Value chain best practices

Here's some great entrepreneurship guidelines for creating valuable commercial partnerships. We worked hard to build these kinds of relationships in our businesses.

My friend Joe from our Great Lakes Hubba Hubba food group sent a link to a really good doc I put to use right away.

The title is 'Value Chain Best Practices: Building Knowledge for Value Chains that Contribute to the Health of Source Communities'.

The subject of the paper is building effective 'value chains'. This is a term or art that improves on the old idea of exploiting and extracting profit from your suppliers, those in your 'supply chain'. The value chain approach is to make all links in the chain increasingly sustainable and valuable to all the other links.

I'm utilizing this model to help the Wisconsin Innovation Kitchen become valuable commercial partner to new and emerging food businesses.

I doctored their graphic (above) for this post to highlight one specific stage: PILOT, at supply chain scale.

This is exactly where the Innovation Kitchen fits into the emerging commerce of local food and regional food systems. It can pilot and produce local food processing at supply chain scale.

The data from our market based, real-time experiments in regional food processing will make this, and many emerging models of all kinds increasingly replicable.

This capacity - this link - is helping build value chain partnerships right now. Today.

I print this out and take it with me on sales calls:

From 'Value Chain Best Practices':

Structural Innovations
Changes in infrastructure that enable healthy value chains:

Structure

• Contracts to increase knowledge and stability of prices

• Minimum price arrangements to provide predictability of pricing; premiums for established practices (sourcing from small scale producers, environmentally sustainable practices, quality of production, etc); and rapid payments on delivery terms

• Preferential sourcing arrangements based on criteria (quality, scale, environmental practices, certification, etc).

• Information and knowledge management mechanisms that support regular two-way communication and innovation.

• Risk Sharing Fund

Organizational Structure

• Sustainability Manager embedded in buyer group

• Specialized intermediaries to aggregate production and ensure
traceability and quality

• Alignment of incentives within organizations so that the goals of the
value chain are symbiotic with the goals of the engaged organizations

• Working with clusters/associations of smaller scale producers, including the facilitation of effective production associations and investing in their
long term business management capacity.

Market Structure

• Harmonize standards and certification schemes

• Fair implementation of standards to ensure that the cost of certification doesn’t unfairly reduce access for smallholders and that producers participate in the development and implementation of standards.

• Equity arrangements including shared ownership business structures and price sharing arrangements

• Make contributions visible through chain



Practices to avoid in a value chain:

• Threats of “delisting” approved suppliers if prices are too high

• Suppliers required paying for promotions or openings.

• Suppliers have to pay back a percentage of annual sales

• Minus margins (can’t supply at a higher price than to competitors)

• Delayed payment for produce already delivered

• Lowering prices at the last minute to suppliers who have few alternative outlets

• Last minute changing of quantities

• Changing standards with no support or time to change the production system

• Arbitrary removal of farmers from the supplier lists

• Using contracts that cannot be enforced by the suppliers

• Institutionalization of results: how can the learning from a value chain project ripple out from the specific chain to impact the core strategies of a large company and ultimately the whole industry?

• Are there public policies that get in the way of the chain, or if changed may help it grow?


Good directions for the many regional food systems now emerging. I look forward to helping this story grow.


Download this summary from the larger Value Chain Best Practices report.

Value Chain Best Practices: Building Knowledge for Value Chains that Contribute to the Health of Source Communities. Full article.

Thanks to my friend Joe at HollyMead Capital for this valuable and timely addition to the conversation.

Graphic borrowed and enhanced without permission from the final report. Thanks!

Hubba Hubbas. The musical.

We've been calling our emerging hub of food hubs in the Great Lakes region the Hubba Hubbas, of course.

Our Hubba group met last week in Chicago. My friend Karen with Fresh Taste has lit the light of this organization and nurtured it. Much good is already underway.

As a professional skeptic, I am startled by my flat out enthusiasm for working with this group, now organizing around the name 'Great Lakes Food Hub Network'

That said, the Hubba Hubbas are now starting to dance. I love this part of enterprise formation. From silence to melody. Something from nothing stuff.

One signature accomplishment of the gathering was our first statement of principles and practices. Best first line of any doc I've signed on to ... 'Assume good will.'


