The Anatomy of Business Books
Entrepreneur's July 2009 issue featured several book recommendations from Jack Covert and Todd Sattersten, respectively, founder and president of specialty business bookstore 800-CEO-Read. The two are also co-authors of The 100 Best Business Books of All Time. They spoke to Entrepreneur about books, business, and what you should know about both.
How did you both get involved with 800-CEO-READ?
Jack: About five years ago, I had a friend who was trying to get me involved in online blogs and that sort of thing. I didn't have a clue how to do it, and he introduced me to Todd. We met and fell in love [laughs]. Well, I hired him as the guy to supply online content and we've been working together ever since.
Todd: So I guess we're going to tell each other's stories. Jack started this division about 25 years ago, and we [were] a part of Harry W. Schwartz, an independent bookstore here in Milwaukee. This chain was around for 82 years and actually clos[ed] its doors at the end of March.
It's absolutely crazy--Jack used to have a desk in one of the stores, but now we've grown this business and added 11 people to it and we're what's left.
What makes this area of publishing so strong?
Jack: If you talk to the big [bookstore] chains, they'll tell you it's the number two category after fiction, which is fascinating to me.
I think that when things are going good, business books make sense, and when things are going bad, business books are where you look for solutions. So it kind of rides both crests.
Todd: [President Calvin Coolidge] said "the business of America is business." And the definition of a business book is changing, particularly in the last five years. Take a look at what Malcolm Gladwell is doing to the typical business book. He's making them extremely interesting and much more accessible to a wider group of people.
What appeals to you about business books?
Todd: Jack will probably tell you he just likes to sell them [laughs]. But for me, what I always found fascinating about business books--or business in general--is the fact that it's almost like the application of . psychology and anthropology, like architecture is the application of mathematics and engineering toward some specific end. It's all these wonderful things that we sort of talk about in the abstract that [become meaningful] when put into the market.
And I love the fact that there's not any one solution for how to make business work, so to me, I can pick up almost any business book and be interested in it because it's going to give you another perspective, even if I think it's wrong.
Jack: OK, up until three years ago I would have said, "I sell business books because I can sell business books." It's a category that you can sell relatively easily because it's solution-based. But going into writing this book and actually being forced to read what people said were good books . I really began to appreciate [them]. The quality of the ideas--it's fascinating stuff. They can help you decide if you're on the right track, or let you know if you need to fix something.
What's an important message you've picked up from reading business books?
Todd: For me, the process of decision-making has become more and more important. We don't think about how we come to the decisions we make or the biases we have.
Intuition counts for about 90 percent of the process, so what I've been spending a lot more time on is thinking about how I make decisions. If I make a mistake, I try not to be upset about the outcome, but think about how to improve my decision-making skills.
Jack: For me, it's the process of going through a book and being introduced to a whole different way of looking at the world. Before I started this business, I had 25 years of retail experience. I picked up a book called Moments of Truth, and realized somebody had put into words what I knew to be true. It was an enlightening experience for me.
I'm going to go out on a limb here and say you've both read more business books than the average person, so let's hear some recommendations. Anything recently published that you think is a must-read for small business owners?
Todd: We're pretty big fans of a guy named Steve Farber. His books are business fables, but they're very character-based and almost like novellas. His latest is called Greater Than Yourself, the Ultimate Lesson in True Leadership.
Jack: He's a good writer. The lesson is very Zen: The reason you're put on the earth is to help people become greater than yourself.
Todd: And the best book I've read on entrepreneurship in the last five years is The Knack. It came out in December  from Bo Burlingham and Norm Brodsky. I was just amazed by how good it was. The opening chapter, "How to Create a Business," is the best description of why most businesses fail in the first six months that I've ever read.
What's a classic business book that's stayed relevant through this recession?
Jack: The Five Dysfunctions of a Team. When things are good, teams run well; but when things are bad and you start laying people off and the team gets smaller and smaller and smaller, problems are amplified. A team that is not functioning right is a bad thing.
The book points out conflicts and the consequences of not communicating . and these things should be applied in organizations.
