Categories
Management

Short term focus creates long term pain

If business were simple, everyone would have one of those Easy buttons on their desk. Your short term focus each day would be to remember to push the button. All that’d be left would be to head home for dinner, or maybe out to the lake or golf course.

The next morning, everything would be taken care of. If you had any employees that you were thinking of letting go, they would’ve left resignation letters on your desk. If you had any openings, there’d be twice as many great applicants as openings. Customers would be lined up out the door, throwing money at your website, etc. All your accounts receivables would be at zero. No one would complain about anything. Vendors would do everything you asked on budget and on time.

Thing is, business isn’t simple, much less the fairytale I described. Yet it’s still easy to find people with a short term focus, which usually leads to poor decisions.

Short term focus? How?

When I say short term focus leads to poor decisions, you might ask “Why?”, even though the evidence is consistent and overwhelming.

Even when we exclude an apparent flood of unethical behavior, big companies and governments find themselves in bad (yet largely preventable) situations due to decisions made with a short term focus.

If you need examples, Google any large company name associated with a large layoff: Wells Fargo, Verizon, Deutsche Bank, GM.

Other than contractors affected by a government shutdown, it’s difficult to find a situation where 30,000 employees that you needed on Friday suddenly became unnecessary on Monday.

Companies keep thousands of employees past the end of a quarter to avoid hurting their stock price, or to avoid having to talk about a layoff (and its backstory) on a call with Wall Street. It can be as simple as an upper level manager delaying action on a situation they know they need to fix because their bonus is tied to end of quarter stock price.

On the government side of things, look at any large infrastructure project (say, US highway bridges) where ongoing maintenance has been delayed for years because the funding was “borrowed” for pork barrel projects. A decade or two later, someone discovers that thousands of bridges are structurally unsound.

Anything to make a sale?

In your business, the numbers might be smaller but the pressures are no less severe. Making payroll can cause business owners to do things they’d avoid otherwise. Almost every business has faced a cash crunch as payroll day approached, even if you were the only one on the payroll at the time. It’s tempting to make what seems like a good decision at the time. That’s the kind of short term decision I’m talking about.

For example, have any of your larger customers told you (not asked, mind you) that to do business with them, they’ll require 90 or 120 day terms because of “business pressures”? Some will reject that business, but many won’t because they need the revenue.

It seems like saying OK to such things is a good decision. We got a new big customer. Let’s tell everyone. We’re sure to get a bunch of business from other people when they see that GiantCorp uses us, so it’ll be OK to deal with undesirable terms for a while.

Long term pain

Trouble is, that rarely happens and those terms are rarely temporary. More often than not, accepting such ridiculous and downright abusive terms is a bad long term decision for a small company.

Short term mindset: “It’s OK to borrow a little to make payroll.” Problem is, even if you don’t borrow to make that payroll, there’s risk in this short term “win”.

Imagine your surprise, when a few weeks later that nice young man from GiantCorp advises you that their new payables policy is 180 day terms (hint: you can say no). If you don’t make a fuss (a short term focus decision), it means you won’t see a check for another 30 to 90 days – even then you might have to badger them to get paid.

Now, you have a payroll funded by debt and another coming in a couple weeks. Oh and GiantCorp just placed another big order today.

This is but one example of why you have to think and act long term, even if it slows you down a little.

Photo by Sam Balye on Unsplash

Categories
Business culture Employees Management

Self-healing teams

Last week we talked about applying self-healing tactics to the tools, systems, and infrastructure that are a critical path to a productive business day. We also discussed ways to make downtime less of a factor for the tools, systems, and infrastructure that can’t self-heal.

While these efforts are useful, creating resiliency and the ability to “take a punch” aren’t limited to tools, systems, and infrastructure. Your team can also benefit from self-healing approaches.

Preemptive self-healing

While self-healing is a valuable tactic for saving time & money, and improving productivity regarding your tools, systems, and infrastructure, people are a bit more complex. People are a bit harder to heal, plus the capacity for self-healing varies a good bit between individuals.

Teams, on the other hand, benefit a great deal from preemptive self-healing. Most of this comes out of extreme care taken when hiring. The same level of care is needed when making team assignments. If you look back over time at the problems you’ve discovered on your teams, you’ll likely find some consistency in the ingredients of the turmoil you dealt with.

You might have someone who simply isn’t a culture fit. Or they could’ve been a jerk. Maybe both.

You might have inadvertently mixed personality types that simply don’t work well together. There’s some value to “You folks need to figure it out”, but it’s still on you to monitor the situation and make sure the effort is being made. It’s not all that unusual to have two people on a team who are solid, qualified people who don’t jell well with one another for whatever reason.

Whatever drama that creates is not likely worth whatever you think you’re going to gain by forcing them to work together. Sometimes, one of them just has to go. These decisions aren’t easy. It’s not unusual to find that a top performer is also the one who doesn’t jell with the rest of the team.

Toxic top performers

To that end, if you have top performers who are creating problems with the rest of the team, and the problems aren’t something you’ve been able to resolve – sometimes that top performer has to be the one to leave.

We’ve all seen someone who is great at what they do – and lousy at teamwork, or arrogant, or disrespectful, etc. Remember how you felt when they did whatever they did and management did nothing because they were a “top performer”. Now that you’re in charge, are you going to be that manager, or that owner?

