Thursday, January 31, 2013

Legal, Ethical & Profitable

This CEO Blogger is willing to consider just about any business venture, or new idea if it is legal, ethical and profitable.   These conditions are really the only ones that matter in a client, or customer driven company.   So if a client requests a new twist to our services, provided these conditions are met, the question is why not?   As an entrepreneur, perhaps from childhood, I have never accepted the status quo.

When anyone ever told me something was impossible, or even a dumb idea,  from a very young age, I either jumped over them, went around them, or pushed them aside entirely to pursue the impossible.   By definition, those people in business and in life, who get big things done, do not allow small minded people to get in their way.   As long as the measurement standard in business is always is it legal, ethical and profitable, the impossible becomes very possible.  

People with big ideas should never allow others who lack vision to condition their behaviors or actions in business.   That does not mean being a steam roller; but it does mean that taking prudent risk, based on experience, is always the basis for company innovation, growth and development.   This often also means being ahead of the market.   Very often, how can a focus group, or market research determine if a "new" idea is feasible unless and until it is introduced in the marketplace.  

Some concepts will fail; in search of the latest and greatest product, or service; but that is OK.   Success has many fathers, while failure is an orphan.  Never be afraid to try new concepts, or ideas as long as they are legal, ethical and profitable.   Just maybe, you may change your industry, or the world. 

Monday, January 28, 2013

A Star Is Born Every Year

A Star Is Born Every Year in business.   The person could be in Accounting, Finance, IT, Sales, Marketing, or any other company department.   In our company, we recognize our Stars with various certificates and monetary awards to make an example of them.  A Star is someone who makes big things happen and consistently.   A Star is a team player who doesn't worry about who gets the credit; but rather just does a great job to advance the interests of the company.

Stars are glass half full, positive personalities that rise above the trivial to embrace the big picture.   Stars are Special, which is the reason they are not every employee.   Everyone wants a Star working for them, which is why when succession planning takes place, Senior Managers always raise their hands to take a Star into their organizations.   

Stars are fun to be around.   Stars get promoted into higher level jobs because of their capabilities and personality.   People who have Star quality sparkle on the job in their own way.  Stars should be nurtured because they are few and far between.   This CEO Blogger is Star Stuck.   Every company needs more Star Performers. 

Monday, January 21, 2013

Managing Resources - Key To Company Growth & Profitability

It is absolutely critical that Senior Managers manage the company's resources, which includes people, technology, equipment and physical space to achieve company growth and profitability.   Spending too much in any one of these areas will be at the expense of the others and the growth of the business.   This is particularly true related to people in a service business because this one cost factor comprises 65 - 70% of the expense line.   This gets down to the department, division, or subsidiary level.  

As such, if one department, division or subsidiary is over staffed, it will be at the expense of the other functions of the company that may legitimately need more staffing.   For that reason, it is possible to see lay-off's in one area, while at the same time the hiring of new employees is happening in another area.   The lay-off's occur when there is a mismatch in skill set, since people cannot always be moved from one job to another.

Specific to technology, no matter how good, it is never good enough according to end users.   As a result, there is always pressure to add the latest and greatest when current technology may be just fine.   And, technology does not always lead to greater productivity.   To the contrary, the more sophisticated the technology, the more people required to support it.   Further, in my experience the breath and depth of new technology rarely gets used to the fullest extent of its capability.   So, more often than not, technology is over bought. 

Finally, there must be a match between physical space needed and physical space owned, leased or rented.   Companies should move quickly to get rid of space that is unneeded, since it is just a drag on the company.   Managing Resources is a primary responsibility of Senior Management.   It is a daily, never ending job.   Ultimately, Managing Resources is the key to company growth and profitability. 

Thursday, January 17, 2013

Finger Pointing In Business

It is really rare that anything really good, or really bad, that happens in business is the result of any one person's work, or effort.   Accomplishments, or the lack thereof, are usually the result of complex relationships that exist between tasks, people, or departments.   Yet, success has many fathers and failure is an orphan.   When things go wrong, rather than look in a mirror, the finger pointing often occurs.   Problems are always someone else's fault; but the truth is that after lifting rocks, we usually find that there is a multi-disciplinary cause and effect relationship that is the basis for errors, or poor results. 

