Business Brilliant

by Lewis Schiff

  The Business Brilliant survey reveals that the desire to delegate tasks is found most commonly among those who have had the most financial success. Nearly 9 out of 10 self-made millionaires said that when it comes to tasks they are not exceptionally good at, they are very likely to delegate those tasks to people who do them better. By contrast, among the middle-class respondents, two-thirds said that when faced with such tasks, they would likely “do those tasks anyway.” This approach is often a mistake that you can end up paying for twice. The final result is probably not as good as it could have been, and even if it is, you’ve expended time and energy that would have been better spent on the things you do well. Self-made millionaires—and dyslexics—seem to know this better than most members of the middle class.

  Chapter 5 described how Paul Orfalea, founder and CEO of Kinko’s Copies, improved the service levels at his stores by studying and imitating McDonald’s and other companies he admired. At the root of Orfalea’s penchant for borrowing bright ideas was his extremely debilitating dyslexia. Orfalea’s office at Kinko’s had no computer and was almost completely devoid of paper. He reviewed his mail with his assistants each day and gave them verbal suggestions about how they should respond in his name. Then he’d race out the door and go visit some stores. “Anybody can sit around an office thinking about what people were doing wrong,” he wrote in his autobiography. “My job was to get out and find out what people were doing right—and exploit it. Then I tried to spread those practices throughout the Kinko’s network.”

  Orfalea squeaked through college at the University of Southern California the same way Schwab survived Stanford—by getting other people to take lecture notes and rewrite his papers for him. When assigned to a big group project, Orfalea proposed that if the other group members would do all the writing, he would do all the duplicating the project required. Ironically, his visits to the university’s copy center for that project inspired him to open up a retail copy shop of his own. As he expanded Kinko’s from the one shop to 800 all over the United States and Europe, Orfalea claimed he managed his time by repeating the mantra, “Anybody else can do it better.” Looking back, he says that “every major success I’ve had in my life has come about because I knew that somebody, often anybody . . . could do something better than me.”

  After selling his interest in Kinko’s for hundreds of millions of dollars and leaving the company in 2000, Orfalea started teaching an unusual economics course at the University of California at Santa Barbara. Naturally, he gave infrequent writing assignments and limited them to a single page in length. Discussions in class were punctuated by exercises in which Orfalea would sometimes pick out a male student at random and challenge him to ask one of the young women in the class for a date—right there in front of everyone. “They get a chance to learn to talk to each other,” Orfalea explained. “They get to see someone asking for something he wants or needs from another person. Sometimes that’s all we need to do in life.”

  When Kinko’s expanded to Great Britain during the 1990s, Orfalea found a business partner and kindred spirit in the eccentric businessman-adventurer Richard Branson, another amazingly successful dyslexic. Sir Richard (he was knighted in 2000) may be the richest high school dropout in history. With the Virgin Group, he has built a vast business empire in which responsibilities are delegated on a uniquely grand scale, if only to accommodate the contours of Branson’s dyslexic brain.

  Throughout his upbringing in British boarding schools, Branson was physically beaten by headmasters who assumed he was either too stupid or too lazy to complete his assignments. In 1967, at age sixteen, he started up a magazine for London-area college students. Like Schwab, he couldn’t edit or read the publication he was running, but he excelled at selling advertising, usually from a pay phone at his boarding school dormitory. When Branson quit school for good that year, his headmaster predicted that he would either end up in prison or become a millionaire.

  Today Branson’s wealth is estimated at $4.2 billion thanks to the hundreds of products and services bearing the Virgin brand name, including Virgin Atlantic Airways, Virgin Megastores, Virgin Hotels, Virgin Mobile phones, Virgin Money, and even Virgin wine. Virgin has become one of the best-known brand names in the world, even though Branson freely admits he’s not good at details. He is now in his sixties and hasn’t held day-to-day responsibilities in any business since he was a teenager. He’s never even learned how to read a financial spreadsheet. Once, at a board meeting, Sir Richard kept mixing up the terms “net revenue” and “gross revenue” until a staff member took him aside and drew a picture of a net catching fish to illustrate the difference for him.

