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If One Million Dollars, Why Not Two? Consultant Finds Successful Entrepreneur Stubbornly Limiting His Own Growth

Updated on August 13, 2011

Business Consultants and Their Clients

Consultant Finds the Roadblock on a Client's Road to Success

The consultant's task of helping people with informed advice combines both reward and frustration in a complex package. In a recent consulting project, I found myself using stories from past experience to illustrate not only how consulting works, or does not work, but also what kinds of problems it can or cannot be expected to help other business-people solve.

Everyone has problems, of course, just as everyone has advice to give others. The universal activity of advising people takes place every day at many different levels. I share this true story here to encourage better problem-solving and consulting not just in the world of business, but in the community at large, and better advice-giving in general.

My consulting career took a big step forward in 1969 when I placed a "Positions Wanted" classified ad in the Sunday New York Times that went something like this: "Gifted special assistant to company owner or president can help you solve problems and reach your goals."

The first response, early Sunday morning, came from Mr. Frank Marlin, president of Eastern Radio Corporation, one of America's first companies to import transistor radios from Japan (some details here changed for confidentiality). Starting from scratch, within two or three years, Mr. Marlin had quickly developed a national market and built a company with 65 employees worth over $1 million (in those days, a million was a million).

Growth had leveled off quickly, however, and in spite of great effort, he could not grow any larger. He asked me to help him find out why. How could a talented, ambitious young man with a great new product become a millionaire almost overnight, and yet stay stuck at that same level for several more years, and not know how to use that wonderful base to move forward into even higher brackets of income and net worth?

He also had a prohibitive turnover in executive secretaries, a key position in most small firms, so he gave me the second job of explaining this turnover, and if possible, helping him find a new secretary who would stay with him permanently.

In the initial interview, he resisted hiring me when I gave some weak answers to technical questions about the import business. Many people make this common mistake of assuming that no one can help them unless they have great expertise in their particular specialty or line of work. Mastering special details got them started in business, so they think they can surmount all new obstacles only by learning more of the same. They underestimate the value of general experience outside their narrow special areas, and they underestimate the extent to which all specific problems and goals have features in common, understandable in general terms to a trained person (just as obscure math problems yield to common denominators and other general procedures and formulas).

Mr. Marlin gave me a desk in his own office, with authority to investigate any aspect of his company for answers, and the next day he had me drive him, in his luxury automobile, out to the airport for the start of his previously planned ten-day business trip to Japan.

While he was gone, I spoke at length with leading members of his firm, even visiting in their homes to learn their perspectives. Rank-and-file employees told me much about the history and internal workings of the company. Leading customers also told me their points of view.

A clear picture emerged that sounded obvious only in retrospect. Even though Mr. Marlin had hired three excellent vice presidents (in marketing, production, and finance), he subtly but firmly resisted giving any of them any real authority to make decisions. They served him dutifully as figureheads, rubber-stamps to his detailed plans and ideas, biding their time quietly until new opportunities for greater responsibility might arise elsewhere.

In short, Mr. Marlin as president still directly supervised all 65 employees of the entire company! He obviously was a man with great operational insight and capacity for supervising people. But he had reached his limit, because every time he tried to hire more people to do more work, serious new problems began developing, and he had to let people go.

Every business organization has natural limits built into its system at any given point in time. Even with a sensational and proven new product for national marketing, Eastern Radio had found its natural net-value limit of $1 million by restricting itself to what one highly talented manager could accomplish directly supervising all 65 of its employees.

When Mr. Marlin returned home from Japan, I shared my results with the youthful enthusiasm that has always been my stock-in-trade. I knew he would be glad to learn that he himself was the problem, because then he could personally supervise and guarantee the solution! His company could start growing again just as soon as he took a few basic steps to learn the art of delegating true authority and responsibility for corporate growth to a few other qualified and talented people he already had on his staff ready to do whatever he said to do.

Mr. Marlin responded, patiently at first, with all the many reasons why such delegation would not work in his case, which all went back to his fear that teaching others what he knew about the technical aspects of the importing business might undercut his authority and destroy the proprietary basis of his success. He relished learning how to do more work personally, but the very thought of "turning the whole company over to hired managers" caused him real pain and denial.

When clients demand to know why they hurt where they do, good consultants, like good doctors, sometimes must give unwelcome news that hurts the client more than the original symptom. This prospective pain, in fact, has been serving all along to help rationalize hiding from the truth about the problem, and make objective, courageous, outside consulting the only way, short of divine intervention, to break free from the essentially self-imposed box of pain.

The client at that point still has two major options: (a) to face up to the newly discovered but painful realities, and cooperate with a new path toward healing, or (b) to shrink back and rethink everything in search of a gentler, kinder, easier path that accommodates the pain.

Mr. Marlin chose Plan B, and within a few days he had lost patience with my counsel altogether. I was too inexperienced at that time in my life to know how to present my analysis and plan for his success in a more effective, user-friendly way, and thus help him move on toward his stated goal of increasing his company's worth by a second million dollars.

In a further irony, he quickly fell under the influence of the wonderful new executive secretary I had recruited in his absence. She, in fact, warming to her promising new role as "chief advisor to the president," urged Mr. Marlin to terminate my one-year consulting contract, because my advice, obviously, would no longer be needed, thank you very much.

I ended up with my $1,000 advance (which to me in 1969 seemed like a million dollars and allowed me to buy a better car) and two of the twelve promised monthly retainer fees. More importantly, I had gained invaluable experience that led to more curiosity about general analysis and problem-solving. I had used my own research and independent judgment to analyze a formidable business quandary and develop new knowledge and specific plans for moving past the problem and closer to the client's stated goals. In the larger framework of offering executive staff services, I had begun functioning as an independent analyst, problem-solver, and consultant, albeit one who still, like my client, had much to learn.

Years later, in 1987, when the one-year-late honeymoon journey with Fay to Niagara Falls took us past some key places of my youth, we drove past that location and found Mr. Marlin's business still operating along the same lines as 18 years before. He apparently still enjoyed micro-managing his 65 employees more than he wanted to make the changes required in management style to move himself up into a higher category of net worth.

Thank you for reading my story. Now I want to read yours. One-way communiction can never establish the kind of relationships needed "to make the world go 'round." You can respond with your comments here, of course, but HubPages also lets you "tell your own story," and I challenge you to do that. HubPages also lets you e-mail me (if you prefer privacy) about your life or your business.

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Copyright (c) 2011 by Max J. Havlick, New World Community Enterprises, Inc., 16 W. Vermont St., Villa Park, IL 60181-1938, all rights reserved (30 min. from O'Hare Airport). Permission here granted to make exact copies that include the copyright notice.

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