Berkshire-Hathaway and Prudential Financial

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					Your High Credibility Formula

  How to Achieve Lasting
  High Credibility in Your
      Work and Life

      Carson P. Porter
Their perception
 is your reality!
          Perception is Reality
   The way others perceive us (or our
    organization) is reality for us.

   If we want to change our current reality
    then we must change the way others
    perceive us.
       Is Credibility Important?
   You bet it is!!!

   If you are to achieve sustainable,
    profitable and fulfilling success in both
    your business and personal life you must
    be perceived as highly credible.
    To whom must I be credible?

   All your stakeholders:
    –   Customers
    –   Employees
    –   Vendors
    –   Creditors
    –   Partners
    –   Family
    –   Community
        Applies to Everyone:
 For-profit businesses
 Charities
 Schools
 Churches
 Teams
 Individuals
    America’s Most Admired Cos.
              Fortune, March 2002

   General Electric
   Southwest Airlines
   Wal-Mart
   Microsoft
   Berkshire Hathaway
   Home Depot
   Johnson & Johnson
   FedEx
   Citigroup
   Intel
    Best Companies to Work For
                Fortune, Feb. 2002

   Edward Jones
   Container Store
   SAS Institute
   TD Industries
   Synovus Financial
   Xilinx
   Plante & Moran
   Qualcomm
   Alston & Bird
   Baptist Health Care
Best Cos. for Working Mothers
            Working Mother, Oct. 2001
             (Listed alphabetically)
   Bristol-Myers Squibb
   Citigroup
   Fannie Mae
   IBM
   Marriott
   Morgan Stanley
   Pricewaterhouse Coopers
   Proctor & Gamble
   Prudential
   Texas Instruments
        Best Cos. for Minorities
                 Fortune, July 2001
   Advantica
   Fannie Mae
   McDonald’s
   Southern Calif. Edison
   Sempra Energy
   Xerox
   SGI
   SBC Communications
   Lucent Technologies
   Bellsouth
  What about low Credibility?
 Enron
 Arthur Andersen
 WorldCom
 Qwest
 Global Crossing

  – Moral: Bigness does not guarantee credibility!
 Your Customers have Choices:
 They can buy from you; or
 They can buy from your competitors; or
 They can choose to purchase nothing.


    – You have to give them reasons to want to
     buy from you!
   High Credibility Formula:

 Guiding   Principles
   Plus
 Communications
   Plus
 Actions
To achieve lasting high
  credibility we must
  embrace the High
 Credibility Formula
 and make it work for
          us!
    What are your Guiding
         Principles?
 What’s important to you?
 What are your core values?
 What inspires you?
    What does Success look
        like for You?
   Define your personal vision of success for
    your life and your business.
    – Do you have a written plan for your business
      for the next several years?
    – Have you ever written down your life’s
      goals?
          Writing it down is the first step toward real
           commitment to your success goals!
   Winners Make
   Commitments!

Losers Make Promises
NO commitment

  NO results
KNOW commitment

  KNOW results
Identify your Guiding Principles

     Then structure your
   business and life to both
  support and promote those
          principles!
    Examine your business from
    your Customers’ Perspective
   Open your mind to new paradigms:
    – What are you selling?
    – What are your customers buying?
        “The buyer rarely buys what the seller thinks
         he’s selling.”
          – Dr. Peter Drucker
 What do Customers Want from
       Your Business?
 High integrity
 Friendly, knowledgeable service
 Recognition
 Free from harm
           High Integrity
 Are you and your business perceived as
  being honest?
 Do you fulfill your promises to your
  customers?
 Are you candid with them when
  problems occur?
     Friendly, Knowledgeable
             Service
 Are you and your associates polite and
  friendly to your customers?
 Are your associates properly trained on
  all aspects of your business relating to
  their job description?
 Have you empowered your staff to make
  decisions to serve your customers without
  having to check with you?
                Recognition
 Do your customers feel that you think
  they are special?
 If appropriate, are your best customers
  provided special rewards, etc?
 Remember the Cheers philosophy:
    – “I want to go where everyone knows my
     name.”
          Free from Harm
 Do you provide a safe workplace for your
  employees and customers that meets all
  pertinent regulations?
 Are your products designed so as to
  reduce potential harm when used
  properly?
        Community Service
 We are all part of a larger community
  wherever we are located.
 What commitment have you made to
  serve your community?
 How do you support that commitment?
 Do you encourage your employees to
  participate in community service?
              Profitability
 Without profits your business will
  ultimately fail.
 Making a commitment to maintaining a
  profitable enterprise is part of reaching
  your long-range goals.
 How do you stress the importance of
  profitability to your stakeholders?
         Guiding Principles for
              Your Books
   We shall treat our customers and associates with
    respect.
   We shall conduct our business with high
    integrity.
   We shall recruit and maintain a knowledgeable
    and friendly team of associates.
   We shall maintain a safe place to work and shop.
   We shall serve our community in a constructive
    manner.
   We shall operate a profitable business to benefit
    all our stakeholders.
    How do you
 communicate your
commitment to your
Guiding Principles?
    Communicating your Guiding
        Principles is Vital!
   It’s not enough to just identify your
    Guiding Principles—
     – You have to tell people about them!
        Who Should You Tell?
   EVERYONE!
    – Employees
    – Customers
    – Vendors
    – Creditors
    – Partners
    – Community
How do you Communicate your
    Guiding Principles?
   As many ways as possible:
    – Business card
    – Signage in store
    – Employee manual
    – Web-site
    – Inserts with products
  By identifying your
Guiding Principles and
 publicly proclaiming
  them you begin the
    process of real
     commitment!
   Making a commitment to
training your team members is
     an important part of
 communicating your Guiding
          Principles.

