Careers, Family, and Gender: Managing Effectively in Today’s Shifting Workplace

Over the past fifty years, America has seen steady shifts in the makeup of its workplace. Managing these changes in career, family, and gender have needed to be addressed by both HR and workers themselves. Pamela Tolbert, professor from Cornell’s School of Industrial and Labor Relations, has been studying how social changes affect organizations and vice versa. She sat down with eCornell’s Chris Wofford to discuss how organizational leadership can address challenges for workers in today’s workplace and what they can do to create a more progressive environment that leaves everyone at the table more fulfilled.

What follows is an abridged version of that conversation.

Wofford: I think one of the through lines to today’s conversation, the thing we’re going to be talking about is work-life balance. Why is that an issue today? What’s the landscape look like? Give us some perspective.

Tolbert: So this gets into how organizations affect social life in part. And I think there are a couple of things that have led to this becoming a really big issue today particularly. I mean people have always worked, people have always had families. But there’ve been changes in both families and the workplace that have kind of lead to a perfect storm in how these two spheres relate to each other. We moved from the kind of traditional family where you have the husband is the bread winner, and the wife stays at home and takes care of things, to a place where you have dual earner couples are common place. And that change occurred pretty quickly actually. About 50% of all families, the husband worked, the wife stayed at home. By the 2000s, it was somewhere between 60% to 75% of the workforce were dual earners.

And then the workplace really didn’t change that much. You know, you have this big social change going on outside the workplace that affects it, not so much adaptation.

Wofford: I’m curious what companies are doing.

Tolbert: So there are a couple of major experiments in particular that I think are really promising. And part of the thing that makes them I think work, is that they’re really focused on rethinking how we work. Not just trying to help people manage work family relations, but the basic premise, these are a couple of experiments. One was done at Best Buy.

Wofford: What happened at Best Buy?

Tolbert: In the case of Best Buy, it was called Results-Only Work Environment (ROWE). So in that case it was started by their HR, but they were very conscious of the fact that part of what had gone wrong in the accommodations arrangements, where you have to ask your supervisor if you’re going to take a leave, or you have to make a deal to have flexible work arrangements. So it’s clear that it’s very important to get the supervisors involved in this. That it’s not something that’s just imposed upon them. So what they did was to bring together teams of employees and their supervisors, and the supervisor was responsible for helping the team come up with the ideas and to think the processes through essentially- everything is fair game. Let’s think about the meetings that we have. Let’s think about whether we could use technology more effectively to do things, rather than having all these meetings. If we made some kind of scheduling arrangements, could we then allow people to have more time off, so that they’re not having to be there constantly? Just to be more effective in thinking about the arrangements for coordinating and controlling.

Wofford: They would close the loop on a lot of their initiatives.

Tolbert: Yeah, yeah. So they could readjust. And it turned out it was a very effective program. I mean the employees were incredibly enthusiastic about it. It spread to a large number of others- it started at headquarters, and then it spread throughout the company, and actually a number of other organizations adopted it. They had data, it reduced turnover by almost half.

And the employees reported that they were getting more sleep, they had more energy, they could focus better, because of being able to control their work. So I think part of what’s important here is that because people were motivated to try and think, how can I work better? Because they have the carrot at the end, that your life would actually be improved. It’s not like, think how to work more efficiently so you can work more often.

With a national policy you could kind of provide incentives for employers to spread the work out a little bit more. Everybody would benefit. Including families. And all kinds of things. So that’s one direction that things could go. We also have model organizations to provide pathways. I mentioned the SAS corporation. There is a case study from … I think it’s in the Harvard. But anyway, it’s about this big data analytics company which has been around since, I don’t know, 1976 maybe. It’s a successful company. Always done well. This is the one where they have a 35 hour work week policy. Although people are also expected that if you’re needed you will be there. But the norm, you have a norm that work is not supposed to wake up every day of your life. They provide childcare policies. It’s a very employee centered company.

And the case makes it sound like Shangri-La. But the thing is is that it’s a private company and I think it’s easier to do that than in a public company because in a public company you start getting pressures from stockholders to cut out the fat and make it run more effectively. It is a private company but it’s had like a 10% sales growth on average every year since it was founded. Clearly it’s succeeding. It’s not like the “fat” is being wasted. You can’t make it an HR sort of project. You’ve got to get it spread throughout the company. But HR’s historically been sort of the champion of these kinds of initiatives.

So I think that the thinking about work and family as kind of integrated whole is an important thing for policy. For national policy but also for company policy.

Want to hear more? Watch the recorded live eCornell WebSeries event, Careers, Family, and Gender: Managing Effectively in Today’s Shifting Workplace, and subscribe to future events.

Workplace Harassment: Making Sense of Rapid Developments in the #MeToo Era

Workplace harassment is a complex and multi-faceted issue that affects every industry. Susan Brecher and Katrina Nobles from the Scheinman Institute at Cornell University are faculty experts in the fields of conflict resolution, employment law, and employee relations. They sat down with eCornell’s Chris Wofford to discuss the various ways in which organizations can respond to workplace harassment.

What follows is an abridged version of their conversation.

Brecher: Katrina and I worked for the Scheinman Institute, which is the institute for conflict resolution at Cornell University. I am the Director of Employee Relations, Employment Law, and Diversity and Inclusion, all of which directly relate to today’s topic. Katrina is the Director of Conflict Programs for the Scheinman Institute. She works on many projects related to conflict both on and off campus. Harassment is a topic that often brings up conflict.

Nobles: In addition to our work with Scheinman Institute, we host a public workshop series. Organizations then ask us to bring the topics covered in the workshops to their offices. These training topics include employee relations, conducting investigations, and employment laws, as well as programs on cross-cultural communications and conflict. We also help build organizational structure around what was learned.

Wofford: What does harassment in the workplace look like?

Brecher: Federal law does not define workplace harassment, and therefore it is open to interpretation. The working definition of sexual harassment includes unwelcome sexual advances, requests for sexual favors, and physical contact. The other definition relates to all forms of harassment in the protected classes: race, gender, national origin, and age. Here, the focus is on verbal or physical areas of conduct, and how they denigrate or show hostility. The two areas of focus are power-based harassment, and environmental, or the existence of a hostile work environment. These all relate to federal law, but there are state and local laws with even greater protections.

Wofford: How do the workplace policies relate to the legal definitions?

Brecher: Policies contain the minimum legal standard, but many go beyond that. Companies are looking for a higher expectation of respect and dignity to bring them in line with their mission and value statements.

Nobles: For many, their mission and value statements represent the ideal. They want to represent these strong values. However, the actions and behaviors that would support this don’t often occur. Missions and values are hard to define and are perceived through multiple lenses.

Brecher: In our trainings, we encourage leaders to find out what the terms mean to the people they work with, instead of assuming they know the answers.

Nobles: We often talk about what respect and dignity looks like. For example, if you show up to a meeting late, is that disrespectful? Opinions differed.

Nobles: How do you account for differences in working style, or generational differences?

Brecher: Workplace styles don’t necessarily break down by generation. And while I know there are generalizations or stereotypes, and it gives us insights into individuals, that’s where we begin to have problems and misunderstandings. One of our goals is to really help people understand their reaction to behaviors.

Nobles: We approach each person as an individual. We try to understand employees’ working and conflict styles to determine how we work best together. We focus on individual culture, social identities, and upbringing. For example, what part of the country did we grow up in? The answers make a huge difference.

Brecher: There’s often a great “A-Ha!” moment when individuals can see you’re not attacking them, but instead recognizing that they come in with a different lens. Some of those lenses negatively impact behaviors.

Wofford: Are companies today concerned about liability?

Brecher: Most organizations are less concerned about liability and more concerned about media exposure, in particular social media. When I train managers I ask them, “Would you like to see yourself on the news engaging in these behaviors? Or on social media?” And all of a sudden another “A-Ha!” moment arrives. Managers need to know what to say because we tell managers they have to report. Some managers think, “If I don’t see it, I don’t have to report.” We now teach them that yes, they do have to do something. But we want them to feel comfortable speaking, so we teach them the words to say.

Nobles: Speaking up is powerful. We need to empower employees to speak up themselves if they’re put into an uncomfortable situation. If they’re not comfortable doing that, they need access to the appropriate channels where someone else can speak up for them.

Brecher: Too often, we’re reacting to the person that comes to us and says, “This person has been doing this for the last six months,” as opposed to supporting the culture in which that person may have said after the first time something happened, “I’d like to give you some respectful feedback.” Having those support points earlier on makes it a completely different organizational culture.

Nobles: Everybody has a different perception of what should be permissible, based on experience and culture. At work, our cultures are meeting everybody else’s culture, and we may have differences. Conversations help the shared understanding around actions and behaviors.

