One of the greatest challenges for a small business is taking the time to step outside of the day to day to plan and strategize. If everybody is too busy plugging holes on the boat, then no one will be looking for what direction to steer. As the new year begins, this is an excellent time to proactively schedule out time once a month with your leadership team and trusted advisors. Taking a these time outs with your team will give you a regular opportunity to take stock of your business and Here is a simple yet practical plan to take control of your organization to lead it to greater success throughout 2019.
Gather your leaders and block off a consistent, predictable schedule for these meetings. By selecting the first Wednesday of the month, for example, there will be little excuse for someone to book a meeting over this one. These meetings need to take precedence above all else.
Your team should at a minimum consist of your leadership team and key employees. Additionally, it is highly recommended to include one or multiple trusted third party advisors that will provide business insight and outside perspective. This combination will provide top-level insights, front-line experience, and impartial guidance.
Lock in these meetings early, and set a standard agenda in advance, so it becomeshabit. Depending on your organization, these meetings could vary from one to four hours. Set the expectation that while these are on-site meetings at the office, they are un-interruptible. By picking a half day, you can go deep and wide in these topics and not miss an entire working day.
Finally, make sure these meetings are a safe space where ideas and opinions can be shared openly. While in the end, not everyone may agree personally with the final direction, everyone must still be respected as an equal. At the end of the meeting, the decisions made are decisions made by the company – not any one individual. By showing a unified front on decisions made, you ensure the organization stays unified on the path – not splintered and confused on where to go next.
Taking time to observe your competition reveals not only your position in the market but can help shed light on where your business needs to be focused. Start by determining your competitive advantages - what separates you from the pack? Why do your customers prefer your products more than the competition? Is it based on price? Effective marketing? Customer Service? Know yourself, then let's get to know thy competition.
After you re-affirm your differentiators and values, consider the competition in your industry and evaluate what they are focusing on. What customer demographics are they targeting? Can you win that demographic from them, or do you let them have it and focus on another? What innovations are occurring in the space or are being chased by your competitors? What new players are entering the market space – and should you try to squash them early?
At the end of this meeting, determine what moves you may need to make to better position yourself in your industry and capture additional market share. Evaluate your competition and determine if a task force needs to be created to further analyze opportunities and liabilities in the competitive market.
When times are good, as they have been for years, it can be hard to imagine business levels not growing, let alone receding. For this reason, all too often we see companies live high on the hog and spend frivolously, or fail to re-invest in improving a system that's not broken. Your Nokia phone wasn't broken either, but you still managed to upgrade it to smart phones, and your productivity has never been higher (even with all the time playing Fortnite).
With the start of the first bear market in years, it is a solid reminder that good times don't last and you need to be prepared to make cost cuts. Further, even in good times, re-evaluating spending leads to increasing profitability.
This meeting can be a great time to bring in your finance experts and operational advisors. Review your Profit and Loss by month and look for abnormal spending. Evaluate employee profitability, overhead costs, interest rates, operational costs. Find out what subscriptions you are paying for that are no longer necessary. Evaluate major bills and shop out to determine if a better price for the same value is available.
Keeping a stern eye on operational spending on a regular basis, and keeping true to managing healthy cash flow and savings reserve will set your company ahead of the competition when the economy or industry faces its next bust. Imagine, operating lean while managing a healthy cash reserve. While your competition is undergoing layoffs, you'll be in a position to pick up their best talent, pick up their clients, and possibly even buy their business for dimes on the dollar.
Gather leaders from each of your business units. Bring in both senior and junior members to your organization to share ideas that would wow the industry. What does your most experience employee think would be a huge shift in the industry - even if it is impractical. What does your youngest, most technological and cultural savvy employee identify as a trend that you are missing out on? What input are you getting from customers that would be a cool or necessary upgrade for your products and services?
The key here is to identify all possibilities and impossibilities. Look at all the impossible or impractical things that have changed in the last 20 years due to microprocessors and good old fashion 'tell me I can't' line of thinking. Re-useable rockets? You must be joking - yet ten years later, it is a reality.
Some potential questions to ask your team during this meeting include:
- What new products or services can you offer either standalone or as compliments to existing offerings?
- How can you improve customer interactions to promote loyalty and improved experiences?
- What new marketing campaigns could you experiment with?
- New media such as Alexa Skills, Virtual Reality, social websites
- Media not used before such as mailers, SEO, intelligent sourcing
- What new industries or market segments could we serve?
Don't just discuss these concepts and let them wither away. Shine a light on the best ideas and explore them further. Make it a special project for someone on your team or your employees to explore. Imaging the future is a fun task, and assigning this work to employees provides them with creative outlets as well as potential responsibility for the future of your company.
