Is “Follow Your Passion” Really Bad Advice?

It’s graduation season, and honored guests clutching honorary degrees are speechifying at commencements all around the country. In a recent story on National Public Radio, quotes from celebrities including Ellen DeGeneres, Oprah Winfrey and Michael Bloomberg all included the same catch phrase: “Follow your passion.” The exhortation has become so common that the news story was about one poor Ivy Leaguer who found himself unable to enunciate his passion.

Fortunately, the fact that he made it as far as graduating from an elite institution probably bodes well for his chances of eventually doing, and being able to afford to do, what interests him. For the rest of the class of 2013, like those for several years before them, the ability to follow their passion will often be impeded by their desire to eat.

unemployment-line-now-hiringUnemployment for new college graduates remains stubbornly high. In a luncheon with an official of the Federal Reserve a few week ago, he noted an anomaly. Unemployment is at the highest sustained rate in 70 years, while the number of help wanted ads are also at an all-time high. The reluctant conclusion is that we have a workforce unable to fill the positions available. From an employer’s perspective, I see three reasons for this disconnect.

1. Just a “college degree” isn’t enough

For years, I and many other employers would use “college degree preferred” as a litmus test to identify people who could set a goal, plan to reach it, and accomplish what they set out to do. With the advent of helicopter parenting and institutional success measured in six-year graduation rates, a Bachelor’s degree often means someone who had the financial means (or the debt capacity) to hang around long enough to amass 120 or so credits. Two day a week class schedules and having mom fill out your course choices online (or pay a consultant to do it for you) doesn’t develop much strength of character.

At the same time, technology and pressure on profits have caused employers to back away from being the trainers of first resort. For many jobs, like entry level sales and retail branch management, systems have replaced decision making, and those jobs can be “dumbed down” to people who don’t have a degree-holder’s salary expectations.

2. A college degree isn’t what it used to be.

The quest for paying customers has caused colleges to expand to unprecedented levels. Here in Texas, UT now operates 9 campuses under the UT brand, enrolling 192,000 students. Texas A&M runs 8 more, with 83,000 enrollees. No one outside of academia pretends that all of those students are receiving the same level of education as ten or twenty years ago.

A part-time employee of mine showed me her class schedule a few years ago. By credits earned she was a junior, and taking upper level courses. Her choices included titles like “The Role of Women in Architecture,” “Non-traditional Literature,” and “Minority Contributions in American History.” When asked why she wasn’t focusing more on her business major she replied “Because these are all required for graduation!” I’m all for expanding people’s horizons, but not at the expense of teaching them what they need to know.

3. There is no “right” to succeed in your passion

The Constitution enshrines the “pursuit of happiness” as a basic human right. It does not make it anyone’s obligation to ensure that you succeed. We’ve raised a generation to believe that success is the inevitable outcome of effort. In a recent interview with a couple who were protesting high school teacher salaries, they complained that their wages were insufficient to support $300,000 in student loan debt. His Master’s degree was in comparative literature. Her PhD was in philosophy. Who told them that was a good investment?

Employers are scrambling to fill positions in programming, engineering and skilled trades. They share stories of graduates with little or no pertinent skills who want to focus their job interviews on salaries, advancement expectations and benefits. There is a fundamental disconnect between what our education system is providing and what our employment market is seeking. Perhaps “Follow your passion” isn’t the best advice we could be giving.

 

Posted in Thoughts and Opinions | Tagged , , , , | 5 Comments

5 Responses to Is “Follow Your Passion” Really Bad Advice?

  1. Ray says:

    Brilliantly put. It is exactly the same in the UK. Graduates with no experience of the real world assuming because they have a degree employers will welcome them and throw money at them. We have all time highs in numbers of graduates but the majority of degrees are in media studies and the like that are of little use to the average SME who will have to invest considerable sums of money to train them and educate them in what business really needs.
    We have the same ‘Follow Your Passion’ message across here and a dumbing down of standards where school children and college graduates are not allowed to fail. They have no idea what failure means or how to deal with it and are now facing it. Many sadly are being woken up with a jolt and big debts for a degree that isn’t worth anything.
    On top of that many SME’s and bigger businesses have job vacancies we can’t fill because the applicants have little to offer and expect too much.