Wofford: Some HR managers are expected to have an enormous degree of responsibility. Is this fair?

Brecher: HR must partner with the experts in the organization to build relationships so that as a team, managers better understand their operations. Partnering opportunities are vital. You have to approach it as a group from an organizational perspective.

Wofford: Should managers learn to investigate instances of alleged harassment?

Brecher: Managers should not conduct investigations unless they know how. Sometimes this can be guided by people who have that expertise.

Nobles: The best tool is to have somebody from your organization attend a full training on how to conduct investigations, because it is complex.

Want to hear more? Watch the recorded live eCornell WebSeries event, Workplace Harassment: Making Sense of Rapid Developments in the #MeToo Era, and subscribe to future events.

Order Out of Chaos: A How-To for Hospitality Planners and Developers

While project management is important in many occupations, for some it is especially crucial and can be a determining factor for success. Brad Wellstead, professor from Cornell’s SC Johnson College of Business, has over thirty years of experience in architecture and project management and has seen first-hand the importance successful project management means for planners and developers. He sat down with eCornell’s Chris Wofford to discuss the importance of leadership and management abilities in hospitality today.

What follows is an abridged version of that conversation.

Wofford: If you’re getting started in this field, what are the particular skills and ability that would benefit one most?

Wellstead: Good project management skills include understanding and getting your hand around scope of a project and being able to schedule and budget and build teams and so on. But then that works into the characteristics where you, as the leader of a project, it’s about team building and significantly excellent communication skills. You have to be a motivator and you have to be a coacher.

Wofford: Budget creation seems like it would be a particular challenge. Any advice on how to deal with that?

Wellstead: Real estate development is interesting because there’s usually one team that comes up with how much money we have to spend on a project. Then, it’s handed over to the group that has to actually execute the project. They say, “Okay. Here’s your budget and your scope, and, oh, by the way, a schedule and make sure it happens in all those conditions.” That handover, that nexus right there, is always a challenging one, particularly if there were any last-minute changes based on feasibility or needs of the project or so on. That gets smoothed over by having the involvement of a project manager who is running it throughout the entire project so, when in fact you are creating budgets, they are able to contribute and add-in the necessary factors of contingency, both time and money to incorporate those so that they’re in as part of it from the very beginning.

Wofford: When you’re involving stakeholders, what are the expectations as far as presenting the state of the project?

Wellstead: When you’re in the implementation stage, when you’re spending 60, 70% of your overall budget, design fees, and construction, that’s when the real money is getting spent. There should be often weekly meetings between the owner and the architect during the design phase and the project manager, of course.

That keeps them up to date and/or the project manager keeps the owner up to date on a weekly basis that way. As you move into construction, typically weekly, sometimes biweekly, meetings of the owner, architect, and contractor. Again, with the project manager representing the owner. That keeps everybody up to date with what’s going on.

Wofford: Tell me what somebody might get out of your course as it relates to what we have been discussing today?

Wellstead: It starts with the understanding of the project and getting your arms around it, the skills of creating a schedule and a budget and running through the whole impact management point of view with some … I don’t want to call them detours, but we talk about creating RFPs and team building and such.

And quality schedule and budget. I’ve never had an owner say, “You know what? Scope and schedule are critical thing. I don’t care about quality. Give me a bad project. It’s fine.” No, that never happens. It’s always come more down to schedule and budget.

Then, there’s this whole other part of that culture that we talk about in the course where it analyzes who the leaderships are and some of the things we talked about when we’re talking about contingency because it leads to understanding how you address contingencies. Is it white hot construction? Is it crazy municipality? Is it a community that’s going to be anti or for development? Is it a difficult site to work in and a whole lot of internal things that are happening as well as external things that could be happening so it gives you this really comprehensive, holistic view of the project that once having done that, you have a sense of how you’re going to move forward.

All of that pulls all that together. Those are the main things: the culture, schedule, budget and the team building and then the impact management aspects.

Want to hear more? Watch the recorded live eCornell WebSeries event, Order Out of Chaos: A How-To for Hospitality Planners and Developers, and subscribe to future events.

Why the Ability to Read Data is Just as Important as the Ability to Read

Working with spreadsheets and analyzing data is no longer reserved only for those who crunch numbers. Today, all fields are relying more heavily on making data-driven decisions and utilizing spreadsheet modeling as a tool for growth. Donna Haeger, a Cornell professor of economics and management, sat down with eCornell’s Chris Wofford to discuss the growing impact spreadsheet modeling is having on business.

What follows is an abridged version of that conversation.

Wofford: How does spreadsheet modeling relate to business analytics? How do we distinguish the two?

Haeger: The spreadsheet modeling piece is really taking the unstructured data. We’re structuring it into an organized fashion. The business analytics piece is really the data-driven decision-making that we’re doing, so making the decisions on the model are what we’re doing when we’re performing business analytics. If we’re using optimization, we want the result of the model to tell us what we should do – how many of a particular product we should produce based on our criteria and our goals. We could also do predictive which is a forecast, like a simulation.

Wofford: What are some typical obstacles? For some people, this is very fresh and if you’re really starting to take your analytics and your modeling seriously, what are the typical obstacles that people run up against when they’re first starting to think about this as a strategy for their company?

Haeger: I think the biggest obstacle today is how much data we have. We’re drowning in data. I always tell my students data is not the problem. We have so much data that we don’t know what to do with it. Most of the startup companies that are working in data analytics are basically becoming specialists in spreadsheet modeling and other types of data modeling so that they can answer questions. And I like to say that every company that has data, which is every company at this point, they’re swimming in answers to questions they haven’t even begun to ask – and that’s a pretty amazing place to be.

Wofford: What is your experience as far as when you work with students? Can you just speak to that broadly about this as a career path or if somebody’s actually already established in a position, how might it benefit them to learn about this?

Haeger: That’s an interesting question and I get this all the time – things like what job titles am I looking for. I have not found a position, an internship or a permanent job, that does not involve data in the business realm as of late. And so that’s interesting because I like to say that this whole thing about data is ubiquitous, like it’s everywhere. There are very few jobs right now that do not relate to having some data literacy, so understanding how to take data and turn it from data to information, which is structuring the data and then analyzing it and turning it to some knowledge is it’s really hard to find a position where you don’t need to know how to do that.

In fact, we’re starting to hear that people are being encouraged to learn a programming language on top of being able to be working with the data.

Wofford: What is that?

Haeger: When you’re working with spreadsheet modeling, you have a lot of control over the data that you receive, however, it depends. Everyone has a choice. I call it a Venn diagram. We’ve gone from where we used to send an email to IT and say, “I need some data, please send it to me” and the business people would get the data from IT.

Wofford: I mean if we talk about data literacy across an organization, for example, there’s certainly a case to be made that everybody should be to literate in some way so we know what we’re talking about. Are visuals where it’s at?

Haeger: We all love pictures, right? I think most of us are visual and even if we’re not visual having the spreadsheet model – and when we say spreadsheet model, it could be a pivot table, table, columns, rows, a chart – when we turn it into a visualization, we’re answering a lot more questions in one image. When we illustrate it this way and if we do a good job with it, it’s much easier for people to answer their own questions and interact with the visual. We’re starting to actually create dashboards now where we’ll create several different pivot tables, pull out some visualizations, put them all on one tab and create slicers where the individual isn’t just looking at three or four images but also being able to hit the slicers and interact with the data. So now you’re answering thousands of questions by interacting with what you see on the dashboard.

Want to hear more? Watch the recorded live eCornell WebSeries event, Why the Ability to Read Data is Just as Important as the Ability to Read, and subscribe to future events.

 

How Entrepreneurs Think and Behave

“Entrepreneurial thinking is about imagining the end and creating the means.”

That’s the mantra of Neil Tarallo, a senior lecturer at The Hotel School at Cornell University and the director of Cornell’s Entrepreneurship Bootcamp for Veterans with Disabilities. Tarallo, who learned about entrepreneurship at the knees of his father and grandfather, says that the term ‘entrepreneurship’ has become too closely tied with startups when in reality entrepreneurship is not solely about starting a business. It is a way of looking at the world.

As part of eCornell’s Entrepreneurship webinar series, Tarallo spoke with Chris Wofford about the behavior traits of successful entrepreneurs and the foundation for entrepreneurial thinking. What follows is an abridged version of their conversation.

Wofford: Nice to see you again, Neil. The last time you were here we covered the business model canvas, (((link to previous transcript))) a great tool for entrepreneurs and managers. Today we’re going to be talking about how entrepreneurs think and behave. Why is this something we should look at? What can we hope to learn from today’s talk?

