Saturday, February 25th, 2012
Emily Litella, in one of her typical on-air rants: “What’s this I hear about computer parking lots? We’re in a recession, people are losing their jobs, and now we have parking lots for computers! It’s an outrageous waste of land and money!”
Jane Curtin, with her typical disdain for Emily: “It’s commuter parking lots.”
Emily: “Oh … Never mind.”
A note to those of you too young to have experienced Saturday Night Live’s original cast from the 1970s: Look up Emily Litella on Wikipedia. Better yet, see her on YouTube. Played by the late, great Gilda Radner, Emily was a commentator for the SNL Weekend Update news. Emily always jumped to rash and incorrect conclusions because she never had the right facts.
Do your employees do the same thing?
I constantly encounter business owners who are worried that their employees will find out either how well or how poorly the company is doing. Of course, lately it’s trending toward the “poorly” end of the spectrum – but either way, here’s my usual response:
“Your employees aren’t dumb. They’ll probably figure it out. But even if you can hide the truth, why would you? In the absence of facts and information, your employees will make assumptions and jump to conclusions. Their decisions and behaviors will be based on these false assumptions. How do you expect that to work out?”
A little transparency goes a long way.
That word – transparency – seems especially relevant today, given our current state of affairs. Think about the world of big-business, banking, and high finance. A string of crumbled companies, bankruptcies, lost pensions, mass firings, devastated families and broken dreams. Don’t even get me started on Congressional “leaders” who make deals behind closed doors and ram legislation through without even allowing their members to read bills before voting.
Many of America’s economic woes could have been avoided, but for a lack of transparency.
I’d argue that transparency gives rise to leadership.
In an open environment, leadership is a must. It requires you to carefully choose the “people on the bus” who are worthy of trust and who will act in the business’ best interests with the information given to them. It also means that you’ll have to explain the information – to mentor and train your team – so they’ll know what it all means.
Transparency allows full and effective delegation. “Here’s the goal. Go make it happen.” Knowing the organization’s goals, financial status, and available resources allow confident decision-making.
Integrity – a cornerstone of leadership – goes hand-in-and with openness. Shady business practices are like fungus and vampires. They don’t thrive in the bright light of day.
Business owners who worry that their employees will know the company’s status are withholding information and keeping their employees in the dark – and still expecting good results. It’s much like asking someone to play a sport without keeping score.
Delegation? A secrecy-cloaked environment throws a blanket over every potential solution. Aside from the top leaders, nobody has the big picture: “What should I do? What can I do? What resources are available? What methods make sense for our current financial situation?” The lack of information will result in questions, false assumptions, and faulty decisions … making micro-management necessary.
So often, the small business community looks to the captains of industry for answers. It sure seems to me that the example set lately by the big business community calls for a shift in thinking.
Why can’t the small and mid-sized business community set the tone for a change? Let’s start a revolution of our own. Let’s be the example-setters. Let’s be the poster-boys and poster-girls for transparency. For integrity. For solid business practices. And for leadership.
The Emily Litella act was funny on TV. It’s not funny in your organization. Open up and get Emily off your payroll.
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Sunday, February 5th, 2012
“What gets measured gets managed.”
It’s hard to argue with that piece of wisdom. That said, here’s another old saw to consider:
“If everything is important, then nothing is important.”
Between these two valuable quotes is a balance and a guideline for business owners.
All businesses have certain numbers that define success. Some, like profit, are universal. Every business must take in more than it spends, so an argument could be made that this number – profit – is a definition of success for every business.
But what about other numbers? There’s certainly no shortage of other things to measure – sales, costs, margins, cash … the list goes on and on.
They’re all important. But don’t forget: “If everything is important, then nothing is important.”
Focusing on a small, carefully-selected handful of numbers and actually doing things to improve them is much more likely to lead to overall success than scattershot oversight of dozens of different numbers.
Some business owners create a scoreboard or “dashboard” of metrics – to pull selected numbers out of the blizzard of income statements, balance sheets and other reports – and single them out for an appropriate amount of attention.
This is how the “What gets measured gets managed” piece comes into play.
So, how do you cut through the scads of potential metrics which might be worthy of your undivided attention, and discover the select few which will truly make a difference?
Think about your business. Two questions:
- Are there things related to your specific business model that are absolutely critical to ongoing success? For instance, if you are the low price leader, then cost of sales is likely a primary area of focus.
