Simple Way to Create a Scalable Brand

Your brand is the core of your marketing strategy. Jackie Yeaney of Red Hat shares her thoughts on how the brand fuels marketing investments that drive revenues.

When a company is in growth mode, it's natural to focus on operations--getting the product to the right customers and keeping those customers happy. Although operations are critical, they will only take a growing company so far. To create a truly scalable growth engine, a company needs a strong marketing strategy, with a solid brand at its core, and a supporting structure for delivering the company's core message to customers.

Jackie Yeaney is the EVP of Strategy and Global Marketing at Red Hat, a software company that has grown from a start-up in the mid-1990s to a billion-dollar open-source developer. Yeaney has led marketing strategy at a number of growing businesses including Earthlink, PGi, HomeBanc, and Delta Air Lines. Asked about how to build a thriving marketing strategy, Yeaney uses an example from nature: a growing tree.

"You need to start with the roots, which is a clear corporate strategy," she says. "This feeds the brand, which is the 'trunk' or core of your marketing strategy. The brand has to be the foundation of your growth. Then, all your investments become the 'branches' that grow from your brand."

At Red Hat, the brand is at the core of all marketing investments. This includes global marketing programs, marketing operations, marketing services, and field marketing in each of the regions. Each of these teams has become more focused, streamlined, and effective by centering their activities and investments on driving the brand message to customers. In fact, each of the field teams behave like a larger organization because of the support behind them. Much like tree branches provide nourishment from the trunk out to the growing leaves, the branches of the marketing organization reinforce the brand to customers through Red Hat's various investments.

As a company grows from a small start-up to a more complex organization, its marketing investments often grow in proportion to revenue. This approach can lead to complex and often disjointed marketing structures. At Red Hat, Yeaney found that as the company grew, new customer acquisition became paramount. This led to a larger marketing organization that quickly lost sight of the core customer value proposition. Each of the branches of the marketing organization were telling the Red Hat story in their own words and their own way. Focusing the organization on a clear and simple brand strategy created more effective results in the field with individual customers.

All growing companies want to invest more as they grow and continue their growth trajectory. Building a solid brand strategy is essential to providing a foundation for future marketing initiatives. After all, branches can't be healthy on their own--they need a strong trunk to fuel their growth.

Have you built a solid foundational brand strategy? Share your thoughts with us at karlandbill@avondalestrategicpartners.com.

Follow Jackie Yeaney, of Red Hat, on twitter: @jackieyeaney

Karl Stark and Bill Stewart are managing directors and co-founders of Avondale, a strategic advisory firm focused on growing companies. Avondale, based in Chicago, is a high-growth company itself, and is a two-time Inc. 500 award recipient. @karlstark

World's 20 Coolest Offices

Location: Amsterdam, Netherlands
Square feet: 1,100
Designers: Alrik Koudenburg & Joost van Bleiswijk

Nothing, an ad agency with clients such as Comedy Central and MTV, prides itself on building the best ideas up from, well, nothing. With that basic idea in mind, the designers set out to make an unforgettable office. Using more than 1,600 feet of cardboard and some glue, the designers crafted desks, bookshelves, and office partitions. Look close and you'll notice it's cut to resemble iron bars and support beams. Just watch out for paper cuts.

Be Happier: Stop Doing These 10 Things

Sometimes the route to happiness depends more on what you don't do.

Flickr Creative Commons

Happiness--in your business life and your personal life--is often a matter of subtraction, not addition.

Consider, for example, what happens when you stop doing the following 10 things:

1. Blaming.

People make mistakes. Employees don't meet your expectations. Vendors don't deliver on time.

So you blame them for your problems.

But you're also to blame. Maybe you didn't provide enough training. Maybe you didn't build in enough of a buffer. Maybe you asked too much, too soon.

Taking responsibility when things go wrong instead of blaming others isn't masochistic, it's empowering--because then you focus on doing things better or smarter next time.

And when you get better or smarter, you also get happier.

2. Impressing.

No one likes you for your clothes, your car, your possessions, your title, or your accomplishments. Those are all "things." People may like your things--but that doesn't mean they like you.

Sure, superficially they might seem to, but superficial is also insubstantial, and a relationship that is not based on substance is not a real relationship.

Genuine relationships make you happier, and you'll only form genuine relationships when you stop trying to impress and start trying to just be yourself.

3. Clinging.

When you're afraid or insecure, you hold on tightly to what you know, even if what you know isn't particularly good for you.

