When your Financials speak

ListeningIf you were your company’s financial reports, would you feel ignored and disrespected? Or even worse, would you feel irrelevant? This may sound weird, but your financial reports have “feelings” too. They can feel strong, healthy and full of vitality. Likewise, they can feel sick, anemic, and in extreme cases, near death. And just as when your child is not feeling well, all you have to do is pay attention, understand the signs, and “listen” to what your financials are telling you about their past, current and probable future condition.

Entrepreneurs tend to view themselves as visionaries with the passion and drive to chase their dreams and build a company. It doesn’t matter if that company is a one-person enterprise or a multi-location behemoth with hundreds (or even thousands) of employees … all financials speak the same language and share the same vital signs.

Consumed with the passion and drive to grow a company, too many entrepreneurs simply ignore or avoid their financials. Some say they’re just too busy and that there is no time. Some claim “numbers phobia” as if reading financial reports is some form of mental torture. Many simply never had the proper training to understand the very simple language that financials speak. The fact is, when it comes to your company’s financial reports, sooner or later what you don’t know or understand IS going to hurt you.

Over the years, I’ve met many extremely bright and talented entrepreneurs that live in a perpetual cash crisis simply because they refuse to listen to and understand their financial reports. Forcing a business to live on the brink of insolvency and financial disaster is the most stressful, debilitating and depressing way to run a company. The good news is that such an existence is completely avoidable. All it takes is some financial literacy training and discipline.

Here are some No-Compromise insights on financial reports and how to truly listen and understand what they’re saying:

  • It’s about stuff: All financials speak in terms of assets, liabilities, equity, income, expenses, profit and the increase or decrease in cash. Your company owns stuff, owes money on stuff, has equity in stuff, sells stuff (products and/or services), and spends money on stuff – all with the intent of making profit on that stuff. The objective is to accumulate stuff (assets in the form of cash, inventory, equipment, etc.), manage your liabilities (payables, credit card debt, loans, etc.), and create equity (when assets are greater than your liabilities). The profit part is easy – spend less than the income your company generates. Okay, you’re probably thinking, “Neil, you just told me the obvious.” My response is, “If it’s so obvious, show me your double-digit profit and impressive cash reserves.” Knowing financial discipline and living it are two entirely different things.
  • Financials tell the truth: You’re either making profit or you’re not. You’re either creating equity or you’re not. Your payroll is either manageable or it’s not. Your cost of goods sold is either within benchmark or it’s not. Either you can pay yourself or you can’t. All it takes for your company to be profitable and financially healthy is understanding and controlling a couple of critical numbers. If you don’t know what your critical numbers are, you’re driving your company financially blind. It doesn’t matter how big and impressive your company appears to others if just behind the curtain is a financial train wreck burdened with debt. Listen to and understand the truth your company’s financials are trying to tell you.
  • Perpetual numeric readout: Your financials are a perpetual numeric readout of your company from its birth to present day. That means you have a wealth of historic financial data that allows you to identify problems and potential problems with extreme accuracy. With today’s technology and applications like QuickBooks, there is no reason or excuse not to have accurate and timely financial reports in the form of a current Balance Sheet (Assets = Liabilities + Equity) and Profit & Loss Statement (Income – Expenses = Net Profit). At Strategies, we run a full set of financial reports every Thursday … and we’ve been doing this for 21+ years. It only takes a few minutes of each week to identify which numbers are heading in the right direction and which numbers are not. If you’re waiting weeks to receive the previous month’s financial reports, you’re waiting too long.
  • Cash is more than king: Managing cash and building cash reserves isn’t luck … it’s 100% discipline. Every day, every month, your company experiences an increase or decrease in available cash. In addition to your operating checking account, the simplest set up is to have a savings or cash-reserve account. Set aside a certain percentage of weekly or monthly revenues and squirrel it away in the reserve account. Start with 5% of income and see how you do. In more profitable months, keep feeding your reserve account by transferring cash that exceeds your operating expenses. This is especially necessary if seasonal gift card sales are a factor in your business. Spending incoming gift card cash today can set you up for a cash crisis when the redemptions come in and the cash is already gone. The cash management game is all about discipline.
  • The insanity of checking checkbook balances: The fact is that money in your checking account is rarely “available cash” because of checks written that haven’t yet cleared. If you are constantly online checking how much cash is in your checking account in order to decide which bills to pay…your company is already deep in financial crisis. Checking account balances are for reconciling your checkbook – not for financial decision-making. If this describes anything close to how your company operates, you need immediate help in the form of financial coaching.
  • The infamous “Cash-Flow Plan”: At Strategies, we’ve been teaching and coaching owners on how to create and live a cash-flow plan. Unlike your financials that are historical reports, your cash-flow plan is a forward-looking monthly projection of revenues and expenses. We fondly call it your “Boss.” Some owners call it “Flow” … as in, “I need to ask Flow if I can afford it.” And after 21+ years of teaching and coaching cash-flow plans, it is still the one discipline with which too many owners wrestle. Those that embrace the cash-flow plan turn losses into profit and cash into cash reserves.

