Seth Godin has made the audio of his recent book Tribes available for FREE. Interesting marketing strategy given that the hardcover edition was published only two weeks ago on Oct. 16. Lots of content in the audio that is highly applicable to our business development model. IBOFightBack, over at The Truth About Amway, has the details here. Or you can go directly to the special promo at Audible.com and download directly.
For those developing an Amway Wellness-focused business – with Gensona and Nutrilite products, and Time Defiance (Artistry Skincare) – this easy-to-understand interview with Dr. Francis Collins on the Charlie Rose Show earlier today will delight you. The interview mentions “Personalized Medicine” at various points but much of the discussion is pertinent to Personalized Health as well.
OUR FOCUS in the Personalized Health business space is on our genetic predisposition for certain health risks — usually chronic and often related to the aging process – based on our personal genomes. Using exclusive, simple-to-use DNA tests and a confidential, online Personalized Health Questionnaire, we recommend behaviour changes (including exercise, diet, among others) and supplements, including exclusive nutrigenomic supplements to support a healthy lifestyle and “extend your years of wellness.”
In a nutshell, that’s our business and value proposition.
For more information on this point, read Section B-1 of the current Business Reference Guide (pdf downloadable for free from our site), and Personalized Health Program Guidelines, available on the Quixtar/Amway site. (Eventually, there should be similar guidelines posted under Best Practices at the IBOAI site and blog.)
Dr. Collins was the head of the Human Genome Project — completed in 2003 – and his lab discovered the genes responsible for Cystic Fibrosis and Huntingdon’s Disease in the 1980’s.
Collins recently resigned his position at the National Institutes of Health to pursue his interests in driving Personalized Medicine research and related writing projects. August 1, 2008 was his last day at NIH.
INTERESTINGLY, Collins recently published a fascinating book on the DNA code called, “The Language of God: A Scientist Presents Evidence for Belief.”
Over on our friend IBOFightBack’s site Amway Talk there was some discussion earlier today regarding Demo’s sharing of an announcement from Pete Strydom (Amway Europe) of the apparently unknown new Managing Director of Amway UK and ROI, Andy Smith. Blogger ‘cmfitzg’ went fishing on the ‘net and found an interesting interview with another(???) Andy Smith, a UK goal setting motivational speaker.
The interview is excellent and I have reproduced parts of it, edited down to fit this space. Most Amway IBOs — whether “System” subscribers or “independents” — who have carefully reflected on the Rich DeVos “Building the Business” clips (here and here), or listened to and absorbed the classic speeches by Jay Van Andel and Rich on the Quixtar/Amway site will find these points familiar, but I thought they were still worth a fresh read.
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I [interviewer Gavin Ingham] have interviewed my good friend Andy Smith of Coaching Leaders about the power of goals and goal setting across your whole life not just your sales and business goals.
Q How will people benefit when they set goals?
Andy Smith Going for goals has an effect on our happiness levels. We are biologically hard-wired to feel happier if we have some sense of control and choice over our lives, which is what setting goals and taking action gives us. We change from feeling like victims of life’s circumstances, or at best passive consumers, into someone who knows they can make a difference. We are also learning along the way - even the mistakes we make, though they aren’t enjoyable at the time, will bring us valuable wisdom if we choose to learn from them.
Q Why is it that most people don’t set goals?
Andy Smith It requires a conscious effort to step off the hamster wheel and take some time to think about what’s important to you and where you want to get to. The best advice I’ve ever been given was “plan the time to plan” - set aside some protected time so that you can think about the future. This is equally important whether you’re working for yourself or in employment.
Q Is the old story that written goals are better than non-written goals true?
Andy Smith There’s a famous story about the “Yale Study” in which researchers asked Yale’s graduating class of 1953 how many of them had specific goals for their future in writing. Twenty years later, the 3% who had written goals had more personal wealth than the other 97% combined!
It’s a compelling story, it’s quoted by Tony Robbins, Brian Tracy and Zig Ziglar, plus legions of other motivational speakers and it sounds as if it ought to be true - but, alas, it never happened. You’ll never see an academic reference for it, Yale have no record of it, and when ‘Fast Company’ magazine investigated the origin of the story, Robbins’ people directed them to Brian Tracy, Tracy said he heard it from Zig Ziglar, and Ziglar’s people suggested the source might be Robbins!
It’s still a good idea to write your goals down though - it’s the best way to get clear about them and keep them in the forefront of your attention.
Q What sorts of goals should people set?
Andy Smith I would urge people to think big and set long-term goals that excite them, without worrying at first about how they are going to get there. It really is a shame when people limit their lives by telling themselves that what they really want isn’t realistic. The only way to find out what’s realistic is to go for it.
You also need short-term goals to aim at, to give you something that’s achievable and to give your unconscious mind some behavioural reinforcement when you achieve them. Psychologists have found (Ken Sheldon and Tim Kasser if you want to look them up) that people are happier when they achieve “vertical coherence” in their goal-setting - that is, when your higher-level and short-term goals are aligned so that achieving the intermediate goal takes you closer to the big one.
Q How should people go about setting goals?
Andy Smith First, get yourself into a positive emotional state by reviewing what’s already working in your life, what you like doing, what you’ve achieved already and what you’re proud of. This will help you find your direction, get you thinking more strategically, and also help you to feel like you deserve success.
Then clarify your values - what’s important to you - in the area of your life in which you want to set goals.
Only then, when you’re feeling good and you know what’s important to you, should you start thinking about specific goals that will satisfy your values. Get clear about what you want, get a clear sensory image of what it will look, sound and feel like, and set a specific date for it in your future.
Q What are your top 3 tips for successful goal setting?
Andy Smith Okay, the first one would have to be focus on what you want, not what you want to get away from. If you don’t know what you want, how will you know if you’re on the right track, or recognise when you’ve got there? It may sound a bit “cosmic ordering” to say that your unconscious mind attracts what you focus on, but it’s only another expression of that principle widely recognised in business that you are going to move in the direction of whatever targets you set. “Towards” motivation gives you a direction, it gets even stronger when you get close to achieving your goal, and you feel good when you have it. “Away from” motivation, by contrast, is undirected, it runs out when you get far enough from the thing you want to avoid, and it’s stressful.
Next, form a sensory image of your goal - what will you see, hear and feel when you have it? This is vital for motivation. Most people are familiar with the idea that goals should be SMART - specific, measurable, attainable, realistic and timed - but you’ll notice there’s nothing in there about whether you care if you achieve them or not. Using your senses gives you that missing piece by providing something to engage your emotions.