What's a book--besides 100 Best of course--that every entrepreneur should read?
Jack: If I was young and starting over again, I would want to read the Monk and the Riddle and Michael Gerber's E-Myth because they cover the bases: You need to be entrepreneurial and a tactician, but you also have to appreciate the journey and have a passion for what you do.
Todd: I agree with Jack. I think you need the two sides, but I have an "and," and my "and" would be that there's still an "action" aspect to being an entrepreneur. Entrepreneurs have all these wonderful ideas, but when it comes down to calling people and getting customers, a lot of them fall down.
I think Getting Things Done by David Allen is really great. David's point is this: It's impossible to manage time, information and priorities. That's not how it works. You don't manage time; time just passes. You can't manage information--you kind of just drink from the firehose every day. You can't manage priorities; everyone else around you manages your priorities.
So the only thing you can do to be more successful is to manage action. Unless what you're going to do is based on some action, all you're going to do is spin your wheels.
Let's talk about 100 Best. Is there another section you would have liked to add?
Todd: A lot of the books we chose in the "Entrepreneurship" section are startup books. I think the idea is that if we'd had a little bit more room, we would have covered the next stage--that next step to growing the business. We would have addressed topics for multimillion-dollar businesses that are still relatively small, but will have to deal with a lot of troubles as they grow.
What are some books would have fallen into that category?
Todd: There's a great book by Doug Tatum called No Man's Land. He talks about companies with revenues ranging from $10 million to $100 million, which he says is a very dangerous place for most businesses.
Once you move beyond that "small business" space, no one wants to give you financing because you're not big enough yet. The people who got you there are probably not the people you need to get to the next point. You're forced to deal with some strong and powerful emotional issues as a founder. Doug is pretty honest about what you need to go do.
The other one is Small Giants by Bo Burlingham, which is about these companies that basically make the decision to stay small and be just incredible and wonderful in the way that they do business. They chose not to be a conglomerate and to stay in their region or specific markets.
Is there going to be a sequel to 100 Best?
Todd: I think the answer is yes. We just don't know what it's going to look like yet. [laughs]
Taking a step back and considering the book publishing industry as a whole, what do you think will be the impact of Kindle and the sale of e-books?
Todd: It's going to be as disruptive as the iPod was for music. We are one year into a five-year cycle. If you'd asked me this question in 2008, I would have been sitting in the camp of "paper's still going to win."
Now I'm 107 percent certain that digital is going to usurp paper. And for your audience, what's interesting . is that our business has gone through major [transformations] before. One was in 1996, when Jack had a huge catalog business and was making hundreds of thousands of dollars that way. Then in the fall of '96, he sent a batch out and nothing happened. Literally, the phone didn't ring.
Jack: I accused the mailing house of not sending them. I thought they were in the back of a warehouse somewhere. At that time, there were a lot of publishers who were very engaged in direct mail. But I called around and it was happening everywhere. We traced it to a company called Amazon . we lost almost half of our business over the next year.
Todd: We've seen this sort of stuff happen before and we survived that, and now we squarely understand what's going to happen with digital. And Kindle's a big deal, but I don't think it's the device that's going to--
Jack: It's not the iPod.
Todd: No, it's not the iPod yet, but they've done some of the right things. I'm almost certain Apple's going to come out with an e-reader device in the next 12 months. And if it's not a new device, there's going to be a 5x7 tablet that's just a bigger version of the iPhone. That's when it's really all going to happen.
So are publishers ready?
Todd: The model for selling digital books is very convoluted, and has not really been established yet. For example, I think 100 Best is available in four or five digital formats, but Amazon only sells the Kindle version, and the only place I can buy the others are on the publisher's website.
It's like Amazon is paving the way and is so far ahead. I don't think publishers realize the power they're giving away to them right now. But I think what's going to happen is in the next 12 months, there will be a lot of smart people coming up and saying, "Here's an alternative place to buy digital products." I think Kindle is making a mistake in wrapping it up in DRM and making it so you can't read it on anything else.