  2. Lara August says:

    I need to take a deep breath before replying because there is some truth in what your are saying, but there is also fault to the logic. It might just be the title that rubs me wrong.

    We have had trouble hiring recently. There are literally a hundred or more applicants for each position, and few are actually qualified. However, these aren’t even for entry level jobs – we are requiring a minimum of 3-5 years of experience for most positions, and they STILL aren’t qualified. I think that this is because most SMBs can’t or don’t provide proper entry level training. My own management team even came to the realization that we were not in a position to hire recent grads, due to a combination of our lack of internal training resources and the cost/lack of availability of those resources externally. So my business is admittedly perpetuating the problem. So on the point at colleges aren’t preparing students adequately, I agree, but I think both colleges and businesses need to adjust.

    Now on to the point about passion. When I was headed to college, my dad pulled me aside and asked what I wanted to study. A straight A student, I replied, “a doctor or lawyer, and I’m leaning toward law.” I’ve never seen such a look of disappointment on his face. To everyone, including myself, I was an artist. I had always loved art and excelled at it in school and in competitions. He asked why I didn’t plan on studying art and my response what that my art teachers warned us not to wind up as “starving artists”. One of my favorite teachers recommended that I study business if I wanted to be an artist. My dad was then disappointed in my teachers and mentors. He hauled me over to the early-stage dial up Internet access that we had at home and managed to find a really cool chart showing income ranges for various professions. He showed me very wealthy and very poor salaries for each position. And then he asked, “where are you going to fall on this spectrum if you are doodling in the margins of your law books? Are you going to be one of the greatest lawyers?” He was right. I was meant to study art. I have an older brother who is a journalist. We have both “made it” in or professions and are at the top of our income categories, and I am thankful to my father for being so supportive of our dreams.

    I don’t believe that passion and entry level job preparedness should be inextricably linked in this discussion. I can’t give up on the idea of self-actualization, but maybe those dreams do need to be tempered with encouragement to pursue a double major or minor in something that will help with the first few years out of college. If I had received a business degree, it certainly would have made entry level job searches less painful, and would have benefitted me in my role as a business owner. Maybe in 1996 that wasn’t as crucial as today. I think the caution is: let’s not overly stifle the passions of an entire generation and wind up with a well-trained entry level, and later, horribly mediocre working class.

    • John F. Dini says:

      Of course we haven’t stopped needing artists, or journalists, or philosophers. I think “follow your passion” has been overused to the point where kids leaving for college just pick their favorite extracurricular activity or high school class and choose that as a “profession.” If you love philosophy, or art, or music, then by all means go for it. But “love” means you read about it on your own, practice it instead of going out on Friday night, and focus your decision making in higher education on schools where those who excel at it go. You don’t pick a mediocre course load at a local diploma mill and think that six years later you’ve earned the right to a job. One major problem is that there is no vetting process. A basketball player finds out whether he can make the grade at each point of passage. If he is passionate, he may still play basketball for a Division III school and enjoy it, but he doesn’t think that’s going to put him in the NBA. Unfortunately, there is no vetting process for philosophers until much later, when they can’t get a job.

  3. Brad Elmhorst says:

    I encouraged both of my children to find work they were passionate about. Both found desired career paths in their senior year of high school, both went on to college and graduated within their chose fields. My Occupational Therapist, immediately employed after college worked two different positions (clinic based & home health) prior to finding, four years and a marriage later, her passion as a neo-natal OT. My Film Editor, living at home worked contract jobs throughout Texas, worked in a warehouse, odd jobs and faithfully made monthly payments on his student loans, while living at home. Two years & 5 months elapsed until he found a full time editing position.

    My point in all this is following a passion has to be balanced/realistic and adaptive. Following one’s passion is not bad advice. It just needs to be balanced with the individual’s commitment (true passion, not a passing fancy) and their resources to stay the course and adapt.

