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Excerpted from Passion Capital: The World’s Most Valuable Asset © 2012 by Paul Alofs.

Several years ago I was in the Thomson Building in Toronto. I went down the hall to the small kitchen to get myself a cup of coffee. Ken Thomson was there, making himself some instant soup. At the time, he was the ninth-richest man in the world, worth approximately $19.6 billion. Enough, certainly, to afford a nice lunch. I looked at the soup he was stirring. “It suits me just fine,” he said, smiling.

Thomson understood value. Neighbors reported seeing him leave his local grocery store with jumbo packages of tissues that were on sale. He bought off-the-rack suits and had his old shoes resoled. Yet he had no difficulty paying almost $76 million for a painting (for Peter Paul Rubens’s Massacre of the Innocents, in 2002). He sought value, whether it was in business, art, or groceries.

In 1976, Thomson inherited a $500-million business empire that was built on newspapers, publishing, travel agencies, and oil. By the time he died, in 2006, his empire had grown to $25 billion.

He left both a financial legacy and an art legacy, but his most lasting legacy might be the culture he created. Geoffrey Beattie, who worked closely with him, said that Ken wasn’t a business genius. His success came from being a principled investor and from surrounding himself with good people and staying loyal to them. In return he earned their loyalty.

For the long-term viability of any enterprise, Thomson understood that you needed a viable corporate culture. It, too, had to be long-term. So he cultivated good people and kept them. Thomson worked with honest and competent business managers and gave them his long-term commitment and support. From these modest principles, an empire grew.

Thomson created a culture that extended out from him and has lived after him. Here are eight rules for creating the right conditions for a culture that reflects your creed:

1. Hire the right people

Hire for passion and commitment first, experience second, and credentials third. There is no shortage of impressive CVs out there, but you should try to find people who are interested in the same things you are. You don’t want to be simply a stepping stone on an employee’s journey toward his or her own (very different) passion. Asking the right questions is key: What do you love about your chosen career? What inspires you? What courses in school did you dread? You want to get a sense of what the potential employee believes.

2. Communicate

Once you have the right people, you need to sit down regularly with them and discuss what is going well and what isn’t. It’s critical to take note of your victories, but it’s just as important to analyze your losses. A fertile culture is one that recognizes when things don’t work and adjusts to rectify the problem. As well, people need to feel safe and trusted, to understand that they can speak freely without fear of repercussion.

The art of communication tends to put the stress on talking, but listening is equally important. Great cultures grow around people who listen, not just to each other or to their clients and stakeholders. It’s also important to listen to what’s happening outside your walls. What is the market saying? What is the zeitgeist? What developments, trends, and calamities are going on?

3. Tend to the weeds

A culture of passion capital can be compromised by the wrong people. One of the most destructive corporate weeds is the whiner. Whiners aren’t necessarily public with their complaints. They don’t stand up in meetings and articulate everything they think is wrong with the company. Instead, they move through the organization, speaking privately, sowing doubt, strangling passion. Sometimes this is simply the nature of the beast: they whined at their last job and will whine at the next. Sometimes these people simply aren’t a good fit. Your passion isn’t theirs. Constructive criticism is healthy, but relentless complaining is toxic. Identify these people and replace them.

4. Work hard, play hard

To obtain passion capital requires a work ethic. It’s easy to do what you love. In the global economy we can measure who has a superior work ethic, who is leading in productivity. Not many industries these days thrive on a forty-hour work week. A culture where everyone understands that long hours are sometimes required will work if this sacrifice is recognized and rewarded.

5. Be ambitious

“Make no little plans: they have no magic to stir men’s blood.” These words were uttered by Daniel Burnham, the Chicago architect whose vision recreated the city after the great fire of 1871. The result of his ambition is an extraordinary American city that still has the magic to stir men’s blood. Ambition is sometimes seen as a negative these days, but without it we would stagnate. You need a culture that supports big steps and powerful beliefs. You can see these qualities in cities that have transformed themselves. Cities are the most visible examples of successful and failed cultures. Bilbao and Barcelona did so and became the envy of the world and prime tourist destinations. Pittsburgh reinvented itself when the steel industry withered. But Detroit wasn’t able to do the same when the auto industry took a dive.

