| Upgrading
the management process
By Evan Wise, Managing Director
of Management One
Small
business has as great a need to grow as larger companies.
The difference is the drive comes from within instead
of from investors and shareholders. That means that
the most successful small businesses will be those whose
owners and leaders have passion, drive and are willing
to take prudent risks to grow. That doesn’t mean
they have the capital to do so.
Many
clients are constantly looking to buy a “system”
that will answer all of their problems. “We need
a new Point of Sale system” or “our accounting
software is holding us back.” We need another
production machine, scale, truck …. There is always
a problem at which, by throwing money at it, we can
grow to the next level.
Sometimes
the need is financial. “If the bank would only
increase our line of credit by 50% we could double production!”
The
truth is that normally the growth never follows the
expenditure. The simple, most straightforward reason
I have seen is “People”. There is more productivity
and capacity locked in the existing people than any
new equipment or system could deliver. The problem is
the leaders don’t know how to unlock that resource
and use it. The finger that points to the solution must
point back at them and they are not comfortable with
that. It is easier to point the finger at the bank or
at a vendor to bring the solution.
We
have found that getting people to work together has
tremendous benefits. In one case an electronics manufacturer
was able to increase revenue 50%, reduce backlog from
3 weeks to two, work one shift instead of 2 in the course
of a year. A folding carton manufacturer was considering
a new die cutter since they worked for 15 years trying
to get the old one from 50,000 impressions an hour to
70,000 without success. In six months, without any new
equipment, the existing staff was able to get the die
cutter to 90,000 impressions an hour.
The
point is that throwing money at a problem is the easy
way out. Sure many solutions take some cash to implement.
The problem is that too often the leaders, owners or
executives look to the outside for a solution before
they garner the internal capabilities.
Training a team to work together to solve problems,
seize opportunity, manage change and grow a business
is a difficult process. Most of the time it requires
outside help… throwing money at the problem. In
this case the money is like a seed that grows to yield
a lot of fruit, year after year.
An
executive has trouble implementing the process because
he is suspect. “What’s in it for him?”
is a question in the back of everyone’s mind.
“Why is he changing all of a sudden?” A
neutral party is needed to bring the process, gain the
credibility, teach and nurture the process and make
the change happen.
Find
a person that has the right process for your organization.
Use the same diligence as you would in choosing new
equipment for your business. Find a person that will
be committed to your team for the long haul.
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