Tarallo: For me, having been an entrepreneur and then moving into an academic environment and teaching the subject, one of the things that became apparent is that entrepreneurship is less about starting businesses and more about how the people who start these businesses think and behave.

Over the past four or five years, there’s been some really great research into how entrepreneurs behave and documentation of the behaviors of expert entrepreneurs. For me as an academic, if we can teach those behaviors and help our students understand those processes, we can put them on a path to be much more successful in their endeavors.

Wofford: The obvious question here: What are those behaviors?

Tarallo: I think more than anything else, the behavior can be summed up as a level of comfort in moving forward without really understanding what the final goal will be or even which path you will take.

One of our Hotel School alum put it really well: “Most of the world needs to know every turn and every nuance in the path that they’re taking wherever they go. Entrepreneurs just need to get to the first turn. When they get there, they’ll look around and evaluate their environment and then they’ll make a decision on which way to go based on that information.”

To start a business or to create something new is very dynamic and it requires that we have a lot of information coming from the environment around us and that we can use that information to find the right direction to go.

Whenever I talk about this subject, I always like to define entrepreneurship because it’s really interesting to me that as I talk to people about what entrepreneurship is, there are a lot of different impressions.

While I wouldn’t say that anybody’s really wrong about how they define entrepreneurship, I like to make sure we’re on the same page. So I always start out by asking, “What is entrepreneurship and what does it mean?” Many of the definitions of entrepreneurship that you see involve some reference to starting businesses and honestly I’ve moved very far away from that. For me, entrepreneurship includes starting businesses but it’s not solely about starting businesses. I like to define entrepreneurship as the process of creating value by bringing together a unique package of resources to exploit an opportunity.

If you use this definition, you’ll see that entrepreneurship and entrepreneurial behavior can occur in many different contexts. As we remove the idea of a startup being the focal point of our definite measure of entrepreneurship, we find that it applies to corporate environments, social enterprises and nonprofits.

Wofford: So you’re saying that maybe people have actually exhibited entrepreneurial behavior but they might not think of it that way because the idea of being an entrepreneur is so closely related to having started a business?

Tarallo: That’s right, it’s really not just about starting businesses. The behavior aspect of it really winds up being an alternative way of thinking, and it’s a way that I approach my entire life and especially my work.

I think about entrepreneurship as being a capacity to perceive and act upon opportunities based on the environment around you and the ability to create and build something from practically nothing. That’s what really great entrepreneurs are able to do, and it involves putting things together in a way that other people haven’t thought of yet.

Wofford: We’ve got some questions coming through in the chat box here and I’m just going to throw one out at you and then let you respond: Do you think entrepreneurs are born or can we teach people to be entrepreneurs?

Tarallo: Well, I sure hope so because Cornell pays me to teach people about entrepreneurship! There is some research out there about how some people are born thinking effectually, meaning they think entrepreneurially. If you watch children playing together, you can see this really clearly. When you see little boys sitting down playing and they have a whole bunch of dump trucks but they need a firetruck, they don’t just say, “Oh geez, we don’t have a firetruck so therefore we can’t have a fire.” No way. What they say is, “Okay, you see this dump truck right here? From now on, that’s our firetruck.” And from then on out, any time one of them touches that firetruck, they’re making the siren noises and all that. That’s a form of effectual thinking.

What we’ve learned is that as people move through the education system in the United States, and I would argue in most other countries, they become less and less effectual in their thinking and they become more focused on how to get someplace and what is needed to accomplish something along that defined path. We work on changing that and it is something that I definitely think we can teach.

Wofford: How do you teach people to maintain or reclaim that effectual thinking?

Tarallo: When I came to the Hotel School at Cornell, my responsibility was to help hotels move their entrepreneurship programs forward. One of the first things we did was to separate the skills and tools that we can teach in the classroom – marketing, finance, those kinds of things – from the behavioral component of entrepreneurship.

The only real way to teach the behavioral part of entrepreneurship is to really immerse the students in the behaviors because that’s where you learn. I learned to be an entrepreneur at the knees of my father and my grandfather because they immersed me in that behavior. Teaching practical skills in a classroom is a very simple thing to do, but the behavioral part is a little bit more challenging.

But we do know that we can teach people to be entrepreneurial. Research shows that if you have had even one formal entrepreneurship course, your likelihood of succeeding as an entrepreneur increases exponentially. That’s because you start to become aware and you start to become conscious of these things as you go along.

Saras Sarasvathy, who has done some really great research at the University of Virginia into how entrepreneurs behave, has identified the two primary ways that people think as causal and effectual. Let’s break those down a little bit. Causal thinking is what we’re all accustomed to and what most of us do throughout the course of our day. In business schools, this might be characterized as a managerial way of thinking. Basically this is thinking about how to achieve a predetermined goal. This is when you say, “Okay, here is the challenge I have in front of me and this is what I am going to do to overcome it.”

The next level of thinking is called strategic thinking. In business schools, we sometimes equate this with creative thinking. This is about generating new means to achieve a predetermined goal.

When it comes to effectual thinking, and this is what Sarasvathy identifies as the way entrepreneurs think, it’s more about moving forward by understanding the means that are around you. Instead of saying, “This is the goal that I have”, what you’re saying as an entrepreneur is, “Here’s the problem I need to solve.” The goal is the solution to that problem but in effectual thinking you are not specific about what that solution might be.

Wofford: To oversimplify it, it’s sort of going with the flow, right? Reacting to what comes along?

Tarallo: Yeah, in a way. Sarasvathy also talks about not thinking about either the means or the end but just understanding the problem that needs to be solved and then kind of letting everything take you in that direction.

Entrepreneurs understand that we can’t control the future, nor do we want to. Because if we let the future unfold on its own, generally speaking it will be driven by our customers and therefore the solution that we create will be the solution that our customers desire. That’s why expert entrepreneurs tend to be more successful than others.

Wofford: Something I’ve heard a lot in the startup world is this idea of the agile methodology. I mean, in the end you’re trying to solve a problem and your solution might look very different than what you initially anticipated.

Tarallo: That’s absolutely true. You know, when anybody comes to me with a business idea and asks me what I think of it, I always tell them that it doesn’t really matter what I think. In fact, it doesn’t really matter what they think about it either. You can only present a product or a service; in the end it is only the customer’s opinion about it that matters.

As I evaluate whether or not someone has the potential to really be a successful entrepreneur, one of the things that I think about is how willing they are to be flexible with the solution that they’re creating. The problem we see with new and inexperienced entrepreneurs is they have this vision of what their company is going to look like and they follow that vision to the exception of all the information that’s around them. That leads to failure.

Wofford: Is this in part because they’ve put too much emotional stake into it?

Tarallo: Exactly. They get very personally attached. You have to be willing to let go. What’s interesting about some of the research into the behavior of expert entrepreneurs is that the only thing that matters to them is solving the problem. The thing that’s really compelling for them is that there’s a problem out there or a gap in the marketplace that needs to be filled. They don’t care they do it, they just care that it gets done.

I’ve created this little mantra: “Entrepreneurial thinking is about imagining the end and creating the means.”

To go back to Sarasvathy, she has something called “the lemonade principle”. This is about the old saying that if the world give you lemons, make lemonade. Entrepreneurs understand that when we have something happen to us, there are usually opportunities to be found. How do we take this worst case scenario and turn it into something that is a true opportunity? How do we move forward with it?

I have another little saying: “The world doesn’t happen to me but the world happens for me.” In other words, when bad things happen there’s generally an opportunity there for me to do something different and new. It’s the old silver lining in the cloud kind of thing.

Another one of Sarasvathy’s principles of entrepreneurial expertise is what’s called “the patchwork quilt”. This is about the fact that entrepreneurship is really messy. It never goes according to plan and things happen that force you to change what you do. So instead of looking at things like a puzzle, where we have very specific pieces that fit into very specific spaces, which is what most causal thinkers would do, for entrepreneurs it’s more like a patchwork quilt. It’s more about finding a piece of fabric and sticking it in, then finding another one and realizing you can fit it in over there if you squeeze it or stretch it out a little bit. No matter how I do it, at the end of the day it’s going to create a big quilt that will keep me warm. But I have no idea what that quilt will look like before I start down that path.

I’ve only touched on a few of Sarasvathy’s principles of entrepreneurial expertise, but I encourage everyone to look them up because they are all very interesting.

Wofford: Great. I can see that we are quickly running out of time. Do you want to leave us with some parting words?

Tarallo: I want to stress that entrepreneurship is not something you do, it’s a behavior. I’m really working hard personally to scrub entrepreneurship as a word that I use to describe a career, because it really is a behavior for me. It’s the way that I act, the way that I think.

