This is my first post as the CEO of the Ottawa Flying Club. It is a honor to be given the responsibility for such a venerable organization. The club has been active since 1928 and has a long history of promoting aviation in Canada. In the last few years, a strong partnership has formed with Algonquin College where OFC provides professional flight training to students at the Algonquin Aviation Management program. While this is beneficial for the club in terms of increased activity and revenue, it is also creating new challenges for a club that is now a multi-million dollar business. Properly managing the growth in the next few years will be critical to ensure that the club continues to benefit from its new business activities. I look forward to these challenges and would appreciate any comments the club members may have regarding the way ahead.
Archive for the 'Management' Category
When we think technology and business, we naturally think products. But it is not always so.
I recently met a friend and we were discussing venture capital and the state of commercialization in Canada for tech companies. Part of the conversation stuck with me - every company is a tech company to some degree.
Technology is know-how and every company must have some special processes, knowledge and capabilities that make them unique in the market. This technology usually ends up in the proceses and data stored in the IT. Even if the provision of the IT services is outsourced, the data and processes still are part of the core competence of the company.
The technology, then, can be any part of the business - logistics, business planning, financial wizardry, marketing, partnerships, … as well as product related.
While this may be a semantic argument about the meaning of the word, it is an interesting point for all those of you who think you aren’t running a tech company.
My post on Sunday discussed my dismay at seeing good Canadian entrepreneurs being told that they would have better chances getting funding if they became good US entrepreneurs. As an example of how blogs are really pulpits, my issue was picked up by Liberal MP Scott Brison, who addressed the point in Question Period yesterday. (See the Hansard, #32 for 24 March 09).
The Honorable Stockwell Day responded with facts about EDC and how it is facilitating $85 billion in financial activity etc…. While EDC does good work and I would recommend their services to exporters, I’m not aware that EDC provides any Venture funding. BDC would have been a better example. So I don’t find the answers of any help, but then perhaps I’m expecting a lot out of Question Period.
The point that the VC community is in trouble is not new. In its latest report (January 2009), Why Venture Capital is Essential to the Canadian Economy: The Impact of Venture Capital on the Canadian Economy, the Canadian Venture Capital and Private Equity Association outlines some of the key issues:
- Wishing to move to a knowledge based economy, the government has, in the past, created a vibrant VC community with tax incentives, government venture funds and massive R&D investments.
- The VC funds have not generated sufficient returns to attract new investment and (in the last four years) the government (both provincial and federal) has moved to indirect support while reducing the direct funding and tax credits. Both these factors have significantly reduced the ability of VC funds to raise new capital.
- The loss of Canadian funding, which declined by 35% since 2003 until the start of the financial crisis in Q4 2008, has been compensated by an increase in US based funding but that this sometimes results in a shift of company activities to the US. (US VCs will invest in Canadian companies if there is a majority Canadian investor. A majority US investor will want the company located in the US, usually within a hour’s drive of the VC’s office.)
Why is it important to fix the VC situation? The relatively large amounts spent on R&D in Canada produce results in terms of innovation. For this innovation to have any impact on the Canadian economy, it needs to be turned into businesses and this requires funding. Venture Capital is an important part of the economic ecosystem that facilitates the creation of these businesses. Without it, the innovative technologies developed in Canada will find their way to other countries.
What is to be done? Find innovative ways to develop the funding and do so quickly. If VC funds develop such poor returns and yet are so critical for the economy, perhaps it would be prudent to consider increasing direct funding from the government, not as an investment but as infrastructure for the economy. Let’s start a conversation on the topic.
It appears the Canadian Government and OCRI are sponsoring Canadian Entrepreneurs to move to the US. SO much for strengthening the tech sector in Ottawa.
I was at a DFAIT sponsored event last week called the Canadian Regional Boot Camp for Technology Start-Ups featuring Silicon Valley experts and investors. Essentially a training and practice session on making the pitch to VCs with a focus on the US. On the surface, it seems like a good program: help entrepreneurs in Canada find partnerships and funding in the US by providing access to VC, angels networks and Fortune 500 ICT companies in Silicon Valley.
The boot Camp is followed by a program where selected start-ups visit San Jose for up to three months, with “subsidized access” to the Canadian Incubator program in Silicon Valley (meeting rooms, coaching, networking events etc…) all with the intent of finding financing in the US.
But there’s a catch. Not mentioned on the web site, and buried in the first few presentations in the day was the following comment: US Venture Capitalists will not invest in Canadian Companies. The advice:
Convert the Canadian Company to a US company and move the HQ to Silicon Valley
The following presentations discussed how to convert a Canadian company into a Delaware “C” Corporation and the need to move the HQ to the US. Of course, keep the R&D in Canada where generous SR&ED tax credits make it worthwhile. I was gobsmacked - shocked and appalled. DFAIT is paying for this?? OCRI is supporting this?? Something is seriously wrong here!