Great Lakes Food Hub Network
Principles and Practices
May 6, 2011

“Assume Good Will”

The Great Lakes Food Hub Network (Hubba Hubba) is a group of food hub practitioners dedicated to collaboratively integrating the values and practices of reciprocity with those of the marketplace. In doing so, we are creating a commons of resources and experience focused on community wealth creation, to which all contribute and from which all may benefit. Community wealth creation requires the implementation of business models that build multiple forms of capital: intellectual, social, financial, individual, political, natural and built.

This implies:

• Basing our dealings with each other on an ethic of sharing as well as individual self-interest
• Conducting ourselves as a learning community, which implies sharing what we learn as we develop new business practices, and organizing ourselves as a group capable of consulting to one another.
• Envisioning our work from the outset as a set of linked initiatives, not solely as individual enterprises

Over time, we commit ourselves to develop methods and technologies that facilitate reciprocity, learning, and the building of multiple forms of capital. These may include:

• Commitment to local sourcing
• Open source IT platforms
• Revolving loan funds
• Shared branding
• Learning journeys and exchanges
• Co-investment
• Business models that involve farmers, workers and communities as co-owners and partners
• Means to connect to similar networks in other regions of the country

We are intentional about expanding the network and will invite others to participate who share the values and commitments described above and who bring skills and resources that will strengthen the network. Our goal is to build a strong Great Lakes network reaching from Minneapolis-St Paul Minnesota to Rochester New York, with the assumption that we will develop relationships with similar networks in other regions of the country. We intend that the work we do will serve and inspire other networks.


+++

Many thanks to my friend Karen and Fresh Taste for helping seed and nurture our emerging Great Lakes Food Hub Network.

Original hubba hubba post with links to Great Lakes food hub friends.

Underlying hub graphic thanks to atributosurbanos, a project from the Andalusia Center for Contemporary Art

Inside the Minds of Great Entrepreneurs

When I had the good fortune to be teaching entrepreneurship through Waukesha County Technical College and its great Small Business Center, I thought one of the significant missing pieces of that subject was the simple act of giving people permission to try, to act. Much of my curriculum was built around establishing ways people could give themselves that permission.

The cover story of the new Inc. Magazine for February 2011, is “Inside the Minds of Great Entrepreneurs”. I thought there was some excellent advice for taking action steps in the largely unknown space of innovation and business development.

If you’re on the sidelines thinking about starting a new enterprise it can be daunting to consider all the ‘rules’ that seem to be required to take the entrepreneurship step.

A new study looking for what distinguishes great entrepreneurs provides some highly valuable advice – and especially, permission - to think big and act fast.

Dr. Saras Sarasvathy at the Darden School of Business, at University of Virginia compared highly successful entrepreneurs to professional managers at major global corporations.

I recommend the article and the study, both linked below.

There are some great quotes to consider if you think you need to have everything locked-down and well known before acting (emphasis added by me):

“Somebody once told me the only thing you need is a customer. Instead of asking all the questions, I’d try and make some sales. I’d learn a lot, you know: which people, what were the obstacles, what were the questions, which prices work better. Even before I started production. So my market research would actually be hands-on selling.”

“…pick your partners and package yourself early on before you have to put a lot of capital out. Chief among those influential partners are first customers. The entrepreneurs anticipated customer help on product design, sales, and identifying suppliers. Some even saw their first customer as their best investor.”

And my favorite: “Entrepreneurs fret less about competitors, Sarasvathy explains, because they see themselves not in the thick of a market but on the fringe of one, or as creating a new market entirely. ‘They are like farmers planting a seed and nurturing it’, she says.”

If you think you need permission to take some actions steps, think again. The entrepreneurs Dr. Sarasvathy interviewed all had at least 15 years of entrepreneurial experience, have started multiple companies – both successes and failures – and have taken at least one company public. All were running companies they had founded and all had current revenues between $200 million and $6.5 billion across multiple industries.

“Sarasvathy concluded that master entrepreneurs rely on what she calls effectual reasoning. Brilliant improvisers, the entrepreneurs don’t start out with concrete goals. Instead they constantly assess how to use their personal strengths and whatever resources they have at hand to develop goals on the fly, while creatively reacting to contingencies. “

Amen. Seems like a good place to end, using text from the masthead of this Sustainable Work site: This site is about creating sustainable startups and growing emerging enterprises. It's about developing successful new products and innovating existing ones. Sustainable work means creating valuable solutions that fix real problems. Sustainable work means creating business processes that make you, your enterprise, and the world a better place. You can do it. Welcome.