Wofford: Neil, thank you once again for joining us. I know you are going to be coming back soon for a webinar that looks at innovation. I’m already looking forward to it.

Tarallo: Thanks, Chris. This was fun. See you next time.

Want to hear more? This interview is based on Neil Tarallo’s live eCornell WebSeries event, How Entrepreneurs Think and BehaveSubscribe now gain access to a recording of this event and other Entrepreneurship topics.

Adding It Up: Hidden Lifetime Costs of Sexual Assault and Misconduct

Victims of sexual assault, violence, and misconduct suffer in multiple ways following the crimes committed against them. Liz Karns, professor from Cornell’s ILR School, has been following the lifetime costs for victims of these sexual crimes. As both a lawyer and an epidemiologist, she is tackling the data from an interesting perspective and sat down with eCornell’s Chris Wofford to discuss the lasting effects for survivors both on campus and in the workplace.

What follows is an abridged version of their conversation.

Wofford: You are an epidemiologist and also a lawyer, so you’re coming at this from two very interesting angles that together make for a really compelling story, so tell me a little bit about when you started looking at this and your experience.

Karns: As an epidemiologist, I started thinking about it just in terms of the types of data we would have, right? But it wasn’t until I went to law school like 13 years after being an epidemiologist that I started applying it to sexual assault, and in that context, I treated, and I continue to treat those cases just as I would any type of medical malpractice case or environmental harm case. They are the exact same set of ways that we assess damage. We need the studies, we need the research, we need the experts, and, it’s been a while coming that we got all of those things together. But at this point, we have so much research, so much information that makes it quite clear that the cost is a lifetime cost, and that currently it is usually the person, the victim, who pays for that – and that’s my interest, is to shift that.

In 2015 we had like a banner year of doing lots of different studies, and these studies were all essentially asking the same, which was ‘Have you been sexually assaulted while in college?’ And, there was some slight difference in terms of the phrasing. This was a study that was done by Kaiser and the Washington Post, and we have 25% of people who were assaulted since starting college, 20% for women, 5% for men. We see pretty similar pattern across all the different places, right? It never varies in a big way. The one that says 27 AAU, this was a study that Cornell was part of. We had 27 different colleges that did the same survey, and it’s important to have this information because it’s consistent across studies. There’s so many people who will say, ‘Oh, but people just make that up or it was dependent on the respondents.’ There’s been a lot of reliability and validity testing on this and this is solid data. The sad thing is that this the exact same data that we had in 1987. The numbers are the same since 1987 – roughly 20% is a consistent thing and it has not changed with anything.

Part of the reason that we add this up is that money matters. Somehow when we start attaching a price tag, people become more accountable, and the different systems that we look at are the legal systems. We’ve got the criminal and the civil system, and the financial obligation that arises out of that. Let’s imagine that a perpetrator is found guilty, and under the criminal system, ordered to pay restitution. That means they have to pay the victim money, and that is a contract now. That cannot be discharged, under a personal bankruptcy, so it is something that will stay with that perpetrator forever until they’ve paid it off.

Wofford: Wow.

Karns: That would change the world.

Wofford: I would imagine.

Karns: This is the standard approach to all injuries. This is exactly what’s used in your car accidents, your slip and falls, medical malpractice, everything else, so it’s interesting that people don’t think of it when it comes to sexual assault. So it’s part of my job, to articulate it, and make people think about that. If we assign dollars, we’ll get societal change. I’m quite sure about this one. The person initially talks to the psychiatrist, and then talks about different situations that this arises in, to figure out how invasive it is in their life. I have had people who could not go to covered parking lots ever again in their lives, and that meant that they would drive 50 miles out of the way to go to a different train station because they didn’t wanna use that one that had the covered parking lot. That meant that she couldn’t take certain jobs, so it’s got this sort of ripple effect.

Wofford: Yes, exactly. So what I’m getting at, or where I was going with that was, linking this particular diagnosis to these behaviors, and I wonder often how that plays out legally.

Karns: Yeah, well, I mean it’s absolutely part of the case because you’ve got, first the initial injury, which is the assault itself, and that doesn’t have a huge amount of value, obviously, like in terms of money, but the ways that it impairs one’s life after that are what get documented. That is the job of the lawyer to go through and describe the day and the life – you bring in different experts to say, this person will have a very predictable set of problems when they have their own children, so that’s a cost that you should be thinking about.

So the expert is who ties this person’s diagnosis and situation and then projects it forward, and when I’ve worked on medical malpractice cases where we had something happening to an infant, we would do the same thing. We’d say this is what their life looks like in the future.

Wofford: Yeah. Okay, behavioral health, again, this is not a big surprise, that they are more likely to be using alcohol or hard drugs, and they’re aware that they need to cut down, so they are aware that they’re using it as a substitute for treatment, if you will. And then this is the one that the insurance company knows is that they continually use more healthcare than non-victims, so whenever somebody discusses, gosh, maybe we should decide this is a preexisting condition, you can see why the insurance company is interested in that ’cause these are very costly, they have higher costs, 20% higher.

Karns: So, when people start acknowledging that the assault occurred, and that’s a process in itself, and realizing that they need counseling, it’s not unusual to have a diagnosis come up from that. They don’t have to go and seek a diagnosis to say, ‘mmm, boom, I have it.’ It’s going to evolve, and you have this statute of limitations, so you have so many years afterwards, that depends on your state, to file this case, and so, you don’t have to seek it right away. If you’re gonna build a case, and you’re talking to your lawyer, right, a lawyer, then they will very much ask you, ‘Are you in counseling? Do you have a diagnosis?’ Most of us have health insurance that would cover some aspect of that so there’s some record of that as well.

Wofford: So you’re recommending that the damages are then directed to the perpetrator, legally. What is the state of the law, what’s happening out there, as far as cases like this? Is this line of thinking adapted?

Karns: Yeah.

Wofford: Okay, so this is nothing new.

Karns: This is not, nothing I’m doing is new. All I’m doing is calling attention to it in a different way, and the way that I check myself, if you will, is that I look at what are called default cases – these are cases where the perpetrator, who then became a defendant in civil court, never showed up and the plaintiff, the person who experienced the assault, has the right to make the argument of, ‘What are the costs?’ And then the judge assesses those costs and decides whether or not they’re warranted.

This is all about true economic loss.

But, compensation funds will actually pay for things like therapy, so you could get that immediate counseling that you need, it’s just onerous to get there. Second one is – I mentioned this before – criminal restitution. This is part of any court process, that the criminal court can order the perpetrator to pay the victim. And then finally, civil damages, and this is the one I think most of us are familiar with, where we undertake legal action. The plaintiff, the person who is the victim, brings the case against that defendant, and everything I’ve talked to today goes into that damages number, and then that number gets used all the way through the civil court process, so demand letter, complaint, arguments.

So shifting the burden is what we need to do. That is absolutely what we’ll have to do. So things we can change. One, sexual assault happens in schools quite a lot, and we need to address the fact that it interrupts their education, and we need to think about a student loan deferral on this. It’s absolutely mandatory. The legal ones, holding the perpetrators responsible. And then finally, support, engaging survivors in discussions about the economic impact.

Want to hear more? Watch an excerpt of the live eCornell WebSeries event, Adding It Up: Hidden Lifetime Costs of Sexual Assault and Misconduct, and subscribe to future events.

Empower Your Team Through Servant Leadership

Servant Leadership is fast-becoming a prominent leadership style, and for good reason: It tends to increase trust and collaboration among team members, helps to build coalitions and community, and promotes ethical business practices.

While many leaders use the power of their position to direct and control employees, the servant leader listens; her focus is on understanding employees to develop and support them. Servant leaders flip the traditional relationship between the employee and the leader, fostering a strong service culture by empowering and involving workers.

As part of the eCornell Entrepreneurship webinar series, Judi Brownell from Cornell’s School of Hotel Administration joined Chris Wofford for a interactive discussion on how servant leadership can transform your organization to one that is service-centered and culturally inclusive.

An abridged version of their conversation follows.

Wofford: Judi, we previously had a great conversation about the art of listening as it relates to leadership (((link to previous transcript))). Today we’re going to be covering the concept of servant leadership. What is that? It sounds like a response to a top-down leadership style.

Brownell: Well, servant leadership is relatively recent. The term was coined at some point in the early 1970s, but it was only recently that it became a truly prominent leadership style. What happens in servant leadership is that the follower experience really changes. Instead of followers taking a backseat and looking to a leader as the one who knows everything, servant leadership really puts the power front and center.