- Are there things going on in your business right now that deserve attention? Examples might include things like declining quality, too much dependence on one customer, or high employee turnover.
If you find that there are specific things that warrant a permanent place on your scoreboard, then add them and leave them there. Or, perhaps you’ll discover that a temporary issue needs attention – so it gets a spot, only until it is resolved.
In most cases, these big-picture, corporate-level “critical numbers” will have underlying “drivers” – activities which must be done to move the number in the right direction. A simple example: weight loss. If your critical number is pounds, the drivers would be calories in (eating) and calories burned (exercise.)
The best drivers measure activities and behaviors, as in this weight loss example. If you want to change a number, you’ve got to change someone’s activities or behaviors.
These are the numbers that deserve a significant amount of time and attention. That’s not to say other numbers aren’t important. They’re just not as important.
Identify and break out your critical numbers and drivers. Get them on a scoreboard for all to see. Talk about them. Teach and learn about them. Assign responsibility for them. Track them. Most importantly, be sure to move them in the right direction.
Your business will be more successful for the effort.
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Wednesday, January 18th, 2012
Leadership. What the heck is leadership anyway? And why should a small business owner care?
Some folks use the word “leadership” as a synonym for influence. Let’s expand that definition to include a couple of other important activities:
- Influence
- Setting the example
- Removing obstacles for your people
This is not an all-encompassing definition of leadership. Volumes have been written on the subject. In a small business setting, though, it’s good to have a simple, common-sense approach to things so let’s focus on these three attributes.
Influence
There are many kinds of influence. A screaming child in a restaurant is influencing the embarrassed parents.
You can use various types of influence over your staff. But we’re not talking about domination. Of course your position of authority is real so you can’t (and wouldn’t want to) turn that off. But how about simply asking your team – individually and collectively – to deliver the desired behavior?
Years ago, I had two employees who became hostile toward each other after a previously harmonious working relationship. It was jarring for their team members, because they both were considered friendly and easy-going. Quickly it became apparent that this wasn’t going away.
Sitting down with both of them, I pointed out that they likely spend more time at work than with their own families, and a troubled relationship affected everyone around them. They got it, and all returned to normal soon after that.
But it’s not always that easy. A similar situation later erupted with two other employees, and it required more firm and direct language: “You don’t have to like each other but you must work together in a professional and congenial way. Otherwise one or both of you will have to leave.”
You’ll develop your own style over time, but don’t shy away from issues in your business – deal with them directly and quickly.
Checkup:
- Do you avoid issues or deal with them promptly?
- What past problems could have been avoided, and what current issues could be solved via a dose of influence?
Setting the Example
This one’s pretty self-explanatory. Nothing will spoil your good leadership efforts faster than “do as I say and not as I do.” This doesn’t mean you have to become “one of the guys” but know this: Your people watch you like a hawk. Model the behaviors you ask of your team.
Checkup:
- Are you a stellar model for your team? If not, in what areas do you need to improve?
Removing obstacles for your people
As the business owner, you’re the main resource provider. Here’s a good way to find out what obstacles are in your team’s way: Ask ‘em.
How about having your employees create a “Stop Doing” list, or a “Hassles” log? What resources do they need? What procedures are outdated?
Checkup:
- Are you fully aware of obstacles and resource shortcomings in your operation?
- Do you have a plan for addressing them?
Be a leader
So, a simple formula for small business leadership includes using your influence to promptly deal with problems, setting the example and removing obstacles. Got more to add to the formula? Post a comment below!
Bill Collier is the St. Louis area coach for The Great Game of Business. He helps businesses increase accountability and results with open-book management. He is the author of “How to Succeed as a Small Business Owner … and Still Have a Life” Bill can be reached at 314-221-8558 or billcollier@greatgame.com. His blog is http://ggobstl.wordpress.com.
Monday, November 28th, 2011
As I write this in November 2011, the “Occupy Wall Street” protest and all its spin-offs in cities all over the world have been going on for about two months. But cities, businesses and the general public are tiring of their antics. Trash is piling up, legitimate events are being moved to avoid problems, and costs are soaring. Worse, the purportedly peaceful encampments are now producing murder, suicide, sexual attacks and clashes with police. Chances are, they will still be in place by the time this publication hits your desk in December.
What’s their message? What are their goals?