No one is irreplaceable.

Read that again. No one is irreplaceable. That doesn’t mean losing them will be a pain-free experience. It may not be. Even so, the damage these people can cause often negates their performance. They can drag down the rest of your team, destroy morale, and prevent others with similar (or even better) skills from blooming because those people simply don’t want to deal with your top performer.

They reveal management’s true self. When the top performer (at least metrics-wise) does things no one else could get away with, it sends a message about what’s important to the company’s ownership: “It’s more important to bring x to the table than it is to adhere to the company’s culture, rules, whatever.

Similarly, it also sends the message that if you can do X better than anyone else, you can get away with anything. Is that really what you want to represent as a manager / owner?

Self-healing performance

A real top performer doesn’t bring a bunch of baggage to work and spray it all over their peers. They don’t aggravate, emasculate, or reduce the performance of the rest of the team. Just the opposite, in fact. A true top performer not only produces like no one else on your team, but they also make the team better by making each individual better.

They teach. They mentor. Their behavior makes people want to work with (or for) them. People trust them.

On teams where this isn’t how you’d describe your top performers, you’ll often find people and/or teams pulling in different directions – even when trying to achieve the same goal. At some point, your company is going to pay the price for that.

Be very careful who you hire and how you build teams. Don’t forget to be the kind of top performer every team member wants to work with.

Photo by Randy Fath on Unsplash

Categories
Leadership Management

Entrepreneur, self-heal thyself

Have you ever gotten to the office in the morning and found a tool missing that you were planning on using that day? It creates some frustration borne in the inability to do what you’d been planning all along. For some, it might make your work more difficult to do, or delay the finish time. For others, the inability to use a certain tool might turn your day upside down.

Time is more than money

“Time is money”, you might think. “The inability to use this tool is costing me money”, you continue, and you’d be right. Now consider the cost when your entire team is unable to work. In some businesses, you might simply send the team home. While your team isn’t getting anything done, at least they aren’t racking up hourly pay. Small victories, I suppose – but every hour they’re down (even when off the clock), your backlog is growing. Customers who are depending on an on-time delivery based on work you intended to have done today might also find themselves in a pinch. It might be a pretty big deal.

It’s possible that the inability to use a tool in your business today could cost your customer(s) business. They might lose a strategic moment, a customer, or a valuable employee who simply decides they’ve had enough of the frustrating inability to do the work they love.

Do you want to be the vendor putting customers in that situation?

Customers aren’t the only ones

It feels like it might be worse if you do this to a customer. If the impact is solely internal and isn’t detectable by your customers, your team will just have to deal with it. Still, it has a cost. In frustration. In time. In “Really? this machine / tool / system is down AGAIN?”.

At some point, your team is going to lose patience. If the problem is bad enough or happens with enough frequency, you could lose key staff members. The folks you depend on most are likely to be the ones frustrated first. They’re the ones who may have the least tolerance for the working conditions caused by outages or downtime. They’ll perceive these issues as a lack of professionalism, or a lack of concern for their career or ability to make differential pay, or whatever. They simply won’t put up with it at some point.

Dial tones

Remember when you never doubted that when you picked up the phone, you’d hear a dial tone. If you’ve never had a landline, think of it as you do your expectation for electricity or running water. While those things do occasionally have problems, your expectation is that they will always be there.

That’s where notification of problems is helpful, but notification doesn’t make things significantly better. Imagine if you got a text message at 6:45am telling you that all the roads in and out of your town would be closed for 72 hours. Or a text that says “Sorry, no electricity until next Thursday“. Sure, it’s nice to know, but without a correction on the way, your day just got turned upside down.

If your internet is down too often and the vendors available to you are limited, are you going to choose one and simply tolerate the cost of downtime? Why not choose two or more who aren’t dependent on the same infrastructure? It may cost a bit more, but so does a few hours (or worse, days) of downtime.

Self-healing

Notification is old news. If a system can monitor systems, assets, working conditions (etc) and notify you of availability problems, why stop there? Why not enable these systems to correct the problem? Can your systems be setup to repair a failing systems, restart it, automatically dispatch service people, etc?

These issues should be part of your risk assessment. If power outages are a frequent thing, you’re need to weigh the cost / benefit of uninterruptible power supplies, a generator, or some other solution. If machinery / tool breakdowns are a significant impact, should you have spares on site? Can you work out an arrangement to have temporary replacements provided / rented? If there is a possibility of contention for rented resources, can you pay extra to make sure your needs take priority, get delivered first, etc?

Your team, your business partners, and your customers see your systems, equipment, & infrastructure as an extension of you. If they can’t depend on those things to be in place and working, they can’t depend on you.

Photo by Saad Salim on Unsplash

Categories
Employee Training Leadership Management

Mental errors

So, this past weekend my alma mater’s football team visited Tuscaloosa. As with most guests of the University of Alabama football team, they came away with a loss. Despite losing by 41, it could have been worse. Really it could. The score didn’t really bother me – I mean, seriously – we’re talking about an unranked team vs the top ranked team in the country. We knew it was going to be ugly.

Coaching?

Even when you “know” your team is going to be clobbered, there are two things you don’t want to see. In fact, I spoke with a sportscaster friend from college about it shortly before kickoff. I mentioned that I’d like to see four quarters of motivated play, ie: no appearance of quitting or giving up, and four quarters without a bunch of stupid mistakes – ie: mental errors. Fortunately, we didn’t see the team giving up late in the game, despite a 40+ point deficit. Mental errors, however, were a problem.

