The Diaphragm People

When I graduated from the General Electric Financial Management Program (Aerospace Electronics, Utica, New York), I was transferred to Charleston , South Carolina as a financial analyst for Large Steam Turbines.  One of my first assignments was to work with the Diaphragm people.

They were in Building #3 and they were from Schenectady, New York.   They were skilled craftsmen, worked with metals and used an automatic template cutter (a process borrowed from the textile industry) and would cut huge plates of steel within 1/16th of a precise specification…automatically.  Looking back…it is kind of amazing and renews my pride in American manufacturing….as it was then. 

They were older and perhaps overly proud, now living in the South but being from New York.  They were working with many former tenant farmers who had been trained at a local technical school to become machinists.

FINANCE, yes, in all caps, is GOD in the General Electric world and I was one of them.  I also was a FMP and that was a very special person in the General Electric world.  I had been recruited and paid by Corporate while “stationed” in Utica, New York.  My new assignment was to work with the Diaphragm people and get them to meet FINANCE’S budgetary guidelines.  They had balked for three years and had not achieved “their numbers” for three years.  An adversary relationship existed between Buildings #1, Building #2 and the Diaphragm people in Building #3.

“Tom…go meet the Diaphragm people and give them their budget numbers….it won’t be a pleasant experience; but, you’ve got to do it.  We have a deadline to report our budgets to Corporate.”  I have always carried a legal pad, so with pad and pen in hand, I walked down the cement road to Building #3.  As I walked in the door, a sense of anxiety overcame me and I took a deep breath.  It was late in the day and a summer shower had just finished (very often in Charleston….a thunderstorm and then everything was sunny and beautiful).   They knew who I was and escorted me into the conference room.  But they began talking and I just listened…and listened.  Three hours later, I had ten pages of notes (but had not given them their budget numbers to sign off on).   I, then  simply said:  “I have some numbers to go over with you but instead, if you will make the time, I will take your lead and see what numbers you feel you can meet and, once we both feel comfortable that those are the numbers you can commit to and meet, I will help you sell  it to FINANCE.” 

We stayed til midnight and then, the next morning at 6:00 a.m., we started again.  This was before lap tops and electronic spreadsheets.  Yes, pencils, calculators and long green sheets taped together!  When we finished the numbers, I understood how they were developed and the reasoning that supported them, I quickly compared them to the FINANCE budget numbers.  They were lower. 

Later that day, I went with the Diaphragm people to the Plant Manager and the Controller and I presented the Diaphragm numbers as if I was one of them.  I explained the logic, the standards and how they would achieve those numbers.  It was quiet and then everyone smiled and said, “ok….these are your numbers….we will hold you to them.”   And the manager of the Diaphragm people then said, “we want to keep having access to Tom and we want him to work with us to make sure we hit our numbers.’

It’s been many years and I am sure most of the Diaphragm people have passed away; but, a sense of pride, respect and friendship was achieved and lasted until I left Charleston three years later.   It was born out of talking, listening and caring enough (on both sides) to achieve a realistic solution that could be embraced, fought for and was achievable.  But probably the greatest value came out of the mutual ownership that was achieved through collaboration.

Is this how you work with your staff and your clients?  If you need help, I can retell my Diaphragm People story (and others that came out of that learning experience).

 “My most embarrassing moment with a new client and his banker…but it wasn’t my fault!”

I was really proud of myself!  I had just started my consulting career after years with General Electric, Frito-Lay, Hunt Electronics, Northern Telecom, G.D. Searle and Regal Cookware and had a new client.  My client was taking me to meet his banker in hopes of acquiring a line of credit. I met him at his office, was handed his Financials (prepared by his CPA) and we rode together to his banker’s office about five blocks away….

Upon arriving at the Bank, the Bank President escorted us into a small conference room and my client started bragging on me and how I was going to make a difference in his business management.  He went “on and on” and I was kind of elevated, if you know what I mean.   And, then….the Banker asked me a question:  “Tom, I was looking at the Net Earnings on the Balance Sheet and they are not the same number as the Net Earnings on the Income Statement…how can that be?”  (well, we know that those numbers are always the same….).  Never again did I simply pick up a set of Financials and hand them over to someone before I checked the net earnings on the Income Statement and Balance Sheet!

So much for being the White Knight!

Sometime in the future, I’ll share what I call “the bankers eyes” and once you work with a lot of bankers, you “just know” how their eyes go down a Balance Sheet and Income Statement; and, within thirty seconds, they know your financial situation and whether they want to work with you or just humor or patronize you.  The only thing is:  I already know.