  4. Zbig Skiba says:

    A wise man once said “I think owning a business is the most interesting thing you can do.” That sounds like passion to me. As does “Awake at two o’clock.” And since when is entrepreneurship a profession with a strong, predictable income stream? Sounds like lots of people following their passions.

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Boomer Business Owners’ Retirement Accelerates

Pepperdine University, in cooperation with the International Business Brokers Association and the M&A Source, publishes a quarterly Market Pulse Survey on the sale of small businesses in the United States. The most recent report, covering the fourth quarter of 2012, shows that “retiring Baby Boomers” is for the first time the number one reason for selling a small business in the United States.

I’ve written since 2007  in this space and elsewhere about the impact of Boomer business owners leaving their companies. You can download my e-book on the subject at www.theboomerbust.com. (The password for my faithful readers is “Woodstock.”) The Market Pulse Survey is just the latest indicator of a crest that is building, and which will have a huge impact on the American business landscape.

hedge mazeIf you are as acutely aware of the impact of Boomers on the American economy as I am, you begin to see it in a lot of places. I attended a luncheon with an official of the Federal Reserve a few weeks ago, and a question was raised about the recovery of residential housing. He pointed out that the introduction of 30-year mortgages with only 20% down transformed the US into a country of homeowners.

Home ownership grew to over 60% of households by 1960, fueled by larger families (Boomer children) and the GI Bill. It stabilized at around 65% from the 1970s through the late 1990s, when it began climbing again, largely as a result of political pressure to let the Federal Government (through their proxies, Fannie Mae and Freddie Mac) make mortgages available to a wider portion of the population. By 2007, the percentage of homeowners had reached almost 70%.

Residential housing markets began cratering in 2007, largely because too many people had been financed into homes they couldn’t really afford. They weren’t just the poor, but also included millions of Boomers who “traded up” in their quest for material success. (See the e-book for more on that Boomer drive.) The presenter pointed out that the population of homeowners was now stabilizing at much closer to 65%, which is assumed to be the normal equilibrium.

What if that is only a “Boomer equilibrium?” After all, the growth in home ownership occurred in a 50-year long expanding economy fueled by Boomers, first as household size increased, then as they became consumers. Aren’t we working with an assumption that the following generations will repeat the Boomer quest for more? Will GenX and the Millennials really get in line to splurge on ageing McMansions, or will they be satisfied with a more reasonable standard of functional shelter?

If the housing market suffered so badly in adjusting from a temporary high of 70% back to a more “normal” level of 65%, what will it look like if the next normal is 60%, or even 55%? (Prior to WWII only about 40% of US households owned their homes.)

The Market Pulse Survey also found that it is increasingly a buyer’s market for small businesses. That trend will inevitably accelerate, especially as we reach the 2018-2023 period, when Boomers turning 65 years old out number the GenXers turning 45 by 4,000 a day. If you are a young business owner, or plan to be one, the time is coming when you can pick and choose your opportunities.

But I’d be cautious of businesses focused on high-end residences.

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Posted in Exit Planning, Exit Strategies, Life After | Tagged , , , , , , , , | 3 Comments

3 Responses to Boomer Business Owners’ Retirement Accelerates

  1. lawrence says:

    I don’t stay in the usa but I agree with you on the matter their is a big differ from.genx and the land wil provide a harder operation to the genx than before or ever

  2. Tom Morton says:

    Great post — as per normal — thanks John.

    I am intrigued by your “Woodstock” password. Is this a reference to Snoopy’s indefatigable secretary? Or to your misty memories of a certain festival in the ’60s?

    I think we should be told…….

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Three Rules for Small Business

A few days ago a discussion on LinkedIn’s “Small Business Accelerator” group asked “What are the three things a small business owner should focus on?” As challenging as any business is, the basics remain the same for everyone. We provide goods or services, get someone to buy and pay for them, and keep score. The “rules” I contributed were very simple, and involve employees, customers and reporting.

Rule #1: Develop a process by which good employees are given the opportunity to grow, and poor ones are allowed to find opportunities elsewhere.

