Adventures in Leardership

The following article was written in 2001 after 9/11.  I updated some wording to reflect this last economic disaster but I was amazed how pertinent and meaningful the message is for surviving this latest economic disaster.

Déjà vu All Over Again

The events of September 11 underscored the globalization that has occurred in the world. The enemy strikes when we least expect it and then retreats, invisible until the next strike.

Many businesses are faced with the same globalization effects in the Great Recession of 2009 . Retailers, manufacturers, construction moguls, Wall Street Wonks and professionals operated  businesses assuming that they were insulated from the effects of what happens elsewhere in the world and their business success would go on forever. Then comes the sudden attack when the world turns upside down. You feel victimized and vulnerable because everything you built is now threatened and none of it was your fault.

The United States and the world essentially shut down while we stabilized the situation, recovered from the disaster and developed a new strategy going forward. You need to take a similar approach as the economy enters recession, people lose jobs and spendable income ends up in savings accounts instead of new goods or  services. It will not be business as usual which means that you need to:

§  Stabilize the situation: Work with existing customers to assure they are committed to your business.  Customers you counted on before are reassessing their own situation.

§  Recover from the disaster:  Develop SWAT teams to find new ways to generate sales and reduce expenses. Even though the disaster was not your fault, don’t sit back assuming YOUR recovery is not within your control!

§  Develop a new Strategy: Reassess your markets, products, people and growth. Develop new objectives and direction for the company if that is required. Down size if necessary. Diversify if warranted. Study the situation and figure out how the environment has changed and refocus efforts, energy and assets to achieve greater success.

Sometimes survival is the first step to success but survival is never an end in itself. This country learned a lot in the hours and days after the attacks. Those lessons need to be understood in our personal lives for our security and in our business lives for our well being. We are in control if we take control. We have learned about teamwork, commitment and unity. The organization is going to change if it is to survive. Don’t act like a victim. Our future lies in our resolve, resilience and productivity.

“Sometimes I get the feeling the whole world is against me, but deep down I know that can’t be true. Some of the smaller countries are neutral.”     Robert Orben

When a company is open to change and accepts the help that is available to it, a picture of disaster can become quite different. The first step is to identify the underlying problems and develop solutions and actions plans to correct the problems. A strategy is developed for operations and cash management and it is made clear to everyone in the company. Many times actions are taken to make the company more lean and competitive before outsiders force the moves. Things change quickly!! All old habits and procedures are questioned and leaders emerge. When there is direction and planning, creditors, vendors and banks tend to have more faith in the future of the company. The key to the successful management of a crisis is that an outside influence is needed. No one inside the company can have comparable perspective, independence and emotional detachment to see the path to success clearly.

There are always some stories that are told and retold because they are so pertinent and meaningful to our own lives. One of my favorites is about Tiger Woods after he won the Masters Tournament in Augusta Ga. Arguably the pinnacle in the golf world, most people would revel in their success and rest on their laurels. Not Tiger. As the story goes, he went to Michael Jordon to discuss how he stays at the top if his game. The two of them agreed that constant and continuous improvement was the key. Tiger then took some time off from golf; not to vacation, not to go on the speaking tour, and not to spend time with his family. He took time off to completely revamp his swing! The best golfer in the world takes time off to revamp the best swing in the world. The rest is history.

We all work at many things and continuously practice some as well but not all practice is necessarily good. Most of us work to a level of proficiency that is acceptable or even respected and then plateau. Studies show that the level of performance does NOT correlate to the number of years in the field! How many people do you know with 30 years of experience compared to those you know with 2 years of experience 15 times over? Maybe even you!

In order to improve in our chosen endeavor, hopefully that includes running your business, you need to follow Tiger’s lead. Don’t just keep practicing the same actions but take your game apart. Get better at each piece and part. In the case of golf it might be keeping your elbow tucked into your side during your swing that is practiced for a month! In your business it might be your hiring process, your negotiation skill, your performance review process or the hundreds of other individual activities that you do every day.

Another aspect of Tiger’s approach is important too. Tiger, again the best golfer in the world, would not have tried to improve his game without his coach at his side. The coach provided feedback on his every move. The coach prevented Tiger from developing and practicing bad habits. The coach challenged Tiger’s thinking to help him arrive at the best way to improve his game.

