The Leading Edge - Spring 2008 - (Page 4)

cover NO PLACE TO GO BUT Business executives shAre how MAjor MistAkes BecAMe lessons for success By Ann M. Gynn enri Morris lost $10,000 helping a fellow businessman. His company, Edible Software, almost went bankrupt when a client stole employees who took proprietary information. Richard Rabins and his brother sold their private company and found frustration operating a publicly traded one. Retail Doctor’s Bob Phibbs told a potential client he could not afford his services. Kristy Choo staffed her new pastry business as if she expected daily crowds and bought equipment without checking prices. The stories are countless—business executives make mistakes, but it’s what they do after the mistakes happen that can spell the difference between success and failure. H Trust takes a hit “I think back of how completely ignorant and naïve I was when I started a business. It’s frighteningly startling. I had no experience running a company,” says Morris, who opened his first company in 1980, just two years after emigrating from South Africa to Houston. He didn’t have adequate capital and his business inexperience led to people taking advantage of him. The latter is one of the hardest lessons he learned. “I got burned badly,” Morris says. He encountered a sole proprietor in Alabama who was in the same business but unable to get the necessary hardware at a good price. The Alabama business friend had an idea—he would buy the equipment through Morris, whose company was eligible for equipment discounts. Wanting to help this man, Morris agreed and began ordering the equipment without marking up the cost to his Alabama “friend.” “For almost two years it worked well,” Morris says, adding he never tried to make a penny in the deal. Then he got a call from Alabama that his business friend needed a $10,000 printer to win a state contract but the state would not pay until delivery. Could Morris order the equipment, pay for it and then accept payment after the state paid its contract, the Alabama man asked. “I couldn’t afford to lose $10,000,” Morris says, but he trusted the man so he went ahead and did the deal. “The man ended up taking the money and running,” Morris says. Even though he sued, the man filed bankruptcy and Morris never got a cent. Morris says he learned that “help” like that was a detriment to his own business. Now, he says, “Don’t give me promises you want me to pay. Pay me upfront and (pay) a surcharge.” Seven years ago, Morris faced a different “trust” challenge so big he almost had to file for bankruptcy. Edible Software, which provides accounting software for the wholesale food distribution industry, had a major client whose new leaders wanted, unbeknownst to Morris, a name-brand software package. But after the million-dollar purchase of another brand, the company found the software would not work properly. Instead of telling Morris what it had done, the company decided to hire away Edible continued on page 6 VOLUME 8 n 4 ISSUE 3 n SPRING 2008

Table of Contents Feed for the Digital Edition of The Leading Edge - Spring 2008

The Leading Edge - Spring 2008 Contents No Place To Go But Up Lessons from Harvard Bits & Pieces Conducting Business Outside the United States Top 10 Misconceptions of Doing Business in Ireland In a Nutshell: Q&A The Leading Edge Alliance

The Leading Edge - Spring 2008

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