Categories
Entrepreneurs Management

Are you keeping up?

Are you keeping up? Gotten a bunch done over the last few months? No? What’s wrong with you? It’s not much of a stretch to think it may have riled up your imposter syndrome or maybe a small bit of regret at your lack of productivity vs. “the hustlers”. Take a look at what some people have done. If you make the mistake of adopting it as your standard of what you should have done during that period, then surely you should’ve done more. Taylor Swift created an entire album over a 16 week period.

What’s YOUR story?

Seriously, it’s OK. You don’t know what’s behind their curtain. It’s not the same as yours. You can work on that, but it isn’t the point.

If you read this somewhat often, you may wonder how you’ll get that week’s suggestion done (when pertinent). You might still be working on implementing something from a month ago. How are you going to keep up? Thing is, that isn’t the goal of this for either of us.

Have patience

When these things are discussed, my thought process is “I ran across this and/or I do this and it works. If you’re in a similar situation, it might help.” Perhaps you’ll use the info. Maybe you’ll implement some of these things in the future when you’re ready or when they’re pertinent.

Some of the things we discuss each week can’t be done quickly. No one, least of all me, expects you to do them all. Pick the things that make the most sense for where your business is at that moment (if you have time at that moment). Once you start one, keep at it. Don’t take your eye off the ball when seven more weeks of suggestions float by and you haven’t touched them. They don’t matter until they do.

Start fewer things and finish more. There will always be time to start something else once your current tasks are done. You aren’t the only one dealing with occasional chaos.

Many large businesses have the same problems yours has. Maybe the scale of the problem is different – but relative to them, the problems are the same, more or less.

They aren’t perfect either

Let me give you an example. There’s a software as a service (SaaS) vendor we use. As a SaaS vendor, the presumption might be that it’s a reasonably “modern” business that has its act together.

They didn’t bill us for 13 months. Yes… THIRTEEN MONTHS.

This is a large company compared to most small businesses. Yet simple things like getting an invoice out every month somehow failed them for 13 months (and not for the first time). Statements? Nope. Never. Not once in five years.

We were allowed to catch up with those invoices over several months since the lack of them was their fault. Eventually, everything got back to normal.

Before long, they were bought by a public company. Presumption: well-organized company. I mean, by definition, a public company has to have accounting under control, right?

16 months goes by. Still no statements. Most months, we get an invoice. At first, cashing our invoice check takes months, then things smooth out. Because we’re working on a new contract, they recently figured out that three invoices from last fall had not been paid. In fact, the checks had been stopped because they weren’t cashed after several months. We thought they were lost and eventually forgot about them (see, it happens).

They can’t start the new contract until those invoices are paid. We hadn’t received notice about them & soon they were forgotten. $40K of accounts receivable doesn’t typically get ignored when they go unpaid. Neither you or I would do that, but… it happens. We worked it out so everything’s fine. We really like the vendor & they provide quality service.

Stay focused

I tell that story because we’ve almost all had invoicing / follow up issues. You might’ve thought “we’re such a mess I’m never going to be able to do this right” etc.

Yet, the things you beat yourself up about are the same things a publicly held company sometimes does. It happens.

Maybe next week’s suggestion helps. Read them, think about (if) they can apply to your business – but don’t lose sleep over them.

Do the best you can. Improve consistently. Slow is OK, just keep improving.

Photo by Jukan Tateisi on Unsplash

Categories
Entrepreneurs Leadership Management

React, respond or rebuild

What’s on your agenda these days? Whether your business is scraping by or flush with cash, you’re probably spending a little bit of time thinking about the future. Which future would that be? Next month, post-tourist season, post-COVID, or some other future? You might be thinking about how to react to this or that, or how you’ll do business until COVID is over, or something else more specific to your business and how things may have changed since mid-March.

React vs respond

The difference between react and respond has been on my mind a lot lately. The challenges businesses face don’t change all that much, until they do.