Finally - put a date on your goal! Until you have put a date on your goal, it will keep getting pushed to the back of your queue of priorities. Even if you say “in a year’s time”, the goal will always remain a year ahead unless you turn that into a proper date.
Why? Your unconscious mind acts like a good and faithful servant, and it will do its best to give you whatever you ask it for. But it will always take the line of least resistance. If you don’t put a date on your goal, there will always be something more urgent to deal with. This is why important but non-urgent tasks tend to be neglected,
Q What pitfalls do people new to goal setting have to be careful of?
Andy Smith Three that I can think of straight away: firstly, not taking into account potentially unwanted knock-on effects of achieving the goal. If you don’t consider all the consequences of your goal - on your health, your family, your friendships, and the wider community - you may end up with something you don’t want. The smarter way to set goals is to take the consequences into account, allowing you to make changes to your goal and/or your route to achieving it. That way you stand a chance of getting the benefits of your goal while avoiding unwanted side effects.
Second, taking too much on and getting discouraged. It can be very easy to set a big, compelling goal – and then feel overwhelmed by the effort you think it will take to get there. The goal is so big, and so different from how things are now, that getting there by the deadline you have set will surely demand too much of you. And the more you think about the legwork it will take, the more discouraged you feel. The remedy is to break it down into smaller steps that feel more achievable, and recognise each step as an achievement. The key really is to get started - not necessarily to “take massive action”, but to take some action to get you going.
Finally - and this is the biggest pitfall of all - not knowing what you want. In the absence of some powerful external motivation, like getting yourself out of debt or meeting a deadline set by someone else, how do people motivate themselves to even think about what they want - as opposed to what they want to get away from? I’ve certainly had large periods of my life when I was more or less drifting. The way out of it is to think about what’s going well, what you are good at and what’s important to you - then it becomes easy to build a picture of where you want to go.
Q Is there anything else you would recommend people to do?
Andy Smith It’s one thing to read about goal-setting methods, but you really have to experience them in practice to get the best from them.
There’s a lot of interesting research on goals and motivation coming out of the Positive Psychology movement at the moment - you can keep up with it on my ‘Practical EQ’ blog. Why not get together with some of your friends and form an Achieve Your Goals group so you can support each other as you work through the exercises? Social support is a key component of goal achievement that makes it much easier for most of us - you don’t have to do it all by yourself! [hmmm… sounds suspiciously like a ’system’ to me!!!]
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SPEAKING OF AMWAY, the most intriguing insight above comes from the NLP research showing that it’s more powerful and effective to be positively motivated TOWARD something than negatively motivated AWAY from something.
For example, are you motivated primarily by a lower order (in the sense of Maslow’s hierarchy of needs) ”negative” you want to escape or avoid, such as an unplanned for or underfinanced retirement? Or (in addition to prudently considering your future needs) are you more motivated by a higher order dream and desire to accomplish something majorly positive, such as being your own boss, running your own business, changing the way people view and take care of their health (Amway Wellness), or their looks, self-image and ultimately their self-worth (Amway Beauty)?
Your thoughts?
“It just seems to me you aren’t going to be credible if all you talk about is your successes.” — JAMES CANALES, President and CEO of The James Irvine Foundation, one of California’s ten largest foundations
“A real leader learns ways to promote and reward truth-telling, demands honesty from his or her crew, and never punishes messengers with bad news.” — C. MICHAEL ABRASHOFF, former Commander of the “Best Damn Ship in the Navy, the U.S.S. Benfold,” and the author of three New York Times bestsellers on leadership, including It’s Your Ship
Amway is currently in the first year of a major business transformation. It goes almost without saying that all businessmen understand that turning a company like Amway North America around is no easy task and takes tremendous skill and expertise. Well, Steve Miller is affectionately nicknamed “U.S. Industry’s Mr. Fix It” by America’s business leaders for his unparalleled success in turning around failing companies. In 2002 the Wall Street Journal asked Miller if he would share with the Journal’s subscribers his thoughts on the most important aspects of turning a company around. That request resulted in an article in the WSJ by Miller that same year titled “Tips From A Turnaround Specialist.“ Allow me to note that Steve Miller is the former CEO of Delphi Corporation and the author of the recent book release The Turnaround Kid: What I Learned Rescuing America’s Most Troubled Companies. As Amway Global is in the midst of its transformation today, its turnaround if you will, I thought after reading Miller’s book that looking at Amway’s North American business transformation today in light of Miller’s seven tips might be a worthwhile online exercise. Below is a list of Miller’s seven tips with my comments added after each tip. I would be interested in hearing your comments about these seven tips as well.
TIPS FROM A TURNAROUND SPECIALIST by Steve Miller
1. Tell everyone the truth, especially if the truth hurts.
This is the one issue I find most disappointing about Amway’s public image. As James Canales says in the quote leading off this post, only bringing up the positive undermines your credibility. Publicly owning up to challenges adds credibility to the positive things a company says. A few weeks ago, Microsoft lost a court case. Within hours their media and PR folks (are you listening Amway/Alticor Media Blog?) released a statement saying “we still believe in our position and expect to appeal.” So, even when a current outcome isn’t positive Microsoft at least publicly acknowledges the current state of affairs. Every time Amway fails to acknowledge or comment on a recent negative court ruling or public event (as has been the case multiple times this year alone) it loses a little more credibility with me and others, and it will continue to lose credibility until its actions in this area become more transparent — or I and others no longer care about Amway enough to be concerned about its failure to be fully forthcoming. In my opinion, Amway’s failure to openly discuss negative news and outcomes shows weakness and frailty, not strength and resolve — and I believe the company is stronger and more resilient than that. It’s well past time to demonstrate it when it comes to truth telling.
2. Don’t study things to death. Most of the choices you need to make are clear, and decisiveness breeds confidence.
Would anyone say Amway has been clear and decisive over the last twenty-five years? While sometimes Tex can annoy people, one point that Tex makes is not refutable: Amway has had more than enough time to deal with several critical issues, some of which were clearly delineated by Rich DeVos over twenty-five years ago. The perception that Amway has failed to act decisively on those issues in the past has bred a lack of confidence in the company among many IBOs, and a general lack of credibility in the public at large. Regardless of what Amway is doing today, it is accountable for failing to act in the past.