You can’t blame the entrepreneurs. There is pitifully little venture capital in Canada at the moment. Tax incentive cuts and poor performance of venture funds in the past have decimated the VC funds in the last year. About the only source of funds is in the US where conditions are more favorable. If you have to leave Canada to get the funding and support your dream, well, that’s what you do. There is no loyalty and there really shouldn’t be. Its business, after all.
But you can blame the government. DFAIT and OCRI, intent on helping entrepreneurs, are helping them move to the US. This is just misguided policy at its worst. I’d expect the Canadian Government to support the creation of a strong entrepernurial ecosystem in Canada. The ecosystem is a cornerstone of creating businesses of all types. Its a necessary condition for a thriving culture of innovation. Instead, I find OCRI and DFAIT working against the goals of a stronger Canada in their efforts to help.
If they really want to help, figure out a way to shore up the VC funds in Canada. Improve the tax structure. Make VC funding part of the infrastructure program. As an investment, funding entrepreneurs has a pretty poor return. But as an infrastructure program, responsible for creating and supporting the economic ecosystem, it probably more important than a building with a fancy lobby.
- Hours a day?
I visited with David Watters of Global Advantage Consulting Group last night. A description of the visit is posted here.
Canada's Federal S&T Innovation Ecosystem Map
I left the meeting thinking about the difficulties in on-line visualization of complex problems. David’s group generates large 3×5 foot posters showing the linkages and inter-relationships in public policy frameworks surrounding government and business ecosystems, such as the Canadian Federal Science and Technology Innovation ecosystem. These ecosystem maps are depictions of organizations, people, policies, regulations, laws, risks and activities that are national in scope. The paper is big and the print is small but the map still manages to get the information across.
Projected on a computer screen, however, the maps lose their appeal. There is just not enough resolution. Even with the ability to zoom in and out, there is so much information to present that the linkages are lost in the zooming. There has to be a better way.
A quick search of the web shows lots of software tools that provide information visualization capabilities. Much of this stuff was developed by or in relation to the US National Homeland Security initiatives following 9/11. While these may be good at showing trends in data, they don’t have the flexibility I’m thinking of.
Read Write Web had an excellent summary of visualization tools available on the web back in March 08. Some of these tools are very interesting. If there was a way to combine these, they may do the trick. Start with the Visual Thesaurus, an interactive dictionary and thesaurus which creates word maps that blossom with meanings and branch to related words, but instead of words and meaning, use organizations and functions. Make the links include such things as lines of authority, influences, lobby efforts, funding, regulatory controls and the like. Then add drill down and layering of information as in Google Earth so that information can be added or removed as required. Provide scope controls to show only the nearest links or up to the whole network. Add the ability to look at the map from a high-level as if you were in government trying to influence entire industries or switch it to look at it from the perspective of a business where you want to see how you fit with the external world.
Now, while the software tool would be cool, imagine the mountain of data required to make it useful and keep it up-to-date. This goes back to the issue of complexity and is the real value added of David’s business. The visualization tool would only provide a better way to sell this value.
Interviewers often ask a simple question, “What was the best compliment that you ever received.” For me, it’s an easy question to answer. A fellow astronaut, Dave Williams, once said to me, “When you’re around, things work.” Now, almost 16 years later, I still remember it and still feel proud of it.
Why? Because it aligned so closely with my own perceptions of who I was and what I was good at. It reflected back at me my own pride in being able to get people and equipment to function and work together in ways that left others surprised and delighted. It was a succinct and direct recognition of my strengths. As a compliment, coming from a peer who I respected and admired, it was very powerful. I couldn’t ask for better. It has become, in a way, my own personal tag line.
We tend to forget the impact of a good compliment. I’m not talking about a flippant “Good Job!” but a well thought out compliment: one that takes close knowledge of the other, a sense of affinity and real appreciation. Delivered well, compliments are treasured. They can motivate a person through very difficult times and can be more reward than money.
I’ll admit that I am not the best at giving compliments but I try. I try to give compliments more than criticism and I try to make them count for something. I hope I have touched people in the way Dave’s words touched me.
And for you? What is the best compliment you have ever received? If you were to compliment yourself, right now, in a way that would have you thinking about it twenty years hence, what would you say?
Are your business processes stuck in a rut? How would you know?