How Great Entrepreneurs Think, Inc. Magazine. February, 2011. Written by Leigh Buchanan,

Dr. Sarasvathy’s full case study

Dr. Saras Sarasvathy at the Darden School of Business, University of Virginia.

Waukesha County Technical College, WCTC and their great Small Business Center

Ten Rules

I've been carrying a link around with me for a long while. This piece was written about web startups in 2005, but I knew immediately there was universal advice for all startups in it.

Now that the Wisconsin Innovation Kitchen is about to open, I've found a great place to utilize this wonderful writing. I would suggest that these ten rules have significant meaning for local foods entrepreneurs (and most other startups).

I'm reposting this writing (edited-down-to-my-favorite-parts) by Evan Williams.

These ten rules are from a blog post that was written in 2005.

The author is the current CEO of Twitter. He has a very interesting bio (linked below) and the whole Twitter-startup thing looks like its working out pretty well for him (Yikes!).

These (edited) ten rules are among the first things I'd tell people to think about as any kind of new entrepreneur, specifically new food entrepreneurs working in the Wisconsin Innovation Kitchen.

Every time I reread these I find myself nodding in agreement or laughing at myself for screwing a few up. All of these things need your attention.

"#1: Be Narrow. Focusing on a small niche has so many advantages: With much less work, you can be the best at what you do.

#2: Be Different. See #1—the specialist will almost always kick the generalist's ass.

#3: Be Casual. If you want to hit the really big home runs, create services that fit in with—and, indeed, help—people's everyday lives without requiring lots of commitment….

#4: Be Picky. Startups are often too eager to accept people or ideas into their world. You can almost always afford to wait if something doesn't feel just right, and false negatives are usually better than false positives. [Editor's note: Amen]

#5: Be User-Centric. Always focus on the user and all will be well.

#6: Be Self-Centered. Great products almost always come from someone scratching their own itch. Create something you want to exist in the world.

#7: Be Greedy. It's always good to have options. One of the best ways to do that is to have income.

#8: Be Tiny. … and the willingness of the big guys to shell out for small teams doing innovative stuff, the most likely end game if you're successful is acquisition.

#9: Be Agile. Ebay was going to sell auction software. Initial assumptions are almost always wrong. The same philosophy should be applied to building a company.

#10: Be Balanced. Nature requires balance for health—as do the bodies and minds who work for you and, without which, your company will be worthless.

#11 (bonus!): Be Wary. Overgeneralized lists of business "rules" are not to be taken too literally. There are exceptions to everything."

Thanks to Evan Williams for some really beautiful work (with apologies for my edits). There is serious startup knowledge in every one of these points. Pay attention.

I would also include that startups need a robust data capture and storage capacity, but that's for other posts.

The Wisconsin Innovation Kitchen can become a platform for all kinds of food entrepreneurs to test their skills and grow smart, creative new food enterprises.

This list is a great place to start.

My thanks to Evan Williams for the great advice!



Original 2005 EVHEAD post: Ten Rules for Web Startups

EVHEAD A blog by Evan Williams

Evan Williams is an American entrepreneur who has co-founded several Internet companies, including Pyra Labs (creator of weblog-authoring software Blogger) and Twitter, of which he is currently CEO. He was born March 31, 1972 and raised on a farm in central Nebraska. He lives in San Francisco with his wife and son.

Wikipedia Evan Williams

The Wisconsin Innovation Kitchen

Independent innovation. Happy Holidays Ben Franklin!

A new Business Week article - Ben Franklin Where Are You? - is about the United States falling behind in the global patent race.

The article in the Dec. 28, 2009 issue by Michael Arndt documents the fact that in 2009 for the first time non-Americans were granted more U.S. patents than resident inventors.

The body of the article focuses on the difficulties universities and high tech centers are facing in the patent race. However, the headline (celebrating Ben Franklin) highlights our history as independent innovators.

It's my opinion that this kind of citizen innovation and entrepreneurship is more alive and flourishing than I've ever seen in decades of work in the field. In fact I think the world is full of Ben Franklins, and that the age of the independent entrepreneur and inventor is just arriving.

I think a difference between an independent inventor and those in universities and corporate labs is that independent inventors work to solve very specific problems not create new technologies.