Please understand, I am not saying that Amway is not dealing with these issues in several meaningful ways today, but it is important for Amway corporate to remember how long some of these issues have been on the table. It’s definitely time for Amway corporate to be very clear and very concise about where the company is headed. I do get a sense that some real changes are being implemented and that the corporation is taking serious steps to turn things around, but clarity and ongoing communication about those changes and steps are critical. The new national ad campaign is a meaningful step in the right direction on a public level, but there is much more that can be done on the IBO level. The North America Spotlight Tour is an important step in that direction, clearly demonstrating the change and innovation coming from the company today. This weekend the Tour stopped in Chicago, and bloggers Big Apple and Bridgett were both in attendance [as were AJ Gannon and bernsber!]. I’m looking forward to hearing from them online when they get home. The recently announced sponsorship of the Tina Turner Tour by Amway Global is another terrific step in the right direction. There is much positive to talk about in this area.
3. Listen to your customers. They know more about what’s wrong with your company, and what’s right, than anyone.
Who are Amway’s real customers? Based on recently revealed data from court cases I think we would have to say it’s Amway’s IBOs. Retail sales of only 3.5% of total volume can hardly be considered much in the way of true customer retail volume. So the question morphs into which so-called “customers” is Amway listening to? Better yet, which of its “customers” should Amway be listening to? It’s IBOs? It’s retail customers? Both? Neither, but “focus groups” instead? Often it appears Amway’s so-called “focus groups’ are made up primarily of IBOs. Think that one out, doing product marketing research with a captive clientele like starry-eyed new Platinums. What we need instead is marketing research done with our target audience, potential customers with whom we have no leverage.
Just who is Amway doing its market research with? I’d really like to know the answer to that question so I would have a better feel for the direction Amway is taking. For what it’s worth, I believe if Amway wants to know what is wrong with these aspects of its business perhaps it should listen to some of the people who have refused to buy our products or decided not to join our business. Ask them why, and then take their answers seriously. The bottom line is that products purchased by IBOs are important to our success, but products that retail customers are willing to buy because they find them compelling and attractively priced are even more important to our long-term success. We do not need or want discounted, low quality products. Discounted products often say the wrong things about a company and its products. (If you don’t believe that take a read of Chapter 10 “The Power of Price: Why a 50-Cent Aspirin Can Do What a Penny Aspirin Can’t” in Dan Ariely’s book Predictably Irrational.) At the same time, over-engineered (so-to-speak) products, expensively priced for our general clientele, also create serious credibility issues for us (think Tolsom Shaving Gel). Neither discounted products nor high end, expensively priced products are the right approach. Beyond that, developing products with the IBO in mind as the primary customer is borderline deceitful in regards to the marketing plan. Hopefully we have learned something from the past on this issue and are not going to travel further down this road.
As an aside, IBOs are customers of Amway in a different and rather unique way: We are asked to promote the business to other potential business owners. So in a very real sense we are “business” customers of Amway. We have to “buy” into the Amway business, and then effectively “promote” it to others. We have to believe it has real value, not only to us, but to others as well, if we are going to build profitable IBO business networks that move products to end users. How do you feel about the value of an Amway business in the marketplace today? Personally I’d say an individual Amway business is more valuable today than it was a few years ago, and it also has greater potential than ever. I’d also add however that it has some serious issues it needs to overcome if our company and our business opportunity are going to recapture their places as the industry leaders in North America.
4. Listen to your people. Consult everyone, from the boiler room at the plant to the executive suite so you become fully informed. Invite everyone to send e-mails, and answer them! (emphasis Miller’s)
My personal experience tells me that Amway does this decently on every level but one. The Opportunity Zone corporate sponsored blogs have been a terrific new approach and have demonstrated Amway’s willingness to listen to everyone and anyone with virtually no censorship. They are moderated by talented and interesting people like Robin Luymes and Beth Dornan, and have convinced me the company is open to hearing from us. However, what these corporate blogs have not done is convince me of Amway’s willingness to allow some of its employees to discuss the truly tough issues. It appears that when the topics get tough, Amway goes mute, and mutes its staff as well. On some level, this needs to change.
Another area where Amway falls down in my own limited experience is in responding to inquiries for clarification, particularly if the topic raised or the question asked has a negative connotation. This kind of goes back to Tip #1, Amway’s apparent unwillingness to speak openly about negative issues. A few weeks ago I sent an e-mail to Amway’s Rules Department requesting feedback on a specific issue, and was promised by e-mail reply that I would receive a prompt answer. Since then I’ve heard nothing, and it’s been over a month. There is tremendous room for improvement in this area. As Miller admonishes, “Answer them!”
5. Do a wardrobe check. If people gladly wear caps and shirts with the company logo, morale is good. If no one wants to be identified as your employee when they go to the mall, you’re in trouble.
This tip is true of IBOs in the field as well, and needs to be directed at both corporate and IBO leaders. I would say to Steve and Doug and the new Alticor and Amway corporate staff, if you don’t see any of your IBO leaders wanting to be identified publicly as your business owners, you’re in trouble. You tell me, have you seen any Quixtar or Nutrilite logos on the baseball hats of any Diamonds on the recreation fields of North America lately? Or on any of the apparel of your corporate staff on a Saturday afternoon? Have you seen any Nutrilite logo clothing on any Diamonds outside of an Amway sponsored function? Have you seen any XS Energy logo decals on any Diamond vehicles lately? (I have one on mine.) By the way, those XS Energy marketing folks really get it. They know how to promote their product and their brand. We should do half as well as they do.
Yes, I know, IBO leaders lead with the business (”Which business?” I might ask, but I digress), that’s why they don’t wear a hat or a polo shirt with Nutrilite’s or Quixtar’s logo on it, and why they don’t have an XS decal on their car. It’s the curiosity approach, stupid. Yeah, I get it, that’s the reason.
Sure it is.
Can you imagine a Nike executive having any problem wearing apparel with the company logo on it? Any Google exec having a problem with wearing her company’s logo on a sweater? A Celtic fan? A Harvard student? Been to a professional golf or tennis tournament lately? Seen any corporate logos around? Heck, as much as it annoys me, I’ve seen dozens of vehicles around Atlanta with large MonaVie logos and contact info on their back window. Do we want Amway to have a reputation that we can be proud of? Let’s start by putting ourselves on the line and have everyone go public about their affiliation with the business — and that means corporate staff and IBOs. Then we’d be forced to truly live up to the reputation we want the company to have.
