Free PR; Peers vs. Managers; NetGain Multiple; Costco
January 31, 2019
HGTV Co-Founder; Best Place to Work; 8 Self-Leadership Traits; Bloomberg CEO Summit
February 14, 2019

Beautiful Name; Costco’s Resilience; Belgium Gazelles; Services Replace Products

Hello ScaleUps, 

Hope it’s been a productive and purposeful week. Here are some insights to help you outlearn/outthink the competition.

Great Company Name
Do you need to rename your company? Congratulations to Dina Dwyer-Owens (Chair), Mike Bidwell (CEO) and her team for taking a huge leap and renaming the almost 40-year-old family business. At $1.8 billion now, the Dwyer Group recently rebranded their collection of 21 home service franchises to Neighborly. Brilliant, memorable, and emotionally connective!  Here’s a link to the latest press release on the details. Again, do you need to rename your company? Something simpler along the lines of Amazon, Google, Microsoft, Apple, FedEx, and Neighborly? Or Costco?

The Resilience of Costco (thank you to Tim Ferriss)
Tim Ferriss highlighted this “article” on Costco. Notes Ferriss, in his 5-Bullet Friday post (one of my favorite blogs each week): “For 40 years, Costco has succeeded with a simple formula: reinvest merchandising profits into lower prices and better products; be a disciplined operator; and treat customers and employees well.” This is a great study in simplicity (drastically reducing SKUs, per slide 44, and keeping the stores barebone, per slide 70), contrarian decision-making (no expensive advertising, per slide 54, and only offering bulk sizes, per slide 58), and much, much more.” Please take 2 minutes to click through the 146 slides (it really is quick to absorb!). Thank you, Tim, for highlighting this great biz example – and love the clever way the story is told via slides. 

Services Replacing Products in Global Trade
A new study out from the McKinsey Global Institute finds the share of goods produced around the world that is traded across borders has fallen sharply, from 28.1% in 2007 to 22.5% in 2017. In turn, the trade in services is skyrocketing. To quote Fortune magazine’s take on important implications of this research: 

  • Foreign trade is no longer being driven by the search for low wages. Less than 20% of trade is based on labor-cost arbitrage, the report says. 
  • Knowledge-based trade is soaring. Investment in intangible assets – R&D, strong brands, intellectual property – has doubled as a share of trade, from 5.5% to 13.1%. 

Fortune continues: “The implications for public policy are clear. Restricting trade in physical goods is fighting the last war. And attempting to restrict trade in intellectual property and intangibles is a fool’s errand. In the next round of globalization, it will be countries with the best talent, not those with the lowest wages, that will have the upper hand.” Brains, not brawn, are the key to success in the 21stCentury. 

Gazelles as Job Generators
Research continues to show that the small slivers of “gazelles” in the economy drive a majority of the jobs. The latest is from Belgium where 3.5% of firms where found to generate 67% of jobs between 2014 and 2017. Thank you to Scaling Up Certified coach Rob Nankeris for pointing me to this study.

CEO-BOOTCAMP: spend 3.5 days with Verne, serial entrepreneur John Ratliff, and 6 other CEOs in a beautiful retreat setting, addressing the constraints holding back you, your business, and your industry. March 12 – 15; Jun 4 – 7, 2019

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Verne Harnish
Verne Harnish
Verne Harnish is founder of the world-renowned Entrepreneurs’ Organization (EO) and chaired for fifteen years EO’s premiere CEO program, the “Birthing of Giants” and WEO’s “Advanced Business” executive program both held at MIT. Founder and CEO of Gazelles, a global executive education and coaching company with over 150 coaching partners on six continents, Verne has spent the past three decades helping companies scale-up. The “Growth Guy” syndicated columnist, he’s also the Venture columnist for FORTUNE magazine. He’s the author of Scaling Up (Rockefeller Habits 2.0); Mastering the Rockefeller Habits; and along with the editors of Fortune, authored The Greatest Business Decisions of All Times," for which Jim Collins wrote the foreword. Verne also chairs FORTUNE Magazine’s annual Leadership and Growth Summits and serves on several boards including chairman of The Riordan Clinic and the newly launched Geoversity. He is an investor in many scale-ups. A father of four, he enjoys piano, tennis, and magic as a card-carrying member of the International Brotherhood of Magicians.