  If Virgin were organized like Procter and Gamble or any other large, diversified corporation, Branson would be hopelessly lost as CEO. But Virgin Group’s modus operandi is the ultimate in delegated responsibility. Every one of its 200 or so product lines is a separate stand-alone corporation, controlled by Virgin but run by a team of entrepreneurs who hold significant equity stakes. Branson has explained that he never wanted Virgin to have “a vast head office and a pyramid of command from a central board of directors. I am not saying that such a structure is wrong.. . . It is just that my mind doesn’t work like that.”

  Freed from poring over spreadsheets and five-year strategic plans, Branson has promoted Virgin’s renegade image through headline-grabbing stunts such as around-the-world balloon flights and a record-setting Atlantic Ocean crossing in a powerboat. To publicize the U.S. introduction of Virgin Cola, he showed up in Times Square astride an army tank. Although Virgin has suffered a good number of failures (Virgin Cola and Virgin Money both flopped in the United States) the Virgin brand remains so appealing to investors that the Virgin Group can often launch a new company with zero risk on its books. According to one report, Virgin Money was financed in Britain with $500 million worth of investor cash, while “Virgin retained a 50 percent stake without coughing up a penny.”

  Branson is likely to pass on any proposal that fails to excite him right away. He’s well known for sizing up people and ideas within 30 seconds of being introduced to them. “I rely far more on gut instinct than researching huge amounts of statistics,” he wrote in his book Losing My Virginity. ”This might be because, due to my dyslexia, I distrust numbers, which I feel can be twisted to prove anything.” He once told 60 Minutes, “If I could read a balance sheet . . . I wouldn’t have done anything in life.”

  What excites Branson most is the chance to play David against industry-dominating Goliaths. He looks for companies willing to go up against what he calls “a big bad wolf” that has been overcharging and underserving the public. Whether the wolf is British Airways or Barclays bank, Virgin’s simple formula is to steal a small, profitable piece of the market by offering better service at a lower cost and with a sense of style and fun.

  By those criteria, Branson has boasted that there is no limit to how far the Virgin brand name can be extended. Already you can zip through London’s traffic gridlock on the back of a taxi-motorcycle called Virgin Limobike, or you can put down a 10 percent deposit on a $200,000 Virgin Galactic spaceship ride (blastoff date as yet unknown). Rock star Peter Gabriel once joked with Branson that Virgin should offer total cradle-to-grave services, beginning with Virgin Births and ending with Virgin Funerals. Branson’s response, in under 30 seconds, was that he wasn’t sure about Virgin Funerals, but he rather liked the sound of Virgin Births.

  The Strength Test

  If a reading disability, or any disability, might be considered a gift, it’s because some disabled people learn to accept their personal limitations at a young age. They give up trying to fix their weak points and instead they seek opportunities to show what they do best. By the time he was twenty-two, Paul Orfalea had already accepted that he would have to start a business of his own because he knew he was a miserably inept employee. Charles Schwab has noted, “I’ve been able, I think, to recognize my strengths and my deficits.. . . I think that probably has bee
n the single most important benefit I received from having this learning issue early on in my life.”

  There is a great deal of common sense in focusing on your strengths and getting others to cover your weaknesses. But common sense doesn’t always make for common practice. Most people say they feel a much greater pull to mend their weak spots before they develop their strengths. A Gallup poll found that 87 percent of working Americans agreed with the question “Is finding your weaknesses and fixing them the best way to achieve outstanding performance?” When asked to choose between building on their strengths and fixing their weaknesses, 59 percent preferred to fix their weaknesses.