If you really want to improve your abilities beyond the plateau you reached long ago, you need a coach that understands your challenges and your business. They don’t need to be the best player but they do need to be a great coach! In our case we not only use a coach, but the entire coaching team impacts the business. Conference calls are important to give other inputs and challenges. On site visits by the consultant is important to help the owner and the steering team improve their game.

Tiger’s success is proof positive that meaningful continuous improvement works. There are many others. Your’s should be among them.

What’s the Point?

By Evan Wise

Managing Director

Management One®

Look at any sport. Read the instructions for any game. The first thing you want to know is, “What’s the goal?” In football they are so blatant as to call it the goal line. In baseball it is called home plate. In checkers it is to capture all of the other persons pieces. Whenever there is a situation where you win or lose, success means identifying the goal and achieving it.

The problem is in many real world situations the goal is not clear. Choose the wrong goal and even if you achieve it, you can lose. Regardless of your view on what should be done now, most would agree that the U.S. chose the wrong goal in Iraq in 2003. We declared, “Mission accomplished” because we achieved the goal we set but it was the wrong goal. The same situation happens in businesses all the time. A goal is set to launch a new product and money, time, emotion and effort are poured into achieving the goal. The product is launched and sits on the shelves unsold. Wrong goal achieved!

What are the goals you have set for your business? If you said to make a profit you are wrong. Profit is what happens when you choose the right goals. Profit is what happens when you achieve the right goals. Profit is what happens when you manage your business effectively. Making a profit requires skill in so many different areas that it is much too broad to be a goal. So what is a goal? How do you create a good one? When we are hired to implement Winning@Businessâ„¢ we work hard with our clients to help them choose the right goals and achieve them. The following are some good guidelines to establish goals.

1. A goal must be simple and clear to everyone who has a part in achieving it. Too often a goal is only in the mind of the owner. Other times the goal is too all encompassing to be achievable (like profit). When the goal is not simple, the impact that each person has on the goal is not clear and direct. There are too many other factors that affect the outcome; no one really owns the goal.
2. If you can’t measure it, you can’t achieve it. When goals are subjective, everyone can have a different opinion about whether it was achieved or not. For example, “We want to make customers happier,” sounds like a great goal for any business. Unless you measure with surveys or repeat business, there is no definitive answer as to whether you were successful or not. Every goal must be stated in measurable terms.
3. Your steering team must own the goal. At Management One® the first endeavor is to replace an owner driven company with a team driven company. The owner still navigates but the team steers. Training and implementing that steering team to work effectively is important in the success of the business. The steering team must own and embrace the goal in order for it to be achieved. If not, and the owner is the only one that embraces the goal, the owner will need to be there constantly to be sure the actions are taken to achieve the goal. When the owner begins to micromanage he emasculates all his employees and he becomes the critical part of the business. He works 80 hours a week and is married to the business!
4. The steering team must create accountability for achieving the goal. Each steering team meeting includes follow-up and review to be certain the goal is being achieved.
5. Communication is always a huge part of every successful company. We work hard with clients to improve their communication processes and skills. When setting goals and achieving them, effective communication to every employee is important. The communication should also include an understanding of how the goal affects the way that person does his job. If the goal does not effect different actions, different results will not be achieved!
6. Give the goal a deadline. Goals that are open-ended are meaningless. That is why there is a goal line in football! Will you reach the measured goal in 3 months or a year? Try not to go longer than a year unless the goal truly demands that much time. (i.e. if you are building a nuclear power plant as the goal, it may take 7 years!)

There are other important keys to effective goal setting but these key steps will move a company in the right direction. A good consultant will help identify the right goal, help you state it in the right way and then stick around to be sure you achieve it.

When a company is planning to buy another company the most important consideration is the strength of the management team. Warren Buffet makes the strength of the management team his most important consideration before investing in a company for his funds. Venture capitalists estimate that 60% of the success of an investment is based on the strength of the management team while 20% is based on the strength of the technology and 15% is based on the market acceptance for the new product. The biggest reason for this breakdown is that the technology will not have a chance to fail if the management team and management process are not competent. Management will make fatal mistakes that will sink the venture long before the technology even has a chance to fail. This occurrence is much more prevalent than most managers believe.