The key is understanding that relationship so that errors don't happen again.   It would actually be better for employees to admit their role in causing serious problems to allow for better problem solving.   Of course, this CEO Blogger is not talking about employee actions that are clearly  illegal, or unethical that should result in the immediate termination of those involved.   I am talking about errors that could be costly.   Once revealed, processes must be put in place to prevent the error from happening again.   That means all the players that contributed to the error must first admit their part and second correct whatever they are doing to cause the error. 

The worst possible scenario is to hide errors from Senior Management because eventually things come to light.   Oh what a tangled web they weave when they practice to deceive.  At that point, the cover up becomes far worse than the crime.   This CEO Blogger has discovered shenanigans after the fact, again nothing illegal, but just plain stupid mistakes that cost us money.   When that sort of thing happens, I have pushed the people involved aside and ultimately taken responsibility away from them, usually in a company reorganization.   In some cases, terminations have occurred.  For me anyway, once my trust is violated, it is all over.

Finger pointing is pretty ugly and often counter productive.   It is critical to recognize that companies win or lose as a team.   It is better for everyone involved in a problem situation be part of the solution, rather than contribute to the problem.   Most important, as soon as a serious problem is discovered, take it to Senior Management.   There is no hiding anyway, so it is better to surface the problem sooner than later. 

Wednesday, January 16, 2013

When Something Does Not Work In Business

When something does not work in business, after a pro-longed effort, there can only be two explanations.   First, the business model is wrong.  If the market place does not substantiate the business model by Sales, then perhaps the concept is flawed.   Second, the people running the business are either not sufficiently talented, willing to work hard, or perhaps motivated to make big things happen.   This CEO Blogger would tend to default to the talent deficiency problem before scraping the business model.  Since I know from personal experience that talented people can make big things happen,  it is usually a talent deficiency that prevents success, since any business model can be tweaked to meet market demand.

There is a saying in the US, "It Good Enough For Government Work".   The implication, whether fairly or unfairly, is that since it is almost impossible to terminate a government employee, there does not seem to be a sense of urgency among government employees to get big things done.  And, the quality and quantity of the work government workers often produce is sometimes pretty mediocre.   This is a horrible generalization because over the years I have worked with some really great government employees; but to say this is the rule would not be correct either.  

The point is that working in business is not government work.  This CEO Blogger expects Managers to get big things done.  Managers need to think more like entrepreneurs, spending their own money, rather than government bureaucrats, to accomplish big things.   Time is money.   Both are always in short supply.   God has given each of us a speck of time on earth to make big things happen.   This CEO Blogger see the light at the end of the tunnel.  I don't have time for Business As Usual Managers, particularly when something is not working.   I expect results for the money I pay; not more of the same, if the same behaviors produce poor results.  Most CEO's share my expectation.   The clock is ticking.   The time to get big things done is NOW.  

Tuesday, January 15, 2013

Using Check Lists To Get Things Done

Doctors performing surgeries are starting to use check lists to get things done.   If you think about it, since some employees are not very organized, the premise makes sense related to many company functions.   Certainly, in providing any service, it seems logical that there be a check list to make sure that all aspects of the service are performed in logical order.   This is particularly beneficial for less experienced employees and or if the service is very technical in nature.   Also, if there are legal implications related to providing a service, then checking the boxes to make sure every "I" is dotted and every "T" is crossed makes perfect sense.   It also insures that in the event of litigation that there is documentation in place to prove proper implementation.

At the same time, when providing a service and using check lists to do it, care should be taken not to appear robotic.   It would not be good if the customer thinks the service provider is just going through the motions.  Also, sometimes the customer will want service out of order, so to speak and that should be accommodated as long as some critical aspect of the service is not eliminated in the process. 