6. Celebrate differences 

When choosing students for a program, most universities consider more than just marks. If you had a dozen straight-A students who were from the same socio-economic background and the same geographical area, you might not get much in the way of interesting debate or interaction. Great cultures are built on a diversity of background, experience, and interests. These differences generate energy, which is critical to any enterprise.

7. Create the space 

Years ago, scientists working in laboratories were often in underground bunkers and rarely saw their colleagues; secrecy was prized. Now innovation is prized. In cutting-edge research and academic buildings, architects try to promote as much interaction as possible. They design spaces where people from different disciplines will come together, whether in workspace or in common leisure space. Their reasoning is simple: it is this interaction that helps breed revolutionary ideas. Creative and engineering chat over coffee. HR and marketing bump into one another in the fitness center. Culture is made in the physical space. Look at your space and ask, “Does it promote interaction and connectivity?”

8. Take the long view 

If your culture is dependent on this quarter’s earnings or this month’s sales targets, then it is handicapped by short-term thinking. Passion capitalists take the long view. We tend to overestimate what we can do in a year, but underestimate what we can do in five years. The culture needs to look ahead, not just in months but in years and even decades.

The writer Arthur Koestler said that a writer’s ambition should be to trade a hundred contemporary readers for ten readers in ten years’ time and for one reader in a hundred years’ time. Lasting influence is better than a burst of fame. Keep an eye on the long view.

Excerpted from Passion Capital: The World’s Most Valuable Asset © 2012 by Paul Alofs. Published by Signal, a division of Random House of Canada Limited. Reproduced by arrangement with the Publisher. All rights reserved.

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You finally got the meeting you sought with a top executive at a prospective client. You prepare well for the session, researching the company and the individual you’re meeting with. After the small talk dies down, you ask your “killer” question:

“I’d like to get a better understanding of your issues. So, what keeps you up at night?”

Terrible question. Awful. Clichéd. One of my clients, the CIO of a large bank, told me that he kicks people out of his office when they pull out that question.

(I’ll get back to why it’s a bad question to use with a prospect you don’t know well in just a minute.)

Good questions can be incredibly powerful. But just as there are powerful questions, there are lousy ones. Here are some of the questions you should avoid:

1. Closed Questions

Anyone who has ever had to sell something knows that closed-ended questions are the least productive type of question you can ask. If you are trying to build a relationship with someone and want to understand how they think and what their issues are, you want to move as quickly as possible from closed-ended to open-ended questions. Some examples:

Instead of: “What’s your market share?” Try: “What are the main reasons you’ve gained market share in the last three years?”

Instead of: “When did you start your new job?” Try: “What’s the most rewarding part of your new job?”

Instead of: “How long do you want the training session to be?” Try: “Why do you want to do a training workshop?”

2. Judgmental Questions

Some questions are really just hidden judgments. For example:

“You didn’t really mean to do that, did you?”

“Why do you think you always arrive late?”

Judgmental questions stop the conversation dead in its tracks. They shut the other person down.

3. Sarcastic Questions

Sometimes we ask questions that aren’t really questions—they are just vehicles for sarcasm and anger, a blunt instrument to beat up on someone. I once heard a parent, for example, ask their high school junior, “Why do you think a competitive college is going to admit you with those kinds of grades?” Other examples would include questions like, “You’re so moody, why would anyone want a relationship with you?” and “Do you seriously think that is going to be acceptable?”

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Nothing says “trust me” like a cold call. It probably won’t surprise you to know that prospects hate taking your cold calls as much as you hate making them.

Often sales people tell me they are frustrated with how to generate enough quality leads to keep their pipelines filled. They are dismayed about the quality of their marketing materials, they are concerned with their company’s low profile or they feel pressure because their efforts are not generating enough new prospect leads. Do you face these same hurdles?

