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What Every Leader Needs To Get Right

What Every Leader Needs To Get Right

According to the U.S Department of Labor, multi-factor productivity in 2016 was negative for the first time since the global financial crisis. While the economy has had a stellar performance in 2017, it could be short-lived if we don’t address the productivity challenges. We can’t do this until leaders get one thing right; creating focus.

With the attention span of a human at an all-time high, competing priorities, and too much information coming in, leaders are faced with corporate attention deficit. This lack of focus is a disease and until leaders can manage company time, they won’t be able to create company focus. Without focus, productivity plummets and performance at every level will suck.

So what does all this mean? It means leaders need a paradigm shift. They must look at company time the same way they look at company capital. Time allocation must be part of the planning process and allocated properly. Leaders can create focus with fewer, more impactful priorities and ensure the bulk of company time is spent on the functions/activity that drives the business forward.

What drives a business forward? There are only two functions that move a business forward; innovation and sales. Period. Yet, we’re still compelled by our corporate ego to do it all in-house. We build marketing, accounting, IT, and ultimately bigger HR departments to manage the internal fight over resources. This model, in most cases, produces incremental growth because it creates big processes. more meetings, more reports, and ultimately, more distractions from innovating stuff and selling it.

Marketing, HR, IT and Accounting have a very important role and I’m in no way trying to dimish this. There are advantages to these in-house engines. However, these teams should be intellectual, not tactical. They are the idea factories, the planners, not the executioners. Leaders should consider outsourcing things like social media management, help desk, or delinquent account receivables and let these teams focus on activity that brings the company vision to life.

Furthermore, the traditional business model dilutes the most two important roles in the organization; Sales Managers and Product Developers. These folks are spending a big portion of their time on other department’s stuff. Getting employee surveys done for HR, filling out reports for accounting, providing content for marketing, and regurgitating the P&L in the infamous “status” meeting.

If the ideas presented here are a bit radical for you, then stop reading now. For those who need major disruption and change this year, here are some suggestions to begin your cultural shift and business model transformation.

  • Remove the obvious absurdity of any given self-serving process. We all know what they are, we’ve all had to deal with some ridiculous step in a process for some control freak on the other side of the building. Acknowledge the elephant in the room and get rid of self-serving, CYA, reports and processes.
  • Automate redundant tasks and perform time studies. At first glance, time studies could be seen as micromanagement and people tend to shy away from them. On the other side of this exercise, the insight gained is priceless. Time studies not only identify useless activity, they also help managers understand what can be accomplished with the time they have in a day. I’ve used a good old fashion stopwatch and a little cost accounting to determine ROI on activities, functions, and entire departments.
  • Restructuring the organization into smaller teams and teaching managers communication skills can eliminate meetings, employee surveys, budget overruns, and turnover. Smaller teams tend to be more nimble, more focused, and less bureaucratic. Managers of smaller teams are more likely to forecast better and less likely to become burned out.
  • Give your sales managers the tools they need to close deals. Big CRMs, ERPs, and other enterprise tools are anchors to the sales team. No CRM, intranet, or internal chat tool will help them sell more. The only activity that generates sales is selling! Sales managers want correct and recent customer information, but their department should not be the producers of this, they are the end users of it. Downsize another department and build a sales enablement entity that will manage and update data, send proposals, secure POs, and be a liaison to other departments. Let sales SELL.
  • Identify and stick to core competencies, then outsource the rest. We tend to want to invent the wheel in-house instead of sticking to what’s in our wheelhouse. I’ve been guilty of this myself. “Let’s save money by creating this thing ourselves.” While we may have saved a few bucks, we spent thousands on lost opportunity and worse yet, created a lack of focus.
  • Allow product people to develop product and meet their deadlines by eliminating projects that suck the life out of innovating. Need examples? Just go ask these folks what projects are albatrosses. Give this team a direct line to customer feedback and then unshackle them to meet customer needs.
  • Infuse time management and time awareness into strategic planning, new hire onboarding, and training. After a while, your managers will come to you with all sorts of time sucks to kick out the door.
  • Look at every cost center in the business and quantify its value in dollars. Anything that can’t be quantified should be tabled until it can or replace the manager with one who deeply understands the value of the function. Don’t waste precious time on activities that don’t produce value to the customer and the business.