Of course, this is much more complicated than it sounds. Small business owners often consider a paycheck and benefits to be investment enough. That isn’t true. Good employees are precious, and they are becoming more difficult to find every year. If you can’t give them chances to grow, to add to their market value, then the best of them will find a company that can.

3 simple rulesWhen an employee shows the behaviors you value: a solid work ethic, dependability, problem solving and initiative; supporting additional training or education is a must. Ironically, the result is that they are worth more, and you can’t expect their gratitude for your investment to offset their expectation of market compensation commensurate with their increased skills. If they are really worth developing, then your investments will pay off on the bottom line.

On the other hand, too many small businesses settle for employees who are merely “good enough,” often because their pay rate is more manageable. You aren’t saving money as much as you’re filling a space that could be used for a top performer. Set goals with realistic time frames, and expecting each employee to know, track and reach those goals. If they can’t, then you have to find someone who can. It’s uncomfortable, but you owe it to your good performers. They deserve to be on a team where everyone shares their values.

Rule #2: Understand why, really why, your customers do business with you.

Few small business owners dig into their customers’ motivations. They are usually too happy just to have the customer. The owner tells himself “We give good service, we are fairly priced, and we stand behind our products.”

Those are merely the basics that every customer expects. Unless you have a unique differentiation, they are probably choosing you for another reason. Customers seldom say that they choose a vendor based on an ability to satisfy their minimum requirements.

The other claim I hear is “We are in a relationship business.” I’m not denying that customer relations are key, but…Duh! Everyone is in a relationship business. Unless you can clearly enunciate what benefits the customer receives from the relationship, you are in danger of the next “nice guy” taking the business away.

Rule #3: Know what the key measurements of your business are, and track them exhaustively.

Financial statements are historical records. While profitability is essential, it’s hard to correct retroactively. True performance indicators are measurements that indicate how you are generating profit, and why. “Indicate” is the important word here. You don’t want numbers that merely show a fact. You are seeking measures that show a trend, a change, or a place to dig deeper for causes.

Are your employees as productive as they were last month or last year? Are your customers spending more or less per transaction than they in the past? Are buyers gravitating to products or services that have lower margins? Are you deviating from a reasonable return, defect or complaint rate?

The best measurements take what you are doing now, and put it against what you did before. Any measurement is useless unless you can determine whether it is better or worse than another.

Running a successful business is never easy, but if you focus on these three rules, it becomes a lot easier.

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Posted in Entrepreneurship, Leadership, Thoughts and Opinions | Tagged , , , , , , , , | 1 Comment

One Response to Three Rules for Small Business

  1. John, The beauty of this article is its simplicity. Rule #3 is of particular interest to me because I recommend another simple tactic that helps in identifying the priority of actions to improve the generation of profit. I am referring to the 80/20 Pareto Principle that approximates to “80% of your profit comes from 20% of your customers” or “80% of your costs come from 20% of your operations.” This is an oversimplification but applying the thought process across a company does reveal where to apply resources. Richard Koch’s book The 80/20 Principle is the reference work on the subject.
    Another comment is more controversial. I like to see business owners measure the value that they are creating in their company and track its change year over year. This is preparation for the day when they will depart, but it is also a check on the health of the company and the industry it is in. The measurement includes a standardized process of a three year forward projection and calculation of the Net Present Value of the cash flow, plus a simple terminal valuation at the end of the third year, discounted to the present. If this valuation is growing, the owner has added comfort in his/her commitment to the company and supports making suitable investments. If it is declining, it is time for a serious look at future plans.

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Small Business and Social Media II

Last week’s column generated lots of comments, and probably requires some follow up.

First, the army of social media fanatics that go ballistic at any hint that SM isn’t the be-all, end-all and answer-from-above for every marketing need on the planet are just wrong. “To every thing there is a season” (Ecclesiastes 8- Hey…do I get big SEO points if I put a link to the Bible here?)  and that applies to social media as well. There is a time, a place and a purpose for any type of marketing, and trying to stretch one modality as a universal panacea for all marketing needs is foolish.