  The Business Brilliant survey shows similar results, but mainly among the middle class. About 7 out of 10 middle-class survey respondents said that when it comes to tasks they are not exceptionally good at, their most likely response is to “work hard to get good at those tasks.” Among self-made millionaires, just 2 percent said the same. A sizable minority of the middle class, about 4 in 10, also agreed that “I try new, unfamiliar activities in order to expand my capabilities.” Fewer than 1 in 10 self-made millionaires said they were interested in attempting the unfamiliar. If they’re not exceptionally good at something already, the millionaires would rather not start learning now.

  For more than a decade, Marcus Buckingham at the Gallup Organization studied how people choose to work with their strengths and weaknesses. He thinks that the oversized concern with weakness is rooted in the way we’re raised and how we’re taught in school. When Gallup asked parents how they would react if a child brought home a report card with an F in algebra and A’s in English and social studies, 77 percent of the parents said they would spend the most time talking to the child about the F, not the A’s. Buckingham asked in Now, Discover Your Strengths, “Despite the demands of today’s education system, does the most time really deserve to be invested in the child’s weakness?” The schools also devote more time and attention to weaknesses. A child with this report card is far more likely to get remedial help with algebra than special enrichment classes in English and social studies.

  Gallup has uncovered a number of common and potentially destructive myths about the relative importance of workplace strengths and weaknesses. For instance, 61 percent of workers say they need to focus on their weaknesses because that’s where they feel they have the most room to grow. In follow-up interviews, they said that shoring up their weak areas makes them feel more responsible, more well rounded, and less vulnerable to embarrassment and risk of failure. What’s missing from this equation is any desire to attain expertise, excellence, or mastery—capabilities that produce real value in the workplace and are only achieved by working from your strengths. And, as Buckingham points out, working from your strengths is always a more meaningful and rewarding experience, because “you will be the most inquisitive, most resilient, most creative and most open to learning in your areas of strength.”

  In previous chapters we explored any number of beliefs about financial success that give self-made millionaires a decided edge over the middle class. This difference in attitudes toward strengths and weaknesses may be the most important edge of all. Each day, middle-class employees dutifully take up certain tasks that require them to engage their weaknesses. They feel conscientious about working with their weaknesses, and hope that the practice will shield them from future reproach and failure. Meanwhile, self-made millionaires are spending each day avoiding their weaknesses in order to stay focused on their strengths—where distinction, fulfillment, and profits are found. Hour by hour, day by day, the middle-class people protect themselves by becoming more well-rounded and ordinary, while the millionaires enrich themselves by becoming more specialized and extraordinary.

  To be fair, self-made millionaires probably have more opportunities to delegate responsibilities in their weak areas, since 9 out of 10 respondents are business owners who call their own shots. By contrast, 3 out of 4 middle-class respondents are employed by someone else. They probably have job duties that are not so easily handed off to others. But is that really true? Buckingham has a commonsense prescription for becoming more strengths-oriented at work: He advises that you have a “strong conversation” with your boss about your job responsibilities. Give your immediate supervisor a proposal detailing how it would help the company if you worked at your strengths more often and had some other duties reassigned. Most people have never done such a thing and I suspect most are afraid to try. As chapter 6 showed, most workers are a lot like Adam McKay at Saturday Night Live before he talked to his manager. They don’t recognize when they have the boss over a barrel. And even if they did recognize it, they would be reluctant to exploit the advantage.

  But before you can even consider requesting a change in duties at work, it’s important to know what your strengths really are. (A strength, according to Buckingham, can be simply defined as something that makes you feel strong when you’re doing it.) Self-made millionaires are more certain about their strengths than the middle class. Among self-made millionaires, 85 percent said that “I know what I’m exceptionally good at that makes money.” Just a little over half of middle-class survey respondents said the same. What’s more, the millionaires’ strengths have been battle hardened through painful trial and error. About 7 in 10 self-made millionaires agreed that “Setbacks and failures have taught me what I’m good at.” Fewer than 2 out of 10 in the middle class agreed.