In the current business environment, velocity is king. Getting high quality and competitive product to market quickly will solidify the future and sustain the business. If leaders can treat time as a resource, a liability, and ultimately, an asset, they will be able to create focus which will propel productivity and significantly improve performance at every level.

Are You Smoking Hopeium?

Are you smoking Hope-ium?

That was a question one of my bosses asked me early on in my career. After my ego took a back seat, I was able to utter the words “I’m sorry, what do you mean by that.”
“I looked over your plan for next year, at a high level, it looks great.  While I love the numbers you have, you didn’t explain how you were going to achieve them.”  Back then I wasn’t very strategic, I was like the rest of the business world- opportunistic and reactionary.  To be honest, there was, in fact, a lot of hope in my plan. I’ve since exchanged my hopeium pipe for conversations and excel.

Over the next two months, he had me build out the numbers by product/service/ customer. then instructed me to clearly define the resources I needed, and accompany everything with monthly goals and a month by month plan of action to reach them. At times, I have to admit, I wanted to stick a pencil in my eye.  It was a lot of work and I worked a lot of overtime. Afterall, we have to keep the wheels on the bus while we’re planning to fly!

Ah! The Pain!

The most painful task in this whole process was “backing into the number.”  What is that?! Basically, I had to document what my department looked like 5 years from now- in other words, create the “vision.”  I had to provide in detail what were we selling, who were we selling it too, how many people were on the team, what the processes looked like, what company resources I would need.  A bit of hopeium here, but not for long.

Once I had the vision, I was asked to put the “Vision” financials on paper. In Excel, with formulas, ugh!  Then the fun began,  I had to run the numbers backwards to the current year.  This was painful, but wow, it ended up being one of the skills I used in all my planning over the years.  This part of the process provides your long-term roadmap and shows you where your sales and expenses need to be next year, the following year, and the year after that.  Now don’t be scared. This is an extreme exercise and my boss was a Software Engineer with an MBA.

Stick to the basics at first.  

If you’re not used to business planning every year, start off small.  Use your current year numbers to forecast and add a percentage for how much you want to grow.   For some,  just the thought of writing a business plan is daunting. I recommend starting small with just the sales/expenses and growth.  You have to plan to grow. This means looking at what it takes to maintain what you have and where you can cut cost to fund growth.  Sometimes funding growth takes financing. Before heading to the bank find ways to cut cost.  A word of caution; in cost-cutting mode, make sure you aren’t sacrificing customer value. Don’t be penny wise and dollar foolish.

Talk to your customers and vendors.

Talk to your customers to make sure they will continue to purchase from you and find out if they see any disruption coming in their industries or changes in their lifestyles.  For instance, if you service Mrs. Smith’s lawn every week but she plans on moving out of state next year; it would be a good thing to know. If your largest client plans on closing that division or is talking about doing so; you would want to know. Right? These are some of the many pitfalls we can avoid through good planning.

Once you work through the sales numbers, look at the expense side. Talk to your vendors.  If your insurance premiums are jumping 10% next year, you should know. If one of the core products you use is being discontinued, you should definitely know.  Moreover, most businesses increase their prices every year, you’ll want to have this information to properly forecast your expenses.  Take forecasting with a grain of salt. It’s an educated guess, but it puts the parameters in that you can work off of. Anything can happen anytime in the year;. being a bit more proactive can help mitigate some of it.  Being proactive is being strategic.

Be strategic, not opportunistic

In a small business or department,  it’s pretty critical we operate strategically.  When we react to everything that’s in front of us every day, we tend to lose sight of the big picture, waste time on things that aren’t aligned with our goals and spend money on things we shouldn’t. When we know what we should be doing and clearly know where we’re going, it’s easier to stay focused and strategic.