An absence of fear or insecurity isn't happiness: It's just an absence of fear or insecurity.

Holding on to what you think you need won't make you happier; letting go so you can reach for and try to earn what you want will.

Even if you don't succeed in earning what you want, the act of trying alone will make you feel better about yourself.

4. Interrupting.

Interrupting isn't just rude. When you interrupt someone, what you're really saying is, "I'm not listening to you so I can understand what you're saying; I'm listening to you so I can decide what I want to say."

Want people to like you? Listen to what they say. Focus on what they say. Ask questions to make sure you understand what they say.

They'll love you for it--and you'll love how that makes you feel.

5. Whining.

Your words have power, especially over you. Whining about your problems makes you feel worse, not better.

If something is wrong, don't waste time complaining. Put that effort into making the situation better. Unless you want to whine about it forever, eventually you'll have to do that. So why waste time? Fix it now.

Don't talk about what's wrong. Talk about how you'll make things better, even if that conversation is only with yourself.

And do the same with your friends or colleagues. Don't just be the shoulder they cry on.

Friends don't let friends whine--friends help friends make their lives better.

6. Controlling.

Yeah, you're the boss. Yeah, you're the titan of industry. Yeah, you're the small tail that wags a huge dog.

Still, the only thing you really control is you. If you find yourself trying hard to control other people, you've decided that you, your goals, your dreams, or even just your opinions are more important than theirs.

Plus, control is short term at best, because it often requires force, or fear, or authority, or some form of pressure--none of those let you feel good about yourself.

Find people who want to go where you're going. They'll work harder, have more fun, and create better business and personal relationships.

And all of you will be happier.

7. Criticizing.

Yeah, you're more educated. Yeah, you're more experienced. Yeah, you've been around more blocks and climbed more mountains and slayed more dragons.

That doesn't make you smarter, or better, or more insightful.

That just makes you you: unique, matchless, one of a kind, but in the end, just you.

Just like everyone else--including your employees.

Everyone is different: not better, not worse, just different. Appreciate the differences instead of the shortcomings and you'll see people--and yourself--in a better light.

8. Preaching.

Criticizing has a brother. His name is Preaching. They share the same father: Judging.

The higher you rise and the more you accomplish, the more likely you are to think you know everything--and to tell people everything you think you know.

When you speak with more finality than foundation, people may hear you but they don't listen. Few things are sadder and leave you feeling less happy.

9. Dwelling.

The past is valuable. Learn from your mistakes. Learn from the mistakes of others.

Then let it go.

Easier said than done? It depends on your focus. When something bad happens to you, see that as a chance to learn something you didn't know. When another person makes a mistake, see that as an opportunity to be kind, forgiving, and understanding.

The past is just training; it doesn't define you. Think about what went wrong, but only in terms of how you will make sure that, next time, you and the people around you will know how to make sure it goes right.

10. Fearing.

We're all afraid: of what might or might not happen, of what we can't change, or what we won't be able to do, or how other people might perceive us.

So it's easier to hesitate, to wait for the right moment, to decide we need to think a little longer or do some more research or explore a few more alternatives.

Meanwhile days, weeks, months, and even years pass us by.

And so do our dreams.

Don't let your fears hold you back. Whatever you've been planning, whatever you've imagined, whatever you've dreamed of, get started on it today.

If you want to start a business, take the first step. If you want to change careers, take the first step. If you want to expand or enter a new market or offer new products or services, take the first step.

Put your fears aside and get started. Do something. Do anything.

Otherwise, today is gone. Once tomorrow comes, today is lost forever.

Today is the most precious asset you own--and is the one thing you should truly fear wasting.

Jeff Haden learned much of what he knows about business and technology as he worked his way up in the manufacturing industry. Everything else he picks up from ghostwriting books for some of the smartest leaders he knows in business. @jeff_haden

Your Website Crashed. Now What?

Last year, hackers took down music distribution site SoundCloud for 36 hours. Co-founder Alex Ljung explains how SoundCloud responded to millions of infuriated users.

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7 Ways to Earn Respect as a Leader

Are you feeling disrespected by your employees? It may be that you're failing in one of these seven areas.

Thomas Barwick/Getty

Do you wonder why some people naturally gain respect, while others have to command or, worse, demand it?

Earning respect is in direct correlation to treating others with the same. Showing respect sounds like a basic skill, and yet somehow complaints about being disrespected run rampant around coffee rooms and bathrooms in companies around the country.