If you need help preparing for a fateful meeting with a banker (or a financier), let’s talk.  I have some more stories to share with you….

 “Tom, I’m not going to do it. It will be self-regulating, anyway!”

I have found that certain entrepreneurs ignore business essentials and always feel that “things will turn out…ok.”  But sometimes, they do not.

My client had developed a significant business but experienced serious cash flow issues that could not be overcome, payroll liabilities, landlord issues….those kind of things  They were very talented and I sought another group for them to become part of.  I negotiated a buy out of their debt and they were to become part of another firm.  All employees (and clients) were out of harm’s way. 

In those situations, a consultant does not want to buy the day and give up tomorrow; i.e., sell short and lose the upside.  In negotiating, I wanted a long term agreement with an incentive built in for upside profitability and equity sharing.  The buyer said, “Tom, I’m not going to do that….this will be self-regulating anyway.  At the end of five years, if I want them, I will negotiate an upside for them; and, if they want to contintue to be part of us, they will negotiate fairly with me to achieve that.  If they don’t want to continue, then it doesn’t matter what I am willing to offer them……..whether it be today or in five years.”

He was right.  The group contributed significantly to the growth of the “buyer” but at the end of the five year period, negotiations broke down and they left.  Sometimes, someone thinks they can learn from their previous mistakes only to find that old habits (business practices?) are difficult to modify.  And what happened to the group that had been originally “saved” five years before and then chose to go back out on their own again?  Within a year, they were out of business (again).  This time….no one offered them an umbrella.

do you need help finding dry land, an umbrella or simply someone to talk to?

 “Tom…the Internal Revenue has frozen our payroll account.”

I was consulting a sales organization in Fairfield, New Jersey and the phone call came that my client’s payroll account had been frozen.  It was Friday morning and all the payroll checks would bounce by the following Monday.

I called the Internal Revenue agent and we talked for a while; and, I could not get a release.  I even begged!  I then got into a Ford Pinto (a hatchback, no less) and drove to New Haven, Connecticut where my client’s receivables were financed (I hoped to talk him into releasing some of his reserve so that I could wire it to the IRS).  It was a lonely drive, full of anxiety and “if you don’t get a release, their employees’ payroll checks will bounce….”  It’s funny sometimes when you are a consultant; even though it is not your fault, you feel like it’s your fault!

The Financier’s name was also “Tom” and I tried to use that to my advantage…no luck.  But we did like each other and he respected what I was trying to do (help my client stay in business!).  I could not get him to advance any funds to satisfy the IRS; and, so I got on the phone with the IRS agent and we talked “a while longer”. …to no avail.  And, then, I lost it…I started crying.

And, then…. the strangest thing happened.  “Tom,” the Financier took the phone out of my hand and started yelling at the IRS agent:  “you’ve done it now…you’ve done it now….you’ve made a grown man cry.”

There is an end to the story and it is a good one:  “the IRS agent released the hold on the payroll account and the company lived happily ever after!”  But, frankly, I don’t remember why the IRS agent released the funds…whether because the Financier sent him money or he gave my client another day to solve its problems.  I do remember “Tom” patting me on the head and saying, “it’s going to be ok….he’s going to release the hold on the payroll account.” 

Have a good weekend. 


 “They either leave at five o’clock or at the end of the year!”

“too many times….” I have heard the entrepreneur’s lament:  “here I am….it’s six oclock (or even eight in the morning) and I am the only one here….it gets lonely sometimes….and then I have to worry about payroll and whether they are going to stay with me….”

1.  Small relationship based groups sometimes reach mid-size level but seldom succeed in maintaining employee retention and devotion.

2.  Talented employees often leave after gaining a client’s confidence and, surprise! take the client with them (ignoring non-compete or tortuous interference agreements).

3.  Entrepreneurs become exhausted training and retraining staff, only to see them leave and accept a position with a competitor or start their own group.

4.  In a new business presentation, the prospective client turns to the entrepreneur and says, “you can have my business if you will personally manage it.”

5.  Without business growth, enployees do not feel they have a career ladder.

6.  “Creatives” often become bored working on the same or similar category (the same with account management).

7.  If groups do not remain committed (and successful) at acquiring new business, the special excitement that comes from “the hunt” is lost; and stagnation occurs.  One client once said to me regarding how proactive they used to be in acquiring new business…”hmmm….we used to do that.  I wonder why we quit.”

8.  I have seen various groups retain highly talented employees, others have serious turnover.  One of the primary reasons lies in the selection of employees, not necessarily the way they are managed.

9.  When an employee feels that he/she has a stake in the business and is required to continue their professional development, a favorable shift occurs between the employee and management.