Dave and I didn't have any budget to launch or grow our company. We had values that were important to us and each of us had a skill set that built on the other person's strengths.

We also knew some really cool ways to solve some very specific problems. The fact that new technologies emerged from this and were taken through the intellectual property process was an afterthought.

The fact that the rest of the world is surpassing the United States in patents is a tribute to the value placed on ever increasing innovation by governments and societies worldwide. Much of the world seems to get it that continuous, sustainable innovation is the only way forward.

So, my favorite independent innovation story from the last startup Dave and I founded…

One of the world's leading satellite and space manufacturing firms, Pratt and Whitney Rocketdyne, recently gutted their two satellite and space manufacturing plants in California and retrofitted them from the ground up with worldwide 'best of class' equipment. Their corporate mantra is: "Pure and simple, we are the best at what's new."

Rocketdyne chose to recycle their manufacturing fluids using inventions Dave and I created. We worked out these ideas far from corporate labs and universities.

It was my last major sale for our company. I really miss that work.

Thank you Pratt and Whitney! The fact that you chose our inventions as the 'best of what's new' for fluid recycling in 21st century space manufacturing is a lifelong honor for an independent inventor.

For those of you working in the trenches, let me say that there are big firms and important organizations looking for better ideas and ways to innovate. Even when you're doubting your own capability to execute or to reach those markets, press on. The world needs you, your ideas, and your work. Like Pratt & Whitney, keep working to be the best at what's new.

Happy Holidays 2009!


Photo courtesy of Pratt and Whitney Rocketdyne. Space Shuttle Atlantis (STS-110)

Business Week article, Ben Franklin Where Are you?. Online edition Dec. 17, 2009. Print edition Dec. 28th and Jan. 4th.

Our first patent (patent number 6,183,654). I wrote this patent and did the patent drawings. For our subsequent inventions, we turned this process over to our wonderful patent attorney Dr. Jaen Andrews - Thank you Dr. Jaen!

The 'Eight Courtesies' of effective enterprise.

These posts have consistently tried to advocate for sustainable, repeatable business practices.

This brings me back often to Tom Peters. I am thrilled to see Tom has a new book coming out in early 2010. Tom Peters is at the top of my list of transformative business thinkers.

His new book is called "The Little BIG Things". Sounds like Tom at his best. He is building his current presentations around what he calls "The Eight Courtesies". I'll highlight them below. Buy the book.

Yes, the economy is awful and people are getting hurt badly, but it doesn't mean that we can't explore options for finding a way forward. There are opportunities for 'the rest of us' to start and grow new and emerging enterprises. I have a powerful sense that new kinds of local and regional trade will continue to emerge worldwide for the foreseeable future. It's happening from Australia to the West Bank, to Avoca, WI, and to China (hello Yongchao!).

There are deep and fruitful opportunities here. I am increasingly seeing my immediate contribution to the subject being enterprise creation through local foods.

Individually, these new enterprises may not seem Wall Street worthy, but in aggregate they represent a lot of positive, sustainable, long-term value for economic development on Main Streets and across regions.

So how do you participate? Think you've got to be some kind of uber-trained CEO type to run a new enterprise effectively? Think again.

It's nothing of the sort. You can do it. You DO do it now in other areas of your life. After 35+ years of entrepreneurship I couldn't have described effective entrepreneurship any better than Tom Peters is doing right now.

Here are the eight most important management tools Tom prescribes in The Little BIG Things.

"Epigraph:

Courtesies of a small and trivial character are the ones which strike deepest in the grateful and appreciating heart.—Henry Clay

The 'Eight Courtesies'

1. Stay in touch. (MBWA: Management By Wandering Around)

2. Invest in relationships. (Make friends. Obsess.)

3. Listen. (Respect. Learn. Student. PROFESSIONAL. Sustainable Competitive Advantage #1)

4. Ask. (Engage. Inspire. Consult. React.)

5. Thank. (Appreciate. Acknowledge.)

6. Network......

7. Apologize. (Unequivocal. Rectify. Over-react. Forgive.)

8. Practice thoughtfulness. (Kindness is free. This is ... STRATEGIC.)"


You heard it here: The Renaissance age of entrepreneurship is just beginning. Remember Tom's 'Eight Courtesies' as you journey.

You can do this friend. Start. Engage. Be courteous. Enjoy.