Where is the company headed in the next year, five years, and 10+ years? What is the purpose of all of this? Take time to re-evaluate your Vision, Mission, and Core Values. If you have done a good job with these in years past, then they should not change much.
Keep these ideas big picture. Blockbuster was in the video tape business, not the entertainment on demand business. Because they did not pivot, they faltered. Focus on what your company provides customers on an emotional level – not product level, and you’ll always have a guiding path for the future.
Additionally, take time to acknowledge the ultimate goal of the leadership. Are you positioning the company to be sold, or to grow perpetually? If you are on the path to IPO, then the investments made in the company and the decisions made should be different than if you looking to hand off the company to family.
Company-wide Employee Evaluations
More than just the manager one to one, your leadership team should meet at least annually to discuss the entire organization. Your fellow leaders and trusted advisors will have various perspectives on each employee based on their unique interactions. Does an employee butter up one executive, while at the same time undermining another?
Take this time to determine which employees are assets and liabilities to your organization. Get the right people on the bus, and start planning now to get the wrong people off. If you need to remove an employee, who will step up to take on their responsibilities? What happens if someone is hit by the proverbial bus and does not come in tomorrow? Put your succession plans in place today, so if they become a reality, you can make a move without a long drawn out process in an emergency.
Recognize your current talent pool, and then determine what additional seats may be needed in the year to come. How many new hires are needed, and where? What positions do you need to onboard and train today to be ready for a 20% growth this year? Alternatively, with the markets threatening bear territory, what fat do you need to cut soon to prevent from cutting muscle later?Your content goes here...
How Money is Made
Go deep and really determine exactly how revenue and profits are generated in your business. What is the profitability by product line? Does that include the returns, repairs, and added overhead required to provide this product or service? Don't just assume, but have your accountant or finance team prove these numbers. Confirm your Return on Sales is at a level that you approve of.
For those that are number-phobic, take time to assess not just the money, but how you strategize your products and complementary products to drive revenues. Do you already, or have you considered a subscription model for your products? Can you give away a product but make up the margin on repair services? Can you come up with new products or services to increase profitability such as a lease program?
As you narrow in on what products drive the best profits and opportunities, determine how to sell more. Would you rather sell 100 products that make $5, or 10 products that make $50? Depending on your market and client base, one of these options may be easier than the other, and you are missing opportunities by doing both, instead of focusing at one. With your most profitable products identified, you can now explore ways to shift the business to optimize those sales and market accordingly.
How did you get where you are today? What can you do to give back and build up good some good karma for the business and community?
Recognizing those that have stood out in the organization, outstanding clients, and service providers breed a positive culture. Consider, the last time someone provided you with a thank you card, even if only for a moment, you were grateful to be appreciated.
Identify the best contributors within your business. Reward them and demonstrate company-wide that you recognize top performers, kind spirits, and friendly individuals. Make awards specific for your company with a hidden meaning, that only your people would understand.
Evaluate your compensation plans, benefits, and bonuses to continue to show appreciation for all of your employees.
Connect with your best customers and thank them for their patronage. After all, keeping a great customer is far better than acquiring new ones. Build on your relationship and let them know you value them, and in return, they will continue to value you.
Give back to your local community as well. What new charitable program can you implement to put good back into the world? Demonstrate that your business is about more than profits by sponsoring a local effort. Create a program that speaks to your customers or industry. Boost not only the locals but also your company culture.
And don't forget your vendors as well. Especially in a bind, we often abuse our vendors and service providers making unrealistic demands, expecting the best work at the lowest price, and making them call endlessly as we focus on 'more pressing matters.' When you have a great vendor that always delivers - you want to identify that and acknowledge it. Encourage them to continue providing you premier service and put up with your demands.
Quarterly State of the Business
These quarterly meetings are critical to make sure the business is on track with it’s goals and pivoting with any unexpected changes. The numbers rule these meetings reviewing the financial health of the business by reviewing cash flow, profits, expenditures, and trends.
Ask the hard questions such as what if sales drop 30% next quarter. Confirm that your marketing plans are working. Explore changing trends and major project updates. Open the floor up to the entire team to address any heartburn they are feeling in the business. Encouraging your team to open up about what they are seeing and addressing potential issues early, you can avoid catastrophe later.
These meetings are a great time as well to briefly explore all the other topics discussed previously. Re-affirm the goals and targets and get in front of anything that is in need of special attention.
Regardless of the specific topic, take regular time to meet with your leadership or trusted advisors. It is easy to get caught up in the day to day emergencies and let the business as a whole fall to disrepair. Devoting time to the big picture is what separates leaders and successful organizations from those that fail.
If you would like to explore these topics further, or explore additional ways for your business to achieve #BetterResults, please reach out.