The Entrepreneur's Mentor

Look But Don't See

How many of us really know- I mean really know- what is going on our organizations?  I think of the beginning of the David Lynch movie "Blue Velvet" which shows a beautiful, serene green field. The camera moves in closer and closer and starts to show what is happening within the green grass. There are bugs and beetles at war, dirt being churned up.

Things can look beautiful on the surface. CEOs and other leaders need to be careful not to accept this view as their only data point. They need to both zoom in and zoom out.

Zooming in means digging beneath the surface to get a sense of what is really going on. Are your employees really engaged in the work of the company?  Does your company have best practices? Have you examined your processes lately to see if they are still working? Have you revised your metrics to fit the changing times? Is what you and company leaders are communicating being heard the way you intended? Being understood? Have you spoken with your customers about how your company is measuring up to their standards?

Zooming out means taking a step back and looking at the business from outside. How does what we do fit into today's world? Are we still relevant? What direction is our market going? Are we ahead of the curve or behind it? Is the economy good for us or bad for us? What about our competitors? Do we have to re-define who they are?

A company is multi-dimensional. One look, one view does not tell the story. True leaders know their companies inside and out, because they have taken the time to explore them from all angles. They have opened communication into all sectors and are willing to hear all views and give them credibility.

There is a lot to see if you only look.

Six Month Review

For some, the key landmark at this time of year is the summer solstice, which just passed; or the first day of summer. To others, it is the end of the 2nd quarter of the business cycle. Either way, the year is just about one half over. What can we learn from the first half?

What did we do right? What could we do better? And what are the critical success factors for the next six months? We are still in the depths of a bad economy, so we cannot expect external factors to be of assistance. Consumer confidence has not picked up, so we can't count on euphoria.

We can only count on ourselves. We have to do the right things. We have to examine what it is that keeps our existing customers or clients coming back and make sure we keep doing those things. If we are not doing enough, we have to do more. It is not just price. Service and quality are critical. Reliability is necessary. Flexibility counts. What else?

We have to remember that our employees are the ones that are responsible for our customer relations. Happy, engaged employees contribute hugely to customer loyalty. Even in the age of layoffs and benefit cutbacks, we can work hard to keep our employees as happy as possible under the circumstances. We can work to inspire them, to earn points for credibility, transparency, honesty and integrity. How we treat our employees is part of our brand- don't forget that.

We can cut cost and lay off employees, but it is rarely enough. We have to keep business coming in the door. We have to pay our suppliers. We have to ask for everyone's contributions- effort, ideas, teamwork and sacrifice.

Entrepreneurs need to ask of themselves what they are asking of their employees. If there is a general wage freeze or cut, the owner should be doing the same to his own wages. If he is asking additional hours from others, he should be putting them in himself.

If something is taken away from employees, they ought to be given an incentive of some sort to get it back. Employees ought to be able to earn back what they gave up if certain benchmarks are hit. This builds teamwork, morale, employee engagement and employee loyalty and gives the employer credibility if he ever has to ask something of the employees again.

Use the midpoint of the year to measure your accomplishments and your opportunities for improvement. Then do something with the information.

Goal Setting Does Work

I have been working closely with a few public companies of late and it is interesting to see how important it is for them to make "the month' and "the quarter." They must hit projections to satisfy Wall Street and keep the stock price high. So there is a total focus on making those numbers.

There is a rigidity and numbers orientation to that effort that is "corporate" in nature, and thus not appealing to many in privately held businesses. Many owners don't care if sales are booked at the end of the current month or the beginning of the next month. Should they?

There is that saying that "You can get what you get or get what you want." Why not the latter? Why not build a realistic budget, realistic goals and real profit? Entrepreneurs may like wiggle room. They may prefer to not be bound by numbers. They may believe they are building a different kind of company, not so numbers driven. But by doing that, they may be acting as a deterrent to profitability.

What you measure is what is important. If you don't measure sales, you are making a statement that they don't matter. If you don't exact accountability, it makes it okay to not hit those numbers.

Over the years, I have excused many salespeople for their failure to make their numbers. I have accepted many excuses. At the end of the day, those with excuses one month or one quarter, had them every month or quarter. They would ultimately not succeed.

Setting goals and holding people accountable to them creates a needed focus and concentration on what you have deemed as important. Of course, just setting a gross sales goal could push salespeople to take or go after low profit business just to build the top line. So there needs to be a profit goal as well.

If you have the right folks selling for your company, they will relish the challenge. If you have set up their compensation correctly they will be incentivized to hit those goals.

The goals you set cannot just be pulled from the air. They must have a basis in fact and salespeople need to know where the sales need to come from. They can't do it alone and good sales management is critical. In small companies, that may come from the owner. If you are the owner and hired salespeople to get away from sales- you are not quite done. You need to manage and mentor your sales staff and you need to constantly reinforce your vision for the company. You need to show your face to the customers too, letting them know how important they are to you.