Remote work is a great example of this. For decades, “managers” insisted remote work couldn’t be done at their business. Suddenly, in the space of weeks, remote work somehow became possible. To be sure, it’s a challenge when you have a house full of kids, but a lot of people have made their way through that maze to a productive place.

When someone who manages people working (most) desk jobs says “We can’t do remote work”, it’s usually a reflex reaction to a perceived threat – the loss of control (as if they have ‘control’). Control is rarely what anyone thinks it is, if it exists at all. “How will I know if they’re working?” is another decades-old symptom of this.

Getting back on track, when you react, it’s typically a reflex. A reflex action logically gives control to whatever stimulated that reaction. While there can be a measured reaction, for the purposes of this discussion, I’m calling a reaction something you do that’s driven by instinct or reflex. In other words, the fight or flight amygdala is driving based on a perceived fear, even if you aren’t escaping physical danger.

When you respond, it’s something planned, measured, and (hopefully) well considered – again, defined for purposes of this discussion.

The future’s on our minds

The future might be on your mind. Is your business facing challenges that could kill it in the next quarter? The next five years? The next 20 years? Your company’s ability to deal with the speed of change might be involved, or it might be something simple like a technology you depend on that’s likely to be displaced over the next decade.

You might not care about that when it comes to forecasting next quarter’s revenue, but it could definitely impact the valuation of your business for sale in a decade. It’s easy to wave that off today when you’re worried about making your nut this month. Trouble is, these things can’t be planned for or implemented overnight. They require consideration well in advance, particular for the large number of business owners who view the sale of their business as the source of funds for their retirement.

Assumptions vary in quality

The quality of your consideration before a response occurs is everything. A lot of our consideration during this process is based on assumptions. Your assumptions might be good, true, dated, false, dogma-driven, ego-driven, and so on.

Question every single assumption that drives your plan / direction for the future. It’s painful when you find one is no longer true, but it’s better to learn that today than five years from now.

Is something still profitable? Prove it to yourself. Is something not profitable? Prove it. What should you stop doing? Does the data back up these assumptions?

Take everything down to bare metal. Make it prove itself true or false, valuable or not.

Once you arrive at what you think are your truths about the business / market going forward, it’s time to assess your current solutions and decide if they get to come along as you move toward the future.

What about rebuild?

One thing we haven’t discussed is rebuild. Going back to the assumption discussion, what if all your assumptions, experience, and knowledge are signaling a future much different from today? What’s your next step? It might be rebuild.

A rebuild is a form of response, and it’s also a longer term effort requiring even more consideration about what is, what no longer is, what never was, and what your forecast as what will be.

This thought process can be useful when things get tough, really bad, or perhaps a little weird and you’re trying to figure out how to move ahead given your forecast of whatever you think life looks like around the next curve.

Photo by sangam sharma on Unsplash

Categories
customer retention Customer service Getting new customers Management

Eliminate customer service

What would happen if 80% or even 90% of your customer service calls went away?

Wait, what?

Oh, I know. You’re proud of the quality of your customer service. I suspect that if I asked your customers, they’d tell me all sorts of great things about how you took care of them, fixed a problem, have a wonderful service team, wear Tyvek shoe covers into their home, etc.

That’s good. Great service is important – right down to the shoe covers. So important that we’ve discussed it repeatedly. Thing is, there’s something better than great service: Service you never have to give because your customers never needed it.

I’m not talking about providing no service at all. I’m talking about taking steps to ensure that the amount of service you have to provide to resolve problems is tiny. Not just any problems – simply the preventable ones.

Damaged during shipping

Outside of very serious package damage that sometimes happens in transit, imagine if you no longer had to provide customer service related to a shipped item showing up broken. You can’t prevent incidental breakage, right?

Let’s try. Have your team back a box like they usually would. Go upstairs in your shop. Ask your shipping team to watch from outside as you toss that box out the window. Did anything break? Pack it better. Did the box crush? Try a better box. Wash, rinse, repeat. If your team is watching, they’ll have ideas to get it fixed. You won’t have to test anymore – they’ll get it and take over.