A servant leader follows a philosophy of service. A servant leader needs to believe that his or her role is really to serve, and they get satisfaction and gratification out of that type of behavior.

Wofford: I don’t want to preempt something you plan to talk about later, but does gender figure into this?

Brownell: It’s fine to talk about it now. I’ve done a lot of work with women’s career development and I do believe that men and women have different sets of competencies that come naturally to them. There are some people who would disagree, but men tend to be more assertive and more readily authoritative. Women tend to be better listeners. Women tend to be more emphatic.

The servant leader has a lot of characteristics that have always been associated with women’s leadership style. The wonderful thing is that, where in the past these characteristics may have been associated with weakness or pointed to as reasons why women are less effective, now the pendulum has swung and these same characteristics fit perfectly with the philosophy of servant leadership.

Wofford: And what’s at the heart of that philosophy?

Brownell: Servant leadership empowers followers. Rather than telling them what to do, and giving them a little bit of training here and there, servant leadership is about really developing your employees, really sitting down with them and asking, “What is it that you need to do your job better?”

It’s about looking at each employee as individually as possible. I believe that the opportunity to do this exists in most organizations. It could be as simply as just sitting down with people and asking, “Are you happy at your job? What is it that I can do as a leader to help?”

A leader presumably has more access to more resources and can perhaps shift an employee to a better position or cross-train them or whatever it is that they need to be happier and more effective in their work.

Wofford: We’ve got a good question here from Karen. She writes: “Yes, the servant leadership style may be more like a ‘woman’s style’ but in my experience (and I think research backs this up) men’s style of leadership includes a mentoring skill, whereas it is harder to find women leaders who mentor other females up the ranks.” Judi, any thoughts on that?

Brownell: Yeah, I’ve got lot of thoughts on that. I did a lot of work on that particular problem, in fact. This is really digressing from our main topic, but it’s interesting. I did a study asking women coming out of an MBA program whether they thought they would be as effective as men in a leadership role. They all said yes.

Then I asked them if they would rather work for men or women, and almost 90 percent of the women said they would rather work for a man than work for a woman. When it comes to mentoring, women either are the very best team ever or they are in conflict with one another, particularly when they are in an organization with very few women and a lot of men.

We need women mentoring women and we need women being advocates for women. And I think there are a lot of women out there who are great mentors – we just need to expand that pool. I think if organizations can build women’s confidence, then they will do a lot more to mentor other women.

Wofford: You said that was a bit of a digression. Where were you planning to go?

Brownell: I wanted to talk about the importance of compassion in the workplace. If you’re a servant leader and you really listen well to your employees and to your colleagues, it really does start a very positive chain reaction. People will see you as a role model and then they too will begin to also listen and be more compassionate in the workplace. Satisfaction at work really escalates when people feel like they are friends. There was a time when employers didn’t want their workers to be their friends because they thought the employees wouldn’t be as productive, but actually we’re finding that almost the opposite is true. The feeling that you’re surrounded by people who care about you makes a huge difference in how we feel about the workplace.

Wofford: Still, from an employer’s standpoint it’s a lot harder to fire someone you’ve become friends with.

Brownell: Yeah, well that’s true. It is harder to fire a friend, for sure. But I’m not talking about friends in the sense that you go bowling together after work. I mean a friend more in the sense of caring about someone because you know a little about them and they know a little about you. But your point is really well taken because that leads to another really interesting area, which is how close can you be with people that work for you without creating perceptions of preferential treatment or favoritism.

Nevertheless, compassion, empathy and caring is really important for a leader. The servant leader feels that the organization is in their care, so they care about its people and everything in it in a way that’s somewhat different than a leader who feels like they own the organization and that they’re driving it in whatever direction they want.

Another thing that I think is really interesting that characterizes the servant leader is self knowledge. I think often we’re so caught up in the actual doing – do this, do that, have this meeting, manage that project – that to have someone who is able to sit back and be introspective is a real treat.

You know, people are taught to talk, talk, talk but no one ever teaches anyone to really listen. Yet, to make good decisions you really need to gather information. Listening is really important to servant leaders. Not only that they’re listening but that people are able to see that they’re listening. Empowering employees and caring about them means paying attention to them.

I think the things that the servant leader focuses on are a little bit different. It’s more people-centric. It’s not that servant leaders are weak. They’re not weak at all. They’re very courageous in how they are honest and caring in the organization.

Wofford: It’s much more about making the best decisions even when they very well might be unpopular, right? Ultimately, the idea is to serve your vocation, right?

Brownell: Right, and being forthright with the information – some good, some bad – about what was done and what decisions were made. I think the whole transparency theme in organizations is important, and I think the servant leader facilitates that.

Wofford: We’ve got another great question from Karen here: “What about when servant leadership bites you in the butt? I tried to practice servant leadership but it comes back to bite me sometimes. Too much empathy, in particular, bites me.” What do you say to that?

Brownell: Empathy should be about recognizing someone else’s position and feeling how it affects them, but the consequences still need to be there. You know, if a student comes to me and says, “Oh I was trying to print and my printer broke down and that is why I’m a day late.” That’s when I say, “I understand that this happened and I’m sorry, but I’m still not giving you credit.”

Empathy is just indicating to the individual that you have in fact heard them, you understand how it could happen and you appreciate that they came to you and explained. But you still have a goal to reach. You still have a policy to meet. So empathy does not mean allowing people to slack off.

Rather than telling people what to do, servant leaders use persuasion whenever possible. This gets people sincerely on board and fosters ethical practices. Ethics have been a real big concern of mine. Sometimes we assume that someone is unethical when actually they haven’t even recognized that there was an ethical issue or an ethical component to what they were doing. They haven’t necessarily considered how their decision affects other people. So modeling ethical practices and being vocal about them are other important aspects of servant leadership.

Wofford: This also ties in to the self-reflection you mentioned earlier, right?

Brownell: That’s right and I think that self-reflection is actually a neglected leadership behavior and yet, if you read about really powerful leaders in various types of industries, almost without exception they mention how important it is to just sit back and kind of think about yourself and your own goals and what’s important to you, what you value, your strengths and weaknesses.

One of the things that a leader needs to do is to have what we call behavioral integrity, which means behaving in a way that corresponds with what they say. If I say I value being healthy but the bowl of M&Ms on my desk is the only thing I have for lunch, that is not displaying behavioral integrity. I think leaders should reflect on whether their actions back up their words.

Another thing to explore is who you become as a leader. One of the transformative things that I’ve been taking a look at is what being a leader does to one’s sense of self. There is this view that power corrupts, and I think servant leadership really helps prevent that.

I think self-reflection, no matter what position you’re in, is really important in the end. Sometimes it may have been so long since you last gave yourself the freedom to really think in these terms that it can be hard to know where to begin. One way to begin is to take some key themes and write down your own self-perceptions and then have someone else tell you what they think about you in those areas.

Wofford: And the servant leader is not only providing this sort of self feedback, they are also providing supportive feedback to their employees, right?

Brownell: It’s really about empowerment. As you empower someone, it implies that you trust them because you’re taking the time to coach them and mentor them. You’re giving them feedback, which is a sign that you care about them and how they are doing. You’re observing and helping them perform even better.

That then increases trust because as a leader you are basically saying, “I’m sure you’re not going to do it exactly the way that I would do it, but I trust that you understand the values and the goals and I trust that you are doing the best you can on behalf of the organization.”

Employees really take off when they feel like someone’s supporting them and that they can be instrumental in the organization’s success.

Wofford: Judi, thank you so much for this introduction to servant leadership.

Brownell: Thank you, Chris. It was nice to join you again.

Want to hear more? This interview is based on Judi Brownell’s live eCornell WebSeries event, Empower Your Team Through Servant Leadership. Subscribe now to gain access to a recording of this event and other Hospitality topics.

How to Develop Your Personal Brand (And Live Up to It)

What adjectives would you use to describe yourself? Would your coworkers, friends and families use the same terms?

Pamela Stepp, who teaches leadership assessment at Cornell’s ILR School, joined eCornell’s Chris Wofford for a WebCast focusing on how to develop a personal leadership brand and ensure that you continue to live up it.

Wofford: I’m very excited to have you here with us, Pamela.

Stepp: Thank you Chris, and thanks to everyone who is tuning in. This is all about you.

I want to start by asking everyone watching to think about who you are as a professional and who you want to be.

I’m going to walk you through the steps to create your own personal leadership brand and then help you come up with a story that you can tell that will demonstrate that brand.

Wofford: That sounds great. I think our audience will really get something out of this. Where should we start?