Second, there is a difference between social media and anything that requires typing on the Internet. As Al Bellenchia pointed out, I blog. (How about circular links? Do they count?) Is that social media? If the “social” in social media indicates interaction between folks, how many of the current 181,000,000 active blogs on the web are actually social? Don’t you have to have a conversation to be social? If a blogger is just blasting out personal rants to the great cyber-void, is that autoeroticism a social activity?

treefallsinforestSo the real question is whether participating in social media has any value if no one is engaged? If a tree falls in the forest and there is no one to hear, does it make a sound? I think not. I just visited a local retailer’s Facebook site (which was in lieu of the business having a “real” website) and it has no picture, no descriptions, no postings, no friends and 5 “likes” in the last 7 years. Clearly that is worse than having nothing at all.

As David Basri pointed out in the discussion thread on this topic at The Alternative Board® Members Forum on Linked In, there is a difference between SEO and Social Media. I somewhat erroneously pointed out that adding multiple useless links to big social media companies would not serve to get me new clients. That isn’t SM, that’s SEO, although blogging may be one of the best tools for scoring on SEO, the two are very different.

Last week I said that linking to Google+, Baidu , Bebo, Orkit, Netlog, Stumbleupon, Blogger, Delicious, Friendfeed, Tumblr, Viadeo, MySpace, Reddit, Digg and Pinterest were pointless. Of course, if this post goes viral I guess the time “wasted” on building all these stupid links was worth it.

OK, I’m just playing with you. Endless site links to boost SEO, retweeting other peoples’ quotations from famous dead people, and weekly electronic “newsletters” that do nothing but flog discount deals are not social media. Anything works at the proper time and in its proper place whether it is “social” or not. Advertising is intended to get folks to listen to your marketing message. Your marketing message is intended to prepare them to buy. The sales process is to follow up on those influenced by your marketing message and close a transaction.

So here are my “rules” for marketing on the Internet:

  1. It’s an advertising medium just like any other. You have to understand who you are trying to reach, and judge the return on your investment.
  2. Time is money. The time you spend on building an internet presence is an investment, and should produce a return. Otherwise you should be spending it on something that does.
  3. Just because you can reach a zillion people doesn’t mean it is a worthwhile effort. Suspects aren’t (necessarily) prospects.
  4. Social media is for interacting with people. If you aren’t prepared to increase your levels of interaction and maintenance with every new success, don’t start.
  5. Be consistent. Your business presence isn’t the place for your niece’s birthday party photos, and your personal sites aren’t for advertising special deals.
  6. Be patient. The Internet is a big place, and it can take a long time to be found. Hoping that each new effort goes viral is like hoping to win the lottery every week.
  7. Deliver value. No matter what you do to be “found,” it’s worthless unless you provide a reason to come back again.

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One Response to Small Business and Social Media II

  1. Hi John,
    You wrote: “Endless site links to boost SEO, retweeting other peoples’ quotations from famous dead people, and weekly electronic “newsletters” that do nothing but flog discount deals are not social media.” So true. Real social media, like real conversation, takes thoughtfulness, consideration and a real interest in listening to others and hearing what they are saying. Thanks to Christi Brendlinger for sharing this awesome post with the BizSugar community.

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Should Small Business Owners Embrace Social Media?

I order a package of vacuum cleaner bags online. The site cheerfully requests “Like us on Facebook!” Kobe Bryant announces that in order to help the Lakers, he won’t tweet during playoff games. A friend tells me that he is the mayor of a local lunch joint on FourSquare.

sm_overloadThis column features at the bottom not only the opportunity to tweet or like, but to share my weekly topic on LinkedIn, Google+, Baidu (does it translate it into Chinese?), Bebo, Orkit, Netlog, Stumbleupon (really?), Blogger, Delicious, Friendfeed, Tumbler, Viadeo, MySpace (THAT’s still around?), Reddit and Digg. I’m not sure why that share widget doesn’t include Pinterest, but we offer it separately. Good thing!