We don’t generally expect major college athletes to commit mental errors week-in and week-out. If they’re a problem in a game, it happens, and you expect the coaching staff to spend some of the ensuing week’s training time to address them. It speaks to a coaching problem when these things happen repeatedly, particularly in consecutive games.

On two consecutive kickoff returns, two different kickoff returners made back to back junior high school football level errors – stepping out of bounds at the two yard line pursuing a ball they’d deflected, and catching a ball heading out of bounds inside the 10 yard line (rather than simply letting it go and getting it at the 20 yard line). Neither player appeared to be aware of their location on the field. I can’t recall the last time I saw this egregious an error of that type at the major college level, much less on consecutive kickoffs. It may not have affected the outcome this time, but it would against a different opponent. Unfortunately, these were not the only two mental errors – they’re simply the easiest ones to describe.

In a football game, you expect mental errors due to nervousness, fear, a pressure-filled situation, fatigue, and/or a lack of preparation. When you are down by 24 in the early first half, about all that’s left is the lack of preparation option. To me, that speaks directly to coaching. At this point in his tenure, there’s already the drumbeat of replacement – so fixing the preparation is essential. You can’t replace your team with better players (or players who fit better into your system) in the middle of the college season, but you can significantly impact their preparation. If you don’t, a lot of other things will likely go badly.

A tie to business?

Of course, there’s a connection to business. The situation speaks directly to hiring well, on-boarding, continuing education, mentoring, management, and leadership. Those things aren’t enough to eliminate mental mistakes, but they certainly help. The preparation that we didn’t see evidence of in last weekend’s game We all make mental mistakes in business situations.

The strategies that reduce or eliminate mental mistakes during the business day are the same ones as in football. Coaching, training, mentoring, and practice are all a part of preparation. Any one of them will not do the job. For example, you can stand at the front of the room and teach people, but until they get out in the field and do what they were trained to do, it’s extremely unlikely they will perform at a high level. Even when they do, practice and mentorship is essential.

An easy example? Your sales team. Some members of your team may not enjoy practicing sales calls with other staffers, or going over recordings of sales calls with a manager or an experienced, successful salesperson – but both practices have proven useful to developing expert salespeople.

It’s on the leader

While the team members are the ones making the mistakes, the responsibility rests largely with the leader. They set the tone and performance expectations, while deciding how much preparation of their team (or their staff) is enough.

Business leaders are all under some sort of deadline. Coaches can’t put off next Saturday’s game. Both have to field the team they have each day or each week. Both are responsible for making sure their teams are well-prepared. What can you do with your team to make sure they are better prepared for their next effort?

Photo by Mari Carmen Del Valle Cámara on Unsplash

Categories
Employee Training Management

Choose process over results?

Every time Alabama loses a starting skill position player (usually the QB), the world asks Saban the same question. Paraphrased, it’s always something along the lines of “Oh my, what a disaster. What can you do to avoid ruining your season?” Mind you, Alabama isn’t the only team that has this figured out, and they certainly aren’t the only team asked this question. As different as teams are, the ones who consistently succeed over long periods of time appear to have a similar solution. They recruit players that fit their system and they make sure every team member knows their system to the point that it’s second nature – regardless of the player’s skill and ability level. Every day, they choose process over results.

What that means is that these teams set the expectation that if you go into the game, you do the job you were trained to do. You’re trained. You know the system as well as anyone. As such, you aren’t surprised. You know the game plan. You don’t freak out when something goes wrong, probably because no one else is. You don’t panic. You simply use your talent and ability within the system you’ve learned. Like a successful business, these teams have built a system that isn’t going to fall apart due to a single point of failure.

Teams aren’t like businesses?

How different is that from hiring carefully and having good process management at your business? Of course, that’s a trick question. It isn’t different at all. The products and outcomes are different, but the work of coaching (training), process management, recruiting (hiring) and so on are roughly the same. One of the things that Saban always mentions is their process. Google “Saban process not results” to see what I mean. A lot has been written about their process and Saban’s often vague answers about what many perceive as a “secret”. Hint: Hard work isn’t a secret.

Some people think that these teams are like a machine, and that businesses that operate this way are as well. In some cases, you might hear comments as if the machine-like behavior is a negative – like all the team members are like robots and can’t think for themselves. That’s fear talking.

If your best salesperson gets the flu the day they’re supposed to fly out to your most important trade show or customer meeting of the year, is it a good thing that the rest of your salespeople know the product and the pitch as well as anyone? Or does that mean your people are bots? Does it mean your company is well-trained, consistent, resilient, or “a machine”? Maybe it means all four – none of which are bad in the right context.

The benefit of everyone knowing the process (processes, really) is that you’re rarely shorthanded. You might not have your best player on the field (or on the trade show floor, or on the phone), but you still have someone who works the same way and knows all the steps. That consistency is critical to improving quality from one end of your company to the other.