Eight Courtesies: From TP blog 11/24/09

I'm going to buy this book: The Little BIG Things. New book by Tom Peters out February 2010

There was an interesting piece on the NPR Radio program Marketplace on Tuesday 11/18/08.

The piece was titled "Starting a Business in a Bad Economy."

In a short space, it identified a number of things that, from my perspective, are critical for small-scale entrepreneurs and startups to understand. It also highlighted some of the most fundamental misunderstandings about entrepreneurship that are in common currency.

What I would like this post to highlight is that small-scale sustainable enterprises are absolutely possible in this economy if you are willing to put in the time and effort. However, the amount of time required for these kind of startups is typically more than you estimate.

If your financial life is such that you need immediate pay-the-rent type cash flows, starting your own business to dig out of this is a very poor option, with low odds of success.

Let's start with current news. There is no doubt this economy is a massive mess. Each time there's been a ray of hope, it's been snuffed out by something unexpected from left field. Then we restart and the process gets repeated. This has been an awful year for the economy and the near future looks very rough.

That doesn't mean you get under your desk however. It means you smarten up and start building some solutions for yourself.

I've run small businesses through the last bunch of recessions, including the whoppers. If you are overextended and have built your enterprise on a platform of unsupportable risk, then you've got real trouble. For the rest of us, the sun will continue coming up. Birds sing after storms.

The Marketplace radio piece was done by Mitchell Hartmann of Oregon Public Radio. Mr Hartmann is a very good reporter and focuses on sustainability issues for Marketplace.

This piece summarized a few of at the many difficulties and opportunities that startups face in this kind of economic environment.

Mr. Hartmann spoke with an advisor at the Small Business Development Center in Portland about people rushing into entrepreneurship out of immediate financial need.

The advisor, Jackie Babacky Peterson, sounded a bit shell shocked, referring to the newly unemployed launching new businesses on their credit cards. That indeed is a very bad path.

Here's a transcript from that section:

"Advisor Jackie Babicky-Peterson is seeing unemployment and entrepreneurship meet but not necessarily in a good way."

"Many people get laid off from companies so they are deciding this is a good time to launch a business even though it may be very difficult."

"Many people will rush into biz for themselves without sufficient planning and with little or no savings they'll use personal credit cards to get going. 'Just pure startup money is now - and always has been - pretty impossible.'"

"Credit cards will kill you."

She concludes: "I think we will have more failures."

I'd like to parse this for what slow, measured, startup types can take from this.

Ms Babacky-Perterson is spot on identifying the process of 'rushing into business' as a way of pre-scheduling the likely death of your enterprise and damage to your personal financial welfare.

One line in that quote is critical. It was about the difficulty in attracting outside money to small startups. Outside investment money for brand new startups has never been available. Not in this bad economy and not in the past when things were better. Appropriate small-scale startup money only comes from your pocket. Alternately, outside investment can come, with an increasing chance for trouble, from friends and family.

And yes, using credit cards to finance your rushed effort will likely kill your startup.

And yes, with more startups there will be more failures. However, the most vibrant regional economies in the US have high startup rates AND high failure rates. What's working here is that cultures of entrepreneurship and participatory commerce are celebrated. If something doesn't work, you try something else. There can't be successes if there aren't failures. The key is how we deal with those failures and learn from them, and how we support the culture of entrepreneurship that engenders all this activity.

And yes, if you drive a boatload of other people's money off a cliff (see current events), you've created dysfunction and hurt the system for those that follow. If you lose a small amount of your own capital (and probably a large amount of time), then you're smarter and ready for the next effort.

In the past, I have quoted Vivek Wadhwa whose common sense seems to show at key points in these national discussions of entrepreneurship. (Jan. 5, 2008)

Vivek Wadhwa founded two tech startups and now researches entrepreneurship at Duke and Harvard.

While Mr. Wadhwa's comments speak specifically to large firms, his ideas deliver critically important meaning to the discussion of small startups.

Mr. Wadhwa says the Fortune 500 is full of companies that were founded during bad times: Johnson & Johnson, Disney, Cisco, and Intel to name a few.

The Marketplace reporter Mitchell Hartmann then referred to a big entrepreneurship organization as saying startups will not increase due to these terrible market conditions.

Vivak Wadhwa says that's the wrong conclusion to draw from the current economic conditions.

Here is where I want to shine a bright light on the good words of Mr. Wadhwa.

