Five Myths About Getting Rich page1
Myth 1: You've got to have incredible charisma
A big personality will certainly help. But being able to size up -- and make use of -- the personalities around you is much more important.
By Josh Hyatt Money Magazine senior writer
NEW YORK (Money Magazine) -- Everyone believes a modern-day leader has to generate a few sparks. "You can't pull together resources and people if you don't have the capacity for making other people want to contribute," says Paul Reynolds, a management professor at Florida International University in Miami.
Perhaps no business leader epitomized that notion more than Herb Kelleher, the chain-smoking, hard-drinking cofounder of no-frills Southwest Airlines, who revolutionized his industry, charmed the unions and inspired his thousands of employees by (among other things) impersonating Elvis and donning an Easter Bunny suit.
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REALITY: It's not about charming people; it's about evaluating them. In Southwest's case, witness that the Dallas airline hasn't lost any altitude without the boss, who retired as CEO in 2001. It's on track to log profit growth of at least 15% this year.
"Charisma was never the key to Herb Kelleher's success," says Bill Payne, entrepreneur-in-residence at Kansas City's Ewing Marion Kauffman Foundation, which promotes entrepreneurship. "He surrounded himself with an exceptional team."
To do that yourself, you need to assess people's skills in a calculating way. Business leaders "may be social misfits themselves, but they know how to size people up," says Bill Heiden, a Lyme, Conn. financial adviser to business owners. "They have the ability to extract the value from other people."
In fact, management guru Jim Collins argues that charisma can be a liability. The force-of-nature leader appeals to employees who need a hero - so when the chief exits, no one can measure up.
Even Reynolds, who thinks charisma does help snare talent, agrees that "to be effective, a person has to have something to offer beyond personality."
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Myth 2: You must be able to see into the future
It's not necessary to be able to develop the next big thing. Far better to master the details in the here and now.
NEW YORK (Money Magazine) -- What George H.W. Bush called "the vision thing" does indeed exist. Think about Gordon Moore, the Intel co-founder who predicted in 1965 that chip processing power would double every two years. Or Bill Gates. Or the Amazing Kreskin, who claims only to be a "mentalist" but could probably do more.
Get the vision thing wrong, and you're dead. The only thing foretold by minicomputer magnate Ken Olsen's famous 1977 pronouncement, "There is no reason anyonewould want a computer in their home," was the decline of his company, Digital Equipment.
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REALITY: Plenty of visionaries were and are firmly rooted in the present. Did Henry Ford invent the car? (Hint: No.)
Did Sam Walton invent discounting? (See earlier hint.)
In each case, they took what existed, saw the potential in figuring out how to make it better, and then slaved away on the details.
Tom Kinnear, executive director of the Zell-Lurie Institute for Entrepreneurial Studies at the University of Michigan, refers to this pattern of action as "telescoping." Successful builders of businesses, whether they're on their own or in a corporate setting, can see the big picture well enough, but they succeed by mastering the little things.
"They pay attention to the smallest details, so they can answer any questions," says Kinnear. "They want to be sure they're getting it right."
Amy Domini didn't invent the mutual fund, but 15 years ago she saw an opportunity to mass-market socially responsible funds that appealed to investors who felt they couldn't put money into businesses they found morally objectionable. Today, Domini Social Investments manages nearly $2 billion in assets.
Once she launched the business, Domini says, she quickly developed "an intense interest in minutiae." Sure she fretted over the details of structuring a product for big institutions. That seems sensible. But she also analyzed the thickness of the firm's brochure paper and looked at thousands of samples of exotic fabrics to find a combination that could muffle the sound in her company's New York City headquarters.
"To build something, you have to fall in love with it," says Domini, 56. "Otherwise you might as well be a corporate cog."
Myth 3: You must stick to your guns, no matter what
Got a great idea? By all means ignore the naysayers and go for it. If criticisms are valid, however, you'd better listen.
NEW YORK (Money Magazine) -- "The concept is interesting and well formed, but in order to earn better than a C, the idea must be feasible," a college professor supposedly wrote in response to a student's term paper outlining the need for a reliable overnight delivery service.
But Fred Smith ignored those discouraging words. "I thought this was a revolutionary idea.... I wasn't intimidated," said the fellow who founded FedEx in 1973.
Herb Kelleher, of Southwest Airlines, has been known to bray, "If it's conventional, it ain't wisdom, and if it's wisdom, it ain't conventional." After all, has anybody ever done anything innovative by consulting a focus group?
REALITY: Yes, actually. If you're intent on creating value - from either a giant company's command center or your guest bedroom at home - you carefully evaluate and absorb feedback.
True, successful people don't change their minds easily, says the Kauffman Foundation's Payne. But they are strategically flexible when they have to be.
In 1984, FedEx launched Zap-Mail, a high-speed fax service. But then cheap fax machines started popping up. "At that juncture," Smith once told an interviewer, "we knew we had to change."
When Sergio Zyman was chief marketing officer at Coca-Cola, he learned that sometimes thingsdon't work out as planned. Remember New Coke? Years later, when he was on his own, Zyman raised $12 million to sell business-planning software. But he soon understood that the market was murmuring bad things about the product. "We had to kill it," he says.
By the time he told his backers, he had concocted a plan for turning the Zyman Group into a consulting firm. Last year the Atlanta company raked in $65 million in sales.
"You need to have enough conviction,"says Zyman, "to know that you can find the right answer, even if you don't know it right away."
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