When your financials speak … listen. No Compromise!

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If there were nothing but green lights

green_lights-#1There are specific milestones in our lives when vision, determination, ambition, self-confidence and opportunity collide in ways that explode all the fears and obstacles that seemingly lay before you. These are the transformative moments when you step willingly into the unknown and take responsibility for your own success. It’s like driving to a destination with nothing but green lights before you. You become so positively charged that you overcome and break through the negative resistance that accompanies all bold journeys. And when you encounter the inevitable setbacks, you simply push harder until you’re back on your intended course.

The truth about these milestones is that you have total control over when and how often they occur in your life. Your current reality … better known as your life … is what keeps milestone moments at bay. You don’t have the time or money. You give the risks more energy than they deserve. The goal you want to chase will meet resistance from those you lead so you discount its value. The confidence busting “what if it doesn’t work?” question eventually starts changing all of your green lights red.

I’m not suggesting that you charge off to conquer every potential opportunity set before you. There are many opportunities I’m thankful I didn’t chase … and some bad ones that I wish I never did. But there are certain opportunities you know are right and yet you allow them to fizzle for all the wrong reasons. Usually it’s due to fear of failure, overwhelming self-doubt and natural resistance to change.

Here are some No-Compromise strategies to create more growth milestones for yourself and those you lead:

  • Create your own “perfect storm”: You don’t have to wait for a crystalized vision, or for determination, ambition, self-confidence and opportunity to collide. Some people wait a lifetime for that perfect storm to happen – if it ever does. If you want a better tomorrow and greater success, make your own perfect storm. Begin by focusing on the outcome or opportunity … not the endless list of excuses of why you can’t and why it won’t work. Excuses are red lights that stop progress entirely, killing necessary changes and opportunity initiatives.
  • Let it bake a little: New opportunities and ideas need time to bake in order to see and understand them clearly. Simply put, trying to communicate a half-baked idea is a sure-fire way to have it picked apart and shot down. New ideas and opportunities all begin with a desired outcome. That’s the easy part. The “let it bake” part means crafting the strategy for your goal in order to articulate it to others so they understand and buy into your thinking. Achieving buy in gives your opportunity traction.
  • “Green light” thinking: What would you change in your company right now if you could count on no resistance or push back from your team? What would you do if the naysayers were forever banished from your world? The short answer is that you would become a fearless leader with a level of momentum that nothing could slow down. The fact remains that resistance and push back are a part of every change initiative. And like duck hunters, the naysayers are just waiting to shoot your idea down. Green light thinking is about not getting stuck or shot down when you encounter resistance and negative “that won’t work” feedback. Yes, you must listen to and process the caution tape … but you will never achieve a transformational career, business or life milestone if your commitment to achieving your goals is not rock solid.
  • There are no do-overs in life: We all get one shot at creating our own growth and opportunity milestones. I’d rather rack up a collection of milestones that I can look back on and be proud of than end up a grumpy old man mumbling, “Should-a, could-a, would-a”. Make your own green lights to clear the way toward achieving your full potential. Make your own green lights to instill the confidence and determination to do whatever it takes to be the leader you are capable of being. Make your own green lights, and you will inspire others to believe in your vision and go the distance with you.

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Leaders are always a work in progress

work_in_progressOver twenty-one years ago, I founded Strategies to coach and train business owners in the disciplines of leadership, performance and growth. I am proud beyond words of my company. In 2008, I wrote a book called No-Compromise Leadership. It won the 2010 IPPY Award for business and leadership. I am also proud beyond words of that book. Guess what? After 40+ years of doing classes, keynotes, countless articles, three books, and coaching leaders … not to mention writing 354 Monday Morning Wake-Ups … I am proud to say that as a leader, I am still a work in progress. I still have much to learn and many disciplines to master.

One of the most challenging aspects of coaching leaders is getting them to lower their “shields” and objectively assess their leadership abilities. Most often, a leadership coach is hired to “fix” problems, which typically means that the leader wants us to fix people (the culture), financial challenges and performance issues. But all business challenges occur on the leader’s watch. The leader is always the common denominator – the one constant in every situation. That’s what I try to explain to a potential client when he or she says, “I’ve hired coaches before and nothing ever changes.” My response is always, “You are correct. Nothing will change until you, the leader, change first.”

It’s revitalizing to be a work in progress because it opens up a world of opportunities that cannot exist when a leader’s shields are up and closed. Every leader has a unique collection of beliefs and behaviors. There is no one-size-fits-all strategy for upgrading who you are as a leader to No-Compromise status. Some leaders are open to new ideas, systems and concepts. There are leaders who recognize that their skills and abilities need improvement, and these leaders seek out the best education, mentors or coaches to help achieve that end. In contrast, there are leaders who are extremely closed off to new ideas and reject any attempts to change their thinking. Their minds are locked and inaccessible … and they prefer to keep it that way.