"We'll be back on track in 2 - 3 years. By that time you will have gotten your business model working, you've got your products perfected, you know your customers, you know your market space, and now you can go to the angel investors, the venture capitalists and pitch a real company to them."

Mitchell Hartmann closed his piece this way:

"So, if you don't have funding from your own nest egg, or from friends and family, you can pretty much forget about going from 0 to startup during this downturn."

With no diss at all to Mr. Hartmann, I humbly submit a concluding summary that would promote some glass-is-half-full action steps.

Mine would run something like this….

If you can invest a small amount of money and a large amount of your time, you can create your own sustainable enterprise in these difficult economic times. With hard work that enterprise can become a commercial platform allowing you to go forward in life with more personal options and more financial security.

Thanks to Mitchell Hartmann for the great piece and thanks, as always, to Marketplace.

Now get out there ASAP and start something. Slowly.


Marketplace broadcast of this story

Next Generation Business Development

The Economic Development Director of Racine County, WI is Gordon Kacala. Gordon and I have not met, but I'm an admirer of his work and his writing.

I buy the Racine Journal Times whenever I'm in Racine, which is fairly often. I love newspapers, but my specific reason is to read Gordon Kacala's column in the Journal Times called 'Developing Racine'.

In a recent column I really liked, Gordon wrote about one of my favorite economic development subjects, manufacturing. Specifically his column talked about ways to define 'next generation' manufacturing.

The definitions Gordon pointed at have been proposed by our own Wisconsin Manufacturing Extension Partnership. I think these are a great first effort. I also think they are generally applicable to all kinds of economic development issues.

This evolving definition for 'next generation' enterprise has five main characteristics called out. I'm going to take each point and apply it to business development generally.

- Your enterprise embraces systemic, continuous improvement

ME: For startups and small businesses, this does not have to
mean biotech patents. It can mean sending invoices faster or storing phone numbers in the right place, or checking credit better. You do not need to be a rocket scientist to continuously improve your operations and the solutions you offer. However, you do need to do both all the time.

- Your enterprise is globally engaged

ME: There is micro-economic and a macro-economic comment to be made, given current circumstances.

The big global stuff is fun, and it's never been more available to small businesses. In both of my last enterprises, we had customers on 5 continents. I sold recycling equipment in Africa, Europe, Asia, and the Americas from my virtual office in Madison, Wisconsin. However going global is not the first step that most startups must learn to take. We took those global steps only after we learned to walk regionally and nationally.

I am not going to dismiss purely local commerce, but it can be very limiting and potentially lethal for most small enterprises.

For most enterprise their first markets need to be regional. It spreads the risk, it increases the universe of customers and it offers the potential for implementing your solutions at lower costs.

After that, when appropriate, you should then learn to market yourself nationally. Setting up a small enterprise that rejects the potential for selling across the United States is naive and wrong headed. When appropriate, marketing small businesses throughout the US has never been easier or less expensive.

After that, go global with my blessings. It can be rewarding and very profitable if you're ready.

- Your enterprise has active strategies to attract, develop and retain the talent necessary to win in a next-generation world.

ME: For the smallest businesses this means training yourself to learn the skills and tools needed to cowboy up commercially in the 21st century. This is not only the digital stuff, but the people skills needed to equitably do commerce going forward. Attracting and developing talent for small business can mean employees, but also increasingly means growing and retaining talented strategic market partners.

For existing small businesses, I would also suggest that the big picture needs adjusting. I mean that we all need to advocate for a system that takes health care out of the list of risks we face when starting and running enterprises. Without that, we can not compete for, or retain talent. The talent we need won't be available because those talented people can't risk their insurance status. The people who small businesses most need, (and I think the same people who most need small business), have to balance their family's risks with every decision as you do. We need to fix health care to fix economic development. Period.

- Your enterprise incorporates green ideas in its growth and operating strategies as a means to reduce waste and take advantage of the growing demand for sustainable products.

ME: I have seen the most egregious BS attached to the green movement, and I have also marketed hard right into it with great success. The test of sustainable green commerce is not a complicated one; it needs to fix real problems and it needs to make money.

There has been a sea change recently that will drive this movement forward. Green has become a national security issue.

As a sustainable path into the future, I have never seen so
much market wind at the back of green commerce

Need a definition of green commerce? I recently saw a great quote by Nobel Prize-wining physist Murray Gell-Mann defining sustainable as, "living off nature's income rather than it's principal".