Using a check list to interview, hire, or terminate an employee is particularly important.   Given the litigious tendency that exists in many countries and various state and country employment practice laws, it is very critical that a check list be used whenever taking any employment action and that all actions be documented.   This is always the basis and defense for dealing with frivolous lawsuits that come up from time to time.

Check lists can be the basis for training that is certain rather than nebulous.   Check lists should be in every training manual for reference.   This CEO Blogger uses check lists, of one sort or another, to deal with all aspects of life.   My annual calendar is in effect a check list that allows me to organize both my business and personal life.   I can now check a box related to this Blog Posting.   I told you so. 

Monday, January 14, 2013

Thinking Outside The Square

In Australia, they say Thinking Outside the Square, rather than Thinking Outside the Box.   This CEO Blogger really likes both sayings; because to survive in business today, we really need people that are not business as usual people.   The easiest answer to every issue, or challenge is always hire more people, rather than finding more creative ways to get work done, or eliminate unnecessary work altogether.   Of course, the rubber always hits the road at budget time.  Since companies, unlike governments can't print money and borrowing to fund growth is costly, adding people requires a corresponding increase in revenues.   If the additional revenues are not there, obviously adding more employees is not an option.  

People in companies must be prepared to Think Outside the Square and often wear multiple hats.   This always happens when companies are small; but as companies grow, all of a sudden, the thought of doing more than one job function becomes unthinkable for many people.   This CEO Blogger has little patience when I see, or hear this attitude from anyone. 

In addition, there is usually a proliferation of Managers over time, often way too many in any company.   Generally, Managers are more highly compensated than line employees and as such if there are too many in relationship to the number of line employees, the cost factor becomes unsustainable, which usually leads to lay off's.  

Self perpetuating bureaucracy is the enemy of creativity.   Many managers are empire builders always seeking to expand their domain, rather than identify how to get more meaningful work done with fewer people.   The real issue is the definition of meaningful work to the organization.   Very often tasks deemed absolutely essential are just nice to have and can even be busy work to justify headcount.   Eventually, it all falls by the wayside at budget time because jobs that are not really essential go away. 

Sunday, January 13, 2013

Using Young Guns & Big Guns

When this CEO Blogger was in Sales 30 years ago at Merrill Lynch, I signed a very large international oil company,  headquartered in the US, based in Texas.   I was very proud of myself for accomplishing this signing because this particular client had been with our major competitor for more than 17 years.   When meeting with my boss, I mentioned that I had worked hard on this deal for more than a year.   My boss congratulated me for my accomplishment; but then went on to say that in fact, if I reviewed the paper file (in those days there were no computer files) I could see that our company had actively pursued this client for 17 years, which was very true.   Not to diminish my effort, his point was that ultimately company's sign clients as a result of on-going investment; not just sales guys, though a particular sales guy may make it happen.   I never forgot that lesson.

In any case, as we were working on the deal, the Procurement Manager at the oil company asked that I bring our Big Guns in for a meeting.   Of course, given the size of this account it was a perfectly reasonable request so I orchestrated a meeting that included my Executive Vice President boss and the President of our company.   I thought this was going to be a meet and greet; but I soon learned that this savvy Southern Procurement Manager had another agenda in mind.  

By the way, when I was young and in Sales, I often got worked by crafty Southerners, who saw me as a young Northerner, coming from California to sell to them.   I usually saw it happening after the fact; but since I was signing lots of accounts in the South, it was always a learning experience that I found humorous.   These good ole boy Southerners very often acted like hay seeds; but they were always really very smart business people.   Today, when selling in the South, you would be as likely to encounter someone across the table from Chicago, or New York than a Southerner; but that was not typical 30 years ago. 

In any case, as we convened our meeting with the oil company Procurement Manager and our Senior Management in the room, it very quickly became apparent that the Procurement Manager's objective was to negotiate pricing that I thought was settled.   This was definitely not a meet and greet.   It became very clear that the Procurement Manager was trying to get our President to commit to lower pricing on the spot, knowing that if he said Yes, right then and there, that there would be no additional negotiations.  