Obviously, if you ship heavy items that will always break the box during a fall like that, a different test makes sense. Your service and shipping departments probably know what kind of damage is in that 80-90% of damage claims.

If you can eliminate 80-90% of the “my stuff arrived and it’s broken” customer service, how much labor, time, re-work, COGS, repacking expense, reshipping expense, employee frustration, and customer first impression damage can you save?

Some of that will fall to the bottom line. Increased margin. More profit without making a single additional sale. No one wants that, right?

It’s a simple example, and perhaps one that you’ve explored because there are hard costs and well, it’s pretty obvious. But did you take the idea further?

Eliminating service

Eliminating service may not seem obvious – even if you’re service improvement oriented. Many of us focus on optimizing support responses and minimizing support ticket turnaround times, only to completely forget to see what could be eliminated, rather than simply working toward making our responses better and faster.

So, back to the original question. What would it take to eliminate 80 to 90 percent of your service “events” in a few departments? What if you only manage to eliminate 50% or even 20% of these events across a few departments? It adds up fast – it’s all overhead.

What could the staff who currently handles these service calls get done that would help the customer (and your company) even more?

Ever have to go back to a customer site to fix something that didn’t get done right the first time? Ever have to go to a customer site to fix something some other company messed up? How does this impact your customer retention? Referrals?

Getting it right the first time is a competitive advantage. Every visit to a customer’s business or home wastes their time and increases the cost of whatever you do – both to you and them. It increases the likelihood that they’ll call you again, much less refer you to a friend who needs the same sort of work done. This isn’t about their desire to help you. If they refer you, it’s because they want to recommend someone who is going to help their friend have a good experience. Otherwise, no referral will come.

Eliminate friction

Preventable problems are the kind that create friction. Friction that slows down adoption of the product or service you sold them. Friction that increases their frustration with something they just purchased. Friction that creates negative first impressions. Friction that creates second thoughts and buyer remorse. Friction that slows down payments.

These problems may seem out of your control, but they aren’t. They may seem may seem expensive to fix, but their prevention saves money in the long run. What service can you drastically reduce or eliminate and in doing so, create a better client experience?

Photo by Clark Young on Unsplash

Categories
Employee Training Employees Leadership Management

On being essential

Is your business “essential”? I don’t mean the Federal distinction. I mean in view of those who you serve, because those are the only ones who matter. No matter how bad the economy or anything else in the future might get, is your business serving essential needs for your clients?

Essential people

The people you’ve hired are a big part of what makes your business essential to your customers. Finding, keeping, and training people who love to take care of your customers is real work. Taking “good care” of them includes training, coherent management, “real wages” and benefits.

A business doesn’t pay “real wages” and benefits because someone else wants them to. They do it because it puts their team at ease, allowing them to focus on the quality, speed, and value of their work. A team that’s not worried about their job has more headspace to attend to their work. It puts a fence around them, making it hard for others to poach them.

Essential customers

Reach out to your very best customers. Call them or write an email that’s very clearly personal and not mail merged. Find out what their concerns are. Do they assume you’re going to be around? Remove any doubt. If you’re having problems, be square with them. You should be asking them if there’s anything causing critical problems right now. Are they things you can help with? Tell them specifically how. If you can’t, can you suggest someone who can? Be the one helping, not the one just trying to make a transaction happen.

You probably know the customers who are most on the edge. What can you manage to do for them? Even a small gesture that buys them a little more breathing room is worthwhile and will certainly be remembered.

Made in your image

When I see a company doing things that make them less essential than they could be, I tend to break down what they do well and what can they do better. In many small businesses, the capabilities and behavior of the businesses mimic the capabilities and behavior of the owner. Most owners are essential to our business – at least until our business matures. Some of this “made in your image” thing is good. Some isn’t. I battled it for years, as many of us do. One of the battles was over bookkeeping.

I’m not a fan of accounting. Accountants are fine. The actual work of accounting and bookkeeping always made me crazy. I know, I know. Seems silly given what I do. It is. Ever have one of those things you know you need to get better at even though you really don’t like it? That was accounting for me.

