargains.

Other competitors are in the middle of the bell curve.  They provide good product at a good price.  How are they going? These companies are being “squished”  by the low cost providers on one side and the premium brands on the other.  They are struggling.  My client wonders how many of these companies will survive.

The middle of the bell curve is a dangerous place to be these days.  If you aren’t careful, you might just get squished like a grape.

Shapiro Quotes

June 19, 2008

I did not know this, but excerpts from my blogs have been appearing regularly in a newsletter containing inspirational quotes.  Members of the Gaia Community select their favorite tidbits and then distribute them via email and the website. 

Click here if you want to read a bunch of my quotes.

Idiots Out-Innovate Intellectuals

March 1, 2008

Here’s a great quote from Ville Keränen from Finland:

“One idiot who walks gets further than five intellectuals who only talk…”

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