Anyone who has paid even passing attention to the Occupy movement knows that the protesters have been criticized for lack of clarity. They’re good at repeating euphemisms and phrases: “Corporate greed!” “Scrap the monetary system!” “People, not profits!” “Down with predatory lenders!” They’re long on signs and screaming but short on specifics.
By the way, here’s their definition of a “predatory lender”: It’s a bank that actually expects you to pay back your loan.
In the spirit of “Give peace a chance” and “Can’t we all just get along?” I humbly offer to fill in the specifics for them. It’s the least I can do. In a word, here’s my take on their message and their goal:
Entitlement.
It’s disturbing that in modern America, people have somehow made it to adulthood without an inkling about capitalism and its role in making this the greatest, strongest, most successful country in history.
Or, maybe it’s not so surprising. Think about it: Self-sufficiency, hard work, entrepreneurship, handling money, doing the right thing, being thrifty … none of these are taught in school. They’re learned – if at all – from family and personal experience.
A new truth has emerged during this long, hard economic downturn: Small business is the heart of our economy. It is the main source of innovation, new jobs and hope. That’s a heavy expectation to hang on America’s entrepreneurs, but I say we’re up to it.
Maybe we have another job to add to that list. Maybe we need to be the primary source of education about capitalism and opportunity … to help stamp out the entitlement mentality.
After all, we do this for our children. Why not expand the lesson into the workplace?
I’m not talking about creating classes or homework. It’s about including simple truths in discussions with your employees:
- We must take in more than we spend.
- A pay raise is not a gift from the owner. It’s driven by the business’ success and your role in achieving that success.
- Our customers have choices. We have to earn their business.
- We must make practical decisions about using scarce resources such as time and money.
- We must honor our obligations.
If your employees hear these messages and better yet, see them in action, won’t they be better equipped to help you succeed? And who knows – maybe your words and example will help someone make better choices at home.
It beats sleeping outside with a cardboard sign that says “Down with the Entitlement Mentality.”
Bill Collier is the St. Louis area coach for The Great Game of Business. He helps businesses increase accountability and results with open-book management. He is the author of “How to Succeed as a Small Business Owner … and Still Have a Life” Bill can be reached at 314-221-8558
or billcollier@greatgame.com. His blog is http://ggobstl.wordpress.com.
Monday, October 17th, 2011
How is 2011 turning out for you? Check one:
[ ] Pretty rough
[ ] Fair
[ ] Great!
Even if you chose “Great”, it’s hard to be optimistic when unemployment is high and many of the most powerful people in our government seem determined to punish achievement via the tax code.
Until fairly recently, entrepreneurs were celebrated and respected. It was all about the American Dream.
Now … well, just listen to the words being used and the proposals being made. It’s clear that some folks don’t value what entrepreneurship represents: Pursuing dreams, hard work, jobs and a rising tide that floats all boats.
When the dearly-held principles that made this country what it is today – including Capitalism – come under attack, it is difficult indeed to stay positive.
Don’t fall for it.
Here are seven resolutions for the new year to help you stay positive and improve your company’s performance.
1. I will not buy into the “the rich don’t pay their fair share” nonsense.
The top 1% of earners pay 38% of all taxes. The top 10% pay 70% of all taxes. (This information is readily available
on the IRS website.) Actually, those with high incomes already pay far more than their fair share. You may not be rich but this ridiculous mantra is mutating into an indictment on all business owners. Get informed – immunize yourself against the negativity.
2. I will run my business by the numbers.
It’s important to regularly review your progress and results, including:
- Sales and gross profit, broken down by product/service or customer segments
- Major expense line items
- Net profit
- Cash balance and cash flow
- Accounts Receivable, if applicable
Look at month-to-date and year-to-date results, and compare to the same period from the prior year. It’s also a good idea to look at your income statement numbers as a percent of total sales to spot trends early.
3. I will “hire hard” so I can “manage easy.”
A bad hiring decision can haunt you for a long time. Don’t make a snap decision. Build a strong team who will grow with your company.
4. I will delegate.
You can’t do it all yourself, so don’t even try.
5. I will connect with my customers.
Find out the answers to these two questions:
- What’s important to you? (Quality, customer service, etc.)
- How are we doing in those areas?
Develop relationships with your customers. Find ways to stand out from your competitors and to become the supplier of choice.