We are nearing the end of the 4th quarter. The sales team should be focused on closing sales for this month and setting the table for next month. Prospecting should be designed to bring in business for next year. Short term, medium term and long term are always part of the sales thought process.

Set reasonable goals.

Show the road to achieving them.

Reward success.

Hold those who don't succeed accountable.

Do it again next year.

You are building a culture of success.

Subtracting by Adding

 How many of us have made that key hire that we have been waiting to find for so long and have made the mistake of thinking that we have found the last piece to the puzzle? Sometimes we assemble a team one member at a time in the belief we are building something solid. We then hire the COO, or Operations Manager or General Manager that we feel will tie the whole thing together.

Wrong!!!!

Do sports teams hire the General Manager after the draft and after the team has made its additions and subtractions for the year, and expect the new GM to wokr wonders with players he had no role in choosing? They usually don't.

Even if the last hire, who we will call the COO for example sake, shares the entrepreneur's vision and values, he or she may not feel the chemistry is right among the team members. Or he/she may get a different feeling about certain individuals. If we trust our COO then, he or she needs some leeway in creating their own team.

Does that mean we allow our carefully chosen employees to be fired subject ot the whim of the new hire? No, of course not.

But it does mean that we have to be willing to listen to opinions other than our own, and hear the reasons why the COO believes certain individuals don't fit the bill. We entrepreneurs may have been blind to certain traits of some of our employees who were with us from the beginning or were good at certain stages of the company's growth. Some can only grow so far and we fail to see that they don't fit the company's current needs.

If an individual's success is going to be based upon the quality of work coming from direct reports, he or she needs some leeway in choosing them and developing them.  There may be some "untouchables" that have  a strong history of performance. There may be some that hold too much institutional knowledge to let go right away. The COO needs to be apprised of the importance of trying to make it work with these folks.

On the other hand, the entrepreneur that has built a company to a certain point cannot just turn over full control to a COO and watch him or her dismantle what has worked well just for the purpose of asserting total control.

Some of us have waited for years for the time to turn over operating control to someone else so we have time to strategize and think about the big picture. But, we cannot do so without a strong degree of accountability in place. The COO needs to understand that any move made needs to be justifiable and run past you.

I have had a COO fire my lawyer and end other long term relationships to put his own people in place. I gave him the space to do so without asking for his rationale. In the end, the freedom I gave him came back to haunt me.

Don't sacrifice your judgment just to give a COO room to operate.

Don't let a COO get away from being accountable to you for decisions taken.

Don't sacrifice your operating principles or values for this key new hire that completes the puzzle.

It is your company and don't forget it.

Always consider options and consequences.

Don't turn the desire to give up running day to day operations into total abdication. You could easily lose your kingdom.

And be careful not to diminish what you have by hiring one person to whom you give the power to bring you down.  Don't subtract by adding.

The whole is supposed to be greater than the sum of the parts, not less.

Meeting Madness

Most employees of the average business feel that they are forced to attend too many meetings, and that most of the meeting time is a waste of time. In many instances, they are not wrong. Those calling meetings need to follow some simple rules.

Every meeting should have an agenda and every attendee should have the agenda in advance.

Every meeting should have set rules regarding behavior and expectations.

Every attendee should be prepared for the contribution required of him or her.

The purpose of the meeting should be clear to all who are asked to attend.

Every meeting should have at least one clear outcome, and responsibilities and accountability should be assigned.

Time is money, and entrepreneurs do not have time to waste. While it is important for all to have their say over issue involving their interests, that does not mean that everyone "gets the floor" for an unlimited amount of time.  Clear and fair limits on discussion need to be enforced.

Meetings are a big part of my day. Some are with potential clients or prospects. Others are with clients to discuss next steps. Still others are for brainstorming. It doesn't matter what the subject is. Meetings need to be efficient and effective uses of time.

Every once in a while, just sit back and listen to others in meetings. See who gets to the point, who doesn't. Determine who just loves the sound of his/her voice and who only speaks when they have something valuable to add to the discussion. Track how much time is wasted when a meeting is unstructured and unregulated.

Do you know how you are in a meeting? Are you aware when you go on and on without saying anything? Are you aware when you cut people too short, either by interrupting them or by body language or non-verbal communication?

Before we attempt to influence the "meeting behavior" of others, we should be aware of our own. We should work to become the role model before we try to impose rules on the rest of our team.

Meetings are tools to impart information, share ideas, motivate others. Don't let them morph into something negative! Keep them no longer than they need to be; keep them positive; keep them on task; and get results.