Stepp: Power is very important to consider when you are developing your personal leadership brand. You need to think about how you present yourself powerfully in an organization and how to recognize if someone is powerful or powerless. A good way to start thinking about this is to choose a person—this could be anybody in the world—who you think is powerful. Think about the characteristics of that person and what helps them be powerful and write down this person’s leadership brand in one sentence.

Chris, let’s use you for an example. Who did you think of?

Wofford: The first person that came to my mind was Bob Dylan. And the adjectives I used to describe him were mysterious, direct, and honest.

Stepp: Isn’t that amazing how fast you could come up with these clear traits? Let’s turn to the audience members. Someone has chosen Oprah Winfrey, saying she is credible, empathetic, driven, and relatable. Does that sound like Oprah? I certainly think so. Another has chosen Barack Obama and described him as gentle, straightforward, and clear-speaking. So we can see that it’s quite easy to identify the personal brands of well-known leaders.

Now let’s move on to thinking about our own personal branding. What makes you different? What adjectives would you choose to describe this brand called “you”?

Wofford: Wow, the answers from our viewers are coming in very quickly. Maureen says she’s organized. Darius, passionate. Marcelo, accountable. Rebeka says she’s driven and has great attention to detail. Carol says she leads and inspires.

Stepp: I can see more results are still coming in, but now I want you to come up with your most noteworthy traits and values. It’s important to remember that your values change at different stages in your life, so I want you to come up with examples of your current value, either personal or professional.

Wofford: Some of the answers coming in include curiosity, family, integrity, honesty, kindness, empathy. These are great examples from our audience.

Stepp: Yes they are. Now I’m going to give you an example of two short descriptions of the leadership brand that I use. I teach at universities and business schools all over the world and one of the brands that I use—and I want people to let me know if I’m living up to this —is that I want to be known for being a knowledgeable and inclusive leadership educator who demonstrates her passion for the subject and genuinely cares about helping her participants or students to grow into the best leaders that they can be.

So that’s the personal brand I have when I’m giving these sorts of talks. I had a different brand when I was a full time businesswoman as the managing director at the Center for Advanced Human Resource Studies. There, I wanted to be known for being a knowledgeable and open-minded business leader who used her confidence, determination, and networking ability to help the center grow into a more global organization.

So that’s how I’ve used my values to create personal branding.

Wofford: Pamela, I’m just going to play devil’s advocate for a moment and ask what the point is in using these words to describe yourself. In your case, you say you’re inclusive, knowledgeable, and dedicated to making sure that people get results out of your talks. Isn’t this just an example of putting your best foot forward? Does it really help one’s leadership ability to go through this sort of exercise?

Stepp: It does, and that’s because once you’ve established your leadership brand, you want to live up to it. It helps keep things clear in your mind and remind you whether or not you’re living up to the way you’ve described yourself and the way you want others to see you. Does that answer your question?

Wofford: It does. You’re saying we’re always a work in progress and that developing a personal brand helps bring focus to our careers and our professional lives.

Stepp: That’s right. It helps us focus on the traits that we want to be known for. Some examples coming in from the audience include inspirational, politically savvy, collaborative, innovative, results driven, strategic.

Then you start to refine those and work toward finding your identity by combining those descriptors. For example, “I’m a strategic innovator who gets things done.” You want to construct your leadership brand statement by putting everything together, all those adjectives and values.

Then you need to start asking other people what they think your brand is because it will surprise you. Make your brand identity real by checking in with others around you. Are you living up to that brand? That’s the beauty of having a defined leadership brand. You can always check in to make sure you are living up to it.

Wofford: So is your recommendation to go to other people and ask them how they’d describe you?

Stepp: Absolutely. You’ve got to keep reminding yourself of your brand and keep asking others if you’re living up to it. For example, I teach undergrads at the university because I want to prepare 20 year olds for leadership and because I want to know that generation. I started writing about being an inclusive leader and when I get evaluations back at the end of the semester, I can see that inclusion is my highest score. That really inspires me to keep working on that and to make sure everybody participates, to make sure I’m including international students who maybe aren’t speaking English all that well, making sure that there aren’t gender imbalances in who I reach. The point is, you can gain confidence if you learn that you are living up to your brand. And if you’re not living up to it, you have to know that. My brand is the yardstick by which I measure myself.

Wofford: We invite you to take a minute and see if you can come up with your own personal brand statement. Don’t overthink it. This is just an exercise and something that hopefully you’ll continue to work on.

OK, we have some responses. Deborah says “I’m a mentor. Helping others is what I enjoy best.” Steve has a great one: “I’m an innovator who pushes the creative envelope by inspiring others to do the same.” Crystal says, “I’m an innovative, compassionate, and knowledgeable leader with a desire to help others become the best that they can possibly be.” I think people are getting there, right Pamela?

Stepp: Yes, you are all doing a great job. These are good examples of leadership brand statements. You can refine and change them, but they shouldn’t be long diatribes. It should just be a paragraph, so these are really well done.

Once you have that brand, it’s time to think about storytelling. It’s always helpful to demonstrate your brand through stories, whether you’re standing up in front of an audience or if you’re at a cocktail party or even just with your friends. When done well, a compelling story can inspire our beliefs and our motivation to reach a goal. So I recommend that you all think of a story that you enjoy telling and think about how you can use that in the workplace.

I also want you to think about nonverbal power. When you walk into a room, you want to stand up straight and have good eye contact.With nonverbal power, you want to express competence. You want to express trustworthiness, dynamism, energy. When you talk, you want to be sure to think about using a proper voice, making eye contact and scanning the whole room.

Another huge thing is that when you are speaking with someone, you need to take the effort to learn their name, maintain eye contact, and make them feel you are focused on them. I’ve always found that amongst the people that I admire, their leadership ability is to make you feel like you’re the only person in the room.

Wofford: Pamela, thanks so much for joining us. I’m excited to get my storytelling ability dialed in and I hope that those in the audience will start working on their personal leadership brand one-sentence mantras as well.

Stepp: Thanks so much for having me.

 

Want to hear more? This interview is based on Pamela Stepp’s live eCornell WebSeries event, How to Develop a Personal Leadership Brand. Subscribe now to gain access to a recording of this event and other Women in Leadership topics. 

Legal Issues That Can Affect the Value of Your Business

Laying proper legal groundwork might not be the sexiest aspect of a startup venture. But a failure to adequately address legal issues has real potential to negatively affect the value of your business down the road.

That’s why Rhonda Carniol, a partner at CSG Law, recommends getting a legal footing established for your company from the very outset.

As part of eCornell’s Entrepreneurship webinar series, Carniol joined Chris Wofford for a wide-ranging discussion of the legal issues that can affect startups. What follows is an abridged version of their conversation.

Wofford: Thanks for joining us, Rhonda. Could you start by telling us a bit about some of the work you do?

Carniol: Thanks, Chris. As a partner at CSG Law, I represent entrepreneurs from startup to exit. I find with my clients that it’s very important for their legal counsel to get an in-depth understanding of their business so they can advise them as to what sort of things they have to address that could really affect their business.

Wofford: Ideally you’d want to hit these people as they’re in the early phases of business development, right? Getting yourself legally established seems like kind of a no-brainer and maybe the first thing you should think about doing. On the other hand, it’s never too late, right?

Carniol: That’s so right. It’s never too late. The most important thing is to get yourself in great shape legally before you try to sell your business. It’s easier in the beginning, but even if you’ve been up and running for four or five years, I still think the things we’re going to discuss today are going to be helpful.

I’d like to start by talking about what makes a business valuable. For example, you’re solving a problem or you’re adding something new and innovative into the market. If you have something valuable, you need to protect your intellectual property. You also need to think about limiting your liability to your vendors or your customers. Additionally, you want to avoid disputes with your co-owners, your employees and your contractors. These conflicts take up time and energy.

The first thing to really talk about is protecting your personal assets. If you’re currently operating a business in your own name, you need to immediately stop. Why? Because your personal assets are at risk. But if you form a corporate entity, like a subchapter S corporation or an LLC, then your personal assets, in most instances, would not be at risk except for in fraud situations.

What type of entity should you form? Well, there are several choices. There’s a limited liability company, a subchapter S, a C corporation, and a benefit corporation. A limited liability corporation is usually what most people choose when doing a startup because it has the most flexibility. Owners of the company don’t have to be individuals and it’s easy to bring investors into the mix. It also has tax benefits because it’s a flow-through, unlike a C corporation.

Sometimes you might instead choose to form a subchapter S corporation. There are less expenses involved but it’s taxed the same way as an LLC. The hot new thing is a benefit corporation, in which you’re supposed to do something good for the community or for your customers or the environment. The problem with that is there are a lot of filing requirements and recordkeeping, so I find that most of my clients, although they may want to do good with their companies, don’t want to be bothered with that.