Your community and the entire world want more sustainable products and services. There has never been more potential for ground-up, sustainable entrepreneurship in my lifetime.

- Your enterprise is skilled in strategic partner and supplier relationship management as a means to increase production flexibility, use partner competencies, and tap new markets.


ME: For small businesses, this translates as setting up equitable, transparent, mutually beneficial food chains with your commercial partners and customers. This is the most profitable model in the long run, and also the easiest to operate. Simple is good.


What we've seen in the economic meltdown this summer is that complicated, opaque commercial systems are almost impossible to manage and master, and in most case lead to disaster.

Next Generation business development will require the positions suggested above: continuous innovation, a regional and national market focus, your approach to all people is one of equality, your approach to commerce sustainably fixes problems, and you develop the ability to work cooperatively and equitably with all your commercial stakeholders.


Sustainable = repeatable. This 'Next Generation' model highlights that approach. Anyone can do this. I believe everyone should start and grow their own enterprises along these principles.

There has never been a more important time to to do so for yourself and for our economy going forward.




Thanks to Gordon Kacala for his good work and good writing on behalf of Racine County. Visit the Racine County Economic Development site

Visit the Wisconsin Manufacturing Extension Partnership site discussing Next Generation Manufacturing

Effective partnering

I'm a big fan of the writer Marcus Buckingham. He has a really great eye for important simplicities the rest of us overlook. His specialty is business writing and he gets to the big picture stuff very effectively.

His earlier book, First Break All The Rules, is excellent. So is his most recent book, The One Thing You Need To Know.

Seriously audacious title, and Mr. Buckingham delivers.

I would not think of summarizing this book because he does it best: Find out what you don’t like doing and stop doing it.

Don’t just take away that summary, however. The development of the arguments leading to the conclusions are as important as the conclusions. Read/listen to this book.

In the course of supporting his thoughts, I think Mr. Buckingham caught one really important idea poetically.

"Effective partnering is the quiet secret of the successful"

My wife and partner, Mary, and I ran a really fulfilling enterprise as partners for 25 years. Solved problems for customers, raised the kids, paid the bills. Mary has been the go-to knowledge worker of our current enterprise since its inception. However, she and my daughters have made it abundantly clear that if a third request is ever made, no jury would convict.

My current biz partner Dave hobbles on water. I think that Dave is the most creative industrial designer in the world, working in our field of expertise. Dave would likely not go to print ( I hope ) with what it’s really like working with me as a partner, but it’s indicative when he says that he’s like DC current to my AC.

Effective partnering. I really like that phrase.

Partners don’t necessarily have to share the business with you. As you consider paths for new or emerging enterprises, consider building your business model around a particularly great vendor (have backups B and C in place please). Perhaps you can partner with an especially great set of customers. Your enterprise can partner with anyone you think may move your model forward. In this part of your enterprise life there are no rules.

In one section of The One Thing You Need To Know, Mr. Buckingham discusses (without using the exact term here) the partnering that should emanate from great managers. Their highest task is to find what’s unique and great about each person reporting to them and build a partnering strategy to put those strengths into play for the common cause. I've always tried to do this.

Partners certainly don’t have to be in the same space with you in this day and age. I looked up an older post from May 13, 2005 that’s about remote partnering, and grabbed a piece from that:

"My current day job is based on the best remote partnering relationship I've ever been blessed to participate in. My friend and business partner Dave lives and supervises manufacturing of our equipment in the next state over, Illinois. We headquartered the biz in Wisconsin where I live and work. By planning our enterprise around this circumstance from the beginning, it feels as though we're just a cubicle away most of the time."

Can partners go bad? More likely than not. Doing enterprise with a partner is not dating. It’s raising kids together. Think through your choices very carefully.

Also be aware that creating great partnering relationships is best made up from slow motion, planned steps, including measurable metrics. This is the kind of stuff, done right, that can turn into the enterprise equivalent of love.

How do you find great partners? I met Mary at Shorty’s Bar in Winona, MN. Hell, I don’t know. Look for help. Trust your gut. Hedge your bets initially then let go as much as you can to the partnership. Great partnering is like making angels in the snow. The impression you make on each other can be art. There is just nothing better in the enterprise world as when great partnering works.