  But training is expensive!
   Is it really necessary?
  Profiting from Learning

Do Firms’ Investments in Education
      and Training Pay Off?

           ASTD Report
            April, 2002
    Stock Market Rewards Heavy
        Training Investment
 Goal: Examine the relationship between
  company’s education and training
  investments and their publicly reported
  financial performance data.
 Reviewed 575 US-based public
  companies for 1996, 1997 & 1998
             What did they find?
   When ranked according to training
    expenditures:
    – Firms in top half of group had average TSR
      in following year of 36.9%
    – Firms in bottom half had TSR of only 19.8%
    – CONCLUSION: Firms in top half had TSR
      86% HIGHER than firms in bottom half.
          (TSR=Total Shareholder Return)
          What did they find?
   Comparison to S&P 500:
     During the same 3 years the S&P 500 had an
     annual weighted return of 25.5%.
    Thus, the firms in top half of the study group
     had a TSR 45% HIGHER than the market
     average!
       Impact on Bottom Line?
   Firms in the top quarter of the study
    group outperformed those in bottom
    quarter (as measured by average per-
    employee training expenditures):
    – 24% HIGHER profit margins!
    – 218% HIGHER income per employee!
    – 26% HIGHER price-to-book ratios!
    Conclusion?
Money spent on
employee training
provides a
tremendous return on
investment!!!
    Training about your Guiding
       Principles is essential.
 It establishes your corporate culture.
 It clearly communicates what’s really
  important to you.
 It sets standards for performance.
    – Are we acting in accordance with our Guiding
     Principles?
             Your Actions
   It’s not enough to just identify and
    communicate your Guiding Principles—


    – You must conduct yourself and the
      business in accordance with your
      Guiding Principles!
     Incorporating your Guiding
     Principles into your Actions
   Recruit people for your team who buy into
    your Guiding Principles
    – Use the interview process to identify the applicants
      who embrace your values
   Train around the Guiding Principles
    – Tie all training to implementation of one of the core
      values.
   Connect annual performance evaluations to the
    Guiding Principles
    – Ask each employee to write a memo each year
      explaining how he or she helped support your core
      values.
   High Credibility Formula:

 Guiding   Principles
   Plus
 Communications
   Plus
 Actions
 NO Guiding Principles =NO Purpose

 You   drift along aimlessly

 Who   cares whether you exist?

 – If you don’t stand for something
   you’ll fall for anything!
Poor Communication Results in
        Confusion
   If you can’t communicate your
    commitment to your Guiding Principles
    in a persuasive manner, who cares?

   Passionate, credible communication will
    inspire your stakeholders to take you
    seriously!
To communicate effectively you
          must:
   Be authentic
    – Speak from your core
    – Speak from experience
    – Be real
   Be enthusiastic
    – Don’t play a role
    – Be excited—passionate!
      Be passionate about your
              message:
   Deliver your message with passion and
    conviction!

   If YOU are NOT PASSIONATE about
    your message, how can your audience be
    moved to action?
  “You don’t have to be
perfect to speak; it’s your
 passion and energy that
   your audience will
       remember.”

       Tony Robbins
People don’t care how
much you know until
they know how much
      you care!
    Your Actions make the Real
            Difference
 Consistent and continuous acts which
  support your Guiding Principles are the
  most powerful communication tools.
 Ask:
    – Why are we doing this?
    – Does it support our Guiding Principles?
    – Will it enhance the perception that our
     stakeholders have of us?
 2 out 3 is NOT Good Enough!

 Inorder to achieve lasting high
 credibility you have to
 continuously conduct yourself and
 your business in a manner that
 embraces and honors your
 Guiding Principles.
         Guiding Principles for
              Your Books
   We shall treat our customers and associates with
    respect.
   We shall conduct our business with high
    integrity.
   We shall recruit and maintain a knowledgeable
    and friendly team of associates.
   We shall maintain a safe place to work and shop.
   We shall serve our community in a constructive
    manner.
   We shall operate a profitable business to benefit
    all our stakeholders.
      Your Books Action Plans
   Reading Celebration program:
    – Create reading programs in local schools;
    – Recognize students who read a certain
      number of books in a year:
          Give prizes for meeting the goal
          Establish a school reading Honor Roll and
           publicize it in the store and on their website
      Your Books Action Plans
   Develop a community of readers
    – In-store events (readings by authors, etc.)
    – Set up reader’s clubs based on various topics
    – Host monthly meetings in the store for club
      members to meet and share opinions
    – Connect readers to others with similar
      interests over the website
    – Solicit reviews of books from customers and
      post on website and in the store
      Your Books Action Plans
 Recruit booklovers as employees
 Provide detailed training to keep staff up
  to date
 Make the website “user-friendly”


    – Make Your Books the preferred shopping
     destination for all readers!
 Knowledge is
potential power!
           3 Types of People:
   Those who make things happen,

   Those to whom things happen, and

   Those who stand around wondering what
    in the heck happened.
      To Build a Lasting High
     Credibility Business or Life:
   Use this new knowledge for your benefit
    – Identify your Guiding Principles
    – Communicate those Guiding Principles to all
      your stakeholders
    – Commit to action plans that support and
      honor your Guiding Principles
       And do it with Kindness!
   Be kind to:
    – Yourself
    – Your family
    – Your employees
    – Your customers
    – Your friends
        EVERYONE YOU MEET!
“I expect to pass through life but
once. If, therefore, there be any
   kindness I can show, or any
    good thing I can do to any
 fellow being, let me do it now,
   for I shall not pass this way
              again.”

           William Penn

				
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