With all this emphasis on management competence, way too many companies feel that management is not a key component to their success. It is very difficult to gauge competence from within the management of the company. The two things that most people feel they do well without training or guidance include sex and management. Manufacturers take the best workers and bump them up to foreman. Retailers put the salesman with the longest tenure on the floor as sales manager. Even the owner often has a technical knowledge, extra cash or a family history in the business rather than any real management training or outside experience.

This dichotomy raises a lot of questions about the value of your business. Would it be more valuable if it were more profitable? Most everyone would answer yes. Would it be more profitable if the management process and team were more proficient? It seems logical that yes would be the answer but the truth is that many independent businesses function as if the answer was a resounding NO. They can’t envision a return on the investment in a management consultant or hiring a proven manager. A consultant is normally a less expensive solution than hiring a proven manager. A consultant can be removed easily if there is not a fit or competence. A hired manager is much more difficult to remove.

Amazingly, the most common objection we hear to bringing in a management consulting team to improve the skills of the management and implement a management process that provides more effective results is that we don’t have the people or the time to do any more than we are doing now. That is really a crime. Your business is what you depend upon to send your children to college and provide for your own comfort and retirement. Your employees depend on your business for their livelihood and your customers depend on your business for your expertise, products and or service. Not providing the resources to make that business more profitable, stable and significant is being pennywise and pound foolish as the British say.

Another reason many owners put off the decision to bring in a consultant to improve the management team and the business is that they are confused about how to choose the right consultant. Admittedly, that is a daunting task. There is no organization that polices the consulting industry or that licenses consultants to be certain that they have the skills required to do the job. Almost every manager has or has heard of the horror stories that were brought on by a consultant. Our approach at Management One® is to train and certify all of our consultants to assure that they will provide the help to clients they expect. Most Winning@Business™ engagements include more than one consultant since we know that every consultant has certain areas of expertise. We have experts in marketing, finance, business management and other areas that are critical to your success.

Finally, every owner is wary of the cost of a consultant. At Management One® we understand the financial limitations of independent business owners and work with our clients to bring the guidance they need in a way that minimizes the time and people commitment they must make. Our affiliates are independent which minimizes overhead costs. Our marketing is primarily word of mouth so you will not be paying for fancy advertisements and you won’t see a Management One® sponsorship of the SuperBowl. The return on investment in Winning@Businessâ„¢ that our clients normally see is generally greater than 5 to 1 and as much as 50 to 1!

What does a management team need to do to be successful? (Notice I said management team. Gone are the days where a single manager can be as successful as a management team working together to solve problems, seize opportunities and manage change.) The following entries in this blog will identify some of the key factors with which a successful team deals.

Copyright 2007 by Management One® LTD. All rights are reserved.

I have worked on team management and business development in everything from a mom and pop haberdashery to a running a paper-mill; from managing a leading worldwide research and development center to the startup of Management One®, a company that implements team management and business development for client companies. The one thing that I have observed as a continuum through all the many different environments in which I have worked is the importance of teamwork through effective team management to success. When I started out working in 1968, the norm was the old command and control style of management. As a worker I hated it but there was no alternative. There was no team management; only a seasoned boss that shouted orders.

The environment is much different today. Business owners, department managers and even executives of large corporations are working with a different workforce than existed even 10 years ago. You are selling to a different customer than you did 10 years ago. The amount of information available, the flexibility that both customers and staff have to come and go as they please is so much greater and the level of competition is so much higher that it becomes imperative that you get everyone working together on your team. The issue that many face is how to do that effectively!

This blog will be about how team management and Winning@Business concepts help businesses to survive and prosper in this new environment. I may not give you all the answers you seek or need but I hope to make you think about your staff, your customers and your business in a different way. Often I will refer to Winning@Businessâ„¢, which is the process that we have developed to help businesses to implement the effective methods to achieve success in this new environment. I will share a lot of what I have learned over the last 17 years of moving my own departments, companies and clients to the 21^st century of profitable business. This process works and has been proven in youth groups, the Geneva Illinois High School football team, a rock group, retailers, manufacturers and service businesses over the past 17 years.

Please feel free to contribute, respond and participate in the discussion. If you would like to contact me directly you can do so through www.management-one.com or evan@management-one.com.

Evan Wise

Managing Director