Can Doug Hall Save You From Yourself? This high-profile adviser thinks he can lift entrepreneurs out of their ruts. If only they wanted to be saved.
(FORTUNE Small Business) – Doug Hall knows exactly what he's up against. "You go into small business to be your own boss," the corporate creativity guru says. "So the last thing you need is some guy from Ohio telling you how to run it." Yet here he is, on a gray, wintry day, acting as part cheerleader, part guidance counselor to Doreen Sark, whose five-year-old business barely broke $100,000 in sales last year, down 10% from 1999. Sark, 57, admits she's ready to give up. After all, her product isn't about to replace the Razor scooter. Her company, MicMac Productions, makes clay figurines of characters from legends of the MicMacs, a native tribe of Prince Edward Island, Canada. Last year she sold 125 of the $200 figurines, which resemble cheesy tie-ins for a Disney movie, compared to 160 in 1999. After spending two years in the red, Sark needs a change but doesn't know what it should be.
This is why she's seeking counsel from Hall, who has built a career of helping such FORTUNE 500 stalwarts as Kellogg and Compaq overcome their scleroses. Since 1991, when he left Procter & Gamble after ten years in brand management, Hall has led Eureka! Inventing seminars at his headquarters near Cincinnati. For $150,000 per company, buttoned-down VPs pelt each other with Nerf bullets and brainstorm like mad. Four days later they leave with loads of product ideas (Duncan Hines Pantastic Party Cakes, for example). Hall, barefoot and clad in a Hawaiian-print shirt, is a ringmaster; but instead of elephants, he rounds up novel concepts.
With Sark--among the dozen or so others he has assembled for a free, three-day seminar on Prince Edward Island, just north of Nova Scotia--Hall is trying to perfect a formula for small businesses. Entrepreneurs, as he sees them, can fall prey to paralysis. "[They] get distracted by so many irrelevant elements," Hall says. Bigger companies have more of a cushion, but small businesses can't watch their numbers deteriorate for too long. "Since 1992, we've had negative growth," says Peter Baker, owner of Island Winds, a 20-year-old maker of wind chimes. In other words, his company is shrinking; sales peaked at $300,000 in 1989; last year he grossed $100,000.
Baker and Sark are among six company heads who have agreed to be Hall's guinea pigs, selected by the island's government because they want help. They're as removed from corporate America as is conceivable--a wooden-toy maker, a sheep farmer, and a fellow selling pewter jewelry. But they share a common affliction: They've become mired in their own mindsets. They built their businesses on instinct but can't admit their guts might not be the trustworthy guides they once were. And there's no one to tell them so. This is Hall's second try at helping only small businesses. As he sees it, he's out to save entrepreneurs from themselves. But do they want to be saved?
Ed Mckenna, owner of St. Peter's Bay Crafted Giftware, is hardly overflowing with gratitude. Sure, he attended Hall's daylong brainstorming session at a restaurant in November, and there's no denying that he walked away with useful ideas after later meeting with Hall privately. But before McKenna converts, he'll need to get past some contradictions. Even though he's running with most of Hall's suggestions, including the concept of selling three earrings at a time (so customers will always have a spare), McKenna is unenthusiastic. "I'd give it a pass," he says of the session with Hall. He says the ideas Hall handed him were "basically stuff I already knew" and that Hall was "flying by the seat of his pants."
McKenna's attitude points to what may be Hall's biggest hurdle: Entrepreneurs don't like anyone--helpful or not--telling them what to do. Never mind Hall's credentials as one of their ilk. "I'm a capitalist," Hall, 42, says. "I've made a pile of money." He won't disclose revenues of the company he founded in 1986, Richard Saunders International (after Ben Franklin's pen name), but gladly volunteers that he's debt-free, paid for his summer home on Prince Edward Island in cash, and two years ago treated himself to a shiny blue BMW Z3. And that he has endorsements from a blue-chip array of Eureka! alumni. Last year, for example, Ford Motor Company's market research team made four trips to his ranch, bringing away at least five "killer ideas" each time, according to Kristy Stoll, the product manager in Ford's market research department who arranged the visits.
But big corporations who make liberal use of consultants are better conditioned to value outsider advice. Peter Baker, for his part, didn't react well when Hall suggested Island Winds needed a new name. "I don't mean to insult you," Hall said, trying to soften the blow. Within minutes Hall's henchmen of "Trained Brains" (Hall has his own vocabulary; see box) rattled off a list of new names, including Ever Chime, Dura Chime, Winds of Chime. Baker nodded and frowned, looking pained. But he came to life when Hall asked him the one question he asks every attendee: "What are you most proud of?" Baker's reply: "Our chimes are rugged, not delicate." And he added that since everything about the chimes was heavy-duty--the tubing, the wires connected to the clappers--they are guaranteed for life. Hall liked what he heard. Earlier, Baker had boasted that his chimes' biggest asset was that they were tuned by ear, not electronically--a story Hall had called "lame" the night before. But Hall latches on to the idea of "industrial wind chimes." By the time they're finished, Baker is ready to start selling all-weather chimes with steel alloy tubing that can pass the tough torsion tests competitors will fail. They gong with the wind--nothing lame about that. Baker plans to demo his macho chimes at trade shows, and he is seeking patents for two new products. "I needed someone like Doug to come along," he says.
Not surprisingly, Hall applies his brand of creative thinking to his own business, especially when explaining why he targets entrepreneurs. He sees his new effort as a "religious mission" and likens himself to a doctor who holds a much-needed vaccine. He admits that the pilot tests are at least as much for his benefit. In part, he's a bored rich guy. "I needed another challenge," he says. He chose the island, where he summered as a kid, to serve as a life-size petri dish. He'll distill what he learns into an efficient process that he'll sell to entrepreneurs through books, videos, and licensing deals. But Hall is aware of the pitfalls. Small business owners might not settle for anything less than another CEO, meaning Hall himself. So he's trying to "design himself out" of the process by assigning a Trained Brain to each company post-seminar--something he learned from the first pilot run, after being consumed by follow-up work.
Then again, Hall's experience on Prince Edward Island suggests that entrepreneurs know more than they think. It could be that after they've had their first success, they're less inclined to ask themselves basic, if hard, questions. If they did, then they might find the answers are often achingly obvious. When Hall asked MicMac's Doreen Sark what she loves about her figurines, Sark started spinning tales of MicMac legends--how the first humans appeared out of an ash tree, or how summer originated as a princess who rescued the MicMacs from the icy winter. It was clear to Hall: Sark and her husband, the chief of the MicMacs, should sell the story, not the figurines. They should make CDs, videos, or small ornaments that would be cheaper and not as labor-intensive. "It seemed so obvious," Sark says later. So why couldn't she see it herself? Why does any entrepreneur get stuck in a rut? Fear, perhaps, or myopia brought on from fixating on the day-to-day. Or just denial. "It's like when a relationship starts to go bad," Sark says. "There are signs, but you don't want to know it." Back in November, when Hall's team packed up its PowerBooks, Sark looked as though she'd been through a cathartic therapy session. "I feel so much better," she said to Hall. The big question for Hall: Is that enough?