The best lead generation is educational because it gets you invited in by the prospect. Here are the top 10 tactics that work, but a la David Letterman, in descending order of effectiveness. These all work, but I like to save the best for last:

10. Advertising.

Isn’t it ironic that none of the great advertising agencies built their clientele by advertising? But if you specialize in an industry and you can get your firm’s name in the right directories, it is always better to be included than not.

9. Direct mail.

This is the traditional direct mail of a letter and a printed piece, like a response card. Some have used this cost effectively, maybe offering a complimentary consultation (there is a much better form of direct mail, however — see tactic No. 1).

8. Publicity.

While getting your name in the newspaper and trade journals is a cost-effective way to increase awareness about your firm, it doesn’t always translate into leads.

7. Paid ballroom seminars.

This is the strategy of renting out the ballroom at the local Marriott or Hilton and charging for an all-day or half-day seminar. Warning: Your information needs to be so valuable that prospects would pay money to get it. Participants should take away a substantial packet of good information from your firm (and a good meal too).

6. E-Newsletters.

This is the water-torture school of marketing, and the opposite of Spam. By signing up for your newsletter lists, prospects are telling you that they are interested in what you have to say but not ready for a relationship now. These people should receive valuable how-to information and event invitations from you on a weekly basis until they decide to opt-out of the list.

5. Networking and tradeshows.

This is an excellent way to gather business cards and ask for permission to include potential clients on your e-newsletter list.

4. Community and association involvement.

Everyone likes to do business with people they know, like and trust. You need to get involved and “circulate to percolate.”

3. How-to articles in client-oriented press.

Second runner up. Better than any brochure is the how-to article that appears in a publication that your target clients read. The blurb at the end of the article lets prospects know how to find you.

2. How-to speeches at prospect industry meetings.

First runner up. People want to hire experts, and an expert by definition is someone who is invited to speak. Actively seek out forums to speak and list past and future speaking dates on your website.

1. Free or low-cost small-scale seminars.

The winner and reigning champion. The best proactive tactic you can employ is to regularly invite prospects by mail and e-mail to small seminars or group consultations. If your prospects are spread out geographically, you can do these briefings via the Internet (Webinars) or the telephone using a bridge line (teleseminars). Instead of cold calls try “warm calls” that are following up on an invitation to a seminar of value.

These can’t be 90-minute commercials. You need to present valuable information about how to solve the problems that your prospects are facing, and then a little mention about your services. The more you help prospects the better it works.

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Many people wonder what separates a top performing sales person from the rest of the pack. In most cases, it’s because they apply a number of best practices in their daily routine. Here are 12 best practices of top performing sales people.

1. They set HIGH TARGETS and goals. Top performers don’t wait for their manager to issue an annual or quarterly quota. They set their own goals which is usually more ambitious than the corporate targets.

2. They carefully PLAN their quarter, month and week, as well as their daily schedule. Too many sales people fly by the seat of their pants and only look at the day or week ahead instead of planning their month and quarter. Look at the big picture.

3. They set OBJECTIVES for every sales call. It is essential to know exactly what you want to accomplish before you make your call (face-to-face or telephone).

4. They LISTEN carefully to what their prospects & customers say. You can ask all the questions in the world but if you don’t hear what people tell you won’t be able to present the proper solution. Instead of waiting for your turn to speak listen to your customer.

5. They WAIT to present their product, service, solution or idea until they know exactly what their prospect’s situation is. The majority of sales people jump too quickly into their ‘sales pitch’ but top performers are patient and wait for the right moment.

6.. They begin every sales presentation with a brief RECAP of their understanding of the prospect’s situation. Again, a simple concept but one that is greatly ignored by many sales people. A quick summary of your customers’ situation give you the opportunity to ensure that your presentation addresses their key issues.

7.. They know how to ADAPT their sales presentation if their prospect’s situation has changed. Making changes on-the-fly is challenging but it is one way to stand out from your competition. Learn how to modify your presentation when customer’s situation has changed from the time you initially met to the time you are delivering your presentation.