I recently made a commitment to wear warm-up jackets, shirts, baseball hats, or something else with the Nutrilite logo on it whenever possible when I give tennis lessons to my students (I am a tennis pro), so I am going to purchase some clothing with company logos on it for myself. I have also made a commitment to tell anyone who asks me what I do for a living (and also those who don’t ask) that I am a tennis pro who is also building an Amway business, chips fall where they may. And I know that by doing so over time I will learn how to handle their follow-up questions appropriately, effectively, and winsomely. I’m not interested in any more “spinmeister” answers to simple questions from prospects and friends, answers that avoid providing transparent, honest, and relevant information. So far my commitment to candor hasn’t created a single problem for me. I am convinced one of the best ways to deal with the negative on the internet is to demonstrate the positive aspects of the business publicly on a personal level. If we can’t do that, then we really do have a problem. As I wrote earlier in this post, the recent national ad campaign by Amway is a great step in the right direction, but it’s time for all IBOs to come out into the open and put themselves on the line too. Right now Amway is investing huge financial and human resources trying to tell North America the real story of Amway. An important aspect of making that investment worthwhile to Amway is having IBOs become publicly visible as representatives of the business. Thus, when people are looking for Amway, they’ll know where they can find it and they’ll have a better feel for the quality of the people in the business. Clearly revealing our affiliation with Amway is one way to do just that.
6. Practice calm realism. The key here is to stay balanced. Truth telling can be scary, but if you let people know there are solutions for most problems, they’ll be less discouraged.
This goes back a little to my comments in point 1. Truth telling is scary, but it’s better than hiding the truth, and all of us know that from experience. In May, in a move unprecendented at a U.S. corporation, the top performing insurance giant, Aflac, decided on its own to give its shareholders the right to weigh in on the issue of executive compensation. Brian Cadman, an associate professor at Northwestern University’s Kellogg School of Management said, “This is going to be a peer-pressure issue and it’s going to be the better-run firms that are going to start down this path. Down the road, it’s going to be the type of thing to help Aflac signal that they are doing the right thing by their shareholder.” Interestingly, Aflac is taking this step while they are not suffering from any public relations nightmares that might have required a face-saving response. Aflac Chairman and CEO Daniel Amos at first said, “I was nervous [about the say-on-pay proposal]. I didn’t know what we were getting into.” But the company decided to that it had to allow the shareholder vote on executive compensation to live up to its “corporate philosophy of openness.”
We’re beginning to see a return to respect for the truth from a number of large organizations. After the Carnegie Foundation’s ill-starred efforts to help Zimbabwe overhaul its constitution and its government, for example, the foundation published a report that began, “This is the anatomy of a grant that failed.” In addition, the Army has begun a critical self-assessmentof the miscues in Iraq to make sure they will never be repeated. No company or institution can afford anymore to deceive itself about the truth about itself. And that includes Amway.
As D. Michael Abrashoff wrote in his new book, It’s Our Ship: The No-Nonsense Guide to Leadership,
“It is plainly suicidal today for any high stakes leader to reject bad news as is it were a live hand grenade and treat its messenger like a traitor…leaders in place or in training have an overwhelming incentive to encourage truth-telling by themselves and everyone who reports to them. Sure, honesty can be dangerous, but, in the long run, dishonesty always loses.”
7. You don’t need all new players to make a team into a winner. Even at companies in crisis you’ll find lots of people who know their job and do it well. Try to hold on to them.
I admit, this point falls outside my knowledge of Amway and Quixtar. I don’t know the corporate staff at Amway all that well. I’m sure several of you know them far better than I do and can comment on this point more intelligently than I can. I do know that the people I have worked with at the company regarding specific needs I’ve had in the business (outside of the previously mentioned ones) have been terrific. Everything I’ve read and heard about the new corporate leadership brought in by Alticor and Amway over the past year has been nothing less than stellar. I would say this bodes well for the company’s future on all counts.
Obviously, after looking down this list, it appears Amway is doing very well on several of Miller’s tips. It’s heartening to know that the company could easily rise to the occasion on a couple of the other points having to do with transparency and complete truth-telling. All it would take is a total commitment to the three dynamics Steve Lieberman recently stated that Amway Global was committed to: honesty, openness, and transparency. I hope Amway’s leaders will jump in with both feet and deliver on that promise no matter how scary it might be. I’m convinced doing so will pay off handsomely in the coming years.
Steve Miller obviously understands company turnaround dynamics far better than I do, so I take him at his word and his expertise that these are seven of the most important tips for turning around a company. It seems to me to be a reasonable list and one worth contemplating in relation to Amway. But, without wanting to be arrogant I would add an eighth tip to his list. Here it is:
8. If, at any time, you are not sure what to do next, refer back to Tip #1. Telling the truth is always the best place to start.
Speaking of Amway, particularly in regards to Miller’s seven points, what are YOUR thoughts on what Amway and IBOs could do collaboratively to truly transform our business positively over the next few years?
Do you believe you are for the most part a “rational” IBO? Or, would honesty require you (and me) to admit that we might be a little irrational at times, perhaps even highly irrational sometimes. What if there was some aspect of our approach to the business that might be more irrational than rational at times, would you know how to be aware of it? Better yet, if we could predict the area of the business we might be most irrational about, and we were aware of the cause of that irrationality, how might we use that knowledge to help us in our approach to the business?
For years I’ve been fascinated by studies into human behavior; why we do what we do and whether we even know why we do what we do. Now, Dan Ariely, the Alfred P. Sloan Professor of Behavioral Economics at MIT, where he holds joint appointment between MIT’s Media Laboratory and and the Sloan School of Management, has examined another side of human behavior, namely, how “predictably irrational” we are in many areas of life, particularly in areas where money is involved. Ariely’s 2008 release, Predictably Irrational: The Hidden Forces That Shape Our Decisions, which became an instant New York Times bestseller, is a compilation of numerous fun and clever experiments in human behavior, many of which have direct implications for IBOs. Thankfully, Ariely’s book is a very easy read and quite engaging as well. While the book is not so much a scientific tour de force as it is a personally challenging work, it is nonetheless, very interesting. If you enjoyed Freakonomics, you’ll find this book an equally good read.