6. I will make smart use of technology to improve my business.
Technology has become so affordable and easy to use that no business has an excuse for not going high tech. Even the smallest home-based business can afford to level the playing field with larger competitors.
7. We will think like a growth company and will not participate in the poor economy.
Get everyone in your company – starting with you and including all your employees – on this bandwagon. Think and talk about growth, pushing through challenges and achieving goals. Be winners.
Build on your successes and learn from your mistakes. Implement all these business practices, and go into the new year with the attitude that this will be your best year yet.
Bill Collier is the author of “How to Succeed as a Small Business Owner… and Still Have a Life” and is the St. Louis area coach for The Great Game of Business. He helps businesses teach their employees to think and act like owners. He can be reached at 314-221-8558 or bill@collierbiz.com.
Tuesday, September 20th, 2011
Ready to start planning for next year? Here’s a checklist for jump-starting the new year.
- Start with a Vision. Think about the business – where you came from, where you are, and where you want to be.
- Pick an appropriate timeframe, maybe 3-5 years out. How will the business look?
Think revenues, people, locations and lines of business.
- Learn from the past. Make the following lists and use them when working up next year’s plan:
- What worked well this year and in prior years? How can you build on those successes?
- What didn’t work so well? How can you learn from and avoid those mistakes?
- Create a budget.
- Start at the top line on the income statement – sales – and work down from there.
Where will your sales finish this year? Where do you think they can be next year?
- Compensation Planning.
- This is a good time of year to deliver employee performance reviews and then build compensation changes into your new year’s budget. Use each employee’s job description as a guide for the review … rate the performance on each assigned duty.
- When thinking about compensation-related expenses, don’t forget your benefits. Thinking of making a change for the new year? Is insurance going up? Work it into your budget figures.
- Fixed Assets. What new property and equipment does your company need? What old assets need to be retired or sold? Again, solicit
input from the employees. They probably know best what they need to properly do the job. Don’t have the cash flow to buy what’s needed? Consider borrowing or leasing for fixed asset purchases to conserve cash.
- Marketing Planning.If nobody knows who you are, what you sell, or how to buy, the results will be predictable. There are lots of ways to market: networking, speaking, customer referrals, telemarketing, direct mail … the list goes on and on.
- What is your Unique Selling Proposition? Do your customers perceive your product or service as a commodity? Do you and your people sell as if you were offering a commodity? If so, revisit what makes your company, your products and your services unique. Ask the question, “Why should a customer buy from us rather than from our competitors?” If you don’t have a good answer, keep working at
it.
- Determine your primary customer targets, and the best ways to reach them so you can tell them about your unique selling proposition.
Finally, if you’ve got the luxury of the time and money .. Go on a 1-3 day “planning retreat.” Take all the info you’ve gathered, and all your financial statements, and go somewhere away from the office to immerse yourself in this planning process. This quiet time is perfect for working on your Vision and reflecting on past lessons learned. If appropriate, take your management team along and invest some time in this valuable work.
Commit to making next year your best ever.
——————————————-
Bill Collier is the St. Louisarea coach for The Great Game of Business. He helps businesses improve results by teaching their employees to think and act like owners. He is the author of “How to Succeed as a Small Business Owner … and Still Have a Life” Bill can be reached at
314-221-8558 or billcollier@greatgame.com.
Friday, September 2nd, 2011
Want educational business articles and information with a humorous twist right at your finger tips? Download Bloapp, a free blog app, then click this post to get the QR code and scan it. It’s that easy!
Friday, August 26th, 2011
We business owners could learn a few things from 3 year old kids. They ask “why.” A lot.
“Why do I have to go to bed?”
“Why is grandma’s hair that color?”
In his book Start with Why, author Simon Sinek makes the case that most businesses can explain what they do and how they do it, but few
can clearly articulate why.
I agree, and suggest that much of the formula for small business success can be found in the
answers to these three questions:
1- Why do you do what you do?
2- Why do your customers choose your business instead of your competitor?
3- Why do your employees work for you instead of somewhere else?
1 – Why do you do what you do?
Of the hundreds of entrepreneurs I’ve met over the years, the most common reasons given for
being in business include:
- Be my own boss
- Passion for industry
- Make more money
Why do you come in early and stay late? Why do you take risks and sign personal guarantees?
Give this question the serious thought it deserves. Then, build your business in a way that supports your “why.”
2 – Why do customers choose your business instead of your competitors?