Our President was a very bright guy and CPA by education.   Though he was definitely a Northerner and well educated, he had a boyish, folksy style.   Rather than negotiate with the Procurement Manager, he deferred to me, the Young Gun in the room, by saying that he just wasn't close enough to the numbers to act authoritatively in agreeing to any deal on the spot.   What was very funny about this tactic is that our President, as a CPA, knew those numbers better than anyone else in the room.   But he also knew that as our President if he started negotiating with this Procurement Manager that it might lead to lower pricing without proper analysis.  

So, by deferring the pricing discussion to me for another time, our President actually out foxed this crafty Southern Procurement Manager.   In the end, we put the deal together, with pricing approved by our senior management, after proper analysis.   As a young sales guy, I learned a lot from this scenario.   There is a time for Young Guns and a time for Big Guns to close a deal.   The Big Guns should be used sparingly on the front line because they are the last word on every issue.  That does not mean that the Big Guns are not involved behind the scenes, while a deal is in progress; but the Big Guns should never be used to do initial work better done by the Young Guns.   This process best allows for mutually agreeable pricing that is based on sound thinking, rather than emotional, high pressure negotiations. 

Thursday, January 10, 2013

Managing Cultural Differences

One of the most difficult issues facing any global company is managing cultural differences.  Aside from different languages to deal with, which is obvious, countries and the people living in them are shaped by their history, dominant religions, values and governments.   Though the industrialized world is much smaller today than ever before because of technology, 24/7 news and universal media,  employees react very differently to internal and external events that impact day to day company operations. 

As such, one size fits all is not very workable.  Global Mind Set Training is very important.   And, some countries practice situational ethics, which is not an American concept.  It just means that American management must be a lot more careful in business dealings when this approach is standard. 

Even though companies in the United States face many more regulations today than ever before governing operations,  depending on the state, it is still far less onerous to do business in the United States, than what we face in many other countries related to employment and other business practices.  Europe, China, Japan and Brazil are particularly difficult business environments.   

In addition, employees in some of these countries have different expectations concerning work and productivity.   The notion of working 50 - 60 hours a week, with two or perhaps three weeks vacation after five years of employment, is an American concept and not that common around the world in other industrialized countries.   Things also seem to move much slower outside the United States.  And, though all people are resistant to change, bureaucratic procedures outside the United States make change even more problematic. 

Yet, for better or worse, global companies must adapt to succeed.  However, it is true, whether in the United States, or other countries, companies vote with their feet when they encounter high taxes, impossible regulations, difficult employment practice laws and or an extremely high cost of doing business.  At a minimum, companies can choose to do business from almost anywhere today.   States, or countries with attractive business environments attract investment and jobs.  States, or countries that make doing business difficult suffer job loss and high unemployment.  It is what it is. 

Wednesday, January 9, 2013

Understanding Corporate Speak

Corporate Speak is a language like any other that must be learned in order to communicate effectively while on the job.   Some employees never do get it.  Really good managers rarely yell and scream to assert authority; but they do use carefully spoken language to influence decision making.    When a senior manager begins a sentence with, "I am very concerned about", the employee better understand that this is a serious discussion, not a debate about the issue.   This can be the equivalent of screaming at the employee.

Usually some directive will follow that conversation, whether obvious or not.  When a senior manager says, "It is your decision; but if I was making it, I would do it this way," that means do what the senior manager suggests be done.   This CEO Blogger is often amazed at how tone deaf some employees are in their daily dealings with other employees, or senior management.   Someone can be screaming at them in Corporate Speak and they are oblivious to what is being said to them because they just can't read between the lines.   Corporate Speak is also about Company Culture, which some employees just don't understand. 

And then, there is the stubborn employee, so set in his or her ways, that he or she just can't hear what is being said to them, no matter how blatant.  Eventually, this employee ends up being terminated for one reason or another.   Though they can be very smart, they are just plain politically stupid.   This CEO Blogger survived 8 very different bosses in six years, when I worked at Merrill Lynch, some of whom were empty suits because I understood and spoke Corporate Speak and Company Culture.  

