This is the Digital Strategy Call with host Brent Lollis and special guest Bo Burlingham, editor-at-large at Inc. Magazine and author of the book, Small Giants: Companies that Choose to be Great Instead of Big.
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Announcer:
This is the Digital Strategy Call with your host, Brent Lollis, an award-winning digital strategist of Fortune 500 CEOs and superstars like Garth Brooks, Taylor Swift and American Idol mentor and Big Machine Records founder, Scott Borchetta. Our mission is simple: to help you navigate the warp speed changes in the digital world and make you the undeniable leader in your industry. Today's guest is Bo Burlingham, editor-at-large at Inc. Magazine and author of the book, Small Giants: Companies that Choose to be Great Instead of Big. The Digital Strategy Call is made possible by Creative State, helping you conquer your competition with world-class responsive websites, video production, branding, search engine optimization, and social media. Go to creativestate.com or call 866-658-7423.
Brent:
Bo Burlingham, welcome to the Digital Strategy Call.
Bo:
Great to be here Brent. Thank you.
Brent:
So you are a writer for and an editor for Inc. Magazine for over 30 years. Tell us a little bit how you got involved with Inc. Magazine.
Bo:
Well Inc. was pretty much a start-up when I got started with it. It had been in business less four years and it was in, I was living in Boston. Actually I was working for Fidelity Investments at the time and they were sort of looking for writers who had a background in general interest magazine writing which I did and I had written for Esquire and Harper's and places like that and they, but who knew something about business and I guess by virtue of having worked at Fidelity for a year, I knew something about business so they recruited me and I was very attracted to the whole subject matter of entrepreneurship which back then was pretty new. There wasn't, people, a lot of people forget that there was a time when it wasn't a compliment to call somebody an entrepreneur. It was sort of a put down. It was like, it was a little bit entrepreneurs were a little bit mysterious and possibly sleazy and that began to change really in the early 1980s and I like to think Inc. had something to do with it and probably Ronald Reagan had something to do with it as a President who really talked a lot about entrepreneurship but mainly I think it was changing because of the entrepreneurs themselves who were becoming well-known for the transformation of the economy. People like Steve Jobs and Bill Gates and so forth and so I had the opportunity to go and work at this publication which was really focusing on this extremely interesting and dynamic part of the economy and I went and I felt like I had died and gone to heaven.
Brent:
So once you got there, what type of articles, obviously you're focusing on business and entrepreneurship but what type of articles do you find yourself enjoying writing the most?
Bo:
Well I like writing about entrepreneurs who are doing really new, different sort of things, particularly in terms of how they run their businesses. There's been a huge change, you know a lot of the attention has been placed on technology and so forth and how that has changed business and it certainly has changed business enormously over the last 30 years but there's been, there've been a lot of other changes that haven't received quite so much attention including in the whole way that businesses are run and the whole sort of common wisdom about what works in business and what doesn't. We talk now about culture as if everybody understands what culture was. Well back in the early 1980s, there was no discussion of culture. Nobody even talked about it until a popular book came out that really sort of began to popularize the idea and now we understand that culture is a very important concept but that's actually new in the last 30 years. The other thing is that there weren't very many resources for people who were starting businesses back then. That changed over the course of the 30 years to today there are great resources for people, networking groups, I mean organizations like the Entrepreneurs Organization and the Vestige, other such organizations. They didn't exist back then or I guess Vestige might have existed as tech but it was much, much smaller and there was just a whole lot of stuff, the capital markets have changed dramatically. Venture capitalists still in its, relatively in its infancy back then. So the whole environment for entrepreneurship has just undergone a seat change in the last 30 years and it's been exciting to watch over that time.
Brent:
So are there obviously you've interviewed many, many business owners and business leaders, are there one or two leaders that stand out as people who are the most interesting or most fascinating for you to write about?
Bo:
Well this won't come as a shock but I did an interview with Steve Jobs actually when he was sort of in the wilderness. It was after he'd been fired from Apple and before he came back and he was working on Next and that was a fascinating interview and there are many others I could cite.
Brent:
So in the Steve Jobs interview, you talk about him being in the wilderness, what was his, what was he like in that period and how do you think that impacted where he ultimately ended up rejoining Apple?
Bo:
Well I had the impression in talking, people have asked me, what it was like and I said it was sort of like talking to Beethoven before he became famous or something like that. It was like talking to an artist because it was as if Steve Jobs had a vision in his head about what technology could accomplish that the rest of us hadn't really seen yet and, it was as if he could see it clearly and he was sort of groping his way toward creating it but you had the sense that you were really, that you were talking to somebody who had this vision of the future and the technology future that very few people had back then.