This one is huge. Here’s an experiment for you:
With no warning or preparation, ask each of your employees to write down the answer to this question. It’s an opinion – no pressure, no right or wrong answers, and nobody gets in trouble for their response.
Gather ‘em up and see what they say. Unless you’ve been doing a pretty good job of discovering and discussing your value proposition (or unique selling proposition or competitive advantage – whichever you prefer to call it), you’ll get about as many responses as you have employees.
Another good exercise: Survey your customers. Find out what’s important to them. What do you do well, and where can you improve?
How powerful would it be for everyone in your company to know exactly why your customers choose you over the competition, and to use this knowledge to enhance every communication, every transaction, and every customer contact?
3 – Why do your employees work for you instead of somewhere else?
Hopefully, it’s because they choose to and not because their choices are limited.
Also hopefully, you see your employees as a team – an essential, important ingredient of your business’ success, and not just a resource to be used and abused.
Each of your employees has a “why.” Find out what it is. Conduct an employee survey, but also be sure to speak with them individually. What are they after? What are their aspirations? How can you help?
Important questions – Important answers
If you will take the time and make the effort to explore these three questions, get the answers and then apply this knowledge to your business, it will go a long way toward building a business that serves your why, your customers’ why and your team’s why.
And isn’t that a great reason to do what you do?
Bill Collier is the St. Louisarea coach for The Great Game of Business. He helps businesses improve results by teaching their employees to think and act like owners. He is the author of “How to Succeed as a Small Business Owner … and Still Have a Life” Bill can be reached at 314-221-8558 or billcollier@greatgame.com.
Sunday, July 17th, 2011
Lead, Follow or Get Out of the Way
Are you a leader?
Before you answer that question, consider … there’s a big difference between management and leadership. Try this quote on for size:
“Management is efficiency in climbing the ladder of success; leadership determines whether the ladder is leaning against the right wall.” – Stephen Covey
Michael Gerber used different words in his classic business book, The E-Myth Revisited. (If you’re among the dozen or so remaining entrepreneurs who haven’t read it, do yourself a favor and read it soon.) In it, he distinguishes between the three roles that small business owners fill: the Technician, the Manager and the Entrepreneur, with the latter handling the strategic work. You could easily substitute the word “leader” for “entrepreneur” without detracting from E-Myth’s wisdom or message. Leadership is indeed strategic work.
There are dozens – heck, hundreds – of definitions of leadership. I suggest that the following 3 skills deserve a place in any discussion of leadership:
- Create a Vision
- Think strategically
- Inspire action
Create a Vision
One of my favorite sayings is, “If you don’t know where you’re going, any road will take you there.” In business, this applies both to concrete, easy-to-measure goals such as revenue and to more fuzzy objectives: What kind of company do we want to be? What sort of people will we let in? What are our values?
Creating and communicating your vision is your business’s roadmap to the future. Creating a vision for your business three or more years out can be a powerful experience. It can re-energize the owner and the employees. I’ve seen this first hand and strongly recommend it.
Have you created a vision for your business?
“Leadership is the capacity to translate vision into reality.” – Warren G. Bennis
Think Strategically
Okay, so you now have a destination in mind. Now, how do you get there?
Strategic thinking is a fancy way of saying you’ll look at the desired outcome – the big picture – and figure out the best use of limited time and resources to help you get there.
How much time do you spend each month thinking about your long-range goals and what you should be doing now to keep you moving in the right direction?
Inspire Action
Knowing what to do is good, but without action you’re going nowhere fast. It’s the leader’s job to get everyone excited and mobilized. Communicate – communicate – communicate. Tell ‘em where you’re going, the path you’re taking, and what’s in it for them. If you believe in your vision and there truly is something in it for your employees, then you are serving them by achieving it.
How much time and effort do you devote to this sort of inspirational communication with your troops? And, do you set a good example?
“Leadership is defined by results.” – Peter Drucker
Be a leader
Being an entrepreneur and a small business leader is much more than an occupation. It’s a calling. Wall Street, Big Business and Washington have all dropped the ball. It’s up to us to keep the American Dream alive. Take time to lead.
Bill Collier is the St. Louis area coach for The Great Game of Business. He helps businesses improve results by teaching their employees to think and act like owners. He is the author of “How to Succeed as a Small Business Owner … and Still Have a Life” Bill can be reached at 314-221-8558 or billcollier@greatgame.com.
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