Teach / document to learn

The best practitioners of your process (or parts of your process) can teach it. If they can’t teach it, they don’t really know it. They might give you some chest puffery and get all “I don’t need to do that”, but that’s their ego talking. Every time you teach something, you learn it a bit more, a bit better, from a bit different angle. To move toward mastery of a subject, try teaching it. You may think you know it already, but as soon as newbies start asking foundational, basic, “topic 101” questions, you’ll likely realize that you don’t know it as well as you thought. It’s service to yourself, to your peers, and to your business.

Documentation has the same effect, but in a different way. When you document a process, you’ll find that the memorized steps are often left out in the first pass. When someone follows your documentation (think of it as “testing”), you’ll almost certainly discover little decisions or questions were omitted.

You may get some resistance to documenting your processes. Yet professional pilots who have flown for 30 years still follow a checklist. They do it for a reason. Under pressure or when we’re in stressful situations, we forget things. We’re human.

Categories
Business model Competition Management

Leg wrestling with fire ants

If you’ve ever leg wrestled, you know it can be fun (among other things), but only under the right circumstances. You’d never want to do it on a nest of fire ants. Their bites would hurt far worse than almost any outcome from leg wrestling. If you absolutely had to wrestle on that nest, you’d put it off as long as possible. When you finally got started, you’d get it over with as quickly in order to minimize the pain and suffering. Making major changes in your business is not terribly different.

Kicking the can

Have you ever put off implementing a major change in your business that you know you have to make? If so, was it because you knew it was going to be difficult? Did you kick that can down the road because you weren’t sure if the change was going to work? The thing is, if you know the change needs to happen – it doesn’t matter if you aren’t sure about its chances for success. The mere fact that you know it needs to be done is a sign that your business is at risk. What’s scary is that you know deep down that not making the change is riskier than making it. But still, you put it off, which has a tendency to increase the risk.

Decide

With difficult things, the first step is usually the toughest. Sometimes the hardest part is making the decision itself. Once that’s done, many of us will focus and start to execute. You may find yourself wrestling with the fear of “breaking” your company, but if the position you’re in has you thinking about this, it’s probably already broken (if not badly bent). In these situations, waiting long enough (ie: too long) will cause someone or something else to make the decision for you.

A good example of such changes can be seen in the volume of businesses that have to re-examine how they get paid. It was incredibly rare 20 years ago for a company to use a subscription business model – except for newspapers, magazines and the like. Changes in advertising such as the loss of traditional classified ads, and the rise of digital marketing changed those markets. That, combined with a lot of foot-dragging re: the process of migrating to digital publication destroyed or significantly weakened many of those firms.

Many of these same changes have spread to businesses with traditional business models. Today, it’s steadily getting to the point where a non-subscription-based company is a rarity in many markets. While not all companies fit that model, those that depend on an ongoing creative and/or maintenance effort have little choice. The economics associated with buy-once, support-forever business models simply don’t work well in many markets where content and/or technology changes daily. They never really worked all that well in software and other rapidly changing markets, but the expansion of these “new” markets from zero to cloaked the economics for years. There was always a new client around the corner because of the growth from ground zero to whatever normal market penetration was for that market.

Blow it up & build it again

Today, many companies that were built over the last 20 years are find themselves struggling with the idea of moving to subscriptions. This, despite the fact that the economics are clear. The challenge for these companies is not only to migrate to subscriptions (or something other than front-loaded revenue models like buy-once-support-forever), but also to adjust their operations to a regular, well-planned deployment of value in the form of updates, fixes, and features over time. Without regular production in some form that produces recognizable value your customers want and need, subscription businesses will struggle to keep subscribers, and find it difficult to grow, particularly when competing with companies using low friction, subscription pricing that makes it easier to buy.

The changes may seem insurmountable, but the choice is clear: If you don’t blow it up & rebuild on your terms, someone else will force you to do it on theirs. Decide whether to live or die, knowing that no decision is still a decision. You simply have to make the decision, plan your execution, and press the start button. It will be hard, but not as hard as watching your market share shrink because you can’t fund the product development work needed to catch up, keep up, or ideally, move ahead. You get to decide your path.

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Categories
Employees Leadership Management

Do small teams need good leadership?

Smaller companies are seldom known for having good (or even great) leadership. This isn’t because small companies don’t have great leaders. Instead, it’s because they are rarely discussed. Someone might talk about the business owner with four employees whose home-grown consulting business is doing good work and growing steadily. But do we hear about her being an amazing leader? Not often. It could lead you to believe that very small businesses don’t need good leadership. Don’t fall for it.

Are YOU a great (or good) leader?

At this point, you might be wondering if you’re a good leader. It isn’t solely about having a good relationship with your staff. One way to see how effective your leadership is, is to leave the office. Does the office work better when you’re gone? Does the office get less done when you’re gone? Do the wheels fall off when you’re gone?

Some teams get more done when their leader is out of the office because the leader is a distraction. This usually takes the shape of interrupting the team frequently to check on project statuses. Sometimes it goes a bit further. If your people are regularly being asked questions about work you know they have the expertise to do, you’re probably micromanaging them.

Does your team understand the big picture? If a stranger asked them what their company does, would they represent the company as you’d hope? Would they describe the company in terms of their job? Would they describe the company in terms of the good they do and how they help their customers?

Does each team member understand why their work is critical to the day-to-day success of the company? Do they understand how less than ideal performance in their department impacts other departments and the overall success of the company? Do they know exactly what they are responsible for? Not “Oh, I’m sure they do”, but “Yes, they have specific deliverables, duties, and expected outcomes for each day, week, month.” Are these things discussed regularly with each team member?