Are parents and teachers shirking their responsibility for turning everyone into good little citizens that can play well with others? Perhaps, but more likely, cultural norms have changed. Families allow for greater familiarity, and schools are more focused on test scores and class sizes than they are on teaching little Johnny and Susie to stand out as leaders.

But whether you are the executive in charge or a contributing team member, your ability to earn respect will impact your emotional happiness and ultimate career trajectory. Some people in authority believe they are entitled to respect simply due to their position or experience, but this sort of respect diminishes over time and can ultimately hurt the company culture.

Here are seven tips to help you be the leader who earns respect rather than just demands it.

1. Be consistent.

If you find you lack credibility, it's probably because you are saying one thing and doing another. People do pay attention to what you say until you give them reason not to by doing the opposite. You don't have to be predictable, just don't be a hypocrite.

2. Be punctual.

Nothing makes me lose respect for someone more then being made to wait. Time is the most valuable commodity for successful people. Missing appointments or being late demonstrates a total disregard for the lives and needs of others. Get control of your calendar.

3. Be responsive.

The challenge with contact management today is there are too many ways to communicate. Between Twitter, Facebook, Messenger, text, phone, Skype, and Facetime, people are in a quandary to know what is the best way to reach you. And even with all the channels, some people still don't respond in a timely manner, leaving colleagues hanging or chasing them. Limit your channels and respond within 24 hours if you want to appear communication worthy.

4.  Be right much of the time, but be comfortable being wrong.

The simple way to be right is to do your homework and state facts that are well thought out. Still, you may have to make a best guess now and then even when information is too scarce to know for sure. Take it as a qualified risk, manage expectations, and if you're wrong, smile and be happy you learned something that day.

5. Forgive others and yourself for mistakes.

If you're not erring, you're not trying. Healthy leaders encourage experimentation and create environments of safe failure. Encourage people to take mitigated risks, and set an example for how to shake off a failure and bounce back.

6. Show respect to others when they are wrong and right.

Disparaging people who make errors will reflect worse on you than those who err. On the flip side, any jealous tendencies toward those who succeed will surely be noticed by those around. Live as if in a glass body. Assume all can see inside your heart.

7. Help those who are holding you back, but not too much.

Good leaders help those around them succeed by overcoming weakness. But respect is lost quickly for the boss who placates habitual troublemakers at the expense of the group's success. Know when to support weak players, and cut them loose when they clearly hamper the result.

Too many people today assume leadership positions without consideration for their impact on others. The leadership vacuum in business today allows them to stay as long they manage acceptable results. Ultimately, your personal leadership legacy will not be remembered for your M.B.A., your sales numbers, or the toys you acquired. Most likely, it will be the positive, personal impact you created, one follower at a time.

 

An Inc. 500 entrepreneur with a more than $1 billion sales and marketing track record, Kevin Daum is the best-selling author of Video Marketing for Dummies. @awesomeroar

Fisker Automotive: It's No Fun to Be a Political Talking Point

This year's brutal election season turned Fisker Automotive into a political football. Here's how the car company coped.

Flickr photo courtesy of Autoviva.com

Attendees at the Frankfurt Auto Show check out the Fisker Karma in October 2011.

If you ask Henrik Fisker, the founder and executive chairman of Fisker Automotive, what his company does, he'll tell you he's shaking up the car industry with a beautiful, new, technologically advanced, environmentally friendly automobile.

But if you asked Republican presidential candidate Mitt Romney, he'd tell you--as he said to a Pennsylvania audience this summer--that the Anaheim, California-based electric-car maker is an example of extreme government waste, crony capitalism, and misguided government support for undeserving industries.

So much for the GOP's love affair with small business.

Speaking at a rowdy campaign rally in Irwin, Pennsylvania, in July, Romney told the crowd:

I am ashamed to say that we're seeing our president hand out money to the businesses of campaign contributors, when he gave money, $500 million in loans, to a company called Fisker that makes high-end electric cars--and they make the cars now in Finland. That is wrong and it's got to stop. That kind of crony capitalism does not create jobs and it does not create jobs here.

The truth is considerably more complicated and offers a cautionary tale for small-business owners: Government funding can be incredibly useful, particularly for high-tech or clean-technology innovators, who have more opportunities to get federal support--but it comes with plenty of baggage attached.