  Norm Brodsky was pretty sure he knew his strengths back in 1987. In eight short years he had taken Perfect Courier, his New York–based messaging and trucking company, from zero to $120 million in yearly sales. Growing the company that fast required Brodsky to put a lot of faith in his own judgment. Other people’s ideas didn’t appeal to him, because no one knew his business better than him. Whenever something went wrong, he relied on his own ingenuity to devise rules that would prevent it from ever happening again. As the company grew, Brodsky rewarded his most loyal employees with promotions, sometimes giving them roles they weren’t fully qualified to fill. And it all worked. Perfect Courier was one of the fastest-growing small businesses in the country. Brodsky took on debt and started buying other companies, hoping to spread his Midas touch.

  Then, on October 19, 1987, stock markets crashed all around the world. The Dow lost 22 percent of its value in a single day, and Perfect Courier got hurt in the fallout. Wall Street’s financial printing business dried up overnight, costing one division of Perfect Courier almost all its revenue and putting the whole company in a cash squeeze. Then Perfect Courier’s banks, spooked by the financial collapse, called in their loans, demanding cash that Perfect Courier didn’t have. Perfect Courier had to file for bankruptcy and pare itself down to almost nothing. Even Brodsky’s personal checking account was seized. Everything he had built over eight years unraveled in the space of just a few months.

  “The shock of firing four thousand people was overwhelming to me,” Brodsky recalls now. “That was the first time I really sat down and asked myself what went wrong.” Besides the crash and the called-in loans, there were other causes beyond Brodsky’s control. Competition in the messaging business had doubled in recent years, putting pressure on prices. And newly affordable fax machines, regarded as “electronic wonders” by Time magazine in August 1987, had begun to take a huge bite out of the demand for delivery services.

  But Brodsky decided that it wasn’t enough to blame the crash, the banks, the competition, and the fax machine. “There was a whole bunch of processes that I could have used to stop those four things from destroying the company,” Brodsky says. “There were a number of decisions I made that were really bad decisions.” Foremost among them was that he didn’t listen. The same self-confidence that enabled Brodsky to take Perfect Courier so far also proved to be his downfall. “When things started falling apart, my advisers, my lawyer, my accountant, they all said to me, ‘Look, there’s a way to save this. You better look at this method, or that method.’ They told me a whole bunch of thin
gs. And I said, ‘No, no, no. I can save this company.’ This [crash] is b.s., I told them. This is temporary. I created a god like atmosphere around myself.”

  Brodsky didn’t recognize the soundness of the advice he’d been offered until after Perfect Courier had collapsed into bankruptcy. If he had listened to his lawyers and accountants sooner, the fall might not have been so hard. “Sure I would’ve been hit,” he says. “I would have lost 30 percent of my sales, but I would have survived. Instead I thought that only I could save the company, that I was invincible, that nothing bad could ever happen to me.”

  Since then, Brodsky has become a small-business guru and sage, mentoring and guiding young entrepreneurs on the subject of wise business management. He is a columnist for Inc. magazine and wrote a book called Street Smarts: An All-Purpose Tool Kit for Entrepreneurs. The bankruptcy of Perfect Courier is something he wears as a badge of honor now. It was an experience that taught him lessons he could not have learned any other way. His chief observation is that most people go wrong by trying to do all the work themselves and blaming bad results on others. The trick, he says, is to do the exact opposite. Trust others to do the work for you, but keep all the blame and responsibility for yourself.

  As he picked up the pieces of his broken company, Brodsky managed his shrunken staff in a very different way. He realized that he’d been promoting loyal employees beyond their capabilities because he wanted people around him who would do what he said. That’s not what he needed to pull Perfect Courier out of bankruptcy. Instead, he hired extremely capable people who could work without his direct instruction. These were people who could contribute to the company in ways that complemented Brodsky’s own strengths. For the first time, Brodsky stopped trying to control his employees. He allowed himself to learn from them.