April 13, 2024

Unitranche

Supportive Business Potential

Keynote Speakers Share Business World Wisdom

Keynote Speakers Share Business World Wisdom

On the first full day of the American Booksellers Association’s Winter Institute 2024, two keynote speakers talked about how they manage difficult business situations—one by fostering agency and change, and the other through constructive negotiation. Private equity investor James Rhee, author of Red Helicopter: A Parable for Our Times (HarperOne, April), talked to WI2024 attendees about how to amplify a bookstore or brand’s intangible qualities, values that are invisible on a P&L statement. Conflict resolution specialist William Ury, author of Possible: How to Survive (and Thrive) in an Age of Conflict (HarperBusiness, Feb.), spoke about “navigating this wave of turbulent times” and avoiding the trap of pessimism.

Rhee walked onstage carrying four books, including his childhood edition of Aesop’s Fables, which he and his father bought in the 1970s at the Corner Bookstore, near their hometown of Stony Brook, N.Y. Years later, as a Harvard Law School graduate with an economics bent, Rhee became known for revamping the company Ashley Stewart, which had been founded as a retailer of plus-size clothing for Black women. Ashley Stewart was near bankruptcy when Rhee offered to come in as CEO, and he reimagined it not as a clothing company but as a luxury fashion brand with an affirmative message for BIPOC people.

“This company was being asked to fit into a box, but it wasn’t a typical company,” Rhee told the Winter Institute audience. He knew its success lay beyond clothing, in clients’ sense of personal identity, and he called his approach “a much more mutualistic form of capitalism.” Rhee believes indie bookstores can succeed by “controlling the story” about their missions and their roles as small local businesses, a concept repeated in several education sessions throughout the day. “We’re going to exercise agency over our own future,” he said.

In Red Helicopter and in his keynote, Rhee, who is Korean American, also introduced the Korean principle of jeong, loosely translated as goodwill. Jeong is unquantifiable, but giving or receiving jeong can forge an emotional bond—“what economists call ‘positive externalities,’” Rhee said. He added: “I found myself again” while working in good faith to rescue the failing company. Now, he hopes to persuade listeners that, although kindness doesn’t appear on a balance sheet, it’s both a literal asset to a company and a source of long-term equity. “Can we be kind and mathematically right?” he asked.

During a debriefing session after his talk, Rhee shared advice from his experience in private equity firms. To test bookstore business models, he recommended that booksellers try an exercise he called “lemonade stand economics” with their teams, imagining how children might operate a corner lemonade stand. At a basic lemonade stand, everyone typically pitches in for supplies, divides the profits evenly, and does not factor in labor, rent, or marketing expenses: “It’s like the purest form of capitalism,” he said, although others might call it a cooperative or collective.

While Rhee’s example was playful, he used it to model a bare-bones enterprise with “an opt-in culture” among participants and everyone understanding what needs to be done: “In business school, you call it ‘cross-functional training.’” Lemonade stand operators exercise a short-term form of the “agency” Rhee seeks, and those uninterested in demonstrating a spirit of entrepreneurship can have their participation “rescinded”—that is, they can leave. In his examples, Rhee suggested that managers benefit from being transparent with staff about a store’s gross profits and net profits. He looked for “what accounting does not measure,” and urged booksellers to think about how intangibles—such as generous customer interactions or low turnover among staff—influence a bottom line: “Cash never lies,” he said. “Your values are on your balance sheet.”

Ury, a negotiation advisor and mediator who has worked with the governments of various countries as well as businesses, began his presentation by naming all the indie bookstores that he has loved throughout his life. “I just have a special love for bookstores and books, and it’s a huge pleasure,” he said. “I can appreciate how challenging it’s been for you the last few years, faced with competition from big chains, and, of course, the pandemic. But I know the role you play in your communities as a place to gather, a place to learn, a place to enjoy. So really, I am delighted to share a few lessons with you—to serve you as you serve others.”

Asking his audience how “we as human beings learn to live together” and “deal with our differences constructively,” Ury noted that people constantly negotiate with their families, coworkers, customers, and themselves. Describing himself as a “possibilist,” Ury said that he believed in people’s potential “to transform even the toughest conflicts we face, from destructive fights to creative negotiations and dialogue.” Ury urged his audience to change their mindsets by thinking of obstacles as opportunities. “Conflict is natural—it is part of human life,” he said, emphasizing that people should embrace conflict in order to “change the form from destructive fighting to creative, constructive, collaborative negotiation.”

To assist the audience in conceptualizing this, Ury constructed an architectural metaphor. He explained that people should step back from any situation to maintain a clear perspective from what he called “the balcony”; try to arrive at a solution that will satisfy all parties (from “the bridge”); and seek help from others in coming to a resolution (“the third side”). “When conflicts are tough, we need all three at once,” he said. “Negotiation is an inside job. It proceeds from the inside out. And, paradoxically, the best way to start is to stop.”

Appealing to people around to find resolutions “is our oldest human heritage in dealing with conflict,” Ury said. “It’s our birthright.” He illustrated this natural inclination by asking audience members to “take an arm-wrestling posture” with the person next to them. When people gripped hands, laughed, and played at fighting, he observed that they were negotiating their behavior with their partner.

Indie bookstores, Ury said, “serve as a natural balcony—a place of perspective where people can see the bigger picture by reading books. Your stores serve as a natural bridge: a place for the community to gather, to mingle, to exchange ideas. Your stores serve as a natural third side: a place that stands for the benefit of the whole, the whole community. I believe you have an important role to play in helping our communities navigate in times of conflict. It is creating possibilities one book at a time. That’s the model of the possibilists: it’s humble audacity. High aspirations, no expectations.”