Ariely’s book has received strong reviews. Here are a couple of samples:
“This is going to be the most talked about book in years. It is so full of dazzling insights–and so engaging–that once I started reading, I couldn’t put it down.” — DANIEL McFADDEN, 2000 Nobel Laureate in Economics, University of Callifornia at Berkeley, Morris Cox Professor of Economics
“A marvelous book that is both thought-provoking and highly entertainly…Ariely unmasks the subtle but powerful tricks that our minds play on us, and shows how we can prevent being fooled.” — JEROME GROOPMAN, Harvard Medical School, Recanti Chair of Medicine
In one of the early chapters, “The Fallacy of Supply and Demand: Why the Price of Pearls–and Everything Else–Is Up in the Air,” a chapter with fascinating discussions on “imprinting,” “price anchors,” and “arbitrary coherence,”Ariely notes:
“With everything you do, in fact, you should train yourself to question your repeated behaviors…We should also pay particular attention to the first decision we make in what is going to be a long stream of decisions. When we face such a decision, it might seem to us that this is just one decision, without large consequences; but in fact the power of the first decision can have such a long-lasting effect that it will percolate into our future decisions for years to come. Given this effect, the first decision is critical, and we should give it an appropriate amount of attention.”
“Socrates said the unexamined life is not worth living. Perhaps it’s time to inventory the imprints and anchors in our own life. Even if they once were completely reasonable, are they still reasonable? Once the old choices are reconsidered, we can open ourselves to new decisions– and the new opportunities of a new day. That seems to make sense.”
After you read Ariely’s discussion on how the pricing of black pearls came about it you might think it a worthwhile exercise to ponder the pricing on your tool system’s “Professional Starter Pack” for $250 (but hey, it’s a $750 value!). Or why the Tolsom Shave Gel is $12.45, even if it does have 19 worthwhile ingredients not found in Nivea’s product. Heck, the first question a rational person might ask is “Is there a sizeable retail market for a $12.45 shaving gel with forty more ingredients than Nivea?” I’d be interested in seeing Quixtar’s figures on the retail sales of Tolsom Shave Gel to non-IBO retail customers (assuming there have been any sales to non-IBO customers). I’m sure that would be an eye opener. You see, despite statements to the contrary, the real issue isn’t whether our products have ”a story to tell,” it’s whether they have a compelling story to tell. If Amway is going to come out with a product like Tolsom Shave Gel it would behoove the company to clearly demonstrate it can reasonably justify to a retail customer (the final arbiter of price) the premium price of its product, otherwise what’s the point in bringing the product to market?
Dan Ariely looks at a number of intriguing issues in his book — and one or two that are not so intriguing. As my kids used to say when a topic was being discussed they found a little offensive or outside their social norms, “Too much information!” And I can say with confidence that I agree with them when it comes to Chapter 5 in Ariely’s book, “The Influence of Arousal: Why Hot Is Much Hotter Than We Realize.” Like I said, too much information. Read the chapter and find out for yourself if you wish. 
Chapters 11 and 12 touch on areas that should be of interest to all IBOs. They are titled “The Context of Our Character, Part 1: Why We Are Dishonest, and What We Can Do About It” and “The Context of Our Character, Part 2; Why Dealing With Cash Makes Us More Honest.” Near the end of Chapter 11 Ariely writes:
“What can we do to keep our country honest?…first recognize that when we get into situations where personal financial benefit stands in opposition to our moral standards, we are able to “bend” reality, see the world in terms compatible with our selfish interest, and become dishonest. What is the answer then? If we recognize this weakness, we can try to avoid such situations from the outset.. We can prohibit physicians from ordering tests that would benefit them financially; we can prohibit accountants and auditors from functioning as consultants to the same companies; we can bar members of Congress from setting their own salaries, and so on.”
There is much in the book that should strongly challenge every IBO to consider how rationally he or she approaches her business. In Chapter 12 Ariely adds:
“We can hope to surround ourselves with good, moral, people, but we have to be realistic. Even good people are not immune to being partially blinded by their own minds. This blindness allows them to take actions that bypass their own moral standards on the road to financial rewards. In essence, motivation can play tricks on us whether or not we are good, moral people. As the author and journalist Upton Sinclair once noted, ‘It is difficult to get a man to understand something when his salary depends upon his not understanding it.’“
At the end of Ariely’s book he writes,
“We are all pawns in a game whose forces we largely fail to comprehend. We usually think of ourselves as sitting in the driver’s seat, with ultimate control over the decisions we make and the direction our life takes; but alas, this perception has more to do with our desires–with how we want to view ourselves–than with reality…By the time we comprehend and digest information, it is not necessarily a true reflection of reality. Instead it is our representation of reality, and this is the input we base our decisions on.”
I have a strong suspicion that if more IBOs read books like this one, it would be far more difficult for IBO leaders to lead their IBOs down roads and in directions that are not in the downline IBOs’ best interests, nor in the best interests of Amway Global/Quixtar. And on that basis alone it is worth reading, for what this business needs more than anything today is thinking, nuanced IBOs who will not allow themselves to be taken down non-productive, non-profitable paths, regardless of who might be promoting that path; or taken in by leaders who primarily have their own interests at heart.
Consider two final recommendations:
“Predictably Irrational is wildly original. It shows why–much more often than we usually care to admit– humans make foolish, and sometimes disastrous, mistakes. Ariely not only gives us a great read; he also makes us much wiser.” – GEORGE AKERLOF, 2001 Nobel Laureate in Economics, University of California at Berkeley, Koshland Professor of Economics
“Dan Ariely is a genius at understanding human behavior: no ecomomist does a better job of uncovering and explaining the hidden reasons for the weird ways we act, in the marketplace and out. Predictably Irrational will reshape the way you see the world, and yourself, for good.” — JAMES SUROWIECKI, author of “The Wisdom of Crowds”
Stop in at your local bookstore, grab a cup of coffee, and read a few pages of Dan Ariely’s book. Or go online and take a look. Who knows, you might find the material as interesting as I did and decide buy it and read all of it. Then take some of what you’ve learned and challenge yourself. Consider how you have approached your business and whether you have been asking the right questions — or just assuming your leaders have your best interests at heart. Heck, perhaps the discussions on this blog and others like it will improve and become more rational as a result as well. Lord knows, that wouldn’t be all bad.
Speaking of Amway, how ”predictably irrational” or “rational” do you think IBOs are?