The thing is, accounting isn’t there solely to keep the tax man happy. The quality of your business decisions will improve substantially as your understanding of your numbers improves. No, I don’t mean the tax code and all of that. I mean the numbers that fall out of day to day operations. They all fall to your books. They’re metrics, but not the normal kind I talk about. Lots of metrics tell a story – and accounting does too. If you don’t listen to the numbers (including the accounting ones), the story won’t go how you want it to.

Mirrors reflect everything

I tell this story to reinforce that my company was a direct reflection of me during my “bleah, accounting” phase and that was not a good thing. It was important to work on (or delegate) the things that I don’t want to be reflected from me. Becoming essential means doing those things for your business.

Unless you’ve worked at it, your business reflects the things you’re good at, as well as those things you need to work on. The mirror reflects everything in front of it. Your business doesn’t have to, but you have to make a conscious decision that this is going to happen.

You have to choose which of your behavior your business reflects and which ones it does better than you. This will, of course, require some delegation or some training, or perhaps both. For me, it was both.

Customers decide

Your customers decide whether or not your business is essential to them. The behavior of your company and the value it provides to your customers is how they decide.

Photo by Faye Cornish on Unsplash

Categories
Business culture Customer relationships Entrepreneurs Management

Predictions, models, tramps, & thieves

I know, you weren’t expecting a reference to Sonny & Cher.

Technical people (programmers, doctors, scientists and the like) aren’t typically considered to be good communicators to the public at large. Good communicators like Bill Nye and Neil DeGrasse Tyson stand out because they’re adept at explaining very technical subjects in a way that’s understandable to everyone. Sure, they have time to prepare, but that doesn’t guarantee content everyone else can understand.

This is one reason why we’re so frustrated with the inaccuracy of “predictions” about things like weather, fantasy football player performance, stock market behavior, hurricane tracks, asteroid paths, and COVID impacts.

How many science-y people in these roles are saying something like… “This is a model. This is how models work. A model is not a promise. It is a set of results from a bunch of calculations based on the data we have today – and the data we don’t have yet. When the data changes, the results coming from the models will change.

The lack of this kind of communication causes modeling to be devalued by everyone else.

What you don’t know

Data changes rapidly – weekly, daily, hourly. Some of today’s data could be inaccurate. We may not know that until tomorrow’s data arrives, or a sensor fails.

Consider hurricanes. Hurricane models “predict” their path & severity. The output changes as variables are added /changed / deleted, and as varialbe importance changes. As the hurricane gets closer to shore (or as the time to make your third round draft pick nears), models become more accurate because there are fewer variables, & the possible range of still-useful variables shrinks.

What don’t we know?

When Donald Rumsfeld was Secretary of Defense, he was asked about then-recent discoveries about WMDs in Iraq. The questions were legitimate as was his answer, though he was mocked for it at the time.

“Reports that say that something hasn’t happened are always interesting to me, because as we know, there are known knowns; there are things we know we know. We also know there are known unknowns; that is to say we know there are some things we do not know. But there are also unknown unknowns—the ones we don’t know we don’t know. And if one looks throughout the history of our country and other free countries, it is the latter category that tend to be the difficult ones.”

Donald Rumsfeld (2002), speaking as U.S. Secretary of Defense

Anyone who has worked with business metrics, science, or fantasy football knows that he was right.

Despite this variability & the knowledge that tomorrow could look much different, we often have to make decisions using today’s data.

Predicting people performance

If you’re trying to predict the performance of a NFL player, it’s equally difficult. We know a player has a 44″ vertical, runs a 4.2 second 40 yard dash, and is a three year All-Star (and more), yet we still can’t accurately predict his stats for next game.

We don’t know that his mother is sick, or that a tiny injury is bothering him intermittently. We might not notice tiny performance differences that affect a game’s outcome. Perhaps only the player who covers him will notice.

