The Power of Poverty: Stop Whining and Do More With Less

Last Updated Aug 9, 2010 7:14 PM EDT

Poverty is powerful. Any bootstrapping start-up CEO will tell you that a limited budget forces you to be creative in ways you might never imagine if you had deep pockets. Not-for-profit diva Nancy Lublin agrees. Lublin, who founded Dress for Success and is now the CEO of the youth volunteer organization, Do Something, thinks that most companies have a lot to learn from their leaner brethren in the not-for-profit world. That's the subject of her new book, Zilch: The Power of Zero in Business (Portfolio, 2010). I recently caught up with Lublin, who was kind enough to share some advice on doing more with less:
Build a glass house. "When for-profit companies do their filing, they lump SG&A (selling, general, and administrative) expenses together," says Lublin. "Not-for-profits have to break out all our expenses and it's all public. I can tell you how much the Red Cross spent on postage last year." When you live a financial glass house, it changes how you operate, says Lublin. "All those executives who spent $20,000 redecorating their offices - would that have happened if those expenses were transparent?" she poses. Her suggestion: build your own glass house by keeping track of every penny you spend, making it all public to your employees, and then measuring the impact of transparency.

Dole out meaningful titles. "Give them out liberally to your employees because they engender pride and a sense of purpose," says Lublin. That's particularly important at small companies, where financial resources are not as plentiful and owners need to find creative ways to engage employees. Your titles should be specific and creative, suggests Lublin. "Jerry Yang's card said "Chief Yahoo" and that said a lot about the spirit of the company."

Crowdsource your branding. Before you hire an outside agency to work on logos, taglines, and your brand message, Lublin suggests you do a little internal crowdsourcing with your employees. "No one knows your company better than your employees, especially at a small start-up," she says. "They're going to have much better ideas than a team from McKinsey." Offer a reward -- say, $500 - for the best ideas and don't forget to ask everyone in the company to participate. "Sometimes we forget to ask the tech guys what they think about stuff," says Lublin.

Love your alums. When employee leave your company, it's easy to forget them. But that's a big mistake. "You are forever on their resume, " says Lublin, "When you go on LinkedIn and look up your company, you'll be shocked at who comes up." Those people are still intimately connected to you, so it makes sense for you to stay connected to them. "We invite them back to holiday parties and to our annual event," says Lublin. "We create a list serve for alumni, like a university." The result: great word of mouth from former employees, who just might be your best source of referrals for future employees.

Embrace the barter economy. Not-for-profits tend to be very creative when it comes to leveraging their existing resources to get access to the goods and services they need to grow. You should be, too. "Maybe you have a guy who is brilliant at HTML and you need an accountant," poses Lublin. "See if you can swap employees temporarily with another company." Finding a good barter partner can be as easy as chatting up your office neighbors in the elevator. But you should also involve your employees in the process. "Tell them 'here' s some of the good stuff we have and here's what we need. Who do you know?'" Think creatively. If you have a fabulous office that closes down at 6 pm, can you offer it to, say, a Weight Watcher's group that meets in the evening in exchange for free participation for your employees? Remember, though, that the IRS has rules that govern bartering.

Do you think that lean budgets foster creativity and innovation, or do they simply make you feel poor? Share your own strategies for doing more with less
  • Donna Fenn

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