According to Interleukin Genetics CEO Lew Bender on ILI’s most recent (Q1) conference call ( http://www.ilgenetics.com/ ) and an outside analyst’s report by Dutton & Associates ( http://www.centredaily.com/business/technology/story/668990.html ), we can expect a relaunch of the Gensona and Personalized Health line by Alticor sometime in Q3 (sometime in the period of July 1 to Sept. 30).
Interestingly, the domain name AmwayWellness.com was registered by an Alticor-contracted consultant (to the best of my knowledge) as of this past Feb. 29, 2008.
And the new weight loss support market research site from Alticor, sponsored by Nutrilite, http://community.mybestsize.com/ comes with pointers to a number of interesting features, including ‘personalized health’-related gurus, and suggests a ramp-up to something exciting coming later this year.
So for those interested in building their product knowledge and expertise in nutrigenomics and optimal health, and developing a health-focused Amway-driven business, here are a few relevent resources to check out.
MP3 “Nutrigenomics, Inflammation and Obesity: A New Paradigm for Personalized Prevention” by Ruth DeBusk, RD, PhD and Colleen Fogarty Draper, MS, RD. MP3 download is $17, CD is $20 plus tax, shipping. Easy to understand for the novice. Ruth DeBusk is on the Nutrilite Science Advisory Board, and Colleen Fogarty Draper, after 6 years with Interleukin Genetics, has recently formed her own consulting/educational company in the area of nutrigenomics. At the link below, see #256 and Product Number 200730131 http://www.intelliquestmedia.com/store/search.php?a=E&c=200730
Courtesy of Colleen Fogarty Draper’s website, the following three downloadable articles provide excellent background reading.
PDF “Nutritional Genomics in Practice: Where Do We Begin?” http://www.nugenso.com/articles/DeBusk_2005.pdf
PDF “Emerging Concepts in Nutrigenomics: A Preview of What Is to Come” http://www.nugenso.com/articles/Kauwell_2005.pdf
PDF “The Genome Health Clinic and Genome Health Nutrigenomic Concepts” (this article by an Australian researcher is more technical, but will be of interest to IBOs with a health sciences background) http://www.nugenso.com/articles/Fenech_2005.pdf
BOOK “Secrets of Supplements: the Good, the Bad, the Totally Terrific” by Gloria Askew, RN and Jerre Paquette, PhD. ISBN: 978-0-9784290-0-3. Gloria is a long-time IBO and has co-authored a very readable, easy to understand book with the beginner in mind. Nowhere does she actually mention the name ‘Nutrilite’ so you can use this book to develop new customers for your Nutrilite product line. The most valuable part of the book is the list of “Ten Totally Terrific Questions” which will guide your prospective client to see that only Nutrilite meets all the key requirements. This book is worth its weight in gold to the Health Business Builder, and for what it’s worth, is being distributed by at least one System (Network 21) in North America and internationally as a key product education resource.
Free sample chapter and Table of Contents, and online ordering at: http://www.phytemedia.com/ In Canada, Secrets of Suppements can be picked up in store or online at Chapters.
And now for the naughty question… or perhaps more accurately, a knotty question:
In your Quixtar/Amway business, what are you really selling? Are you first and foremost selling a business opportunity, or are you driving a product-based business which has the option of also being duplicated, for those interested in doing so? It’s an important question, and may differentiate between those who are “products of a System” and those who may be operating as non-affiliated “independent” IBOs (if you’ll pardon the redundancy in that).
If the question is unclear, say so and I’ll try to rephrase.
My guess is that if your business is primarily selling a business opportunity, the above resources recommendations were of relatively low relevance to you. If you are focusing on a product-driven business with a strong focus on developing long term clients – and still including networking and duplication — you will make the effort to download and read the documents above, and invest in the Ruth DeBusk MP3 and Gloria Askew’s excellent book on supplements.
SPEAKING OF AMWAY, these are just my thoughts — am I right or wrong?
“The worth and value of knowledge is in proportion to the worth and value of its object.” – SAMUEL T. COLERIDGE
Don’t we all enjoy the expectant smiles on the faces of newlyweds on their wedding day? In fact, I would say there are few newlywed couples that don’t have special dreams for their marriages on that special day. Both the bride and the groom envision a happy home, smiling children, fun times, and growing old with their mates. Sadly, sometimes their dreams are later shattered by the infidelity or dishonesty of a partner — or even both partners. The result? The trust they once had in each other is undermined and the relationship becomes broken. Some couples are able to recover and to recapture their marriage dreams and rebuild their relationship – perhaps even stronger than before the infidelity. But others are not. For some, the personal hurt and the harm to the relationship was too great and too painful for one or both of the spouses to overcome.
In “rdknyvr’s” June 7th post he asked the question “How do you recapture your dream?”. I was surprised to find that all of the posted comments discussed only one side of the issue, the internal mindset of the IBO. Many seemed to believe that an IBO’s loss of his dream was indicative of a weakness in that IBO’s mind, heart, or will; and all he needed to do was read another book or listen to a CD or two to begin to get back on track. While I agree the IBO’s mindset is an issue, it is only half of the story — and maybe not even the most important half. I am convinced there is an undiscussed aspect of this “lost dream” issue that is equally, if not more, important: the worthiness of the object of your dream, the worthiness of the object of your trust.
As I said, some couples aren’t able to recapture their dream and restore their marriage. One spouse simply no longer believes in the long-term trustworthiness of their mate. On the other hand, those married couples who are able to recapture their dreams do so as a result of both spouses exhibiting daily trustworthiness toward each other over a period of time. And that is the key factor: daily trustworthiness toward each other over a period of time. It doesn’t happen in a week or a month. It often takes months and years. Day after day the husband must demonstrate that he loves and cherishes his wife. Day after day the wife must demonstrate that she respects and loves her husband. Both spouses must demonstrate through their daily behavior that they are worthy of their mate’s trust if the dreams they initially had for their marriage are going to be recaptured and rekindled. Ultimately, if a spouse really believes his or her mate can truly be trusted in the relationship, that spouse can begin recapturing again the dream he or she once held for their marriage, and begin to move forward with confidence.
The same is true in this business.