If your boss must give you a direct order to do, or not do something, it means that you missed all the signals given in typical Corporate Speak.  It also means that you placed your boss in the worst possible position of having to be a blatant authoritarian leader, which is certainly not my preference.  When this happens, you are the big loser because your boss will think the less of you.  Listen carefully when your boss speaks to you.   Every conversation is a business conversation, even the ones about family, or small talk.   Learn to understand and communicate in Corporate Speak to be successful.   Otherwise, your corporate interactions are likely to be pretty unproductive and unpleasant and your career will be on a road to no where. 

Tuesday, January 8, 2013

Successful People Never Stop Learning

Successful people never stop learning.  Yet many employees think their education ended with a high school diploma, or college degree.  NOT.   Competing in a global marketplace requires continuous learning.  Even though this CEO Blogger has various university degrees and credentials,  it is rare that I don't spend some time reading every day and that has been true since I learned to read.  Natural curiosity is a very valuable attribute.   And, now with the ability to Google almost anything, how great. 

Employees often hit a glass ceiling related to promotions because they are stuck in a time warp.   Their job skills are outdated and they have done nothing to either retrain, or gain additional learning to make them more valuable to a company.  It is these people that are often laid off in a down turn.   It is unfortunate when it happens; but it is self inflicted and completely preventable.  Really valuable employees rarely lose their jobs and or if they do lose a job because a company has gone under, they are snapped up quickly.

Developing talent is all about learning.   Great companies provide training; but smart employees take responsibility for their own development.   Those that only have a high school degree, if they didn't go to university right after high school, go back to school to get a university degree, while working.   Those that have university degrees, often get graduate degrees, or other types of learning to make themselves more valuable.   Travel to learn; not just for fun.  Forget about bowling on Wednesday nights, use the time to learn another language, or additional job skills, if you want a better job. 

We live in a very competitive global business environment.  Many jobs can be off shored today to lower cost countries.  Employees working in the first world, primarily Western industrialized countries and some countries in Asia Pacific, are now competing with smart, hard working employees in the second and third world, whether they like it or not.  It is what it is.  The only way to compete is to have job skills and new learning that are uniquely valuable to a company.   Get with the program, or stop complaining when you get passed over for a promotion.   You hold your future in your hands. 

Monday, January 7, 2013

Two Minutes Matter - Company Strategy

This CEO Blogger recently watched the University of Alabama - Notre Dame Championship Football game.  Sports was never really my thing, unless betting was involved.  I am happy to report that I bet the game a combined score of 40 or more and won just about a dollar for every dollar that I bet; not a bad return on my investment.  In any case, before the game began, the coach for Notre Dame said something that struck me as relevant to business management.  He said that in any football game, the play during the first two minutes of each quarter determined which team would win the game.

What he was really saying was that there was a strategy to winning.  Unfortunately for Notre Dame, they never controlled the first two minutes of any quarter and therefore lost resoundingly.   In fact, though they won the coin toss, which would have allowed them to control the ball going into the game, they gave up that privilege to Alabama and it may have cost them the game.   This Blogger CEO would never have given away that advantage.   

Whether it is the first two minutes, the first two days, the first two weeks,  the first two months, or the first two years needed to control and win the game in business,  it is probably not longer.   And, it is always better to be on the offensive than on the defensive in any business venture.   Things move so fast today and the world is definitely a smaller place so that he who hesitates will lose the competitive game every time.   The market place requires better, faster and cheaper in order to win.   That reality is not going away any time soon.  

Apple may be on top today because they got there first; but there are no guarantees at all that Apple will remain on top.   This CEO Blogger remembers the days when Apple almost went bankrupt and as crazy as it might sound, it could happen again if some other company, or person comes up with a better idea.   That is the basis of Free Market Capitalism.  Winning is all about Focus, Discipline and Passion.    The University of Alabama controlled the ball from the very first two minutes of the game and they beat Notre Dame resoundingly.  Winning is all about a sense of urgency.   Those companies and people who have it are winners.   Those that don't are losers.   It is what it is.