by Gigi Wood
IOWA CITY – Assume nothing.
That’s the takeaway Henry Tippie offered to a crowd of more than 200 people at the Sheraton Iowa City Hotel Feb. 23 as part of the MidWestOne Lecture Series. The annual series is a partnership with the University of Iowa’s John Pappajohn Entrepreneurial Center that offers rare appearances by some of the UI’s most successful business alums. Last year, Russell Gerdin, founder and chairman of Heartland Express, spoke.
“Believe me, every time I’ve gotten into the assumption business, I’ve been shoved to you know where,” Mr. Tippie said.
He delivered a speech titled “Decisions,” and offered a textbook-like set of principles for achieving success in the business world, as well as life.
Mr. Tippie, the man for whom the UI’s business school is named, echoed the importance of having a plan several times throughout the lecture. One mistake entrepreneurs often make early on is not having a plan. For small operations, a plan for the current week is just as important as a five-year plan, he said.
“I’m not opposed to business plans; if you don’t have a business plan you’ll probably fail,” he said. “But there’s one problem with business plans for small operations or somebody starting a new business. What is your plan to meet the payroll and your expenses this week? Think about that. I’ve been part of many startup businesses throughout the years, and there’s no use thinking about five years from now. You better be thinking about this week. That’s a big difference.”
It’s important for the owners of small businesses to have a Plan B, he said.
“If you can’t meet payroll or things don’t pan out, where do you go after that?” he said.
The backup plan is all about money and is different for each person, whether they are out of money or owe money, he said.
“Let’s say you’re in a company you started and it’s not working,” Mr. Tippie said. “Before you start down that trail and getting into that activity, you already need to be asking yourself, ‘Well, if it doesn’t work, what am I going to do?’”
He kept his own backup plans private.
“There’s various people over the years who get a kick out of talking about my backup plans, and I have them,” he said. “That doesn’t mean I share them with everybody, because I don’t. I keep a lot of things very tight. I know how to survive. After all, I came out of the Depression. You had to know how to survive.”
Every business wastes time and can become more efficient, he said. When he was financially involved in a broadcast media company, research showed that salespeople made an average of five sales calls a day. He said adding an additional sales call each day would be the same as adding another day of productivity to the week.
“One more call a day, five days a week, that’s five calls, that’s an extra day,” Mr. Tippie said. “That’s a lot of money. And you can apply that to any business.”
Accumulating wealth requires discipline, he also said. He suggested the audience, largely made up of UI students, put away a set amount of money each month that is untouchable, similar to paying rent. Then, invest it, he said.
He also spoke about giving 110 percent on the job, being willing to find out the answers to questions, dealing with rejection and choosing jobs to gain experience, not money.
One important decision in Mr. Tippie’s life was made at the request of his mother, who told him to leave the family farm in Belle Plaine and work elsewhere.
“The farm was no way of life whatsoever; farming was not like what you have today. This was back when we had horses and had to use a lot of backbone. We’ll put it that way. There isn’t too much I haven’t done,” he said.
He joined the Army Air Force and when his service was complete, he attended the UI using the GI Bill. He studied accounting to improve his chances at securing employment.
“The feeling was, you may not have a job but if you know how to keep books, maybe you can get a job,” he said.
He graduated from the UI with an accounting degree in 1949. He has been a part of 12 companies going public, serves as director of several companies and is chairman of the board for Dover Motorsports and owns a 33,000-acre ranch in Limestone County, Texas.