Wofford: How is a benefit corporation different from a 501(c)(3) nonprofit?

Carniol: Well, a benefit corporation is still being formed to make profits. But they can sacrifice some of those profits in order to do good. A nonprofit, of course, is not out to make a profit. So it’s a different type of entity.

Wofford: Okay, got it.

Carniol: What I really recommend is to get an agreement in place right away between the owners if there are multiple owners involved. As soon as possible. In an LLC, this would be called an operating agreement. In a corporation, it would be a shareholders agreement.

A lot of people say, “I don’t need an agreement. I worked with Tim for 20 years. We love each other.” Well, let me share a story. I recently represented someone who had worked with their co-owners for 10 years in various corporations. They waited a year and a half after they started a new business to do an agreement. They were almost ready to launch when they discovered that they had a lot of disagreements, even over how much of the business each person should own. So the cost to them was significantly higher than if they had sat down in the beginning and had the discussion initially. The thing that made them finally come to a decision was everyone’s worst nightmare, which was the creditors of the company coming forward and saying, “We’re going to put you in bankruptcy. You’re not paying your bills.” That’s not a situation I want to see anyone in. You need to sit down in the beginning, find out if you have any differences, find out if your visions are the same, and enter into an agreement.

I often see situations in which a company is about to be sold and it comes out that the assets of the company aren’t in the company’s name. Instead, they’re in the original owner’s name. This is a major problem. The assets then have to be transferred into the company and they may have significant value at this point and therefore pose tax issues.

Another messy situation can arise in a multi-owner deal. If one person owns the patent, for example, then that individual has considerable negotiating power going into any deal – much more than the other owners. The easiest way to avoid these things is to move your assets over to the company at the outset. If you’ve already started a business and your assets aren’t with the company, move them over now.

Wofford: This goes back to your earlier point about doing all you can to avoid disputes.

Carniol: Exactly. That’s also why I can’t stress enough the value of a contract.

You should also always have a contract with your independent contractors that includes enforceable ownership language and confidentiality protections. You want to protect your customer list, your contacts, your vendors, your unique processes and your way of providing products. If you don’t have a confidentiality agreement, these things could skip right out the door with an independent contractor or a departing employee.

Wofford: Are these contracts something that should be drawn up by individuals? Do they need to involve highly complex legal language? Would you craft an NDA, for instance, without legal counsel?

Carniol: I know there are templates online, but you should not have an NDA without legal counsel. This is a really inexpensive document for your lawyer to draft. They will draft it geared to what’s important for your business. I don’t suggest just doing it yourself because you just may not protect what you need to.

Ideally, you should have a separate agreement for your employees and another for your independent contractors. If you’re further along in the process – let’s say a private equity firm is starting to look at you – you will need a different type of confidentiality agreement. Sometimes you’re going to have confidentiality provisions even in your customer agreements. But they won’t be as big as what you put in your independent contractor agreement because you don’t want to scare the customer away.

There are some other things that you might think of putting in the independent contractor agreements. You might include indemnities. If you get sued by a third party because of something the independent contractor did, you want them to step up and indemnify you. Of course, there are things that are standard in the industry so you cannot be too far-reaching, or the vendor is going to tell you to go take a walk.

You may also want to think about including an anti-competition provision. Sometimes this is appropriate and sometimes it is just not. You cannot stop someone from running their business but in some situations, you may want to prohibit them from making the same product as you, at least for a short period. You just need to evaluate it and this is a good time to call a lawyer to find out what the standard in the industry is and what is reasonable.

Wofford: What about contracts and agreements with your own employees?

Carniol: Your employees will probably become your most valuable assets, so you need them to sign confidentiality and ownership agreements. Without an agreement, an employee who conceives of an invention typically owns the patent rights, not the company. So, think about how this is going to look when you try to sell your business or get an investor. The best way to deal with this is to put it in an agreement.

Depending on your particular business, you may also want to consider whether non-competes and non-solicitation agreements are needed with your employees. In some industries, requiring a non-compete would mean you could not successfully hire anyone, but you at least want to establish a non-solicitation of your customers and definitely a non-solicitation of your other employees because this will prevent a group of employees from leaving and forming a competing business.

Since your employees are such valuable assets, you may also want to consider allowing them to have a stake in the success of the company. Consider whether certain employees should have an ownership interest or a phantom interest in the business. This is also something you would definitely need to talk to an attorney about because a lot of it depends on how far along you are in the process of building your business.

Wofford: Obviously, giving employees ownership encourages them to work hard for your company and to remain loyal.

Carniol: Absolutely.

I’d like to now talk a little bit about customer agreements, which are often needed in the business-to-business market and even in the consumer market. In the consumer market, if you have a web platform up, you will usually see an acceptance agreement that most people click without reading. Even though most people won’t read it, you should have an agreement that people must accept in order to do business with you, in order to protect yourself. Of course, the type of agreement you are going to have depends on your product, industry standards and your customer base. It needs to be tailored to your business.

In the business-to-business market, let’s say you are providing software that another company is going to use to operate and it is integral to their business. You want to limit your liability, because one lawsuit could put you out of business before you have even started. You also want to make sure that it is clear that you own everything and you are not giving ownership to the other company.

Another thing that is really important is to clarify payment terms. You have to specify in these agreements when the customer has to pay you. You do not want to have to get into a lawsuit situation as a startup, so having these kinds of provisions is going to help you avoid disputes and litigation.

Wofford: What other legal angles are essential to consider?

Carniol: Once you have your agreements in place, the most important thing is to develop and protect your brand. This is what differentiates you and makes your business unique. The example I like to give is toothpaste because it’s so boring. Even so, most of us have a favorite brand of toothpaste. Everyone has brand loyalty and that’s why you have to take care of your brand. Trademark your name, your logos and your designs. Doing a trademark only costs about $2,000, and it’s money well spent. You don’t want to start operating your business and then have another company come in and say, “Hey, you can’t operate under this name because I’m using it in the same business.” One of the most important things at the outset of starting a business is avoiding disputes.

Wofford: But a $2,000 layout in the early stages might seem like a lot to people, right?

Carniol: Well, a trademark adds value to your business because you own the intellectual property. You now have a name when you go to sell your business or when you’re looking for investors.

If you have the opportunity to do trademarks to protect your business and your assets, it makes your company more valuable when you go to sell because you have something that makes you unique. Plus, if you have a good idea and you’ve got a patent or a copyright or a trade secret, it slows down anybody else who wants to copy your idea.

Of course, not every idea can be protected. Establishing a trade secret isn’t easy because, generally speaking, for a company to be considered the owner of a trade secret, it usually must be shown that the subject matter has economic value. On top of that, you’ve got to use reasonable precautions to maintain the privacy of it. One famous trade secret is the recipe for Coke and they’ve maintained the confidentiality of that forever.

But you can also use contracts to protect the disclosure of confidential information. Ask people to sign a confidentiality agreement. The only time that this is really a problem is when you approach potential investors and venture capital. Often, they will not sign a confidentiality agreement because they hear so many ideas. Once you’re an established company, it’s different. You can get investors in private equity to agree to limited confidentiality agreements.

Wofford: What about the process of establishing copyright?

Carniol: Filing for copyright allows you to seek statutory damages. However, filing copyrights all the time isn’t realistic. If your business is about updating content constantly or you have a lot of content, you’re just not going to do this. It’s going to slow you down. And not everything you create can be copyrighted.

For instance, facts can’t be copyrighted. If you’ve done a lot of research and you’ve accumulated a lot of facts and data, that’s great — but you can’t copyright it.

The next thing I want to talk about is patents. Getting a patent is the most expensive process — it costs more than getting a trademark or a copyright. But again, not every product can be patented. And for those that can, the patent office has to approve it and that is a long process. Even when you get the patent, you can face lawsuits trying to claim that your patent is invalid. In your filing to the Patent Office, you also have to have to publicly disclose much of your invention and a lot of times, you won’t want to do that. You could do that disclosure and not get the patent and then your secret sauce is out there.

Patents also have a limited life. They last between 18 and 20 years. Once the patent’s life is over, you can’t license what you patented anymore and get money for it.

Wofford: That’s a lot to consider.

Carniol: It is, and it all goes back to doing an initial analysis. What is the goal? Do you want your business to go on for 40 years with a product that you can continue to license or is it something you’re constantly going to be innovating and updating?

Wofford: As we wrap up, I want to ask how much legal stuff can be sorted out by individuals on their own or would you always advise people to seek legal counsel one way or another?

Carniol: Yes, I think you should seek legal advice. I’m sure people are going to walk away from this going, “Wow there’s a lot to do. This is going to cost me a fortune.” It’s actually not going to cost that much.