Get rid of the gaps

If you’ve decided that you need to get better at leading your team – what’s the next step? Go back over the previous section. Become a much better communicator. Leave nothing to assumptions, which doesn’t mean “Be a nag.”

You might be thinking “My people know what they are supposed to do.” That might be the case, but the truth is probably different. I suspect if you sit down with each member of your team and discuss your specific expectations, there’s going to be some gaps between what you expect and what they think you expect. Is that fair to them? Does it serve you and the company well?

If you find yourself frustrated with a team member, think specifically about what’s frustrating you. Are you absolutely, positively sure that they know they should be doing whatever you’re frustrated about? Are you sure that they know exactly what your expectations are? “They should know”, you might think. If you’ve haven’t explicitly told them, they might have the wrong idea entirely. They might not even realize how critical a seemingly minor expectation is because you haven’t explained how their work fits into the big picture. Rather than stew about it, take a minute to discuss it with them.

Make sure your expectations match their understanding of the job. Be sure they understand how their work fits into the entire process. Make sure every department knows *exactly* what is expected of them. If even one of your expectations are unstated, that can fester into a bad situation. Unstated assumptions can kill a company.

Water that garden

If you plan to grow, you need to cultivate the crops you’ve planted. It’s no different with your staff. As your team grows, someone (probably multiple someones) are going to stand out as up and coming leaders for your team. The point is, this isn’t solely about your leadership skills. Your ability to grow leaders and get out of the way is key to your company’s future growth.

As you grow, I guarantee the team will eventually outgrow your ability to manage it. People who have studied leadership and management in the real world will usually quote numbers from five to fifteen direct reports as the limit of the number of people a single person can manage effectively. Don’t wait until things get crazy to make a move.

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Categories
Improvement Management Manufacturing

The benefits of speed

For years, Dan Kennedy has said “Money loves speed.” He’s usually referring to making decisions and implementing things quickly, rather than falling prey to “Good is the enemy of perfect” (among other things). This is not speed for the sake of speed, however. The benefits of speed in the right circumstances, under the right conditions, are worth examining. You may find that you can’t increase speed without negatively impacting quality or safety. In those situations, I’d pull back on efforts to increase speed. Below, I discuss a few situations and opportunities that I hope will spur some ideas that will help you find places to increase the speed of your business activities.

Military time… and yours

A tank that can be refueled in one hour is more effective against an enemy than a tank that can be refueled in two hours. The same can be said for equipment not used in battle, like your lawn service’s mowers, or a delivery truck – even though defeating an “enemy” is not your goal. Similar effectiveness can be gained from a mower that can run twice as long, either because it consumes less fuel per hour, or because it has twice the fuel capacity of a similar mower.

During World War II’s Battle of Britain, British pilots who survived being shot down in morning were frequently back in another plane and in the air defending England that afternoon. German recovery crews had to travel much longer distances to recover a pilot and get them back in action. In addition, they had to have long range fighters so that pilots could fly to England, attack, and return back to Germany. These speed, distance, and equipment requirements thankfully had them at a disadvantage.

Is there anyone who hasn’t been parked at a point of sale counter, hotel front desk, or similar as an employee waited on a computer to perform some task necessary to allow us to check in, complete a purchase, etc? Some companies seem to be on a never-ending quest to improve these experiences. They know that customers want the shorter wait times in line. They’ve seen customers get frustrated and leave a store due to long lines. Meanwhile, other companies seem to ignore these counterproductive point of sale speed and usability problems, much less the long lines they can cause.

Sometimes, you have to temporarily slow down in order to speed up. A wobbly wheel will shake a car (and its passengers) to pieces, make the car less safe to drive, and prevent the car from reaching higher speeds. Taking a few minutes to stop and tighten or change the wheel costs a few minutes, but pays off in safer, faster driving. A simple example, but it begs the question: What’s wobbly, sketchy, or less than dependable at your business?

Downtime

Downtime is a speed issue as well, since you can’t get much slower than zero. Every time you eliminate or reduce downtime, there’s a corresponding increase in speed. The great thing about downtime is that much of it is preventable, whether it relates to computers, processes, or boat trailers.

Downtime hides in places you might not expect. Electricity. Disk space. Oil. Anti-freeze. Drive belts. Spare drive belts. Tools in vehicles. Flashlights in vehicles. Better warehouse lighting. Better training. Prevention has a solid ROI. Ask your team about processes, situations, and equipment that fails. Remember – injuries count too. Your people know where the dangerous places in your business are. Ask them, not only for where these things are, but also for ideas on how to address them.

Supply chain problems have a way of creating downtime as well. When you run out of raw materials due to order errors, delays, mistakes, or really – any reason, production grinds to a halt. Zero speed, particularly in a production environment, has a high cost. If you send people home because you’re out of raw materials, you not only miss out on the work getting produced, you also risk losing skilled people who probably weren’t easy to find. Most supply chain errors are preventable. Your team can help identify ways to deal with these problems, so be sure to ask if they’ve seen these issues before and have been involved in resolving them. Either way, take advantage of their experience and insight.

There is one place where speed isn’t recommended: Hiring.