Brent:
And you've also, you've written several books. I'd like to focus on a couple of them today. One's called Finish Big: How Great Entrepreneurs Exit Their Companies On Top. The other is Small Giants: Companies that Choose to Be Great Instead of Big. So those two titles focus on different approaches to leading and growing a company. How do you think a business owner or leader should decide if they want to finish big or if they want to be great instead of big?
Bo:
Well I think everybody wants to finish big because basically what I mean by that is finish happy and the big thing I discovered really when I went out and began interviewing people who'd sold their companies and left their, everybody, every owner exits sooner or later. You may exit feet first but you're going to exit and those who do exit presumably not feet first, but because they sell their company or they want to retire or something like that, it's very noticeable that a very large percentage of them are deeply unhappy after they do it. I mean it's like they've, and it really has nothing to do with the amount of money they've got, it has to do with a sense of identity that they've lost a sense of purpose, that they've lost and sort of suddenly finding themselves in a situation that they're totally unprepared for and so finish big really focuses on is a book about the difference. What did the people who had happy exits do that the other, that the ones who had unhappy exits didn't do and vice versa. Small Giants is basically a book that basically states what should be an obvious proposition namely that big, as Jim Collins says, big does not equal great and great does not equal big and that it really challenges people to ask themselves what does it mean to have a great business. So I mean that's what you want, which I assume most people do. What does it mean to have a great business? Different people have different definitions of that but it's something that frankly every business owner should be asking themselves and should be asking themselves fairly early in the process and in Small Giants basically I look at 14 companies that are undeniably great within their industries. They are viewed among people who know the businesses best as the really the cream of the crop in their industries and yet they made a conscience decision that they weren't going to get as big as possible as fast as possible because they had other goals that they considered more important. I guess the other book, there are two other books that I actually wrote with co-authors that I would want to highlight as well. One is the Great Game of Business which I wrote with Jack Stack, the co-founder and CEO of Springfield, it's called SRC Holdings now. Back in the beginning it was called Springfield Remanufacturing and he is really the pioneer of open book management which is the idea that you can teach everybody in the company how the business works and how they contribute to its success and you can run the company in a way where everybody really sort of knows what's going financially in the company and it has just been a huge success for SRC and has been picked up by literally thousands of companies around the world. The other book I would mention is Street Smarts which is a book that I wrote with Norm Brodsky who if you are Inc. reader, you know Norm Brodsky because he and I have been writing a column there for the last 20 years or more and he is just a really extremely smart entrepreneur, serial entrepreneur who has been through all the ups and downs of business and is very insightful in terms of what it is that people need to do to achieve whatever it is they want to achieve.
Brent:
You mentioned happy exits versus people who have exited and are unhappy. One of the chapters in your book is entitled Who Am I if Not My Business. How do you think leaders or what did you learn about leaders who are able to avoid the trap of tying too much of their identity and too much of their self worth to their business?
It's a huge challenge for people and I think part of the problem is is that people don't start thinking about these issues early enough.
Bo:
Well to a certain extent it's unavoidable that you're going to attach a lot of your identity and self worth to your business. I mean if it's what you do, if it's what you're passionate is and it should be, you probably shouldn't be doing it. You are undoubtedly going to invest a lot of yourself in it and be very closely identified. Your identity is going to be very tied up in it. The problem, that poses problems when you get, can pose a challenge when you get to the end of the journey because basically, you're going to have to leave your company sooner or later and once you don't have your company anymore then the question gets put front and center in front of you namely, okay who exactly are you and that can be a difficult question to answer if you've spent most of your life building this business that you love and that you no longer have. It's a huge challenge for people and I think part of the problem is is that people don't start thinking about these issues early enough. They don't give themselves enough time to really think about what, where it is they're going. They also have some wrong ideas. We think of building a company, our language we talk about building a company right and, as if it's a construction project. The goal of which is to build the company but I've realized in writing Finish Big that that's really the entirely the wrong way to think about what you're doing when you're in business.