To be candid, one of my own struggles with the Amway business has been this issue of broken trust. Before I go further, let me state for the record this is just my opinion. Your experience and opinion might be different. Regardless, I believe some, if not all, of the IBO training systems have violated on some level the trust they were given by rank-and-file IBOs. I’m not sure of all of the reasons, but without wanting to impugn anyone’s motives, greed and control immediately come to mind. Let me be clear here. I do not think all tool systems are equally culpable, but I do believe all systems are somewhat culpable. The lack of transparency and full disclosure about tool system issues has been pathetic, unconscionable, and inexcusable. Often training materials, CDs, and books endorsed and promoted by tool systems have been little more than Yugo quality drivel, but at a BMW price. For example, you could easily find two dozen far better business and personal motivation books in ten minutes on BarnesandNoble.com for less money than you pay your tool systems for some of the mediocre books they promote — and earn PV/BV to boot.
At the same time Amway has also violated the trust it has been given by rank-and-file IBOs to provide quality products at a reasonable price and to guard the integrity of the business. It has allowed tool systems to operate virtually unrestrained for years. Most, but not all, of the substantial lawsuits the company has been drawn into over the past three decades originated with a tool system issue, as IBO leaders battled each other over tool system income payouts and other issues, and the company was drawn into their battles. In addition, Amway had little incentive to improve its products or pricing because the lack of profitability from product movement was hidden behind the substantial incomes IBO leaders earned from the tool systems. Tool system income and the personal use business model insulated the company from the business realities of many of its non-competitively priced products. Thus company products were often Acura quality, but at a Ferrari price.
One-sided arbitration processes, broad in scope non-compete clauses, heavyhanded enforcement approaches, and an unwillingness to candidly discuss negative business issues, have also worked to undermine trust and respect. Some have even backfired against the business. This lack of transparency and honesty about product and company issues and the business model itself has been nothing less than a huge disappointment to me.
Yet, even through all of that, I, like many of you, want to trust the company. I truly want the company to be a business vehicle worthy of my trust and worthy of the investment of my time and effort. There was a time when this business had a strong moral imperative, when integrity was a non-negotiable, when trust had been earned over many years, and that earned trust was valued and protected. Somewhere, at some point in time, at least in the North American market, it appears everyone lost their way.
Thankfully, the UK situation and other recent legal issues were a real wakeup call and got the attention of everyone.
Pastor Timothy Keller of Manhattan, New York, uses an example to make an interesting point in his book The Reason For God. He says,
“Imagine you are on a high cliff and you lose your footing and begin to fall. Just beside you as you fall is a branch sticking out of the very edge of the cliff. It is your only hope and it is more than strong enough to support your weight. How can it save you? If your mind is filled with intellectual certainty that the branch can support you, but you don’t actually reach out and grab it, you are lost. If your mind is instead filled with doubts and uncertainty that the branch can hold you, but you reach out and grab it anyway, you will be saved. Why? It is not the strength of your faith but the object of your faith that actually saves you. Strong faith in a weak branch is fatally inferior to weak faith in a strong branch.” (bold italics mine)
To take the point a step further, one of the key issues in having worthwhile dreams is finding a strong branch, an object (read “a business vehicle”) worthy of your faith, dreams, and efforts. At the present time I am not convinced Amway is the strong branch I believe it needs to be. I believe it can be, but I do not believe it is that branch today. Over the past decade I am sure there have been thousands of ABOs in the UK who trusted Amway to be their strong branch and the vehicle to achieve their dreams. Have they been rewarded for their trust? Have they been rewarded for centering their dreams on their Amway businesses? Are the issues rank-and-file ABOs have in the UK today due to their lack of belief or their lack of a dream? Or are they due more to the lack of daily faithfulness by Amway and some tool system leaders to the trust they were given by ABOs? I think a quick read of the judge’s final ruling in the DBERR v. Amway UK case provides a clear answer.
So to recapture our dreams it isn’t enough for an IBO to take his mind, heart, and will in hand. It’s equally important for the company and IBO tool system leaders to take themselves in hand, to act on a daily basis in a manner commensurate with the trust they have been given.
Let me ask you, which of these options might you prefer? A business with a mediocre product line but a great business model; or a business with a great product line but a mediocre business model? My answer? Neither. Neither business would be a worthwhile object of my trust or faith, nor worthy of my dreams or efforts. Rooting my dreams and investing my effort in either business approach would be incredibly foolish in my opinion.
I’m looking for a business with great product line and a great business model — one worthy of my trust and an investment of my time and energy. Product line is not enough on its own. Business model is not enough on its own (and, for the sake of discussion, I am including tool systems when I say “business model”). It takes both quality products and a solid, integrity based business model.
A business with respect for all IBOs all the time. A business that views transparency, honesty, and openness as part and parcel of the very fabric of its business. A business that, to borrow a biblical phrase, “swears to its own hurt.” A business with a vast Ellis Island and a small Berlin Wall (and you know what I mean by that). A business that becomes so competent at doing what it has set out to do it doesn’t matter what its competition is doing. A business with a few less legal eagles and a few more Jon M. Huntsmans. [Read Huntsman’s book “Winners Never Cheat: Everyday Values We Learned As Children (But May Have Forgotten)” and you’ll understand what I saying.] A business with less hype and spin, and more truth and candor. A business with an unfettered commitment by everyone at the company and in the field to real transformation, rather than a business that sometimes acts like a bipolar teenager giving it lip service.
That would be a good place to start in rebuilding trust with me. How about you?
When I begin to really see that kind of a business day after day, not just when it suits the company or IBO leadership – a business truly worthy of my trust and efforts — that’s when I will start believing far more deeply in the company and its potential to again be the vehicle to help me achieve my personal and business goals.
And that’s when I will begin recapturing my dreams in the business again.
“A brand name is more than a word. It is the beginning of a conversation.” – LEXICON
“Brand equity is the sum of all the hearts and minds of every single person that comes into contact with your company.” – CHRISTOPHER BETZTER
“A brand that captures your mind gains behavior. A brand that captures your heart gains commitment.” – SCOTT TALGO, Brand Strategist
Quixtar and Amway Global are in the midst of a complete Business Transformation. A focal point of that transformation is the move from the “Quixtar” brand name back to the Amway brand name as “Amway Global” (but don’t be surprised if it moves further to simply “Amway”). I personally am pleased with the change, believing it to be in the best interests of the company and all IBOs long-term.
