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September 2005

ANNOUNCEMENTS

RUBENSTEIN ANNOUNCES CANDIDACY FOR U. S. CONGRESS

Herb Rubenstein has announced he is a candidate for the United States House of Representatives. Previously we announced that he had moved to Colorado and that Herb Rubenstein Consulting had established an office there. Rubenstein’s theme is, “A New Voice. New Ideas. New Leadership for Colorado.” The 7th Congressional District of Colorado will be one of the most competitive House races in the United States. In a recent article in the Colorado Statesman the editor wrote that Rubenstein had an “uncanny can do attitude,” and he expected to receive a substantial number of Independent and Republican votes in the general election. Rubenstein faces a very challenging Democratic primary race and will be developing a large cadre of volunteers and a campaign organization based on the organizational development principles developed through Growth Strategies. For more information about the campaign and his positions on the key issues in this race facing the country, see www.herbforcongress.com. The caucuses for the primary start in March. The general election will be held in November, 2006. Please feel free to join the initial campaign committee being formed and volunteer at our website. People from all across the United States have already joined the committee, and we have over 80 members. And sign up for our campaign newsletter at our website or email me at herb@herbforcongress.com.

Herb Rubenstein Consulting DONATES A WEEK TO LEADERSHAPE SUMMER CAMP FOR COLORADO STATE UNIVERSITY (CSU) STUDENTS IN ESTES PARK, COLORADO

Building on his leadership writings and executive coaching in the field of leadership, Herb Rubenstein was a cluster facilitator for the Leadershape training experience organized for 65 CSU students. Students worked on creating their life visions, organized team projects, developed presentation skills, and identified new public service activities to undertake during their tenure as CSU students and throughout their life. For more information regarding the great organization, Leadershape, visit, www.leadershape.org.

Herb Rubenstein Consulting PROVIDES LEADERSHIP KEYNOTE SPEECHES IN COLORADO AND TEXAS

Speaking at the Jon Ben Sheppard Leadership Forum in Odessa, Texas to the Texas High School students, Herb Rubenstein’s keynote speech on “Leadership: What’s Youth Got to Do It?” introduced the idea that Article 26 of the U.S. Constitution, which gives 18 year olds the right to vote, should be amended to allow 16 year olds the right to vote as well. This position is based on the growing maturity of our youth, the fact that allowing 16 year olds to vote would enhance their high school experience, and the growing importance of public policy issues that affect young people today. While this position is controversial and will take many years to pass, Rubenstein is dedicated to make this a reality during his political career.

At the West Chamber of Commerce in Jefferson County, Colorado, Rubenstein spoke about the upcoming Leadership Revolution, also the title of his forthcoming book. Through information technology and an increased desire to be involved in the decisions that affect their lives, people are stepping forward -- in the United States and in nation after nation -- to take more leadership roles in the world. Rubenstein’s new book shows how economic, social, educational, technological, political, cultural, and environmental forces all contribute to a new era, which he calls the leadership revolution.

Herb Rubenstein Consulting COMPLETES TRANSACTIONS INVOLVING SALE OF TWO FIRMS

Herb Rubenstein Consulting has successfully completed two major projects in the Washington, DC area involving negotiations to ensure that owners of minority interests received full and fair value for their share of the firms that were sold. In one case, Herb Rubenstein Consulting represented the majority owners of the business, but in the other matter Herb Rubenstein Consulting represented the minority owner. Herb Rubenstein Consulting’s ability to value the businesses properly, manage the dialogue among all parties, and keep everyone on a proper schedule while they developed all of the paperwork necessary to insure a successful closing were the hallmarks of the successful strategies deployed by Herb Rubenstein Consulting.

This month’s article is about the how small and medium sized businesses, nonprofits, and educational organizations, as well as the larger ones, need to focus on and excel at “external relations.” As always, we hope you find this article useful and that it improves your business and organizational practices to help your organization become more successful.

It is not surprising given Rubenstein’s declared candidacy that this article focuses on the proper relationship for organizations between “business and politics.” Part of Rubenstein’s message is that all organizations must have strong external relations programs to survive and thrive in a world where every organization is affected by government regulations, government-oriented programs, and opportunities that can be created for the organization by making sure that your organization is well known and highly respected throughout the larger community.

Leadership, Business, and Politics: Three for the Money

Article by Herb Rubenstein
President and Founder, Herb Rubenstein Consulting

Introduction

Often business and nonprofit leaders people are advised to “focus, focus, focus.” That means:

• Get the product out
• Have the services component of your organization perfectly organized
• Achieve zero defects
• Hire the right people
• Establish the right processes
• Strive for constant improvement
• Provide great customer service
• Keep accurate financial records
• Conduct robust business and strategic planning
• Always have adequate capital and cash flow
• Sell, Sell, Sell

Solid leadership and entrepreneurship is required to design, plan, execute, evaluate, and improve every part of your business (or educational institution or non-profit organization – as this article applies to these groups as well). So, now that we have said everything that needs to be said about leadership and business, “What’s Politics Got to Do With It?” This article answers that $64,000 question. In this article we discuss an area given far too little attention among small businesses, “external politics.” We leave the issue of internal politics to another day and another article.