you're on a journey and like every journey, it has a beginning, a middle and an end
What's really happening is that you're on a journey and like every journey, it has a beginning, a middle and an end and the end of the journey is not when you build a great company, that's the middle. The end of the journey is when you leave that company and as with anything else, if you're going to be happy at the end of the journey, it pays to be thinking about it as a journey and understanding that it will at some point come to an end and you should probably be thinking early on about what or at least, not necessarily answering but at least asking yourself and exploring what the possibilities are for how the journey might end and most people don't do that. Most people wait, they get to a certain point and then they say okay I guess I'm ready to leave or I'm ready to sell my business and they call up their accountant or their lawyer or they find a business broker or an investment banker or something like that and they say okay let's sell the business and that, and they skip over, see here's another thing I discovered which is that we think of the exit process, I always thought of the exit as an event. Like it happens at some point down the line in business but I realized that an exit is not really an event, it's a phase of the business. You know you have the start-up phase, you have the growth phase, you have the mature phase, then you have the exit phase and that there are really four stages to it. The first is what I call, is sort of the educational phase. It's an exploratory phase where you think about the what possibilities are you educate yourself about really what's going on. The second stage is the strategic phase, stage and that's where you really try and build into your company the kind of qualities that are going to allow you to have the kind of exit that you want. The third stage is the one where you actually get ready to do a deal, start looking for buyers and that sort of thing and then there's a fourth stage which everyone forgets about which is what comes after you've actually done the deal, in other words, you're not really done with your exit until you've moved on to something else and that can take a long time and needs to be, that's something you need to be taking into account as you're going along. Now the problem most people get into is that they skip over stage one and two and they go straight to stage three and then they suddenly wind up in a situation in stage four that they're totally unprepared for and that they have all kinds of issues that they're not prepared to deal with, in fact they've never even thought about them and so they suddenly feel lost, like they don't know who they are anymore. I'm not saying that this happens to everybody but it happens to the great majority of people. There's some people who take a totally different view toward their business that they're essentially view their business as an investment and if you do regard your business as an investment and you treat it as an investment, maybe your goal is to be serial entrepreneur and that each of these companies that you buy and own are sort of chapters in the book. That's one way, those people tend to have less of these problems afterwards but most entrepreneurs are pretty passionate about the companies that they are building and the services or the products that they are providing and when you have that passion, and their passion about the people they work with and so forth and when you have that passion, it becomes a whole other thing later on.
Brent:
That's great information. So the overall focus of this show is helping business owners become the undeniable digital leaders in their industry. You talked about the people you wrote about in your book being kind of the cream of the crop and the leaders and this has a little bit narrower focus of how do you become a digital leader within your industry. What are some of the biggest challenges you think businesses face in this kind of fast-changing digital world?
Bo:
the smart people go out and get the help that they need to really understand what the opportunities are and what the pitfalls are
Well I would be lying if I didn't recognize that there's a generational component to this. I'm older, I'm sure I'm a lot older than you Brent. I'm 70 years old so I, people who are my age have a, grew up in a very non-digital world and a lot of the challenges in the digital world involve learning a whole lot of stuff that we never knew before and we need help doing that and the smart people go out and get the help that they need to really understand what the opportunities are and what the pitfalls are. It's like anything else in business. I suspect that younger people who really have grown up with the internet and with the whole, with the whole digital universe, they have certain skills and certain ways of thinking that really give them an advantage I think in this area. I don't know. Would you agree with that?
Brent:
I do agree but I also agree with you that regardless of generation or background, the people who need help in any area of their business go get that help so I think that's great advice whether you're young, old, or somewhere in between is if you need help on something, go find it.
Bo:
Yeah absolutely. As to become the digital leader, Brent I probably need to listen to your, to more of your podcasts. That's I think where I'd begin because to tell you the truth, I'd have to define, the first thing I'd have to do is to define what it means to be a digital leader. I'm not sure I have the answer to that. It doesn't mean that I am using the digital tools more effectively than other people. What exactly is a digital leader?
Brent:
Well I would say it's a couple of things. One is, just like you said in your book, you talked to people who were seen not only by themselves and their employees as leaders, but seen as by their industry and even maybe their competitors as the clear leader. I think those same things apply in the digital world. Who is leading in that area, who's leading in social media, who's leading on the web, who is leading, right now obviously video is a huge part of the digital landscape. Who's leading the way in that and one of the specific things I wanted to ask you about being a writer by trade is how do you think organizations might use good, well-written content that isn't just a blatant advertisement, how could they use good, well-written content to help build their brand?
Bo:
Well obviously as you're aware, I have been in the midst of an industry that has undergone huge, that's sort of been dead-center in terms of being hit by the digital revolution, namely the publishing industry and I've watched up close how magazines including Inc. or Forbes where I am now, have struggled to try and figure out how to really adapt to this whole environment which this whole changed environment I mean where everything about what we do is different. I mean what the advertisers are expecting is different, what readers are looking for is different, the whole way that people approach what you produce in terms of reading online versus reading on a page, the mindset appears to be different and it's been a struggle for everybody. In fact a lot of publications haven't really succeeded in making that transition very well. What was your question again, Brent?
Brent:
So the basic question is with what you said, publications are what their readers expect is different and how they sell, how they generate advertising revenue is different. Many magazines are using sponsored content and sponsored videos to help their advertisers and to generate revenue. So the question was how can organizations use good, well-written content that someone like you might write to help build their brand online?
