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Sunday, 31 July 2016

Looking To Improve The Business? We Need To Plan And Be Consistent!

I heard a neat little maxim recently that really had some resonance for me:

“You don’t have to be sick to get better”

My old friend and US Vistage speaker, Lee Thayer, used to say that the first line on everybody’s role description in any business should read:

“My primary role in this business is to make it the best there is in the industry, BY ANY MEASURE”

Please note the words By Any Measure because adding that puts meaning into the maxim.  We can’t achieve what we can’ t measure so making the comparison on a level playing field makes it easier to assess where improvements need to be made.

Lee also said that he didn’t like the Japanese concept of kai-zen, or small, incremental changes, to achieve the improvement.  He much preferred a big, dramatic change that would resound throughout the business and build enthusiasm.

There is a good reason for this approach as big improvements are noticeable in the business whereas small incremental changes creep up relatively unnoticed until someone checks the figures and notes the change.

However there is good evidence that kai-zen works in the right hands.  For example, Sir Dave Brailsford, former head of Team GB Cycling and now head of Team Sky Cycling is a great enthusiast for the small regular incremental change.

He has a ferocious adherence to the smallest detail that can be changed for the better as the results in both of his recent appointments testify.  Team GB was extremely successful at the 2012 London Olympics and did you realise that Team Sky has won the Tour de France three times in the last four years?

Just watch the way that Team Sky dominated the race this year.  It brought cries of “They are suffocating the race” from commentators who should know better.  If people didn’t like it they had the answer in their own hands.  As Dr Steve Peters says, somewhat dismissively “Deal with it!”.

There is no doubt that Team Sky are the one to beat but it doesn’t stop them constantly looking for small incremental changes to equipment, riding styles, tactics and strategy not just to stay ahead but to consistently move ahead.

In so many cases we leave change and specifically improvement changes to a time when we most need them perhaps in a recession or when we experience surprise competition.

The time to implement improvements to whatever we are doing be it in design, operations, quality, service and so on is when we are at our busiest, not at a time of desperate need.

For example the sales effort can start to be slowed down when the order pipeline is long and deliveries start to suffer.  That is just the wrong time to slow down, that is when we are sick, and then the need to get better is paramount.  Desperate times generate desperate measures that are not always to the benefit of the business and its people.

In the 1920s, a French psychologist, Emile Coue, became very fashionable for his strictures on self -improvement.  He suggested for example, that we should daily clasp our hands tightly and say several time:

“Every day and in every way, I am getting better and better”. 

Auto-didactic it may be but if the constant repetition of the phase achieves its objectives who can argue?
As the saying goes, we don’t need to be sick to get better.  Indeed we certainly should not wait until we are sick to try to look for improvement.  It may be just too late if we do.  Dramatic change or incremental change?  Whatever is best for you and your business but constant, dedicated, planned and programmed improvement is essential.

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Sunday, 24 July 2016

What Drives the Entrepreneur? It’s Much More Than Making Money!

There was an interesting programe on BBC Radio 4 last week that discussed entrepreneurship and the rationale for going into business as distinct from searching for paid employment.

The Bottom Line, hosted by Evan Davies, had three people who had left highly paid employment mostly in the financial industry to set up their own small business, together with a representative of a Venture Capital fund who has invested in start-up businesses.

The contribution from the entrepreneurs was perhaps as expected.  They enjoyed the relative freedom especially the fact that they no longer were tied to the regular and mind numbing commute into the centre of London.

Add to that the newfound ability to run the home as well as the business was very desirable together with a feeling of freedom in setting the times to work.

All very positive although there were some downsides that were to be expected.  In the main they were all surprised at the number of hours that they had to work to make sure that all the bases were covered.  If it wasn’t production (one of them was making and selling artisan jams) it was having to do the accounts and indeed all the associated administration themselves.

I recall myself when I ventured into self-employment a long time ago I called it the Copy Syndrome.  In my paid emolument to get a copy of a document all I gad to do was to pick up the phone and ask my PA to do it.

Now I had to do it myself and as it was before the advent of copier/printers I had to go to a local copy shop.  As it was always raining, or se3emed to be, usually my final decision was not to bother.

This lack of support comes as a shock and has to be combatted.  If the business is funded then it is naturally feasible to employ the support from the start but normally it is the owner on his/her own in the big world of business who has to do it.

The other point is the hourly cost of doing just that.  I reckon that if many entrepreneurs calculated their actual hourly remuneration it would be seriously lower than the National Living Wage in most cases.

Irrespective of that there is a huge recompense to the entrepreneur in creating something ex-nihilo, that is out of nothing except the desire to succeed.

All the entrepreneurs on the programme made this point as well as the level of hard work that self-employment demanded but without suggesting that it was a problem.

One of the participants ran her business very satisfactorily but had decided that the experience was sufficient and had reverted to getting a job again.

I could relate to everything that the entrepreneurs said but was disturbed by the opinions of the venture capitalist.

For a start he said that potential entrepreneurs shouldn’t go into business on their own and to mitigate the problem they should seek out a partner.  In my consultancy days I made good money from unscrambling unsatisfactory 50/50 partnerships that had gone sour.

By all means take on good people who can contribute in the early stages of the business and even let them invest if it is appropriate and if they wish but NEVER 50/50 or even worse, three equal shareholders.

His other dictat was that going into business on your own will be (note: will be) in order to make money and therefore running it for the bottom line was the raison d’etre.  Normally a VC will invest in a business to grow it and then to sell it four or five years on so his comment was understandable.

While prudent accounting is an essential part of the process because we want the business to be profitable, the real drive has to be to follow the dream to create something for the future.

It is exciting, very demanding, constantly in the thoughts, creative and completely compelling and most entrepreneurs would agree, they wouldn’t want to do anything else.