For leaders, few challenges eclipse the need to objectively examine one’s basic beliefs about leading people. Leaders must do this in order to harness and organize collective efforts and achieve the right outcomes. Beliefs act like an internal guidance system. It doesn’t matter if you’re headed in the right or wrong direction; your beliefs are what keep you on course. For a leader to change his or her beliefs requires an extremely high level of openness and contemplation. But, I caution you – no matter how open you perceive yourself to be, your beliefs will continue to filter and reject conflicting input and data unless you truly allow your mental shields to come down.

To become a No-Compromise Leader (and stay a work in progress), you must unlearn many of your past practices.

  • You must find innovative ways of challenging your beliefs, so you can be open to new ideas and opportunities.
  • You must create your own compelling value proposition for change. Begin by answering two simple questions.
    1. If you continue your current leadership thinking and behavior, will you ever achieve the results you seek?
    2. If you change and adopt new leadership thinking and behavior, what would the possibilities look like?
  • You must avoid resisting new ideas, concepts and points of view that differ from those that supported your past successes. What got you here could be obsolete tomorrow.
  • You must adopt a mindset that helps foster more fulfilling relationships in your organization. Lead to serve. Lead to win.
  • You must believe that it’s not only possible to find a more enlightened path as a No-Compromise Leader – it’s your responsibility to your company, your employees, your customers and yourself.

Knowledge can be defined as information organized in a framework that renders that information useful. Simply put, it might be that your context for viewing information about leadership is significantly reducing, or even preventing, its effective use. Very often, your mindset stands as an invisible shield to innovation and learning. Your mindset can make you informed, but not knowledgeable. To become more knowledgeable, you will have to accelerate a process of self-examination and resist the temptation to seek simple answers. To accomplish that, the No-Compromise Leader must keep his or her ego in check. Otherwise, any attempt at self-examination will be pointless.

CONCLUSION: “Open” leaders are receptive to the perspectives and points of view of those they lead. Not everything you hear may fit in with what you want for your company, but there are always new insights to be gained by listening. “Closed” leaders are just that – closed to the opinions, perspectives and points of view of those they lead. Closed leaders are more “command and control” … and therefore are inflexible and resistant to change.

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Founders Fatigue Epilogue: To become reinvigorated

invigorateMy Founders Fatigue MMWU of a few weeks ago not only hit its mark, it pushed some owners to recognize that they have Founder’s Fatigue and inspired them to do something about it. I was glowing as I read one such email from a husband and wife team that own a wildly successful, six million dollar company. They attended a Strategies Incubator prior to opening in 2003 and have grown a model Team-Based Pay company ever since. Their words were inspiring because no matter how successful a company may be, owners and leaders are always susceptible to Founder’s Fatigue.

Their email said, “We were suffering from Founder’s Fatigue and badly needed the shot in the arm we received at your recent Team-Based Pay Conference. We returned reinvigorated and ready to improve our company’s culture. Yes, we have drifted over the past few years … but now we are working hard at getting back on track. It’s amazing how liberating it feels when you finally make the tough decisions and move forward. Almost feels like it did when we first set out on our entrepreneurial journey – only we’re much more profitable. :)”

I’m writing this epilogue on Founder’s Fatigue because I too know what it’s like to experience it. My company, Strategies, is 21 years old. You can’t run your own company for that long without acquiring the occasional case of Founder’s Fatigue. I guess because I spend the better part of my day coaching owners and leaders through all sorts of issues and challenges, I have a heightened awareness to the possible presence of Founder’s Fatigue in my own company. As a coach, my job is to offer everything from leadership insights and problem solving, to talking leaders off the ledge when they find themselves on the verge of losing it. The one constant I have learned is that the cure for Founder’s Fatigue always – and I mean always – begins with a tough decision that has lingered for far too long.

Here are four no-compromise leadership strategies to “reinvigorate” you should you acquire a case of Founder’s Fatigue:

  1. It’s OK: You are not invincible. You are not a super hero. You are an individual with the vision, desire, tenacity … and just the right amount of craziness … to chase your dream of building your own company. It’s OK if you lose your momentum and drive every now and then. It’s OK that the pressure of leadership occasionally surpasses your tolerance level. It’s OK to step back for a bit to regain your perspective on where you are and where you’re going. It’s OK to take time to focus on yourself so you can better focus on your company.
  2. Visions are ALWAYS subject to change: I started Strategies in 1993 with a vision to publish a monthly magazine that was all business and no advertising. Strategies magazine was a great project, but after fourteen years and 168 issues, it was time for a new vision for Strategies to move forward as a coaching and training company – not as a magazine publisher. That was a seriously tough decision for me, and I had let it linger for a bit too long … but I finally made the call. My primary passion was always for teaching, speaking and writing about business and leadership. I didn’t need a magazine to do that. What I needed was to make a tough decision – which I did. I was reinvigorated and my company was reinvigorated because its leader got unstuck. If you’re not willing to change or modify your company’s vision when necessary, expect a case of Founder’s Fatigue that can and will spread throughout your entire company. Change is the constant. Visions are not.
  3. Seize the moment: For the husband and wife team I mentioned above, the moment happened at our Team-Based Pay Conference and again with my Founder’s Fatigue MMWU. They acquired a renewed vision of where to take their company and were given a name for the funk they were feeling. They seized the moment to break out of their Founder’s Fatigue funk. They made that tough decision to implement change and move forward. They recognized that their funk had become the company’s funk, and that it had gotten all over everyone. Had they not seized the moment and stepped into the daylight to see new opportunities, their extraordinary company would have degraded into the realm of the ordinary.
  4. Work with a mapmaker: It’s hard to plot a destination if you can’t see the map. I coach leaders. Strategies coaches many leaders. In a lot of ways, business coaches are like mapmakers. We help you find the best route to your destination and our job is to get you there safer and faster. I am not attempting to sell coaching here – I am simply making the point that having someone outside of your company that you can talk through your ideas, challenges and objectives with … and that will hold you accountable for those things … is a necessity in business today. Find the right coaching company and team of coaches to guide you and keep you reinvigorated. Maybe it’s Strategies, or maybe it’s some other company or individual out there. What’s important is finding one that fits you and your company. Do that and you’ll have the best deterrent for Founder’s Fatigue.

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The Conversation

conversation#1As a business coach, much of my work centers on guiding leaders through the wonderful, wacky world of human thinking and behavior, both of those they lead and their own. Dealing with financial stuff is easy. It’s math. Spend less than you bring in and there will be profit. Revenue projections and budgets are mathematical assumptions that we fondly refer to as “wild-ass guesses.” But it’s the leader’s thinking and behavior that brings the numbers and profits to life. System and procedure design is easy too, but it’s getting people to buy into and live the change that tests one’s ability to lead. And to truly become a No-Compromise Leader, you must master and engage in “the conversation.”

The dictionary defines the word “conversation” as the informal exchange of ideas by spoken word. Ah … the spoken word. People, one on one or in groups, exchanging their ideas, points of view, excitement, concerns and frustrations. There is a sense of shared liberation to be able to put everything on the table for discussion and resolution. In every way, the conversation is the single most powerful tool in every leader’s toolbox.

Here are ten no-compromise lessons to master and engage in the conversation:

  1. It’s about understanding: Leadership is about guiding people to a better tomorrow. But your definition of a better tomorrow may not be right for everyone. Engaging in conversation means acquiring a deeper understanding of the dreams and motivations of those you lead. Simultaneously, in the process of conversation you provide deeper understanding of your own dreams and motivations to your people. The deeper this mutual understanding goes, the deeper the mutual trust becomes. A leader that puts constraints on conversation – or avoids it entirely – is more of a dictator and taskmaster than a leader of people.
  2. Vision drift: Visions are pretty awesome and empowering when they’re new and fresh. But visions can and will drift as time passes and the inevitable obstacles pop up. People begin to question the journey, even if they’re on the right path, and if the vision is really achievable in the first place. Conversations are the most effective deterrent for vision drift.
  3. Clarity and clarification: People support and fight for what they understand and believe in. In almost every case, achieving that level of clarity requires consistent and often repeated conversations on the “why, what, how and when” of what needs to occur. The more conversations you have, the more focused your team becomes on achieving the right outcomes. You can refer to conversations as meetings, huddles or one on one’s … it doesn’t matter – just as long as the “exchange of ideas” element exists. Remember, engaging people doesn’t mean pummeling them with instructions, goals and to-do’s.
  4. It’s happening anyway: If you’ve been avoiding conversations, here is a little dose of reality – they’re happening anyway. The problem is that you’re not included and the content of those conversations is likely headed in the wrong direction or, even worse, feeding toxicity and dysfunction. Leaders lead and orchestrate the conversation. If you’re spending too much time working in your business, chances are you have lost control of the conversations … and that’s probably why your company is springing leaks.
  5. Tough will only get tougher: Avoiding a tough conversation today only gives you a tougher conversation to deal with tomorrow. Every leader has one of those tough conversations just waiting to happen. Take a deep breath and get it off your plate so you can move forward. Remember, tough conversations mean there is “drag” in your company. Your job is to create “lift”, leaving room for your business to grow.
  6. Keeping it open: Exchanging ideas means being open and respectful to the ideas and points of view of those that you lead. In listening to your employees, you may even discover a better way to accomplish a task or goal. But you will never have an open conversation and exchange of ideas if you DO NOT listen. People need to trust that their voices will be heard. It’s not a conversation if your voice is the only one sounding out. Listen. Learn. Understand. Appreciate.
  7. Keeping it safe: Tough conversations only achieve resolution if it is safe for the employee to get his or her concerns on the table. Tough conversations are tough enough. Adding fear of confrontation into the already stressful mix can blow up the conversation and lead to a bad ending. The best strategy is to ask permission to address some tough stuff. I’ve never had an employee say, “No, I prefer you don’t.” Doing so sets the seriousness of the conversation. You also want to keep assuring the employee that the intent is to end the conversation with a resolution that both parties can live with and feel good about.
  8. Leadership boundaries: As the leader, you are in a different place with different responsibilities than your employees. Simply put, it’s difficult to be both a friend and a leader at the same time. If you venture too far into being a friend, it can blur your effectiveness when you need your leadership voice to be heard. It can also cloud your judgment when tough decisions need to be made that you know will not be received well by your “friends.” This is often the cause of unintentional, culture-damaging “double standards.” I’m not suggesting that you can’t be friends with your employees. I am merely emphasizing that you must retain your perspective – you ARE the leader and there are certain lines that are dangerous to cross.
  9. Never too late: If there is anyone in your company that is long overdue for some appreciation directly from you … have that conversation. If there is an employee that seems to have defected to the dark side … have that conversation. If someone on your team feels that he or she was overlooked for an opportunity or took the blame for something that was not entirely his or her fault … have that conversation. It’s never too late to acknowledge, appreciate, give explanation, regain trust or apologize.
  10. Relentlessly communicate: Relentless communication is the responsibility of all leaders. You are the voice of the company. Your company speaks through you. You are the keeper and protector of the vision. When your voice goes silent or is seldom heard, your people and your company are leaderless. Chaos replaces clarity. Dysfunction infects your culture. It’s amazing that something as simple as a conversation can prevent all that. All you have to do is let “the informal exchange of ideas” that we call “conversation” transform ordinary into extraordinary.