Bo:
Well this is actually, you're getting into an area of debate. There are, those of us who believe and it really has to do with what your business is and who you're, who's in your market because the question then becomes I have, I believe that quality whether you're talking about products or services or writing, ultimately wins over the long term. That people will naturally gravitate to the quality of whatever it is they're reading, whether that's the quality in terms of the kind of information that's being delivered or the quality in terms of the analysis and the interpretation of that information, the quality in terms of the entertainment value of reading something. So basically if you have writers who are talented and who work hard, whether they're writing in books or magazines or they're writing online, over the long term, I believe that the quality will shine through. Now that said, there are obviously certain areas of marketing online for example where what constitutes quality may be different. So it's, there's certain sort of common wisdom and this is an area really again, I can't pretend to be an expert in but about what online will attract the kind of, well if you're in business, the kind of customers, the kind of follows that you want and I think that that depends a whole lot on who those followers are and what they're looking for. I mean there's certain things, like when I go online, there's certain things where I look I really just don't want to read a whole lot of stuff about it. I want to sort of get the information, get it fast and get it accurately and that's a different kind, that's a matter of quality as well. Somebody who's really good at that is really sort of giving the readers online what they want and need for that purpose. Then there are times when I'm going in and I'm really try to educate myself about something and then I'm looking for something different. I, then I'm looking for the quality of the analysis and the quality of the information that's being provided and then rarely for me, again I'm not saying that I'm typical at all but when it comes to reading for pleasure, that is, approach that with a whole different mindset. I'm not even sure that I do that online really and again that's a different kind of quality. So I think that the thing's that most important is to really, as in every other aspect of business is to really understand clearly who your audience is, who you are writing for and what they are looking for, what they need and that will change dramatically depending on the answer to that question.
Brent:
Absolutely, I totally agree that there are different types of writing that people need in different scenarios whether they are reading for pleasure, reading for education, needing quick bits of information and so I think that all of those things are things that businesses can do if they can provide content for all of those types of readers they're more likely to attract the type of customers that they want so I certainly enjoyed our time together and if our listeners want to find more information about you, where can they find it?
Bo:
Well I do have a website at boburlingham.com and they can certainly go there. I also have a blog that I'm doing at Forbes now so you can go to Forbes and look for me, for my blog at Forbes and I have a, I have my books out there. And Small Giants I should mention has been around now for 10 years and it's done well enough and had a big enough impact that the publishers decided to come out with a 10th anniversary edition which will be out September and it will contain two new chapters. One is on how Small Giants fail which really looks at the sort of the financial imperatives faced by companies that choose to be great instead of big and that was very instructive to me. That's something that I've really learned over the last 10 years. And the second one is an update. What's happened with all these companies and I think that for, it's a book for people who really are thinking about what it is, am wondering and wanting to create a company that's great and I think that it has a lot of ideas there for to provoke creative thought along those lines and I guess that that would be, well that's one place to go so.
Brent:
We should also mention that that Small Giants book kind of spawned the Small Giants community. Can you tell us a little bit about that organization?
Bo:
Yeah sure. It was actually, it came about because after Small Giants came out, there were a lot of people who read it, a lot of business owners who read it and identified with it and they wanted to know how they could get in touch with other people and a lot of people came to me and said, there's a great business opportunity here and I basically I said yes, that's true. There is a great business opportunity. What it needs is an entrepreneur to go after it. I'm a writer and finally one of these people came to me, a very, very successful entrepreneur who is making this case to me and I said, his name is Paul Speigelman, he had a wonderful company in Texas called Barrel Health and he was, we were having dinner one night and he said, you know you really should do something with this and I said well I agree that somebody should do something with it but I'm not the right person. What it needs is an entrepreneur. You're an entrepreneur, Paul. If you really feel passionately about this, go ahead and do it and I'll support you and he decided to go and take the initiative and in fact what's happened is that it has attracted a lot of people from all over the actually not just in the United States, from all over the world who identify with the idea of doing business this way and who want to learn from each other and so the Small Giants community arose and now there's a summit international summit every year and there are also visits. There's a program where we take people to visit great companies, to visit Small Giants and to learn from them and in addition, the staff of Small Giants community is in the process of preparing a program which they call the Small Giants journey which really helps companies to improve in different areas in their journey to become great. So they can be found, the organization is if you go to smallgiants.org. That'll take you right to the Small Giants community.
Brent:
Well that's great. It's a fascinating organization. I have looked into it myself in researching for this interview and they hold all kinds of, like you said, events and summits and workshops and a lot of great resources for business owners who as we always talk about, want to be the leader in their industries so our listeners should definitely check that out. I appreciate your time once again. Bo Burlingham thanks for joining us on the Digital Strategy Call.
Bo:
Thank you Brent.
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