I’ve been driving my daughters to the same daycare for the last several years. First my oldest, who now takes the bus to school, and now my youngest who will spend at least two more years with this daycare. We’ve moved once during these years but the final portion of the route I drove each morning remained the same. I choose this route based on the stop-lights, trying to spend the least amount of time at each light. There was one intersection in particular where I needed to cross four lanes of traffic. The light was lengthly and long ago I decided to turn right and then left at the next street. At the next street, I was only turning left so I had to wait for the light and traffic to clear. It was a short light and I never had to wait long. Then the traffic patterns changed and the number of cars turning left increased. It frequently took two lights to get the chance to turn. I got used to the wait.
Recently driving with my wife, she asked the obvious - why not go straight through the main intersection? So stuck in my habits, I started to explain but managed to stop myself. Things had changed and I had not adapted. My carefully planned route was no longer optimal. I was wasting time. I started to drive through the main intersection, enjoying a shorter over-all trip.
Its a small example I know, but applied to business, it begs review of your processes. Are your processes still optimal? Has technology changed? Are you doing things because that is the way you have always been doing them? Are you stuck in the rut of working business processes? Perhaps its time for a review.
Public servants in Canada have a rough job. They are the experts that keep the machinery of government working. They provide continuity in a business that is full of bureaucracy. But on top of that, they have to acquiesce to their Minister, someone who is, regardless of the representative authority and quite necessarily, an amateur. After a few years on the job, the public servants start hoping for a change. Thank goodness for frequent elections and cabinet shuffles. But the honeymoon doesn’t last long before the servants start finding fault with their new master. Its not that they want a new one, they just want the current one to go away.
If you are in the public service, you either recognize this sentiment or you can ask around. I bet you can find a good percentage of the people in your office that agree with the phrase “I don’t work for the Minister.” The general feeling is that the Minister is a pain, constantly needing to be informed with briefings and memos, and all this effort gets in the way of the real work - the reason the servant is there. The sentiment is right up there with the musing of the past waitress who thought the restaurant would be a better place to work if there were no customers. The real work is keeping the ketchup jars filled.
For the public servants, the real job, the tough job, is recognizing that the minister represents the authority of the people. As impartial servants, they have a duty to inform and shape the views of the minister but, in the end, they must obey the Minister whether they agree or not. Fearless comments and loyal implementation.
My wife and I have a long standing joke. Early in our relationship, I made the unfortunate mistake of giving her some constructive criticism. I simply said, “You don’t take criticism well.” She bristled and replied “What do you mean? I take criticism great. Come on! Give me some criticism and I’ll show you how well I can take it.” After a pause we both burst out laughing.
Despite the irony, her defensive reaction was and is typical of how people react to criticism. Recognizing the benefits of constructive criticism is one thing. Reacting accordingly is something else. Being told that you are not doing something well enough can be difficult to take. Ego gets involved. A sense of ownership is involved. It becomes personal, quickly if not immediately. Controlling your reactions is important.
But so is the message. In any communication, there are two people. One is trying to get the message across and the other is receiving. Each has a 50% responsibility. The trick in giving criticism is to do it in a way and manner that it will be received and understood. If you can do that well, how the other person receives the message is their 50% of the problem.
It is also helpful to realize that communication is very complex and contains multiple messages. Every time you talk to another person you relate the following:
- * The factual content of the message;
- * Inferences conveying what you think about the listener;
- * Inferences conveying what you want the listener to think about you; and
- * Inferences conveying what you think about the state of your relationship with the listener.
Anytime you communicate you send these four messages with weights on various inferences. The listener processes the information in the same way but may weight the messages differently resulting in a completely different interpretation.
We all like to think that we are factual, but the reality is that we aren’t. We all use these four elements all the time. If we didn’t and only spoke in facts, sarcasm would be lost on us. So accept that these four messages are getting passed and use them to your advantage.
In the case of constructive criticism, you need to pass the message that, for example, your colleague’s work is low quality and needs to be improved, but do it in a way that does not send bad messages in the other three channels. Avoid the words “you” or “your” as they send the message that the criticism is directed at the colleague personally and not the work. Refer specifically to the low quality work and how it is low quality. Send specific messages (verbal and non-verbal) to backup the other channels that the criticism is not directed at the person, that you hold them in high esteem, and that you do and will continue to respect them and their work despite this. You also have to pass the message about what you want them to think about you in a constructive way. If you can do all this, you’ve done your 50% of the communication. It is then up to the other person to do theirs.
On the receiving end of the criticism, realize that one of the messages getting past is that the other person feels strongly about and values the issue enough to bring it up. The inherent message is that you are important to them and they are trying to help. Try not to get defensive but accept the message and act on it.