After the game, the coach might tell the press that they called different plays “because he’s hurting a little bit” as a ploy to distract their next opponent. It’s Rumsfeld’s “unknown unknown” to most of us.

You don’t know when you draft a great quarterback that you’ll lose him for the season in week seven because he tripped over his own feet during practice. Likewise, if you don’t know your best salesperson’s mother has terminal cancer, you won’t know that (or how) it affects their work.

Will models help you?

How’s your team? Is anyone challenged by something that impacts them like a nagging injury? How distracted would you be in that situation? What would help you? What needs do your people have that they don’t normally have? How can you help? Can they help each other?

What aspects of your clients’ performance could be predictive? What data is indicative of their performance? What *was* indicative but has changed? What don’t you know? Have you checked in with them? How can you help? Can they help each other?

Can performance modeling help you see performance changes earlier? Can models help you make better decisions earlier?

What don’t you know?

Categories
Leadership Management

Be Prepared on Main St.

If you believe the folks randomly interviewed on the news, it doesn’t seem like anyone’s too worried about COVID-19 here in Montana. How they shop tells a different story: people want to be prepared. I recently found the TP section of Wal-Mart all but empty. Costco was out of TP except for the big public restrooms rolls. Same for the 20 pound bags of rice (Costco-wise). I mention this because ignoring the need to “Be Prepared” (the Boy Scout Motto) isn’t advisable in your business life any more than in your personal life – even if you weren’t a Scout. To that end, a friend sent me a link to a founder/CEO advisory sent by the Silicon Valley venture capitalist firm Sequoia Capital. Print readers, see https://medium.com/sequoia-capital/coronavirus-the-black-swan-of-2020-7c72bdeb9753

The Sequoia advisory was aimed at founders and CEOs of firms they’ve invested in, yet they kindly shared it with everyone. They called it (paraphrased) “guidance… while dealing with potential business consequences of the spreading effects…“.

If you read it, bear in mind that it’s targeted at founders and CEOs at startups, not necessarily at Main Street businesses. Still, much of the guidance applies to local business, so I used a little editorial license to adjust their guidance for Main Street.

Challenges being faced

They listed drop in business activity (sales), supply chain disruptions, curtailment of travel, time to containment, recovery time for the economy after containment. All of these things could impact Main Street. For non-tech businesses, the supply chain is the one that concerns me. Stay on top of this if you depend on Just-In-Time suppliers.

Cash runway – Most Main Street businesses don’t have a Silicon Valley style runway. They have receivables & payables and the only investor is often the owner. If you have a line of credit to smooth out the bumps, have a cup of coffee with your banker. No one likes surprises – and that goes for both of you. Two-way communication is critical.

Fundraising – Few Main Street businesses are concerned about raising another round of capital, but the thought of forging partnerships during difficult times is wise, even on Main Street. As the advisory noted, “Constraints focus the mind and provide fertile ground for creativity.

Sales forecasts – While this paragraph is brief, it’s important. Customers may delay payments because they’re being paid slowly. Be prepared, communicate often, assume nothing.

Marketing – While I agree that care is needed (where the advisory says “rein in customer acquisition spending” and “raise the bar on ROI for marketing spend“), events like this cause some companies to freeze. Fear has them not marketing as hard (or worse, not at all). Fear-induced contraction can become self-fulfilling, causing business to soften because they took their foot off the gas. Even if your spending is curtailed, don’t stop marketing altogether. If you invest carefully, you could pick up some business you might not otherwise have gained.

Headcount – While it’s just slang, I detest this word and its cousin “Human Capital”. As if we’re thinking “Hey Buck, back that skid of human capital up to the loading dock, will ya?“. Let’s take a different angle at this. Your people are going to be scared, or at least, worried. They’re worried that you might cut their hours, or cut them loose entirely, much less that the business might fail. People don’t respond well to surprises. Communicate early & often. If you have an emergency fund or cash buffer that has you ready to make payroll despite a bumpy three or four months, tell them sooner rather than later. Their concern will impact their behavior. You don’t want that.