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Categories
Management market research Positioning Product management Sales Setting Expectations

Increase sales by making deployment easier

Everyone wants to sell more, yet few ask what impacts it the most: deployment. I had a long overdue conversation to catch up with Richard Tripp this week. His “POV method” is the best process I’ve seen for refining & re-prioritizing product focus. It’s based partly on finding out the number one outcome that the majority of your actual paying customers care about. Tripp calls this group of customers a company’s “center of success”. To my knowledge, use of his process has been limited to software companies – mostly SAAS companies. It struck me during a long drive yesterday that it could be used to improve the sales of any team. Teams with a deployed service or shipped product might gain the most.

Involve the whole team

The not-easily-impressed folks might think “Wooo, talking to customers – that’s a super new idea” and they’d be missing the point. Having been involved in many such efforts over the years – my experience is that the POV method is different & better.

It’s different in part because it isn’t about a group of VPs sitting around pontificating about things they’re disconnected from. Why disconnected? Because most VPs no longer spend time customers in the trenches. Even if you’re a owner/VP now, you weren’t always one, so you know what I mean. It’s better for the entire team to discuss progress together rather than in a series of silo’d departmental conversations. When everyone hears from everyone who has data / experiences to contribute, a much richer, more complete picture is the result.

One of the outcomes is the reduction of the pain and suffering required to adopt a product / service and substantially shrink / simplify the timeline from payment to “we’re getting the benefit we paid for”. I remember years ago watching the discovery process unfold during the early stages of a POV conversation about a group’s (non-SAAS) product.

During the discussion, a normally quiet member of the service / deployment team who spent all of their time with customers during the deployment process blurted out something like “Do you have any idea how frustrating our installs are and how long it takes our customers to go live with our software? At least three months!!

The product team’s reaction was shock and surprise, as you’d expect. Because management was part of the discussion, the project got immediate momentum. A substantial and cooperative joint effort between the product and the service departments to substantially pare down install / deployment challenges was the outcome – a small but high impact improvement.

Assembling a grill

Software deployment challenges are common, but deployment problems aren’t limited to software. The longer that the time-to-benefit period grows for any product or service, the easier it is for buyer’s remorse to take hold. If it takes 90 days to get your product or service producing, customers can lose sight of why they wanted the benefit.

It reminds me of buying a new grill, getting it home and putting it together.

If you’ve assembled a grill in the last 20 years, you know that the grill business needs some work. People buy a new grill because the old one finally rusted out, they need more capacity, or they’re having an event & need a bigger one. Most people don’t do this weeks in advance. They might buy the grill a day or two before the big event.

The likely result is one of those “It’s 10 pm on Christmas eve and I have toys to assemble” experiences. Instead of fitting together plastic parts, there’s sharp-edged sheet metal & screws that look alike but aren’t. Meanwhile, two people must hold the pieces in position so the third person can turn a few screws. Eventually, this pile of parts becomes something that will eventually cook a meal. Does it have to be this much trouble?

Imagine if the team(s) responsible for packaging, instructions, & parts watched consumers muddle through this process on a third floor apartment patio. Enlightenment is guaranteed. When a developer watches an end user use their software, it’s often painful because what seemed obvious almost never is.

Whether you make software, grills, or campers – your development, packaging, and deployment staff will learn important lessons simply by watching a few customers unpack, assemble, & deploy your product or service.

Photo by Matthieu Joannon on Unsplash

Categories
Business model Entrepreneurs Leadership Management Small Business

Small Business Scorecard

I’ve long focused on helping businesses one on one, by choice. From time to time, I’ve considered mechanisms (other than my writing) that provide help in a group setting. Ideally, this would let me help more people while not drastically increasing the time required to do so. Typically, this means holding webinars, group coaching, masterminds, ie: “one to many” events. This piece is intended to fill some of the gap between one-on-one help and one-to-many help, at least for now.

How we get help differs

When it comes to seeking help, business owners appear many forms. Some repeatedly seek help from people, books, and other resources. Others tend to accept help about specific topics, or when a resource is recommended to them by a trusted friend. Some read or listen to many sources of help / advice, but are pretty choosy about the things they implement. Some seek no help at all – and this group seems to be broken down into a group that knows they need the help but never take action, and another segment that simply figures it out on their own (or doesn’t).

Efficient learning varies from person to person. Some prefer reading, while others learn / retain more from audio, video, pictures and/or diagrams. Some people prefer brief information, others tend to consume “long reads” or extensive, highly detailed video. This time around, I decided to take a self-guided approach. I’d appreciate feedback on how effective the scorecard is for you – and why.

How the scorecard works

I’m calling this a scorecard, but the goal is not to arrive at a number and think “We got a 74, so we’re doing fine as is.” It’s more of a self-assessment & introspection tool. You’ll find statements about how things work in your business. You’ll agree with some. Others will have you thinking “That’s definitely not us.” If a seemingly-negative item on the list doesn’t pertain to you, cross it off. Look at the items you circled / checked as “yep, this is us” as a milestone on the way to a stronger company. Some may need recurring attention.