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Sunday, 17 July 2016

Need to Challenge Your People? Try These Great Questions!

I am a great proponent of a one-to-one meeting to discuss the needs of the team member rather than the leader.  I strongly believe, as the members of my Vistage CEO peer group know only too well, that a great one-to-one with honesty and openness on both sides can elevate the discussion to a much higher plane.

The crucial factor is the realisation on the part of the leader that coaching plays a very important role in the art of leadership.  It is even more relevant where the leader has started and built the business and needs to transmit knowledge and experience to the management team.

Coaching is not just a routine for telling people how to do their jobs.  My good friend and Vistage speaker, Nigel Risner says, “Be the coach, not the commentator”.  It is mostly about helping rather than telling and also about drawing out and developing the natural abilities of the team member.

What takes time very often is the development of that openness and honesty on which the whole success of the exercise depends.  Many people are hesitant in opening up to a “superior” in the business

Challenge can be very daunting to a sensitive soul even when it is couched in positive terms and again it takes time for people to understand that challenge can open up new vistas for them and develop their natural abilities.

We often don’t know our capabilities and great coaches can draw them out and offer a new perspective on work and even on life itself.  Kindness and understanding are both essential components of the role of the coach allied with sensitivity and compassion.  No wonder that many leaders duck out of the coaching role and depute it to outside professionals.

It is a pity when this happens because coaching offers a great way for both parties to understand each other better and to offer to the team member a way to demonstrate their own understanding of their role and responsibilities.

When the atmosphere is right, when the team member feels ready, when the leader judges that low level challenge would be appropriate then a series of questions can open up the thinking of the team member.

For example, how about this for starters:

“What don’t you want to talk about today?”

That gives the individual an opportunity, if taken, to open up and bring out often deeply felt issues and that can be cathartic.  Again timing is of the essence.  Answering such a question can be painful and the team member has to be in a good frame of mind to accept that it is intended to be helpful.

Another great question is to ask:

“Given the opportunity, what would you be willing or unwilling to change?”

Change can be very painful for some and the good leader/coach understands that.  It can result in denial and denigration;  That’s a ridiculous idea” or ”We tried that before and it didn’t work”.

The status quo is not an option.  Indeed one of the vital parts of the leader’s ethos is a healthy dissatisfaction with the status quo.  If we don’t move forward then we move backwards, or worse, downwards. 

Change then is inevitable and the leader needs to promote it, to discuss it and implement it while still understanding that it can be painful.
 aAnother probing question is:

“Where do you limit yourself?”

Self-limitation leads to the construction of a self-imposed ceiling on ability or ambition.  Admitting and tackling that limitation can help people to do things that they never thought was within their capabilities.

I will often say that as Chair of Vistage CEO peer groups of highly effective and ambitious leaders we need to be professional listeners, not advisers, but rather coaches helping our members to open up, to understand and confront their issues and to explore the options open to them. 

Everybody would profit from knowing and having a good listener.  In the end, everybody wants to talk about the most important person in their lives, themselves and that is where we, as leaders, can offer an outlet.

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Sunday, 10 July 2016

Looking to Increase Revenue? Then Boost Your Salesforce Productivity!

We hear from the economists and the Office for National Statistics that although the UK economy is growing even post Brexit, national productivity is still lagging behind other countries, productivity being defined by GDP divided by the number of hours worked or alternatively Output per Unit of Input.

Remember the three-day week?  During the tenure of Edward Heath as Prime Minister in early 1974 there was a spate of industrial action primarily from the coal miners that led to fuel shortages and reduced electrify output.   Accordingly the decision was made to reduce the working week for commercial users to conserve supplies.

Guess what; production scarcely reduced even though the effective working week was drastically reduced.

We are talking here about measurable output in the way of Gross Domestic Product but have you ever though about the productivity of other notionally non-wealth producers in your business?

I recall once going to a large and, on the face of it, successful engineering company to discuss their sales operation.  We looked at the total orders received, the number of quotations sent out, the conversion rate, and all the other criteria that go to measure the effectiveness of the selling effort.

In an interview with the Sales Manager I asked him how many actual sales calls, that is eye to eye contact with the customer, were made in a given time and he hesitated.
I try to make one a week”, he said.

And the rest of the sales people?” I asked

Much the same” he admitted.

Even though the way that selling is organised these days is different from then, the point should still be made.  The best way to generate sales is by personal face-to-face contact with the customer and by using professional selling methods.  Let’s make it clear. 

There is absolutely no point in expecting the sales people to do all the background stuff such as market research, quotations, follow up telephone calls, general sales administration and eve call planning and at the same time demand from them a high return in order levels.

Sales are one of the areas of business that are genuinely measurable and there is little doubt that given good quality and service it becomes something of a numbers game.  The more you go out and sell then the more successful you will be.  It really is as simple as that.

So why do so many businesses persist in expecting their sales people to undertake all the peripheral stuff to the detriment of the face-to-face time with the customers?

The most effective sales force I ever encountered was 120 strong of good engineering sales people, flat salary above market rate, no commission and a backup team to do all the necessary administration for them.

We were measured on not only sales successes but also on the expected number of calls per day at around eight.  That was deemed a fair number for the market we served and most of us managed to achieve it.  It wasn’t a demand, just an expectation and could always be overridden when the situation demanded it.

Paperwork for the sales team during the working week was limited to Friday afternoon hence the joke at the time about the salesman (or woman) who would park the car, open the windows and the roof and “do the paperwork”.  This was defined a “getting a layby tan”.

We normally pay sales people a significant amount and naturally expect them to produce.  It makes no sense then to have them undertake activities that divert their attention and effort from what they are employed to do; to go to see the customer and sell the product or service.

Increase the productivity of your sales force and just watch the increase in sales.  Worth it or what?

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