10.  Entrepreneurs are generally self-starters and driven to succeed.  A group must weigh the benefits of hiring self-starters and ensure that they have a career path that facilitates business management responsibilities, professional development and bonuses (not necessarily just money).

11.  I have seen 45 year old entrepeneurs become 60 years old and still not have a transitional management staff that ensures that their legacy and ability to sell their group has been achieved.

If this resonates with you…either as an employer or an employee….let’s have coffee.

 My Platform Speaking Professor at Texas was sloppily dressed but knew what he was talking about….

In listening to my professor, I learned that my hopes of being a Winston Churchill, Franklin Roosevelt, John Kennedy did not follow my rendition(s) in high school of yelling “Friends, Romans, Countrymen….lend me your ears!”

Standing there before us, pipe in hand, he said:  “no 3 x 5 cards, no memorized speeches, no attempts to be funny (you aren’t good enough to pull that off!)…simply carry on a conversation.”

My friends, you have to learn to “talk to people” if you are going to be successful (if you are not comfortable in front of people . . . take a speaking/communications course or hire a coach). 

Over time, I learned these speaking/presentation skills that I want to share with you:

1.  My name is….there is nothing more personal than someone’s first name.  When in business meetings with people you don’t know, prepare name tags.  You can be high-ended with professionally prepared name tags or you can buy stick-ons, but, remember to use name tags.  It makes it easy for everyone to know someone’s name.  Whenever I hear “Tom”, a little voice inside says “they are talking to me!”

2.  Using someone’s name and following it with eye contact is very personable.  Looking at someone is one of the most effective communication tools one can use (they say that Robert Kennedy could stare a hole through you and, in doing so, he had your undivided attention because you felt that you were the only person he was talking to).  In that speech course, the Professor insisted that we look at each person for seven seconds and then move to the next person…try it some time.

 3.  Talk to them…don’t read to them…don’t lecture them…don’t recite to them.   To come across as “genuine,” first name, eye contact and conversation is what it’s all about.  Ronald Reagan and Bill Clinton were masters at the “sound bytes.”  A lot said in a few words. 

4.  Make sure that you have been cordial:  Have you asked your audience if they want something to drink?  Do they need time to use the rest room?  Do they need time to be acclimated to the conference room environment?  Are they comfortable with others in the room?  Are the visual aids placed where everyone can see?  Is the lighting adequate? 

5.  Express appreciation for the opportunity to share.  And, then explain what you have to say and why it is important.  Also, present a roadmap (not a handout!) of the conversation that is about to take place:  Everyone always likes to know where they are going and how long it will take to get there.

In summary:

  • Refer to everyone by their name, if appropriate
  • Look them in the eye
  • Talk to them as if they were sitting next to you in a coffee shop
  • Make sure you have acknowledged their needs (including their ability to see/understand your visual aids)
  • Let them know where they are going and how long it will take 

Good luck!

 He called me… “Mr. Tom”

Many years ago, I was employed as Controller of Hunt Electronics, owned by Bunker, Herbert and Lamar Hunt. The company included an assembly plant in Matamoros, Mexico (the Drive Inn was one of the great restaurants, even played Glenn Miller music).

I would take trips (and eat at the Drive Inn) to review the assemly plant’s work performance and audit the “into/out of Mexico cost-of-goods” so we would be in compliance with United States Customs Office filings.

I became friends with the Assembly Foreman at the plant.  One day, he drove me to the Brownsville, Texas, airport….

As I retrieved my bags, he put his hand on my shoulder and said, “Mr. Tom, I love you and your passion…but please don’t forget to enjoy the moment.”

In today’s business world and social settings, it is easy to forget about the moment. We often prefer to look back to a better time or hope for a better time in the future. 

This reminds me of a concept I learned once, perhaps it was from Wayne Dwyer or Scott Peck, in their early years, who said, “we often go through life solving a problem, only to look for another problem to take its place.”

I would like to recommend a book that I have by my bed, “No Ordinary Moments” by Dan Millman. His premise is:  “in every moment, the quality of your life is on the line.  Life is a series of moments.  In each, you are either awake or asleep-fully alive or relatively dead… by treating every action with respect and every moment as sacred… (one will) find a new relationship with life, filled with passion and purpose.”

Here’s to you on a Friday afternoon…enjoy the moment!

Tom Irwin 

 Mission statements are corny, corny, corny….

Every time I walk into a business office and see a “mission statement” proudly displayed on the wall behind a receptionist’s desk…I listen for the music, the violins and the harps.

