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What They Don’t Teach You at Harvard Business School, McCormack, Summary

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May 3, 2019

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Josh Jones

I asked my assistant to make an executive summary, which I share with you here:

  1. Reading People
    1. Opens with anecdote about two people; he met Nixon twice–the fact that he used several of the same phrases both times made the interactions feel staged–and represented Doug Sanders, a golfer, who despite a “hustler” persona paid commission in cash for an event McCormack wasn’t aware he had attended
      1. These interactions were, in retrospect, representative of both individuals’ personalities
    2. Goes further into advice on interacting with people, which can basically be condensed to:
      1. Trust your gut, but be rational
      2. Listen to and observe people; read between the lines
      3. Appeal to and be aware of ego (others’ and your own)
      4. Get others’ opinions of people you are doing business with
    3. He also has a section on “Golf Course Insight” which is similar to his other advice, but in more anecdotal form.
    4. “Seven Step Plan” of reading people:
      1. Listen aggressively
      2. Observe aggressively
      3. Talk less
      4. Take a second look at first impressions
      5. Take time to use what you’ve learned
      6. Be discreet
      7. Be detached
  2. Creating Impressions
    1. Discussion of what people might expect from you going into a meeting and when it can be advantageous to confirm/disprove that
    2. Written correspondence should be formal but not stiff, and should be personalized; otherwise it feels like spam
    3. Associate with people who reflect well on you
    4. Dress well (he quotes Chanel here: “if a woman is poorly dressed you notice the dress; if she’s impeccably dressed you notice the woman”)
    5. Be punctual and straightforward
    6. Be friendly and polite, and flatter strategically
    7. Subsection: “The most important personal asset in business
      1. “Obviously the real answer is common sense. But if you don’t have it already, you probably never will… sense aside, then, the most important asset is a sense of humor.”

From audiobook summary:
Prologue:
“Street smarts” that one should know but that can’t be taught in a classroom
Business is a “duel”—to win, must stay one step ahead of competitors
Innovation, creativity, and intuition are as important as technicalities that are taught in MBA programs

Part 1: People
Chap 1: Reading people
    Must understand potential and current clients—what they want, are motivated by, etc.
    Can deduce this from observation; must get their guards down and make them feel comfortable if they are to behave and speak sincerely
    Important clues—posture, tone, facial expression, etc.
    Listen more, talk less
    First impressions are important; convey warmth, competence, and detachment
    Don’t let people know how much you know about them, and be selective with what you let them know you know and in what manner you do this

Chap. 2: Creating impressions
    How to build a good reputation
    Many small, sincere gestures are better than a few grand ones that could be interpreted as phony
    Secretary/receptionist should interact with clients in a way that mirrors desired image—if your receptionist is rude, that reflects poorly on you
    Dress well—people stereotype based on clothing; use that to your advantage
    Keep promises and go the extra mile to be nice, compromise, etc.
    Common sense and humor are most important; putting people at ease and maintaining perspective

Chap 3: Taking the edge
    Take advantage of other people’s perceptions of you
    Take initiative in social and business situations, but don’t rush or act without thinking
    Take all possible opportunities—unknown which will pay off, so invest broadly (but wisely)
    Discipline—know when to act, and when to wait

Chap 4: Getting ahead
    Some people fail and some succeed—this is because they know (or don’t know) what they are capable of, and act accordingly
    Contextualize failure and success
    Say “I don’t know,” “I need help,” and “I was wrong”—shows humility and sincerity

Part 2: Sales and negotiation
Chap 5: The problem of selling
    When selling, buyer and seller are unconsciously and consciously weighing pros and cons of transaction
    Salesmanship is very important even in non-sales contexts

Chap 6:Timing
    Most ideas that don’t succeed don’t because they were timed badly, not because they were necessarily bad ideas
    Be patient, try multiple times, and wait for good opportunities
    Renew contracts when people are happy, not when deal is expiring
    Be efficient with people’s time

Chap 7: Silence
    Be comfortable with silences; they force/allow other party to talk without making you overshare
    End meetings on positive note

Chap 8: Marketability
    Connection between product/service and consumer
    Market according to consumer perception of product
    Be enthusiastic about product
    Anticipate objections
    Consider what they want and emphasize those facets of product
    Imaging—get people to associate certain traits that they value with the product, to increase its value

Chap 9: Stratagems
    Sell with different strategies depending on situation
    Must be able to answer the questions: 1) what is the customer’s need? 2) who is making the purchase?
    Make customer feel like they are smart for choosing your product
    Make them feel like the product is already theirs
    Sell directly and alone to the highest-authority person—one-on-one deals allow for more personalized sales tactics
    Limit choices—alternatives can compromise perceptions of your product
    Don’t overuse visual aids—not necessary for quality product

Chap 10: Negotiating
    Getting people to buy is more complicated than establishing terms of purchase
    5 principles:
        What is the exact thing for sale?
        When will the buyer benefit from their purchase?
        Where can and can’t buyer use the product?
        How unique is the product?
        How much time and money will this purchase save or consume?
    Let buyer make first offer—it shows what they think product is worth. If the offer is high, accepting it makes them feel like they are making a deal
    Don’t take low offers personally, and ask why if they offer something that doesn’t benefit you—if they aren’t deliberately doing this, they will make better offer
    Present deal as mutually beneficial
    If you know their deadline, make the deal feel urgent
    Stick to position and know whether you are ahead or behind
    Will you use legal contract or informal agreement? Both have pros and cons based on trust between participants, size of deal, etc.

Part 3: Running a business
Chap 11: Building a business
    Be aware of all steps between current state of business and desired state of business
    Don’t grow business beyond what management can handle
    Diversify and expand after management is stable

Chap 12: Staying in business
    Business becomes harder to manage as it grows
    Systems change and things that may work early on won’t work later/vice versa
    Maintain structure and make employees feel necessary
    Don’t let policy become dogma; evolve it with company’s progress
    Balance between successful precedent and innovation
    Delegate tasks
    Balance flexibility and consistency
    Pay salaries and bonuses according to employee value; low wage and high bonus at beginning to incentivize them, and make them aware of dollar value of benefits—increase salary with experience so that long-term employees feel that they are progressing
    Criticize and praise in balance
    Give employees agency in their tasks
    Prioritize long-term over short-term gains; quality is important and can be seen as an investment in your own business’s long-term success

Chap 13: Getting things done
    Be organized and in control of schedule
    Plan for the future
    Record details simply but accurately
    Write down ideas as they come up
    Plan next day at the end of each day; expand to weekly, monthly, and yearly plans
    Adhere to schedule
    Account for human behavior of colleagues and associates
    Make calls, rather than receiving them, and end calls as soon as objective is accomplished
    Be aware of own habits and behaviors, and account for them
    Say no
    Make decisions quickly and don’t overanalyze
    Use simple and specific memos
    Maintain a tidy workplace, where necessary information can be easily found

Chap 14: For entrepreneurs only
    Be emotionally committed to your work
    Examine motives before starting new business, and be aware of problems that will come up
    Implement existing skills and strengths, and be practical
    Money is not a sufficient motivator, especially not at first
    Pay low but compromise with stock and/or bonuses
    Overestimate overheads
    Be cautious in partnerships
    Prepare for potential failure

Epilogue:
    Lessons from sports:
        Don’t be complacent
        Don’t be arrogant

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