 Greetings! The enormity of the tragedy in Japan this week is beyond what most of us can comprehend -at least those of us who have never personally experienced sudden destruction and human anguish at anything near this scale. Our hearts go out to the victims and their families, and there is also an important call to action for all leaders of companies, large and small. Could your company survive a major disaster? Most companies don't have a comprehensive disaster recovery plan, and for many that do, that plan may not current or even viable. The local flooding the recent heavy rains have unleashed in many communities in our region may seem to pale by comparison to the tsunami that decimated coastal Japan, the damage is hardly inconsequential - and the risk of sudden loss from myriad dangers is ever present and if not prepared for - could severely compromise or even destroy your company. Having adequate insurance coverage will help (and is necessary) but is not sufficient to secure your company's continuity and future. Relatively simple and inexpensive measures include offsite data backup of all critical files and records and a reliable recovery system, a plan to remotely operate your business if you cannot access your offices, a remote system for communicating with employees, customers, suppliers and partners and ideally a means to get hold of enough short-term cash or access to a sufficient credit line to make emergency purchases you may need to ensure continuity. Data loss alone can be catastrophic. Today there is no excuse for not having a fully secure data back-up and recovery system. A data recovery expert once explained to me that there are two kinds of people in the world: those who have lost their mission-critical data - and those who will. In my Deliberate Leadership keynotes I address the fact the single most important role of the CEO is to first protect and then grow the assets of the organization. Make sure your company is prepared. I also note in my Fiscal Leadership workshops that most established companies are relatively easy to lead in good times, but leadership is often tested and severely challenged during difficult times. As difficult as the recent recession was, the impact of even a small disaster can be catastrophic. As W. Edward Deming points out - "It's not enough to do your best, you must know what to do, and then do your best." While on the topic of risk - in last week's Monday Morning CEO, I promised to address the concept of risk reversal. The concept is that in any transaction both parties undertake some degree of risk. The buyer must trust in the promise of quality, suitability and even delivery. The seller must trust that she will be paid and that his reputation will be preserved or enhanced through the transaction. While both sides take on risk, it is the seller that invariably has the greater need to convince the other party to accept the risk and purchase the goods or services. Risk reversal is a simple, yet powerful way to remove that obstacle from a sale. In essence, the seller will take on all the risk by assuming the risk of the seller. A great example of this is the unconditional buyers satisfaction guarantee that LL Bean (www.LLBean.com) has offered for nearly a century. Understanding the concerns customers had about buying through the mail and not being able to first examine the quality or aesthetics of a product being purchased established a policy of buying back any product purchased, for any reason, for as long as you owned the product. You could literally buy a pair of boots, wear them for twenty years until they were worn through - and exchange them for a new pair, no questions asked. According to their Website: " Our products are guaranteed to give 100% satisfaction in every way. Return anything purchased from us at any time if it proves otherwise. We do not want you to have anything from L.L.Bean that is not completely satisfactory." It is alleged that people actually made a cottage industry of combing through garbage dumps, thrift shops and yard-sales looking for old LL Bean merchandise and exchanging them for new items. In reality they represented a very minute subset of the total sales of the company (today in excess of $1.5 billion). It turns out most customers are honest and refrain from what they feel is steeling or cheating, and returning things requires enough effort that it dissuades most casual offendors. The total cost from those who felt differently was a small price to pay for developing an enormous base of loyal, delighted customers. No amount of advertising could ever achieve the same results. Interestingly, their return policy remained unchanged until recently, when sites like eBay provided a marketplace for enterprising LL Bean scavengers to the point that it could actually be a legitimate threat, and now LL Bean reserves the right to ask for proof that the individual returning the item had purchased it. In the case of my brother's business ( www.JLFurniture.com), I have long suggested that Joel offer a 100% satisfaction guarantee on his work. Rightfully, Joel is loathe to offer a no-question asked return policy on custom-designed, hand built furniture that he sells for thousands of dollars. But I have always contended that with certain conditions in place, he and his customers would win. The key condition is that the furniture must be paid in full, delivered and installed and that it remain in the buyer's possession for 60 days. I am confident that almost no one will return one of his commissioned pieces once they have "lived" with the furniture a while, and very likely received compliments on the wisdom of their purchase. (I also suggest he take a higher deposit on the order -to help improve his cash flow - and refund all but the delivery and return shipping charges.) If he did need to buy back a piece on occasion, he could always resell the piece online or in a gallery and make back his costs. Moreover, it would increase the number of people willing to purchase - and enable Joel to increase his prices. In the end, I am fully convinced that he would significantly increase his sales and profits. This week I also have included the promised highlights from Alan Beaulieu's 3-hour presentation to the Vistage NJ All Cities CEO Conference last week, some interesting perspectives on "being the boss" and more... As always, wishing you a great and successful week ahead. 
Philip R. Liebman Managing Director, Strat 4 Group Chair, Vistage International P.S. Last week was the Vistage All-Cities CEO conference in New Jersey featuring Alan Beaulieu. If you would like a PodCast of the presentation, please contact me and I will be happy to send it to you. There will also be another opportunity to attend an Experience Vistage CEO Peer Group Roundtable on March 23rd. | 