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Founders Fatigue and what to do about it

fatigueI was doing a coaching call with an owner. We were discussing strategic changes he would like to implement that could dramatically increase revenues, address customer needs more quickly and efficiently, improve customer retention rates and provide his employees with significant income growth. His company was already quite successful and actively encouraged employee engagement through open-book management, team bonuses and profit sharing. His proposed strategic changes made perfect sense. I could hear the commitment and passion in his voice – until he began talking about his people and their reaction to his ideas. His tone changed as he shared employee resistance to expanding roles and new opportunities. And then he said, “I have owner’s fatigue.”

He didn’t say, “I’m burnt out”; he simply used the term “fatigue” to describe his current state as a company founder that is facing yet another uphill battle to take his company – and his employees – to a better place. Being burnt out is a dismal state where leaders barely have the strength to raise the surrender flag. Founder’s fatigue is a condition that owner’s experience after years of pushing and pulling their companies up all of those “next levels” and through all of those inevitable challenges. Founder’s fatigue is what owners feel as they stare up that steep slope to the next level of success. The question is: how long will you stare at that next level before saying, “Lets do this”?

Here are some no-compromise leadership insights into preventing and overcoming founder’s fatigue:

  • You’ve been here before: When you started your company, you were in high-risk mode. Everything was on the table to win or lose. You pushed yourself and your team to achieve hard-earned breakthroughs and successes. Every next level effort tested your tenacity and ability to lead through adversity. You became a veteran of business by having fought the hard battles, experiencing many victories among your share of losses. Here you are about to engage in yet another business battle that you know your company must fight. Founder’s fatigue is simply what you feel because you know and understand the task before you. It’s natural to feel founder’s fatigue. You also know that it’s your responsibility to initiate the command to move forward. You know the way.
  • Stop feeding the parking meter: The big danger of founder’s fatigue is when owners keep feeding the parking meter to avoid moving forward. Eventually you’ll run out of coins. Eventually your team will get tired of watching you feed the meter and talking about great things that will happen. There’s nothing wrong with parking for a while to rest, regroup, plan and gather the necessary resources, but as the leader, it’s up to you to hit the launch button and initiate change. Your team will not hang around indefinitely waiting for you to decide if you want a relationship with the parking meter or the opportunities that are waiting beyond the horizon.
  • When the train leaves the station: It’s amazing how founder’s fatigue seems to mysteriously evaporate when the leader finally hits the launch button. Wheels start to turn, engines begin to hum and excitement builds once the journey begins. Muscles warm up and the pace gets faster and easier to sustain. Getting your train out of the station is the fastest and most efficient way to overcome founder’s fatigue. All aboard!
  • Relentless communication: All change requires relentless communication and information flow. That’s the only way to achieve synergy. Relentless communication is the responsibility of leadership. Relentless communication reinforces the importance of reaching the destination and what it’s going to take to get there. Relentless communication allows for quick adjustments to the obstacles you are sure to encounter. Founder’s fatigue cannot take hold and survive in a leader that is on task and engaged. Pick up that megaphone and make your voice heard.
  • Fearless leader factor: One of the prime feeders of founder’s fatigue is dealing with diehard change resisters. Over time, it’s natural for people to settle into “their work” to the point where any change is regarded as trespassing on their turf. Of course long-term employees deserve respect for their loyalty, but when they become a roadblock to progress, you need to help them decide whether they want to move forward or get off the train. Yes, it can be emotionally draining to get change resisters onboard, but it is even more draining to allow change resisters to remain steadfast as roadblocks to your initiative. The fearless leader factor must be used to resolve the stalemate so the company can move forward. Friendships may be lost and feelings may be hurt, but this is about protecting the company and the team. It’s the tough work of leadership.