Even if you don’t hire a lawyer, there is a lot of free advice out there from universities and other organizations for startups. There are accelerator programs where you can get free legal advice. Of course I’m biased because I’m a lawyer but I think that when you start out, you should at least have an initial conversation with a lawyer and find out what is important and what isn’t. Then you can spend your dollars wisely and not waste money on things that aren’t important.

Wofford: I think this conversation was very useful to our audience. I appreciate it, Rhonda.

Carniol: Thanks, Chris.

Want to hear more? This article is based on Rhonda Carniol’s live eCornell WebSeries event, Six Legal Issues That Can Affect the Value of Your Business Subscribe now gain access to a recording of this event and other Entrepreneurship topics.

How to Successfully Pivot Your Startup

The fundraising and engagement platform GiveGab made waves in January 2018 by purchasing one of its biggest national competitors. With the acquisition of Kimbia, GiveGab is one step closer to becoming the biggest charitable software program out there.

But that success would not have happened if the company hadn’t decided to completely change direction from its original vision of being a social network connecting volunteers and nonprofits. In 2015, GiveGab pivoted to focusing on helping nonprofits attract and maintain donors rather than volunteers.

The company’s CEO and co-founder, Charlie Mulligan, spoke with eCornell’s Chris Wofford about his “painful” yet highly successful pivot decision and to share tips on how to decide when it’s the right time to change strategic direction. What follows is an abridged version of Mulligan’s presentation, delivered as part of eCornell’s Entrepreneurship webinar series.

Mulligan: I’ve met thousands of entrepreneurs at this point. I think almost all of them would describe themselves as having a vision of what they want to happen and being very persistent. While I agree that these are really important traits, they can also impact the challenges of pivoting. If you really pride yourself on what you are doing, it can be very hard to have to admit that your vision was wrong. When reality hits, it’s sometimes like you suddenly realize you’re climbing the wrong mountain. It’s not a matter of changing little tactics. You have to change your entire strategy. That’s what a pivot is to me.

When you are starting out, there is really no way to predict the future. Yeah, some people get lucky but for a lot of startups you’ll find that the reality is different than what you envisioned so you’ll have to decide what to do. You can quit or you can be flexible and make a different choice.

Wofford: How do you know when it’s the right time to change direction?

Mulligan: It could come at any stage. When you’re starting out, you have this idea of what the customer wants. Well, you better talk to as many customers as you can and you need to realize that oftentimes you will hear what you want to hear so you have to be very careful and make sure that you start to listen before you get too far down the road. You might have to pivot very early once you’ve assessed the demand and done the research.

The key thing about a startup is a lot of times you’re trying to create something new or completely different, but when you’re doing research, the research is about old products or old ways of thinking. So you won’t really know for sure whether your new way is going to be right.

Wofford I’m sure the audience would love to hear the details of your decision to switch tactics at GiveGab.

Mulligan GiveGab set out to be the social network for volunteers, which meant that we were a connection portal to help volunteers and nonprofits find each other. We interacted with a lot of nonprofits and they were really happy to talk about this. They loved the idea and then as we built our product they thought it was great. We had a free product so we had thousands of nonprofits and hundreds of universities sign on. We passed 100,000, things were growing and moving fast and we were getting great press and great feedback.

But it didn’t take us long to realize that there was really low engagement. Nonprofits would sign up but then only come back like every six months to do something. It was really challenging to get them to actually post volunteer opportunities.

When I first started I thought it was going to be really easy to get nonprofits to post volunteer opportunities because they were consistently telling us that they need more volunteers. But we couldn’t get nonprofits to actually sign in and create volunteer opportunities. That meant that we were having a hard time matching the volunteers who had signed up with opportunities in their area. You know, a volunteer in Montana and a nonprofit in Minnesota don’t really match up.

That’s why we decided to go after universities to help build an ecosystem because a lot of times they have volunteers and nonprofit partnerships. The problem we found there was that it was a super long sale because we were talking to low level employees. We should’ve noticed this problem earlier but if you want to know what a nonprofit really cares about, you need to go see what the executive directors are doing. What the directors are doing is looking for donors, not volunteers.

Raising money is really what mattered the most and we weren’t listening to that. So we decided to go down a new path. We sat down and really looked at what the nonprofits were using their volunteers for. Almost always, the volunteers were being used as a direct or indirect way to get donors. It’s really about money for nonprofits and volunteers are a way to get donors more engaged. One of the things we kept hearing all of the time – and the research backs this up – is that only 19 percent of first-time donors ever come back. Nonprofits spend all of this time getting donors and then four out of five of them are gone and never come back. We were skirting around the edges with volunteering but the core problem was how to get more donors and keep them coming back. So that’s now the problem that we decided to solve.

Wofford How big was your organization when you decided to make this pivot?

Mulligan We had 90 employees and we had a lot of funding. We had dozens of investors and so I had to go back to all of them and admit I was wrong. Then we had to let about half our company go. These were really good employees so that was a very painful day.

For a lot of people, ‘pivot’ is just a word, just a strategic choice. For me, it’s a painful memory. It was necessary and I’m really glad we did it, but it was painful.

We had to totally re-brand. We were the social network for volunteers so we were highlighting happy volunteers and like things like that, which makes no sense for a fundraising platform. So conceptually we had to change everything. Then we had to build it and go back to our development team and say, “Ok, we’re starting from scratch, let’s learn how to do this.”

There are also laws around fundraising so there was a lot of work in just making sure we were doing things the right way.

Wofford That sounds really challenging.

Mulligan It was, but one of the great things about pivoting is that if you’ve built a great team, as we had, then you’ve already figured out how to work well together. In our case, the employees we were left with were great, so we got a second shot at something and the second product looked a million times better than the first product because we really knew what we were doing by that point and we had a system in place.

There’s also a certain amount of incentive in a pivot situation because maybe you’ve run out of money, so you know that this could be your last lifeline. So you better make progress and you better make it quick. There is nothing like the gallows to give people focus.

As an entrepreneur, it can be very challenging because you have told a lot of people about your vision and you’ve been very persistent and then you have to go and tell them, “OK my vision sucks but now I have a new one.” You’re asking people to buy into this new idea even though your first was wrong.

Wofford That must take a certain humility.

Mulligan Sure, and you also have to make some super painful choices. Like I said, we had to let employees go. We had to go back and talk to investors and let them know that all of their investments just went backwards. Nothing about it is fun but you have to just face it head on, so I just owned it. I think that approach was super helpful.

You have to pick your new course of action and then you have to forget the past. Pick your new vision and just sell that like that was the only one you ever believed in. And of course you’ve got to somehow get everyone to buy into this one as much as they we’re into the first one. These are all way harder things than I think people realize.

Wofford It certainly sounds hard. Was it a challenge to keep morale up?

Mulligan Well, when you’ve just let half your workforce go, keeping morale up was already a challenge. People’s workloads had doubled and then it was like, “Now let’s do it over.” I think what helped us is that we spent a lot of time making sure that our new course of action was picked by everyone, not just me.

Wofford Everyone needs to be on board to make a pivot work.

Mulligan Right. We had conversations with the people that we were going to keep and said, “Look, if your heart’s not 100 percent in this, you need to let us know because there are people we are letting go whose hearts are 100 percent in this.” That wasn’t a threat, it was just the reality. I think people really appreciated the openness and transparency. When we let people go, we really supported them but we also sat everyone down and said, “OK guys, we’ve got to forget about it. There is a lot of pain here, but we need to just move forward.”

When we did our pivot in January 2015, we had five nonprofits raising money on GiveGab.
At the end of the year, we had 700. All paying customers, so we were making money off all of them. We are currently on pace to potentially have well over 20,000 nonprofits by this year. We also have 10 states using us as their statewide giving day platform later this year. So the pivot worked.

Wofford Wow, it’s very impressive. Congratulations.

Mulligan We’re really excited and of course relieved. We saw the bottom and that makes you appreciate it more when things are really working.

So much of the startup ethos is ‘vision and persistence’. I think you need vision and flexibility. You can also think about it in terms of the difference between persistence and resilience. Persistence is putting your head down and running into the wall. Resilience is putting your head down but looking around a little and realizing there’s a door over there and you can walk right through it.

Wofford Charlie, thank you so much for sharing your experience and giving such great advice about changing strategic direction.

Mulligan Thank you, Chris. I enjoyed being with you.

Want to hear more? This interview is based on Charlie Mulligan’s live eCornell WebSeries event,The Startup Pivot: Changing Strategic Direction. Subscribe now to gain access to a recording of this event and other Entrepreneurship topics.