Charles River Apparel

Governor Patrick Declares Today as Family Business Day

Medford, MA – Governor Deval Patrick of Massachusetts has officially declared today, April 29, 2009, as Family Business Day in the Commonwealth of Massachusetts. Governor Patrick is recognizing the important role family businesses play in the local Massachusetts economy. The day also coincides with the Northeastern University Center for Family Business’ announcement of the Massachusetts Family Business of the Year of which Medford-based apparel manufacturer, Charles River Apparel is a finalist. Barry Lipsett, President and CEO of Charles River Apparel comments “Of course we would love to win, but in this case being nominated is truly an honor. The strength of our company comes from being a multi-generation family business. The family atmosphere we foster at Charles River Apparel is what makes us such a successful company even in the current economy.” Charles River Apparel has a 30-year history behind its apparel business and continues to employ a variety of family members throughout the company. Charles River Apparel has previously been listed as a Boston’s Best Place to Work by Boston Magazine. The winners of the Massachusetts Family Business of the Year awards will be announced this evening at an awards banquet.

The Massachusetts Family Business of the Year Awards program was created two years ago in a partnership between Northeastern University's Center for Family Business and The Family Firm Institute New England Chapter. The awards program serves to promote and highlight some of the great achievements of Massachusetts-based, family-owned businesses and entrepreneurs.

Good Bank Bad Bank

An Interpretation by Bob Berg CFO for Charles River Apparel

A Good Bank will embrace you and loan you money in good times and bad times.
A Bad Bank will embrace you and loan you money only in good times.

A Good Bank will express interests in your business and will always want to meet and talk about how things are and what are the plans for the future.
A Bad Bank for the most part expresses little interest in your business as long as the fees and interest charges are paid and their Assets are firmly protected.

A Good Bank is consistent in its policies and very rarely makes changes that affect you.
A Bad Bank will make changes with little or no thought as to what the impact may be on you as an account.

A Good Bank will stick with you and remember all the times in the past when things were good.
A Bad Bank will forget about the past and treat you like a second class citizen when there is the slightest hic-cup in the business.

A Good Bank will work with you because they are familiar with your business and will not pass you off as a problem loan to another party within their bank.
A Bad Bank will take the typical approach that if you are considered a non-performing loan they will take you out of Asset Based Lending and throw you to the notorious Work-Out Department where you will be treated like a dead beat and as a result all bets are off and there is a new set of rules in play.

A Good Bank will listen and allow you to put in place a plan that if it makes sense will support you and look at the positives while the plan develops.
A Bad Bank will show little or no interest in working with you because at this point in time the only object is to make the bank whole and purge them of you the non-performer.

A Good Bank will acknowledge your expertise and the way you have successfully operated your profitable business in the past, recognize that everyone is going through a tough time and go forward with you provided you have a workable and creditable plan that makes sense.
A Bad Bank will do everything that they can with no regards to the past and your successes to make them whole up to and including forcing you into Bankruptcy.

A Good Bank will stand by you and fund initial losses within your plan provided their assets that support a loan are still sound.
A Bad Bank will show no regards for how much they may be covered by the company assets and refuse to fund any losses.

A Good Bank will happily give you an umbrella to protect you from the rain.
A Bad Bank will happily give you an umbrella when it is not raining.

These off course are my professional opinions after several years of working with more Bad Banks than Good Banks;

Re-Think, Re-Adjust and Re-Focus

[By President & CEO Barry Lipsett] With the economy hitting everyone hard, the lofty goals we once made for ourselves and our companies  now may be unattainable.  How do we measure and where do we go from here?  Should we re-focus our efforts, re-think and re-adjust our goals? 

I am a big believer in setting goals and using metrics to help measure and guide my company, but during this time of uncertainty we need to become more flexible.  Why not keep your smaller goals (and metrics) but do away with many of your bigger goals and stop your long term planning? No longer can it be argued that success was due to an Executive who “set a goal and remembered their goal at all times” (from “Rich Like Them” by  Ryan D’Agostino).  Books that focused on structure, planning and goal setting, such as “Seven Habits of Highly Effective People” have given way to books emphasizing creativity, flexibility and change.  “Outliers” the bestselling book by Malcolm Gladwell shows how achievement can “follow a peculiar and unexpected logic.”

Before the recession hit in January of 2007 Eric Abrahamson and David H. Freedman anticipated the necessity and benefits of disorder with their book “The Perfect Mess.”  They wrote about “The Seven Highly Overrated Habits of Time Management” and asked “what happens if after years of focus and consistency you discover you’ve picked the wrong goals?”  The book quotes a management consultant, named Bill Starbuck, who believes that long range planning has an adverse effect (on growth).  That’s because formal planning can end up locking companies into faulty strategies, focusing everyone’s energies on opportunities that never materialize and causing companies to ignore real opportunities that spring up in their place.

More recently Drake Bennett writing in the Boston Globe on March 15, 2009 questioned the effectiveness of goal setting.  His article is titled “Why setting goals can backfire” and writes that “a few management scholars are now looking deeper into the effect of goals and finding that goals have a dangerous side” and that companies have the “ample ability to hurt themselves by setting blindly following goals.”  Goals can “focus attention too much, or on the wrong things, it can lead to crazy behaviors to get people to achieve them” say Adam Galinsky a Professor at Northwestern University Kellogg School.  Think of the Government’s goal of increased home ownership and how it caused so many problems of late.

As an entrepreneur it may be time to embrace some disorder and look for new opportunities.  It can be argued that a moderately disorganized and flexible system may “yield better solutions” and bring better results. Some goals, however, may just be too important to ignore.  Sales and profit are the life blood of your company and you probably need to re-adjust your goals and expectations until the economy turns for the better.  Continually re-think where new opportunities may lie especially with increasing sales.  For example, at Charles River Apparel, we have looked for opportunities where other may not think to look.  One year the recipient of our Sale Rep of the Year Award was given to a Sales Rep that had been promoted from the warehouse and re-located to Texas.  We based his potential on an effective personality test and his desire to grow with the company.

Remember that during a recession is when the most opportunities present themselves.  So don’t be afraid to re-think your long term planning, re-adjust your goals and re-focus your organization to be more flexible.  Going forward you may want to consider Drake Bennett’s thought that it may be a “good time to ask which of the goals we had set for ourselves were things we really needed to achieve, and which were things we only thought we should (achieve).”

Bottom line is that your organization may benefit most, right now, by being more focused on the work for its inherent interest and value rather than for its outcome of growth and profit.   At Charles River Apparel we are continuing to look at our organization and make sure we have the right people in the right places.  That each person is not only good at what they do but that they find value and meaning in their work.