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Reigniting your leadership passion

passionLast July I completed the 77-mile Prouty Ride in New Hampshire. There were hills-a-plenty and I turned in an average speed that was so slow I don’t even want to share it. I have a top-of-the-line Specialized S-Works road bike, so it wasn’t my equipment that was lacking. What was lacking was the ability of the bike’s engine – me. My growing frustration with my slow performance finally got to me. I may be 64 years old, but I know I’m physically capable of developing more power and speed – and reigniting my passion for cycling. So I hired Tracey Drews, a Carmichael Training Systems (CTS) coach, to kick my butt into shape. In two months, I increased my average speed almost two miles per hour and lost 10 pounds in the process. I feel great. I’m proud of my improvements. I got my passion for cycling back.

In recent weeks, I’ve talked to a number of owners/leaders who admitted to having lost the passion to push their companies forward. The most common statement sounded like, “I’m just going through the motions.” That’s what I was doing on my bike … just pedaling away miles and not doing the type of training that produces gains and breakthroughs. And just for the record, you can’t achieve gains and breakthroughs in business and life without pushing and challenging your abilities – without taking decisive action to snap out of your funk.

Here are my no-compromise, “kick your own butt” strategies to reignite your passion for leadership and push your company forward:

  • Clean your plate: A leader’s plate is where projects and problems tend to land – yours and everyone else’s. If you don’t pay attention and manage what’s taking up residence on your plate, you can find yourself stressed and overextended. Take control of your plate by cleaning off all of the non-essentials and time-sappers. Most importantly, redirect all those projects and problems back to the people that originally owned them. Leadership team members will never learn and grow if you keep finishing or fixing their stuff.
  • Find your BHAG: A “Big Hairy Audacious Goal” is the kind of worthy and lofty challenge that wakes up both leaders and their companies. BHAGs are bold. BHAGs are grand visions that inspire and motivate. BHAGs are worth fighting for. More than anything, finding and chasing a BHAG always reignites a leader’s passion and energy for the work of leadership.
  • Put a pin on the map: The first thing my cycling coach asked me to do was define my goals and timelines so we could make a training plan. The training plan was a guideline that would take me to my goals. A goal without a deadline is a “maybe,” but putting a pin on the map sets the destination. Define your BHAG, take a deep breath, and put the pin on the map.
  • Blow up the blockage: A leadership blockage is nothing more than a fear of the unknown. Guess what? The worst that could happen seldom, if ever, happens. And guess what? Not everyone is going to be happy with change. But … guess what? Giving in to your fear of confrontation by remaining stuck is the fast track to everything you don’t want to happen. No one follows a leader that is stuck, or too timid and afraid to tackle a worthy challenge.
  • Read No-Compromise Leadership: My book is a game plan for achieving a higher standard of leadership thinking and behavior. So far, every leader that has read the book thinks I wrote it just for them. Learn about the Four Business Outcomes. Learn how to use and balance the BIG Eight Drivers. Learn what it really takes to successfully navigate a company-wide culture shift to the “No Compromise” zone. It’s a damn powerful book that will get you back into the leadership game.
  • Get a coach: The right leadership and business coach can take you farther and faster than if you go it alone. The most important component is to have someone that will hold you accountable and not buy into excuses. And it really helps to have a coach to talk to when your leadership flame needs an extra spark.

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The Team-Based business model ROCKS

TBPC_groupOn September 21st-22nd, Strategies held our first annual Team-Based Pay (TBP) Conference in Chicago, IL. It’s amazing that 158 business owners and leaders gathered to learn, to be inspired and to celebrate this thing called “Team-Based Pay.” Heck, it’s just a pay system. But labeling it “just a pay system” is a shortsighted conclusion that discounts what a company can achieve by rewarding the right overall individual and team performance. Team-Based Pay isn’t about the “pay” … it’s about achieving excellence by defining and rewarding excellence. It’s about building a team-based business model that is void of the “I/me/mine” commission mindset.

The intent of the TBP Conference was to bring together our community of TBP companies to network and share knowledge of the team-based business model. From the owners on the panel discussion to success story upon success story told by attendees, there was one common denominator essential to each experience – company culture. Our closing keynote speaker, Jack Stack, CEO of SRC Holding Corp. and author of bestseller, The Great Game of Business, said it best, “Create Leaders. Create business people who think and act like owners. Become a successful business of business people.” Jack offered the following three essentials to building a team-based company.

  1. Recognition: People need to be recognized for their contributions and their talents. They don’t want to be treated as irrelevant or disposable.
  2. Career Opportunities: Believe that everyone can go somewhere.
  3. A Stake in the Outcome: Believe in creating wealth for those you work with while you create wealth for yourself.