8.. They know how to properly and effectively POSITION their product, service or solution. The vast majority of sales people fail miserably at this. They talk, talk, talk but usually end up talking about aspects of their product or solution that have little or no relevance to their customer’s situation.

9.. Their sales presentations FOCUS on the prospect. Most sales presentations focus on the seller’s company, their product, or other trivial information that is of no interest to the customer.

10. They always establish the NEXT STEPS. Decision makers are busier than ever which means they are more difficult to connect with. Avoid losing contact with a prospect by agreeing on the next steps after every sales call. Do this in face-to-face meetings and telephone calls.

11. They FOLLOW-UP after the initial call or meeting. Many a sale has been lost because the sales rep failed to follow up after the initial call. You cannot rely on your prospect or customer to call you; you need to take this initiative. Set this up during your call or meeting. They PROSPECT continually to keep their pipeline full. It’s not uncommon for sales reps to experience peaks and valleys in their sales. This is usually a result of failing to prospect for new business on a regular basis. Avoid the highs and lows and schedule time to prospect for new business every week.

12. They deal with the DECISION-MAKER whenever possible. Dealing with people who have little or no buying authority is a waste of time. However, many sales people fall into this trap because it is easier to connect with people other than the decision maker. And that may be true. However, in the long run, they end wasting their time because they don’t close the deal.

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I know a number of successful Silicon Valley clients who dress in ripped denim, Vans shoes and t-shirts. They are worth hundreds of millions, even more, but it’s a status symbol to dress like you’re homeless to attend board meetings.  Conversely, I have worked with market traders who dress in suits and ties every day of the week (DT springs to mind). And this contrast shows the dramatic shift that has occurred in business attire in recent years, as each industry has developed its own rules.

So how do you learn the rules? Back in the early 1990s, as a young exec, I read Dress for Success by John T. Molloy. It gave me a clear understanding of how to dress to impress. But the “business casual” dress movement has turned all of that books ideas into quaint nostalgia. But fair or not, dress still has an impact on how you’re seen. For sales people, especially, first impressions matter.

My daughter will confirm that I am not a fashionista, but I do have some simple rules for successful dressing if you are in sales.

Know your prospect’s uniform.

Before you meet with a prospect, you should know that company’s dress code. “Business casual” has a lot of meanings. Call the front desk at the company and ask what the company’s dress code is and what the men and women wear. Or ask your contact. The point is, part of your responsibility is to understand that company’s culture, including its dress code. Ask for examples, especially of the senior most person who will be in your meeting.

Dress one step up.

If your prospect is in denim, you wear khaki. They wear sport coats without ties; you are in suits without ties. The point is that you always dress one step further up the clothing ladder than your prospect, but not two. One step says that you respect and value them. Two steps can send a loaded message.

It’s not just what you wear–but how you wear it.

Polished shoes, pressed shirts and well-fitted pants always.  At this point, some of you are thinking, “Does he really have to say this to people?” while others are saying, “Why do I have to tuck in my shirt?” But when your clothes are pressed, buttoned down and well-fitted, you convey that you are a person who pays attention to the details and are professional

Grooming trumps style.

Even if you’re wearing a great suit, if you’ve got a terrible haircut, you’ll give a bad impression. As crazy as it sounds, everything on the grooming punch lists – fingernails, facial hair, haircuts and oral hygiene–matter.

Know your company’s uniform.

One of my clients makes sure that when his sales reps are making their sales calls, they wear a very specific uniform. (His company’s clients accept this because they see it as an extension of the brand; the company sells safety products.) It doesn’t matter if the reps are presenting in a board room or on a manufacturing plant floor, they wear the sample simple uniform. Obviously, if you work at this company, you follow this dress code in order to fit in.

Remember, you can dress in a way where your attire is the only message people remember, or you can dress in a way that takes nothing away from the message of value your company brings to them.

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