Harry Beckwith is one of my favorite authors and marketing advisors. A Phi Beta Kappa graduate of Stanford University, his book Selling the Invisible has been named one of the Ten Best business books of all time, with sales of over 675,000 copies in 14 languages. He is also the author of The Invisible Touch, You, Inc., and What Clients Love. In addition, Beckwith is a highly regarded speaker at national conventions of Fortune 200 companies as well as a regular contributor to CNN, the Wall Streeet Journal, Business Week, Entrepreneur and other periodicals. He also advises and consults with some of the world’s most respected companies, both in the US and internationally, including Disney, 3M, Wells Fargo, Hewlett-Packard, Target, and DuPont. Harry and his wife, Christine, are partners in their firm, Beckwith Partners (http://www.beckwithpartners.com/).
I subscribe to Beckwith’s email newsletter “Invisible Ink: Thoughts on marketing from Harry Beckwith” and found one of the short columns in his May 20th newsletter to be of particular interest. Harry devoted a few minutes to discussing how well Apple is managing its brand in the marketplace. I thought you might find his column of interest as well. By the way, you can subscribe to Beckwith’s free email newsletter at http://www.harrybeckwith.com.
LESSONS FROM FLYING APPLES
Item: April 23, 2008. Defying the economic tides, Apple today announced a $1.05 billion profit for the second quarter and a 45% increase in revenue over the same quarter a year ago, fueled partly by a 51% increase in unit sales of Macintosh computers.
We live in a world where technological improvements can be mimicked by a competitor in weeks, not the years it once required. In services, the final competitors for an account appear so similar on the surface that a prospect must dig beneath that to make a decision.
How do people choose?
They chose the brand, as Apple is demonstrating vividly.
You know “Apple” the minute you encounter it: its groundbreaking stores, its ads, its point of purchase, its packaging, its website. You hear iPhone, iMac, iTunes. You know them not just on sight, but even before, in your mind’s eye. You can picture them: simple, engaging, clean and wonderful to look at, easy to read - and use. Indeed, that expectation becomes a prophecy; an i-anything becomes what you believe it will be.
You sometimes know you are experiencing “Microsoft,” if they make their logo so large you can reach no other conclusion. But what would a Microsoft store look like? A Microsoft version of the iPod? A Microsoft phone?
Why are the these questions so hard to answer, when the same questions about Apple are so easy? Because Apple understands brand identity. Apple knows that, as the word suggests, an identity is something identifiable, and also identical every time; otherwise, it would not be an identity at all, but a collection of different masks, obscuring the company behind them.
There are colors that belong to Apple - and thousands that do not. Surfaces that belong to Apple (brushed silver) and dozens that do not. Sentiments that belong to Apple (”insanely great”) and those that do not (”a commitment to excellence”).
You even know what to expect from Apple’s instructions. They will appear to have been written by Hemingway: not one word more than necessary, just one true and painstakingly edited sentence after another.
Apple is managing its brand brilliantly. Every element sings in unison, a song without a weak note. The brands you trust most do that. They are predictably good at least and great at best, and their utter consistency reassures you:
I want what they have.
And in growing numbers, people want what Apple has. Out in the economic gloom you can see Macintoshes and iPhones flying, and Apple’s obsessive management of its brand deserves significant credit.
I think Amway and all IBOs would agree that we want the Amway brand to be just as identifiable in a consistent and positive way as Apple is in the public at large. But how could we help bring that about? How cold we manage the Amway brand better?
What are YOUR thoughts on how Alticor/Quixtar/Amway and IBOs worldwide could manage the Amway brand name better?
“Capital isn’t so important in business. Experience isn’t so important. You can get both these things. What is important is ideas. If you have ideas, you have the main asset you need, and there isn’t any limit to what you can do with your business and your life.” — HARVEY FIRESTONE
“It isn’t the incompetent who destroy an organization. The incompetent never get in a position to destroy it. It is those who achieved something and want to rest upon their achievements who are forever clogging things up.” — F. M. YOUNG
Just a quick post to provide an update of sorts on a few topics:
1. My friend’s 15 year old son, Michael “Anthony” Keogh, who was diagnosed with acute myeloid leukemia last Thursday, started chemo (as part of a clinical trial) on Friday. Tests yesterday showed there were no leukemia cells in his blood anymore, the chemo had killed all of them. However, the leukemia cells in his bone marrow must still be dealt with. Anthony appears to be holding up fairly well to the chemo. His twelve and thirteen year old brothers were tested on Monday to see if they were potential bone marrow donors in case a bone marrow transplant is needed. Thankfully, according to his doctor’s update yesterday, things are going as well as they possibly could thus far, so that is very encouraging. It appears this very serious and rare disease in young adults was caught early and that is giving everyone hope this terrific high school sophomore will beat this. I know you don’t know Anthony, but if you would like to know more about him and his ongoing situation you can keep up on things here: http://www.caringbridge.org/visit/anthonykeogh
Please pray for Anthony.
2. I think some of you misunderstood my April 28th post “Is It Time For All Bloggers To Get On With Building The Business?”. Let me make this as clear as I can, it has never crossed my mind to discontinue this blog. Not once. I simply was trying to say that I thought it was important for me personally to get on with building the business for reasons that are critical and meaningful to me. Those reasons may or may not be nearly as critical and meaningful to someone else — and I respect whatever they decide to do at this time. Beyond that, I think this blog is very important today, and may become increasingly important in the coming months and years. That’s a good reason for me and you to work diligently to make this a consistently intelligent and respectable resource for dialogue about the business. I fully expect to continue to post on a consistent and regular basis.
3. The new world of communications is all about collaboration, as Don Tapscott and Anthony William’s 2006 book Wikinomics: How Mass Collaboration Changes Everything so well expressed. Before I actually started this blog I envisioned it as a place where several people would post and share their thoughts on business issues. One of my favorite online resources is the quarterly magazine City Journal, published by the Manhattan Institute (http://www.city-journal.org/). I saw this blog early on as a vehicle to do something similar to what City Journal has done so well, but directed at the Quixtar/Amway business. To that end there soon will be a couple of ”guest” bloggers who will be contributing original threads to the “Speaking of Amway” blog from time to time, and then engaging our online audience. Expect to see the first guest post within the next week or so.
4. My “Speaking of Amway” main website will be up soon. I started with the blog site, but always intended to put up a complete site with multiple venues. This main website will host several position papers on topics (including some we’ve already discussed), as well as other business related information that Quixtar/Amway IBOs might find of interest. It will link to the “Speaking of Amway” blog, have other personal interest essays, and much more. I hope you’ll find it to be of real value to you. Expect to see it up and running by mid-May.<