Strategies Coach Robin Gribbin delivered the following 12 No-Compromise Strategies to keep commission thinking from creeping back into a team-based culture:

  1. Stop talking about and comparing commission to TBP: Too often, owners/leaders keep the commission conversation going when there is no need to continue the debate. If you’re a TBP company … you don’t pay commission. Why keep the conversation on the table?
  2. Thinking and behavior drive the numbers you want: You can tell employees to “get their numbers up” all day long, but the fact of the matter is that numbers are an outcome. Focus on getting “Culture & Teamwork” and “Individual Strengths” right and the numbers will amaze you. The more these two critical areas shift to TBP thinking and behavior, the better “Performance & Critical Numbers” and “Skills Requirements” will get.
  3. Stop tracking “Request Rate”: Request rate is 100% super-concentrated “I/me/mine” thinking. The power is in tracking client retention and loyalty to the company.
  4. Column vision is “I/me/mine”: Coach employees to think WIDE, not narrow. “Column vision” cannot compete with “Everyone is responsible for every hour the company has available for sale” team thinking and behavior.
  5. For “top producers” and “senior staff”: Their future earning potential resides on all the columns on the appointment book – not just their own.
  6. It’s about managing your “Service Payroll %”: Once set, commission, including sliding scales, is inflexible. Simply put, you can’t control your payroll percentage as long as payroll is a fixed percent of revenue. Any change or adjustment in commission rates instantly turns into a full-blown pay conversion. Because TBP is hourly, not commission based, it can be controlled to adjust to changes in operating costs and cash flow.
  7. Never ever: Don’t use “cutting hours” as an everyday means to control your TBP payroll costs. If you have too many hours for sale, it’s a symptom that your productivity rate systems need attention and that you’re not following your cash-flow plan. Keep cutting hours and you’ll demoralize employees that want to work.
  8. I repeat: If you believe that employees won’t be motivated to work without the incentive of “commission,” why are so many leaders complaining about unmotivated commission employees? Leadership, clarified expectations, rewarding the right behaviors, systems, accountability, teamwork and culture are all where motivation is derived.
  9. Busier isn’t always better: The more you drive revenues in a commission-based business, the more you drive up your payroll costs. Make payroll a fixed expense and you can manage payroll costs just like any other cost.
  10. Watch your words: Commission has its own vocabulary that speaks “I/me/mine.” Build your request rate. Build your book. Your client/my client. That’s my sale … I should get the credit. It’s hard to build a team-based culture when your terminology does not match what it means to be a team.
  11. Love/hate relationship: Too many owners and leaders hold themselves hostage because they “love the money but hate the employee.” The longer you continue to pay an employee for performance and behavior that drives you crazy, the more toxic and contaminated your culture becomes. Make the tough decision and get it over with.
  12. Double trouble: Double standards in any company will wreck your culture. Reread number 11.

I want to personally thank my Strategies team for making our first TBP Conference an outstanding success for everyone. Eric Ducoff and the corporate office team planned and executed the entire event without a hitch. My team of Strategies Coaches delivered powerful content in the breakout sessions … and, when it came to customer service … they truly practiced what we coach and teach at Strategies every day.

We hope you join us at the 2015 TBP Conference next September.

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Keeping your business in balance

in-balanceI was boarding a 20-seat commuter plane with six other passengers. We took our assigned seats, most of which were toward the front of the plane. Just before the captain started up the engines, he came into the cabin and asked a few of us to take seats further to the rear. “We need to balance out the plane,” he explained. Given the explanation, I was happy to move to an aft seat. In the process, I found it interesting how immune we frequent flyers on commercial jets have become to flight dynamics. I know I never give it a thought.

But on that tiny plane, I was reminded how performance and safety depend on the proper balance. That captain knew that had he not balanced the weight, he would have had to over-compensate on the controls to keep the plane flying straight and true – especially during takeoff and landing. As captain of your business, how often do you find yourself trying to overcompensate when things are out of balance? You know exactly what I’m talking about.

It’s when you’re trying to fire up your team while their sense of urgency is stuck in a funky comfort zone. It’s when you take your eyes off the financial controls and expenses get out of hand. It’s when team morale and motivation turn into a toxic stew that contaminates a once-vibrant culture. Simply put, when the symptoms indicating that a business is even slightly out of balance begin to appear, it’s imperative for the leader to engage and restore balance.

But before you can do that, you must look at your own life. Do you have a sense of balance in your life? Are you calm? Happy? Have a clear sense of priorities? You need to have your personal house in order. If not, your staff will sense a “do as I say, not as I do” attitude that will further degrade your business culture.

Everyone has a different interpretation of what a great business culture is. A balanced business has a culture that fuels a sense of energy and momentum. The different departments synchronize, with everyone coming together for a common purpose.