I'm deeply thankful to all the great partners that I've worked with over the decades. I also thank Marcus Buckingham for an elegant, important contribution to this subject that you should carry with you, friends:

“Effective partnering is the quiet secret of the successful.”

Visit Marcus Buckingham’s site

Remote partnering

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There are many ways to solve problems. Physical proximity is not necessarily a requisite piece of the solution.

When we first started Banner Graphics our technology limited us to production of graphics that could only be used indoors. This was a big piece of the market, but adding the capability to offer work that could be used outdoors was also valuable. Often, one customer had both needs. The biz was growing nicely and we were always busy, but we were looking for sustainable ways to grow.

In between jobs, we tested changes to ink chemistries and fooled around with different substrates and overlays.

But we kept coming back to the fact that we WERE always busy and finding a fix was taking too much time away from our day job. So we set up our first remote partner. We visited with a local firm doing high volume laminating and learned from each other what kind of problems could be solved if we worked together. Ultimately we decided to make their capabilities part of our business model, and they made our services part of theirs.

Yes, outsourcing. Well, sorta. We weren't eliminating jobs, we were trying to grow our own jobs into something even cooler. Initially we took graphics there once every week or so. Within a couple of years, we'd moved next door. Within a year or two after that, a near continuous stream of graphics flowed out the back door of our shop, into theirs and back to us as finished product.

The core component of this little dance was data control. Knowing where everything was all the time and when it should be somewhere else. By starting early with this vendor, we both were able to work up data management strategies specific to the process. Even at high volumes (that neither firm expected at the start of the relationship) the process was easy and profitable for both because we'd thought it through at the beginning. Neither company's core business was hurt by intrusive production problems caused by their partners. That's because the data management just plain worked.

Over the years we were fortunate enough to expand that network considerably. Different enterprises, with different specialties joined the network. The next was down the block. The one after that was across town. The one after that was in the next county. After 25 years the network was many states wide. Everyone in the network contributied their core competencies to each other and everyone played nicely or they got yanked from the pool.

My current day job is based on the best remote partnering relationship I've ever been blessed to participate in. My friend and business partner Dave lives and supervises manufacturing of our equipment in the next state over, Illinois. We headquartered the biz in Wisconsin where I live and work. By planning our enterprise around this circumstance from the beginning, it feels as though we're just a cubicle away most of the time.

How does this work? Surprise. Good data management. Knowing where everything is all the time and when it should be somewhere else. Everything. All the time. Heard that before?

This remote partnering idea works with employees and co-workers as well. If you have an employee that you have to be standing near to supervise, I'd suggest that is an employee you don't necessarily want anyway. Why not let your coworkers live somewhere else too? They're grown ups. If they're good at what they do, their contributions are obvious.

This model requires moving physical goods and digital data effortlessly. I believe you'll need to have access to the commercial shipping grid (FedX, UPS, DHL, USPS, etc) and as fast a data connection to the internet as you can afford. It's doable without these, but a lot trickier and subject to problems. More on shipping in a future post.

For remote partnering data management, you can start with pen and paper, telephone and faxes, but I'd go digital ASAP. There are terrific database programs available to run on multiple platforms that we, the un-digerati, can readily make use of. Database programs allow you to present the same data a zillion different ways depending on how you want to look at it and what you want to do with it. Data files can easily be sent over the internet or live wired to a network.

At some point organizations will find the sweet spot where coalescing around a physical 3D location has merit. We've done that, but much of the organization is still remote, including me. Very little in life has to be all or nothing.

Remote partnering takes people of good will acting justly to keep the enterprise sustainable. As the complexity level goes up the need for written documentation for these relationships grows. But that's not new legal ground here in the 21st century. It's been done and any good biz attorney can match up an appropriate solution to your circumstances.

Remote partners can be your friends or relatives (careful!), new people you've carefully networked with to create the opportunity, outside businesses, or people directly employed by your organization. Most likely it'll be a mixture of these.

Downsides? This remote partnering stuff really confuses the bureaucracies set up to support small enterprises. Monies to support local businesses aren't available when your employees live in another state. State tax breaks for many business aren't available when the headquarters is someplace else. But who cares. Better not to rely on that stuff any way. You're better off spending your time selling than begging bureaucrats, but that's also for another posting.

I'm convinced remote partnering is an extremely valuable tool for sustainable enterprises, given the right individuals, the right talents, and good execution.
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