And there's another lesson as well: As a small-business owner, the way you react once you've been thrust on the world's stage matters--particularly if there is deep, hurtful criticism that can damage your brand and your future business prospects.

"This is political, and politics does not always make sense," Fisker says.

A $529 Million Loan

Fisker's story has drawn parallels with Solyndra, the solar panel company in Fremont, California, that shut down in bankruptcy and controversy after receiving half a billion dollars in loans from the federal government. Like Solyndra, Fisker sought, and received, substantial government support.

Unlike Solyndra, however, it got financing under a program created before Barack Obama became president. The funds came from a Department of Energy program meant to develop advanced technology for cars, created through bipartisan support in 2007 under George W. Bush; Fisker applied for the loan in 2008. (Other recent loan recipients under the program include rival electric-car maker Tesla Motors, as well as Ford Motor and Nissan North America.)

Fisker was approved for a $529 million loan in 2009. The deal was structured to give the company access to funds in two tranches, tied to the successful completion of specific business milestones. The first chunk of financing, a loan for $169 million, supported the development of the Fisker Karma, an electric luxury sedan with a hefty $100,000 price tag. The remaining money was to be used to build out a plant in Delaware, acquired from General Motors during its bankruptcy reorganization in 2009, to manufacture a more affordable sedan called the Atlantic, with a price tag of about $50,000.

Problems Emerge

But in May 2011, the DOE froze the second part of Fisker's loan after the car company failed to meet sales goals laid out in the loan agreement, because of a combination of production and regulatory issues. Fisker, which says it has "delivered" around 1,000 Karmas to retail locations worldwide, has also been beset by some major product problems. In at least one instance, a car battery burst into flames, destroying a vehicle, and when Consumer Reports tried to take the Karma for a test drive, it failed to operate.

Then Romney attacked, accusing Fisker of two more transgressions: spending taxpayer funds to pay workers at a plant in Finland that Fisker uses for advanced motor assembly, and milking political connections to get the financing. (John Doerr, a partner at venture capital firm Kleiner Perkins Caufield & Byers, which has invested millions in Fisker, is an economic advisor to the Obama administration as well as a Democratic fundraiser.)

Failing to meet production and sales deadlines is fairly common for new technology products, says Timothy Lipman, co-director of the Transportation Sustainability Research Center and a car industry analyst. He points out that car manufacturers must deal with the expense of producing their product, creating large distribution channels, satisfying regulatory concerns, and testing, among a host of other issues.

"Cars have a very high barrier to entry, and car manufacturers must cross a 'Valley of Death' to bring a product to market," Lipman says.

Both of Romney's claims, however, could be extremely problematic if proved true--with Fisker potentially violating the terms of the loan, on the one hand, and falling afoul of federal conflict-of-interest rules, on the other. "When you are pouring millions of dollars to support a company that is not manufacturing a large amount of their product in the U.S., it stands to reason other companies might be doing more to benefit the economy with that money," Lachlan Markay, an investigative reporter for the Heritage Foundation who examines government spending on green technology, says about Fisker.

Worrisome Precedent

To critics, the brouhaha recalls a GOP scandal that dates back 30 years: that of defense contractor Wedtech, a former South Bronx, New York, baby carriage manufacturer that used fraudulent minority-contractor status to become a $100 million-a-year defense contractor.

The company was founded as a machine shop by Puerto Rican immigrants, but by the time of its expansion it had sold a controlling interest to Romanian-born businessman Fred Neuberger. With forged documents claiming it was still minority-owned, Wedtech bought or bribed officials in three states, as well as in the Capitol and White House, where former Reagan advisor Lyn Nofziger used his influence on behalf of the company. Wedtech ultimately garnered some $500 million in Pentagon small-business contracts to build things like military engines, grenade throwers, and pontoon boats.

The scandal finally implicated more than 20 people--including Attorney General Edwin Meese III, who had allegedly intervened on behalf of the company to successfully secure a $32 million army contract that had originally been rejected. Meese resigned because of the taint, although he was never charged with wrongdoing.

Fighting a PR Nightmare

As for Fisker: Both the automaker and the Department of Energy say the Romney claims are patently false. Fisker says no funds from the DOE grant were ever used overseas. And Damien LaVera, a spokesman for the DOE, wrote in an email, "Nothing in any of the 950,000 pages of documents the Department has voluntarily provided to Congress demonstrates anything except what we have consistently said from day one: decisions on loan applications were made on the merits after careful review by career officials and technical experts in the loan program.'

