by Howard H. Stevenson, Serafim-Rock Professor of Business Administration, Harvard Business School
I remember very well the first time I talked to Bob Reiss. It was in 1983, shortly after I had returned to the Harvard Business School to help build a new faculty group focused on entrepreneurship. Somehow, Bob heard about the effort, and called me up.
"I'm glad the School is finally doing something about entrepreneurship," Bob said in so many words. "Come see me next time you're in New York."
So I did, and I wasn't disappointed. He greeted me warmly in the spartan offices of R&R, and within a few minutes was regaling me with a fascinating story about a recent adventure he and his company had gone through.
Quickly, that story turned into a case, and that case is included as an appendix to this book. I've written lots of cases, but none was easier than "the R&R Case. "For many years thereafter, I used "R&R" as the subject of the first class session in my entrepreneurship courses. It was almost always a lively class. "Risky business, this fad-game business, right?" I'd ask my class. Yes, most people agreed; very risky. "So, if it's so risky," I'd continue, "who took all the risks?" Suddenly, my class had trouble finding the risks. "Hey," I'd ask next, "where did all those risks go?"Bob's special genius, my students gradually came to realize, was in getting a whole basket of contingent commitments lined up. When the last one fell into place, there literally was no risk.I would usually go on to describe a managerial spectrum, which had what I called entrepreneurs at one end, and managers at the other. Entrepreneurs, I suggested, were opportunity-driven. They used few resources -- and when they did, they tended to be other people's resources. They committed quickly, and in small increments. They rewarded people for the value they created.
Bob embodied all of those traits. In fact, he practically anchored the entrepreneurial end of the spectrum, and his example helped me think through what distinguished entrepreneurial management from other kinds of management. If Bob was doing it, it was almost certainly entrepreneurial.
Those traits shine through the pages of this book. So do many of the other characteristics that make Bob a fun person to know, and distinguish him from the run-of-the-mill business person. For example: Many people in business tend to divide things into either cooperation or competition. But in business, as in most things in life, you're both competing and cooperating. In Low Risk, High Reward, Bob shows how to do both. He emphasizes the satisfaction of "getting your share of the pie" -- but also the importance of making the pie bigger.
And by the way, Bob extends that prescription all the way to the end customer. He reminds us that success lies in delivering value to the customer. At the same time, Bob's book is an antidote to all the business books on the market today that argue for a passionate, single-minded dedication to one thing or another. The customer is very important, says Bob. So is the product. So is the order. So is the reorder.
That's one of the things I noticed first about this book, in an early draft. Most authors of business books (who tend to be either professors or consultants) try very hard to boil things down to "seven key points" or "six good habits" or some other small collection of precepts. Bob is a business person, who operates in the real world. His lists never have fewer than a dozen or two key ideas -- and sometimes many more. The real world, Bob reminds us, is very complicated.
Another thing that Bob reminds us of -- and it's one reason why I gave the manuscript to my daughter to read -- is that entrepreneurship is not about having the great idea. It's about having at least a pretty good idea, and executing it with skill and passion. It's about the million details you have to get right if you want to have the right people work with you, successfully. I noted with interest the emphasis that Bob places on relationship building. As noted, he makes the pie bigger for everybody. He doesn't burn bridges. He can call again (and people will be glad to hear from him).
I believe we should teach Bob's approach to financial analysis at the Harvard Business School. What are the numbers that you have to watch, and how often do you have to watch them? For the founder and grower of a business, Bob's chapter on numeracy alone is worth the price of the book.
In fact, there's a great deal in Bob's experience -- colorful and unusual as it has been -- that turns out to have universal appeal and importance. Maybe you won't have your wristwatches "knocked off," as Bob did. But the minute you have a good idea, someone out there is going to figure out how to make it cheaper, better, and faster. Are you prepared to respond? Bob tells you how.
And maybe you won't use a manufacturer's representative (as Bob often did, and which he sometimes was himself). But if you make a product, you will almost certainly be distributing through channels that you don't control yourself. Do you know how to create incentives for all the people in that supply chain? Bob has lots of good ideas for you.
I couldn't be happier that Low Risk, High Reward makes Bob's ideas and example accessible to a new and broader audience. I hope that the many people who've always wanted to start a business will buy this book, read it, and -- if they decide entrepreneurship is for them -- take the plunge with Bob's help. And I hope that those entrepreneurs who are already in business will dip into this book for help, new ideas, encouragement, and a timely pat on the back.
Entrepreneurship is a strange and exciting road, and Bob Reiss is one of my favorite tour guides.
Risk, High Reward
List Price: $19.95