I don’t know about you, but I’ve approved an expense on a whim that in 20/20 hindsight didn’t make sense or didn’t generate a return of any kind.  Time suck, and a waste of money- nothing more than that.  I have a rule now- if there is an expense I want to incur for growth, I wait 7 days before committing. This gives me time to step back, revisit my plan, and clearly understand how this will get me closer to my goals. 9 times out of 10; I don’t commit.  Hey, I’m human! I can get caught up in a sales pitch too once in awhile.

Having a thought out plan helps us stay centered and focused. Plans are living, breathing documents. They are outlines of what needs to be accomplished. You should be flexible and ready to pivot when something isn’t working and also ready to capitalize on things that are, even if it means foregoing something else.

Chunk it out. 

How many of us write these beautiful, well thought out plans and then never look at them? I’ve done it myself and have seen it happen.  The way to keep the goals and the plan top of mind is by using a month by month action plan.  Chunking out tasks that map into your revenue goals.  You can call it a “To Do” list, but we like to call it “The Action Plan.”  This is where the rubber meets the road in the day to day grind of operating. Keeping yourself or your team focused on reaching milestones every month will help you stick to your plan.  We use one at Workbea.  Click the link below to see the planner we use. It has proven to be a huge help keeping us focused and has helped us reach our goals this year.

Happy planning!

Meet Your Business Goals Next Year

Time To Begin Again

It’s never too late to begin a business plan.  Ideally, August is the time to begin the process for a January fiscal year, however, late is better than never.  The process forces us to take the time to look back, reflect on what went well and what didn’t. It’s also a time to look at your goals and see if you are on track to accomplish them or decide if they were a bit too enthusiastic.   Goals is a small but important part of your plan.  When setting your goals for next year, here’s some things to keep in mind. 

Get Clear

While it’s business as usual in the day to day grind, it’s so critical to take a step back, understand where you are, where you want to go and how you’re going to get there. An important part of this process is getting clear on the what. Without the what, the how is irrelevant. Here is a list of you’ll need to think about.
1. Get clear on where you want to go.
Start gaining clarity by seeing the end.  Create a vision of what the business will look like in five years. Who is on the team?  What types of clients are you serving? How is the business structured? What are the sales and the margins? From there, in your mind’s eye,  work backward in 1-year increments until you get to this year.  While you won’t be able to see a granular view, you’ll have a better idea of what needs to be accomplished over the next 1-3 years.

Set Goals

2. Get specific and time-bound goals.
Once you have a clear picture, you can begin the process of developing your goals. Using the example of financial goals, you might say I want to increase sales x% by the end of 2018. Then divide that number into quarters and you have a real goal to meet every three months. 
Without time-bound goals, we become activity focused.  Our activity only becomes productive when it can be associated with something we’re trying to accomplish.  We only have 24 hours in a day, how much of that 24 will you spend on the activities that directly moves you closer to your goals?  

Decide How

3. Come up with the how. 
Once you understand where you want to be, think about how you will get there.  This is called “strategy.”  A strategy can be fluid.  If you develop a strategy and find it isn’t working, you can change it.  I’ve seen strategy change weekly in some organizations, especially companies in disruptive industries.  Having a strategy helps us develop a path to the end.  For example, if you were planning a trip to Europe, you might decide you will use a combination of train, plane, and automobile to get there.  

Chunk It Out

4. Chunk it out.
 If you need $5k every three months to hit your goal at the end of the year, you’ll have to decide the how. Is it new customers, raising prices, cutting costs? If it’s raising prices, you will have a list of tasks that go along with that plan. Maybe you call every customer to get feedback, do some research in the market to see where competitors are at, writing a letter to your customer, setting a date, having a plan if customers move away from you because of this…and the list can go on and on.

Track Progress

5. Track your progress.
Wherever you write or type this all out- be certain to also track progress. Set smaller goals every week and set an hour a week aside to review your progress, pivot if you need to, and rewrite goals if you have to in order for them to stay relevant to what you’re experiencing in real day to day.
You can really be, have, or do anything- just get clear about what it is, set some goals, make a plan; then stick to it. Easy.
Need some help with this? Contact us at info@workbea.com to book some time with a business consultant or take one of our Workshops on planning.