Marketing

  • Our marketing is completely automated across all media, digital or otherwise.
  • Our marketing is strictly digital. We don’t make sales calls, send US Mail, visit prospects, have prospects visit us, and we don’t go to trade shows.
  • Our marketing is strictly organic. We don’t advertise, other than having a website.
  • We test new ads against our ad that performs the best.
  • We market our work consistently.
  • We spent ad money effectively.
  • We have data that tells us what works and what doesn’t, marketing-wise.
  • Our marketing is executed based on a plan or marketing calendar.
  • We collect information about people who show an interest in our products / services.
  • On a regular basis, we reach out to people who have shown an interest in us. We send offers as well as useful information that will help them make a purchase decision.
  • In marketing dollars, we know how much it costs to get a highly-qualified lead.
  • In marketing dollars, we know our lead cost on each type of media.
  • For each of the media we use for marketing (radio, tv, newspaper, direct mail, various internet options), we keep track of lead quality, lead volume, and ad investment.
  • We decrease our marketing efforts / spend when the market is tight.
  • We use our lead cost to drive decisions about ad purchases – including internet ad options.
  • We increase our marketing efforts / spend when the market is tight.
  • We don’t really advertise with any consistency. You might say it’s driven by which ad salespeople call on us.
  • In our market, expertly-done marketing has ceased to become an edge. Everyone in our market is a good marketer.
  • We decrease our marketing efforts / spend in good times.
  • Most companies in our market are spray-and-pray marketers.
  • Some companies in our market are haphazard or random marketers, but there are some that we’d consider experts. They spend ad money effectively.
  • We increase our marketing efforts / spend in good times.
  • We’re one of the haphazard / random marketers.
  • We’re one of the more effective marketers in our market.

Operations

  • It feels like things “fall apart” a little when critical people leave, or are out of the office.
  • When the owner or manager are gone for the day, things seem more productive.
  • When a team member is gone, it’s easy to deal with their workload because we’ve been cross trained.
  • When someone is out of the office, it can be a little tough, but we have written process / procedures documentation to help us get the work done.
  • We rarely / never have to contact someone who’s out of the office to ask them how to do something, or to get online and help us deal with this or that.
  • When our front desk takes order / job status calls, they have to call back into the shop to get someone to tell them what’s up with an order / job.
  • We sometimes run out of the supplies / raw materials we need to do our work.
  • It’s common for us to contact someone who’s out of the office because we need help dealing with something they do.
  • Customers can tell when a critical employee is on sick, off that day, or vacation.
  • When a customer contacts us to find out the status of a job / order, any employee can easily and quickly find the info and pass it to the customer.
  • Customers can’t tell when a critical employee is out of the office.
  • We never run out of the supplies / raw materials we need to do our work.
  • We use a system to track and manage our tasks / work.

Business model

  • Our products / services are one-off. We don’t make something once and sell it multiple times.
  • Once we make tooling, we can make and sell the same item repeatedly.
  • We sell services on a subscription basis.
  • The business doesn’t generate income when the owner isn’t working.
  • We serve a vertical (narrow) market.
  • We sell products and service them, so ongoing reputation is critical to get returning customers.
  • If we’re not on the job and billing hours, we’re not generating revenue.
  • We serve a horizontal (wide) market.
  • Our market has already been disrupted / is difficult to disrupt.
  • Once created, our services have a marginal COGS so we can make something and sell it repeatedly.
  • Our customers pay us each month. We deliver / replenish consumable products / services.
  • Our market could easily be disrupted.
  • We provide customers with a service infrastructure.

Staffing

  • We’re always understaffed.
  • We have trouble keeping people, but they don’t tell us why they leave.
  • We have trouble keeping people. They tell us why they leave, but we can’t or won’t do anything about the things they mention.
  • Customers can’t tell when an employee is brand new.
  • Our people rarely do things together outside of work.
  • It takes a long time for us to hire someone because we’re careful to find people who fit our existing team.
  • Customers can tell when an employee is brand new.
  • We have trouble keeping people. We’re not sure why.
  • Few of our first line managers are familiar enough with the line employees’ work to take over for them in a pinch.
  • It takes a long time for us to hire someone because candidates are hard to find.
  • We’re overstaffed, but our workloads vary wildly so we don’t want to shrink the size of our staff.
  • Our team is a family – they frequently do fun / family / activities together outside of work.
  • Our first line managers could easily handle the work our line employees do, if they needed to.
  • We tend to promote from our existing staff.
  • We rarely promote from our existing staff.
  • Our team tends to be swamped one week, and might be sitting around with nothing do the next week.
  • Most of our team members are easily replaceable.
  • We have employees who have been here for many years.

Sales

  • Our sales team says they never have enough leads.
  • The sales team feels our leads are properly qualified when they get them.
  • Customers and prospects comment that our sales team was useful in helping them make a purchase decision.
  • Salespeople often comment that they’re getting leads who aren’t suitable for our products / services.
  • Our pipeline is difficult to confidently predict more than a couple of weeks out.
  • We have quotas, but we aren’t involved in deciding what they should be.
  • We close an acceptable-to-us percentage of sales when we have a highly-qualified lead.
  • I feel confident when I give a solid lead to one of our salespeople.
  • We have sales quotas – and we’re involved in determining those numbers.
  • We’re constantly under pressure to make quota – and we know it’s because the company’s cash flow is precariously low.
  • We get very few complaints about our sales team.
  • Finance is always bugging us to give them pipeline information, but we can’t consistently tell them anticipated revenue more than a week or two in advance.
  • Our sales team has an experienced leader.
  • It’s not unusual to get comments that our sales team is pushy.
  • Finance really appreciates that we can give them dependable sales pipeline info 30-60 days in advance, so they can depend on revenue in advance of receiving it.
  • Sometimes people send in feedback saying our sales team is more interested in closing a sale than they are about helping customers decide on a purchase.
  • We have more leads than our sales team can handle, but not all of them are well-qualified.
  • Our sales quotas feel like impossible expectations rather than achievable goals based on lead flow.
  • Our sales team is lead by the salesperson who usually sells the most.
  • We have more highly-qualified leads than our sales team can handle.
  • We believe that our product / service makes a significant improvement in the lives of our customers and as such, it is our obligation to offer it to as many qualified prospective customers as possible.
  • Our sales team easily handles all the leads we give them. They keep asking for more.
  • Most days/weeks/months, our sales team can handle the leads assigned to them.