So what does balance look like in business? That’s an interesting question, as balance can’t be seen. However, you can experience it and measure it. Consider these points:

  • It’s capable, confident and aggressive: Employees of a balanced business enjoy pushing the envelope. They do so because when there’s a state of balance, the natural tendency is to compete and drive forward. An unbalanced business gets bogged down in its own internal issues.
  • The pace is fast and steady: If you exercise regularly and take care of your body, you know what balance feels like: you feel energized and have the endurance to go the distance toward whatever goal you’ve set for yourself. A business that can consistently function at a fast and steady pace is balanced. An unbalanced business always seems to be running out of gas and having engine problems.
  • Execution at its best: Balance is like a football team that makes it to the Super Bowl. Every player and every coach is there to work together and win. A balanced business is disciplined yet flexible enough to be self-correcting when things go awry. A balanced business is impressive to observe and do business with, and consistently outpaces the competition.
  • The results are measurable: When a business is in balance, it’s evident in the numbers … from revenues, profits and a healthy Balance Sheet to high productivity rates, customer and employee retention.

If you want your business to fly high and fast, it’s your job to get it, and keep it, in balance. Flying any other way is dangerous. No compromise.

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What you need to know but do not know

need_to_know2Being a truly effective leader means being in the know about everything that is going on in and around your company. But being in the know about “everything” is impossible and would probably cause your head to explode. Yet, every day there are forces at work that could impede growth, hinder productivity, drain cash flow, degrade your brand or cause you to miss a major opportunity. By forces, I’m referring to the people side of your company where decisions are made and where thinking and behavior deviates from the company’s vision and core values. This is where personal or collective compromise can throw a wrench in what should be your well-oiled machine.

In business, believing in the old adage, “What you don’t know can’t hurt you,” is like avoiding reality by sticking your head in the sand. If you’re having cash-flow problems and you’re not paying attention to – or can’t read – your financial reports, and you don’t have a cash-flow plan/budget … then you don’t know what you need to know. If you’re having productivity issues and pushback on much needed changes, but do little to change your “I don’t like structure” leadership style … then what you don’t know – you need to know. If you’ve ever discovered a major problem and uttered the words, “How was this happening right under my nose?” … then you don’t know what you need to know. Got it?

Since it’s impossible for any leader to know and do everything, here are some no-compromise strategies to keep you in the know more effectively than ever before:

  • Myopia” isn’t a Greek island: In business, the term myopia refers to that very narrow field of sight we fondly call “tunnel vision”. A leader may see what’s directly in front of him, but be oblivious to hazards and threats coming at him from the sides or behind. So often, what leaders need to know is readily available, but they’re “too busy” or preoccupied to really see or even be aware of it. Even with the best intentions, some leaders shut themselves off from what they don’t want or care to know – or believe that others are paying attention for them. Strategy: Schedule time to come up for air so you can pay attention to and check in on what’s going on in your company. All it takes is asking a few questions and setting aside the time to really listen to the answers. The intent is not to catch people doing something wrong – it’s to ensure that they’re doing their jobs right … and to coach them where needed. Avoiding myopia is the best strategy to avoid problems before they occur.
  • Upgrade U: You can stick to the business and leadership skills you have and are comfortable with, but it is unlikely that your current skill set will keep pace with the growing complexity of your company. The problem is that a leader’s pre-ordained obsolescence creeps up almost unnoticeably until time and circumstance takes the leader to task. Yes, you have unique skills and talents that got you to this point … but that’s no guarantee that those skills can or will take you any further. Strategy: Make a plan to upgrade your skill set at least once a year. Challenge yourself to get better. And guess what? It will actually feel good and broaden your leadership horizons.
  • OK, stop avoiding it: We each have natural skills and interests that we build our careers on. But when leading a business, there are skills you need to know that are beyond your interests, abilities, and comfort zone. Nevertheless, there are specific skills that your leadership position requires you to learn and know – but not necessarily master. For example, the need to know and understand your financials and practice financial disciplines is a non-negotiable for all leaders. You can delegate the bookkeeping and accounting – but you cannot delegate the knowledge of what your financials are telling you. You may have a low tolerance for confrontation, but knowing how to navigate tough conversations that must take place is non-negotiable. Strategy: I bet you have a couple of non-negotiable skills that you’ve been avoiding like the plague. Well, it’s time to make peace with these imaginary monsters because in this case, you know exactly what you don’t know and it’s time to do something about it.
  • Every company has ick: It’s that festering, toxic stuff that lurks in dark places with names like “resistance”, “resentment”, “attitude problems”, “egos”, “entitlement”, “laziness” and “indifference”, to name a few. No one aspires to be a leader because they want to deal with ick … but it’s part of the job. What’s interesting and remarkably clear is that as ick accumulates over time, it does so right under the very noses of the leaders that build the company structures, layers and levels that feed the ick. Ick feeds on stagnation, lack of information flow, lack of opportunity – and lack of appreciation. The point here is that what you need to know is all around you. Strategy: The best way to know and prevent ick is by involving all employees in the process of business growth. Contrary to popular belief, people want to be a part of something that’s worthy of their effort. People want to contribute. That’s why I believe in open companies with open leadership and cultures. That’s why I believe in transparency and open-book management. What you need to know resides in the hearts and minds of those you lead. Tap into the knowledge of your people and you will know more than you could ever imagine.

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