If it starts to look like making payroll could be tough a month from now, don’t wait to tell them. I know, I know, you don’t want to lose them, so communicate carefully and honestly. Be flexible & creative. Find a win-win to help them stay that helps you both, even if part-time. When things get rolling again, you don’t want to be the business who can’t hit cruising speed due to an inexperienced staff.

Capital Spending – As Sequoia noted, keep your powder dry.

Leadership – They hit this for a couple of paragraphs because it’s important. Depending on how things go over the next few months, your checkbook and your leadership could be tested. Your actions will send a message to your entire community.

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Categories
Leadership Management Project Management

Make a game plan, then work it

We’ve been mulling change, prioritization, and getting important tasks done. It’s time to get serious before the holidays distract you. When they’re over, having a ready-to-start game plan will help you get a solid start on the new year. Question is, what should be on your game plan?

Big rocks

We’ve all probably heard the story about putting the big rocks in the jar before adding pebbles, sand, & water.

The story resonates because we remember a time when we left the big rocks till later & then disappointed someone by missing a deadline, or being unable to fulfill a commitment.

These disappointments, failures or what have you often happen at least in part because we didn’t deal with the big rocks first. Old news for Covey followers, but worth a reminder when making a game plan.

A game plan of three things

I suggest starting with three big tasks. Looking at the list of tasks you want to accomplish in the next year, which three should have the most impactful and positive strategic result to your company over the long term?

Think about it. Discuss it with your team. Decide.

Consider the possible causes of failure. Some call this a “pre-mortem”. Make sure your game plan includes steps to defuse these issues or prevent them from becoming a problem. Think about the essential accomplishments needed to complete these tasks. Make sure everyone knows what these points are & that someone has direct responsibility to monitor them.

Painting the building may not be one of your three things, but it could be. I can recall on more than one occasion seeing a restaurant whose building had clearly been ignored for many years – and wondering if they handle food safety with the same level of care.

Up next – figure out how long these tasks will take. You need to know if your game plan is reasonable. This is not the place for fantasy.

On guesstimates

People are terrible at estimating how long a task will take. Eventually, some figure out a system for accurately estimating how long work will take because they got burned, fired, etc). This is particularly true in the technology business, but we aren’t alone.

Why is that?

We’re too optimistic about the pace we can maintain. We rarely bother to consider that we may run into an issue that we’ve not dealt with before – and the research, work (plus rework) & testing to resolve it takes time. These episodes don’t typically happen just once in a big project – which we also don’t consider.

We often discount the possibility of interruptions for urgent tasks that, while not of high importance, still must take precedence for a few hours or day. Naturally, we forget how many times this has happened based on our history, industry, team, etc.

Some folks estimate something, then “double it and add four”. Maybe that builds enough buffer into the estimate, but it’s still a wild guess with little more than gut feel to back it up. “Double/triple it” is a pretty good indication that you put insufficient thought into your estimate.

In some environments, you’ll find people will give an “instant” estimate to stop the “How long?” questioning. “You need to do this, how long will it take?” doesn’t usually have a legitimate answer when the task was unknown to you five minutes earlier. Saying “two weeks” without further introspection is simply avoiding persecution… temporarily.

It takes thought to produce a reasonably accurate estimate. This isn’t about making estimates correct to three decimal places. It’s about being reasonably close.

If you promise completion on January 15, you need to have confidence in that date from day one. If you know from the start that you’ll never make the date, don’t know if you can make it, or can only make it if everything goes perfectly – you’re asking for trouble.

Work backward

Big tasks should be broken down into pieces before you can estimate them. Starting from task completion & working backward helps us remember steps we might otherwise forget.

Estimate your list of steps. Break down steps estimated over four hours & estimate the new steps. Four hours seems extreme, but it’s a timeframe we can wrap our heads around. In your line of work, maybe it’s four days. You know where your estimation accuracy really shines.

Make a game plan. Work your plan. Get big things accomplished.

Photo by Christian Erfurt on Unsplash

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.

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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