I often wonder who wrote it.  Was there collaboration or was it an officer of the company sitting in his office with a legal pad, or, worst, a consultant asking “now, who are you . . . or who do you want people to think you are?”

I would recommend another business view:  “what are you willing to promise and take responsibility for to your customers, prospective customers and your employees?”

I often encourage clients to develop a “Promises Made and Promises  Kept” statement and display it in their sales kits, professional presentations and collateral.  This statement should spell out what one can expect from the company and what they are willing to “put on the line” as promises to their valued relationships.

I recommend that you rely on case studies.   Document your “legacy” with stories.  After all, it’s what you’ve done, not what you say you’ve done, isn’t it?

If you need help developing a meaningful mission statement, I will be glad to collaborate with your key staff, gain feedback from your customers and input from your employees.  You can then develop a promises and accountability statement that truly represents your business and mission.

 “For the love of a dog”….yes, Marketing 101 does work!

Yesterday, I went to Petco to buy dog food .  My income has been down and I decided to talk to a sales assistant about reducing “my investment” in premium priced dog food (for Casey, my dachshund).

Several years ago, I had bought a premium priced dog food during one of their sales promotions; in fact, I bought four bags because they were only $5.00 for each 7.5 pound bag of “premium, holistic, all natural dog food.”  Well, several months later, I went back to Petco, and, sure enough, the same promotion was going on.  So, I bought four more bags; and, then, guess what happened?

The next time I went in to Petco to buy “that dog food that Casey loves” and…whoa…it is now $19.00 for the same bag of “premium, holistic, all natural dog food.”  Well, I bought two bags and so for two years, I have been buying two bags at a time for $19.00 each (instead of $5.00 each).

Yesterday, I went back to Petco (Casey was almost out of dog food) and I asked to speak to a sales assistant.  I admitted that my income was down and I needed to switch to a less expensive dog food.  I told him the brand and he said, “oh, now…do you want to stay in the all natural food category?”  I said, “yes, but I need to find some that is not so expensive.”  Well, we walked around and I finally said, thank you, let me just look.  I could not find any “all natural or almost all natural dog food” for less than $17.00 to $20.00 for a similar size bag. 

I then found the “same brand” was running another promotion….for a 2.5 pound bag and it was only $2.50 a bag…wow.  So, I picked up five bags and was saving $12.00 and Casey was getting her same dog food.  Hurray!  When I got to the cash register, the sales attendant said, “now, you normally buy the chicken and oats, this is trout and oats.”  I said, “you had the chicken and oats” in the location with the promotion for $2.50 a bag.”  He said, “that is true…but the promotion is only for the trout and oats.”

So, I was back to where I was when I entered the store…trying to reduce “my investment in premium priced dog food…”  So, I started walking around the store again.  And, the sales assistant came up and said, “didn’t you say you have a dachshund?” and I nodded my head; and, he then said, “we have some dog specific dog food and you may want to look at it.”  I went over and sure enough, there was a dog food specifically created for dachshunds…”Breed Health Nutrition….Dachshund 28” Teckel 28” (whatever that means).  It shows an illustration of the skeleton of a dachshund and red spots highlighting their back bone and joints (you know, dachshunds are prone to have back problems and a vet gave Casey a steroid shot once because she couldn’t walk without crying).  I read the information and thought, “gee…Casey is nine years old now…and I should do what I can to reduce the risk of her having back problems.”  Well, guess what…this is a 2.5 pound bag for $19.00 (instead of a 7.5 pound bad for $19.00).  I am now considering spending THREE TIMES as much as when I came in.  I put the bag down and started walking away; and, a little voice in my head (my conscience?) said to me, “Tom…you may look back someday and realize that you did not do everything you could to help Casey.”

Guess what I did?  Yep…Marketing 101 does work.

Have a good weekend.

 When I saw his eyes tear up…I knew that I had finally uncovered the defining question.

I was in Houston, meeting with a new client, taking notes on my legal pad.  I looked at him and said,

 “you know, you have been very successful…but let me ask:  “Why haven’t you been more successful?”

He immediately “teared up” and got quiet:  “Tom, I feel like, no matter what I did, I couldn’t get to the next level.”

I now regularly ask that question…and often, the client becomes silent and looks down.  It is almost always the same answer:  “I never got to the next level.”

One client who achieved over forty million dollars in billings, when asked the question, got up, walked over to the window and said, “I got to forty million dollars but I was never invited to the next level of client…it was almost like there was a glass ceiling.”

In my years as a consultant, I feel that there are various reasons for not getting to the next level.  Perhaps, someday, we can go over my list and see if you can identify one (or two) reasons that might apply to you.