The traditional media reports celebrity tweets as hard news. Fast food chains start hashtag discussions about a new sandwich. My 17,000 Twitter followers are a nice number, but even if I was the Sheik of Araby I couldn’t marry a fraction of those followers who have suggested it (and I’m only including the ones who ask in English).

For a small business owner, the deluge of attention surrounding social media is confusing.  You read about a food truck on the West Coast with 100,000 customers eagerly following their daily location tweets, and presumably flooding to patronize it when it’s in the neighborhood. When your business would be thrilled with ten extra customers a day, that kind of following looks might tempting.

Besides, social media is free. John Wanamaker, the Chicago retail magnate, once famously said “Half of the money I spend on advertising is wasted. If I only knew which half.” When the money spent on advertising is zero, isn’t any return worth it?

This is a column for business owners. If your business is large enough to employ a marketing manager who has a social media strategy, have at it. If you use an intern from a local college who is free, or nearly so, let them fly. The question is whether you should be involved in a social media effort for your business.

Social media is a retail phenomenon. If you sell to the general public, are responsible for business development in your company, and have the time to spare, by all means tackle social media as an advertising vehicle. If you are sitting in your retail store between customers, boot up your tablet. If you are surfing the ‘net for half of the evening, get some plugs in for your business. Social media can do a few things well. It eases a potential customer’s risk tolerance by showing that lots of folks have purchased from your business before.

But I’ve stopped looking at ratings on Yelp, Urbanspoon, Travelocity or BizRate. Every feedback page has at least a couple of folks who say it was the best experience ever (friends of the owner?) and a couple who rate it the worst. I don’t know who these people are, or whether they have a clue about what a good meal or good service is.

If you sell to businesses, focus instead on your value proposition. I’m astonished at the number of B2B small business owners who think that a Facebook page can replace a business webpage. It can’t. It’s less organized, less focused and less controllable. The Facebook page for this column, which is the only FB presence I have, is “liked” by the National Rifle Association. Is that good for my business? I’m not so sure.

And by the way; I’m fully aware that I could have hugely raised my SEO score by linking all the websites mentioned above. I didn’t, because there is no chance that they would generate a new client. It would just have been 15 minutes of wasted time.

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Posted in Entrepreneurship | Tagged , , , , | 5 Comments

5 Responses to Should Small Business Owners Embrace Social Media?

  1. Bob Dodge says:

    So, John, if you spent that fifteen minutes on Soical Media, it would no longer be “free.” I agree; have a college intern to it, but if it is the buisness owner, think of the other things not being done while he or she is maitaining the social networks (consistency and regularity are likely required) that would have positive impacts on revenues, cost, margin, qulaity, employee development, customer acquisition, etc.

    As usual a thought provoking article. I “like” them, but I am not going to take the time to do the social media thing, however.

  2. John, you blog. Often and well. Welcome to social media. Too many organizations, large and small, are mistaking medium and message. The question of whether to tweet, post on Facebook or pin on Pinterest is secondary to, as well as subservient to, where your customers are and the value you are providing to them through your marketing content.

    If all you are doing is “tell and sell” marketing, then any new effort is likely to be wasted. It’s the 21st century equivalent of door-to-door. If you are providing value-added content, then the time to increase distribution via a few clicks is de minimis.

    For most B2B products/services, Facebook provides little return…but

  3. Harry says:

    John – You have some good points here. However, for every research that shows the failure of social media to bring new business there is a counter-point showing how social media has helped improve the business. I don’t think social media can help you sell if you don’t have good products and value proposition for your customers to begin with. It can however, reach existing and new customers through additional channels and for that I think it’s worth spending your time on that. You do have to be judicious in how much time and effort you spend.

  4. Andrew Baird says:

    We use Facebook for B2B, both for sourcing and working with partners and for leads, opt ins (and yes) clients.

    People are often surprised by this, but a significant portion of these come from Facebook (and not the normal b2b suspect LinkedIn – although we do get results from it as well).

  5. Webdev1 says:

    Social media may costly but for me it really helps to gain costumers. But it is necessary to maintain the high quality. Me as a consumer, I rather choose good quality than popularity.

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