Defining Politics in the Business Environment

“Politics” means two different things. Internal politics focuses on how your business is governed, how decisions are made, how personal relations among employees are handled, and to what extent all of the people in your company feel they can participate in improving the company, setting policy, and having the authority to make and execute decisions on behalf of the company.

Good internal politics makes every employee, in Charles Handy’s words, feel and act like a “member.” Applying the long standing marketing slogan used by American Express, “Membership has its privileges,” good internal politics requires making sure that every employee is sufficiently acknowledged, honored, included, and involved in the business to feel privileged to be a part of the company. Many companies do that quite well, or at least they try to do an adequate job in this area.

Where most businesses drop the ball is in the area of “external politics.” External politics is the development, nurturing, and expansion of relationships outside of the company. This means developing good working relationships with government officials (elected and appointed), interest groups related to your business, and media and stakeholder groups, including those in the immediate geographic location of your business. External politics is going beyond having great relations with your customers, investors, advisors, supply chain providers, and government regulators who have direct contact with your business. Small businesses often ignore the entire “external politics” arena and then wonder why their competitors get invited to places where significant numbers of potential customers gather … and they don’t. The best evidence that small businesses ignore this vital area of business development and intelligence gathering is to ask yourself and your employees, “Who is in charge of ‘external relations’ or ‘external politics’ in our company?” You will get looks of disbelief, confusion, and bewilderment because in all likelihood not only is no one in charge of this key area, no one in the organization has ever even discussed this area in any strategic sense.

Even if you only have a few employees, you need to have someone in charge of your company’s external relations effort, and it can be handled with only a few hours of someone’s time each week. A “best practice” to launch your company’s new “external relations” effort would be for the head of the company to announce that this is a high priority, and everyone in the company is part of the effort. To get everyone involved, the leader must delegate specific responsibility to develop and improve the company’s relations with specific groups. Employees can also identify groups that the company should pursue for long-term advantage, as well as build relationships with external people and organizations for short term gain.

Ten Reasons in a Nutshell

If you are not convinced already why small companies like yours should expend some of your scarce financial and human resources on external politics, we provide ten reasons to undertake this activity in a systematic and intensive way:

1. External individuals and groups could become customers.
2. External individuals and groups could become referral sources or channels to new customers.
3. Employees will personally benefit and gain satisfaction from identifying external groups of interest to them and serving as your company’s ambassador to these groups.
4. The company will gain valuable marketplace intelligence regarding competitors and new business opportunities.
5. The reputation of the company, CEO, and employees will be enhanced by this effort.
6. The recruitment of employees, investors, and members for your board of directors and board of advisors will be improved by the expansion and success of your company’s efforts in external politics.
7. The company will improve its ability to influence local or state level policies, purchasing practices, and regulations that affect its business.
8. The company’s sales and marketing activities will be enhanced by the increased company presence in the external world.
9. The company’s ability to enter in joint ventures and strategic alliances and to expand supply chain resources will be enhanced.
10. The company will get better information about the resources and assistance available from government agencies as well as about favorable tax and loan programs. The company will be able to access public resources in a manner that would not be possible without a successful external relations effort.
    

Conclusion

The best example of the success of this strategy was the creation of a position by Ted Turner when CNN was a small company. The position was “Director of Middle East Relations.” I had the privilege of working with the gentleman who held this position for many years ago. He served as Ted Turner’s Ambassador to the Middle East in the 70’s, 80’s, and 90’s. Due to his great relations with every government and media executive in the region, when the wars broke out in the 1980’s throughout the Middle East, each country turned to this Ambassador and invited CNN into the region. Revenues grew rapidly for CNN, and Ted Turner’s efforts at external politics paid off one hundred fold.

Small companies must initiate their investments into external politics in a small way, but great dividends can be achieved. The way to start is to put the item “external politics” or “external relations” on the agenda for the next employee meeting, the next board meeting, or on your “to do” list to jog your memory that this might be an area you have ignored. The payoffs often come slowly, but over time they are as cumulative as compound interest. Be sure to put the words “external politics” or “external relations” into the job description of one of the company’s employees, possibly your own. I think you will find that over time, the work is enjoyable and the return on investment is very high.

Biographical Information

Herb Rubenstein is an attorney and the CEO of Herb Rubenstein Consulting, a leadership and management consulting firm. He is co-author of Breakthrough, Inc. - High Growth Strategies for Entrepreneurial Organizations (Prentice Hall/Financial Times, 1999). He also serves as an Adjunct Professor of Entrepreneurship at Colorado State University in Ft. Collins, is a member of the National Association of Corporate Directors and has been an Adjunct Professor of Entrepreneurism at George Mason University. He is a member of the board of directors of the International Leadership Association, is a founding member of the board of director of the Association of Professional Futurists, and is the author of numerous articles on boards of directors, leadership and strategic planning. He has his law degree from Georgetown University, his Master of Public Affairs from the LBJ School of Public Affairs, a graduate degree in sociology from the University of Bristol in Bristol, England and was a Phi Beta Kappa/Omicron Delta Kappa graduate from Washington and Lee University in 1974. His email address is herb@herbrubenstein.com and he can be reached at (303) 279-1878 or (303) 910-7961.

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