The Romney campaign did not respond to a request for comment, and Kleiner Perkins declined to comment.

But even if Romney's attacks were invalid, they created a PR nightmare for Fisker--and the company knew it had to respond immediately. Lacking a big budget to run commercials and advertisements, it decided to reach out personally to people who mattered most to the company.

"Our reaction was to come out with a factual and very unemotional list of facts that challenged the allegations and put the facts in place," says Roger Ormisher, a company spokesman.

That list was sent to media and investors as well as any customers who had questions. And that seems to have done the trick. "This is all noise that will be gone after November, and the people who know about it don't care anymore," says one investor, who asked to remain anonymous.

Future in Question

That's not to say Fisker doesn't have other obstacles to overcome. It recently laid off about two dozen workers in the Delaware plant, where it had planned to add 2,500 employees. The remainder of the DOE financing is also in question, although the automaker says it plans to rely more on private funding to support its operations.

Henrik Fisker says the company has raised more than $1 billion in private equity investment since 2007, with the DOE loan actually helping the company attract hundreds of millions of dollars in 2009 and 2010 by giving it a "runway."

And going forward, the entrepreneur says, he hopes to stay out of politics and let Fisker Automotive return to its core mission.

"Our plan is to continue to make great cars and engineer them here in the U.S.," Fisker says.

Jeremy Quittner is a staff writer for Inc. magazine and Inc.com. He previously covered technology for American Banker, and entrepreneurship for BusinessWeek. @JeremyQuittner

Has the Free Market Gone Too Far?

Michael Sandel, author of What Money Can't Buy: The Moral Limits of Markets, shares his thoughts about what should and shouldn't be for sale.

Flickr/katiemarinascott

These days, too many things come at a price, argues Michael Sandel, a political philosopher and Harvard professor. Market values have metastasized through our society, he says, distorting debate about issues as complex as health care and immigration and as seemingly simple as the question "What do we value?". In his recent book, What Money Can't Buy: The Moral Limits of Markets, Sandel accuses businesses and the U.S. government of sacrificing values such as justice and respect for human dignity in favor of utility. Leigh Buchanan asked Sandel about when such trade-offs cross the line and what he thinks politicians should be discussing.

What are market values? How are they intruding where they don't belong?
They're a way of valuing goods, based on use. When we're talking about televisions, toasters, and cars, market values are appropriate. But when we're talking about personal relations or family, market values may not be appropriate. For example, even if I wanted more friends, it wouldn't work to try to buy some. The money that would buy the friend dissolves the good that makes friendship valuable. We have drifted from having a market economy to becoming a market society. A market economy is a valuable and effective tool for organizing productive activity. A market society is a place where almost everything is up for sale.

Is there an argument to be made that the ceaseless pressure on companies to innovate propels them into morally questionable areas?
Yes. Advertising is a very good example of this. The intense pressure to capture human attention has pushed it into morally questionable areas. For example, many school districts now are allowing advertising on school buses, in the cafeterias, in classrooms. And the advertising companies promote this to potential clients, saying you can gain access to a captive market of teenagers without the usual distractions. And it's not just schools. The fans that people use in churches have ads on the back. They used to be from funeral homes, but now it's corporations. So the congregation sits fanning itself in one large wave of product placement. Churches, fire trucks, fire hydrants, police cruisers. There's advertising in jail cells. Talk about a captive audience.

The political parties generally frame economic debates around taxes and spending. What should they be talking about?
The values that underlie their views on taxing and spending. Beneath those arguments are questions: What is the relationship between individual rights and the common good? What do we owe one another as citizens? Those are big philosophical issues, and they aren't just abstract ideas for scholars.

What examples would you use to frame such a debate?
Increasingly, we have relied on the market to allocate military service. In Iraq and Afghanistan, there were more paid military contractors on the ground than there were U.S. troops. Yet we never had a public debate about whether we wanted to outsource the war to private companies.

What are the most extreme market solutions you've seen proposed by politicians?
One novel effort to raise funds for local government was put forward by a candidate in Nevada who proposed allowing people to buy permits to speed up to 90 miles an hour. The state highway patrol concluded that it would imperil public safety.

Did that candidate win?
No.

 

Leigh Buchanan is an editor at large for Inc. magazine. A former editor at Harvard Business Review and founding editor of WebMaster magazine, she writes regular columns on leadership and workplace culture. @LeighEBuchanan