Management / Leadership

  • You can ask any of our employees what motivates us as a company, or “What’s our why”. They all know.
  • Our people are an investment in our business.
  • We have to constantly watch our people to keep them working.
  • Our managers are all family members who learned to manage here – and it’s worked great for years.
  • Our people feel like a cost / expense.
  • Sometimes new employees have to wait to get a phone, desk, computer, tools, or a space in the shop. Those things aren’t always / usually available on their first day.
  • Employees know what our company long and short term goals are.
  • We’re an open book company.
  • Our managers are all family members who learned to manage here. I think the company would positively benefit from an experienced leader.
  • We don’t share any financial performance information with our people.
  • When a new employee get to their desk / work station / shop station on their first day, they have everything they need to get to work.
  • We have a 401K.
  • Team members don’t seem to connect their work with the company’s goals.
  • It takes new employees a few weeks / months to get their act together and become effective.
  • We routinely discuss the importance of 401K participation in our employees’ future.
  • Our financial performance is none of our employees’ business.
  • Any good manager could join us, learn our business, and be effective here.
  • Only our family can manage this business.
  • Our employees understand what makes our business profitable and sustainable.
  • New employees often comment about how good / refreshing our on-boarding process is.
  • We encourage our employees to educate themselves and offer ongoing training as well.

Finance

  • We know where the funds for our next payroll will come from.
  • We’re always on top of the required state and Federal reports related to employees and such.
  • Sometimes we have to pay our invoices late, but it’s not an every month thing.
  • We get paid late by our customers and it creates issues for us.
  • We don’t have receivables.
  • Our payables are always behind.
  • We never have any issues with state or Federal tax returns or deposits.
  • We’re always on top of tax returns.
  • If sales could deliver dependable pipeline numbers for the next quarter, our finance problems would disappear.
  • The owner / management hates accounting.
  • We’re always up to date on tax deposits.
  • We’re not very good at managing the company’s finances.
  • We tend to be late on tax returns. Sometimes we have to pay a penalty.
  • Managing our finances is one of our superpowers. We suspect we’re better at this than many other companies.
  • We tend to be late on tax deposits. Sometimes we are charged penalties / interest.
  • We do all our own bookkeeping and accounting / tax work.
  • Debt is an important ingredient in our ability to grow.
  • We do our own bookkeeping, but we have a professional handle the taxes and related paperwork.
  • We outsource bookkeeping.
  • We’re focused on eliminating debt for the long term, even though we know it may slow us down from time to time.
  • We have a professional handle taxes and related paperwork.
  • Our “numbers” drive strategic decisions.

Systems

  • We understand that “systems” might include automation, but also may include manual systems – such as checklists, documented work processes, job descriptions, manufacturing reviews, and similar items.
  • New employees learn our systems as they learn their job.
  • We’re gradually systemizing parts of our business.
  • None of our systems are “perfect”, but our imperfect systems save time, keep us on track, and help us avoid missed steps.
  • There’s one person who knows it all on our systems, but that’s it.
  • As an owner, I ask myself “Whose job is this?” every time a piece of paper crosses my desk.
  • Our systems are a strategic advantage. They make our work safer and more consistent. They help us produce a more consistent outcome for our customers.
  • We routinely review our systems with feedback from the people who use them. Reviews drive upcoming system improvements.
  • The nature of our business requires that we invent most or all systems ourselves.
  • We don’t have anything we’d call “automation” but we’re definitely a systemized business.
  • We have several team members working together to know, improve, and manage our systems.
  • Over time, we train new employees on all the company’s systems so that they help in any area if someone is out.
  • We understand that automation / systems can be leveraged in any part of our business, from management to finance to manufacturing, sales, and/or marketing.
  • We’re using systems and ideas that others have refined over time.
  • Systems (and particularly automation) are something we need in order to keep up with competitors. If we didn’t have to, we’d use as few as possible.
  • Our systems have been in place for years. We rarely change them.
  • Our systems are very close to ideal. We’ve worked hard to get there.
  • Our systems are difficult to change.
  • Our systems are a mix of commonly-known systems from experts and systems specific to our industry and/or business.
  • We train new employees on all the systems in their area.
  • Adding new systems to our work is easy.
  • It’s difficult getting new systems into our workflow.
  • When we hire people. we look for experience in systemized businesses and experience with systems like ours.
  • If we find job candidates with experience with systems unlike ours, we consider this useful as we might gain an edge from that differing background.

Photo by Dan Meyers on Unsplash