590 likes | 849 Views
So You’re Stuck: Dealing With Challenges in Business November 22, 2013 Barnett Gershen. BSCAI is the Business Resource for Contractors — 2013 BSCAI Annual Convention. Family Circus. Housekeeping. Start Time: 9:45 AM, Stop Time 11:00 AM
E N D
So You’re Stuck: Dealing With Challenges in Business November 22, 2013 Barnett Gershen • BSCAI is the Business Resource for Contractors — 2013 BSCAI Annual Convention
Housekeeping Start Time: 9:45 AM, Stop Time 11:00 AM To keep us on track, and because I only have about 75 minutes to speak, please hold your questions until the Q&A at the end. I will set aside 15-20 minutes for the Q&A part of my presentation. You may write your questions down with one of our pens we provided. Please set phones to ‘silent’ mode. A copy of this presentation may be downloaded from my website at www.gershenconsulting.com/bscai2013.pptx or from the BSCAI website. Time-saving idea – Go ahead and rate me a 5 before we begin!
Housekeeping (2) • If you haven’t already, pick up a Gershen Consulting business card at the entrance • To be in the running for an iPad Mini ($300 retail value), leave your business card next to the sign up sheet at the front. The winner will be randomly selected. • Easel – 5 minute exercise… • I’ll ask 3 people in the audience “If this presentation was a great success, what questions would I have answered?” • At the end of the presentation, I’ll return to these answers and see how successful I really was
Introduction – Barnett Gershen Grew Associated Building Services (ABS) starting with two employees to become the 9th largest privately held maintenance contractor services company in the US with 13,000 employees and sales of $230 million. Hands-on experience from leading Associated Building Services (ABS) from its inception to its successful sale in 2004. In 2005 he founded Gershen Consulting, where his proven abilities as an executive are used in reproducing companies, driving up the top line as well as increasing the bottom line. Specializes in helping executives shorten their journey to the next level of success
ABS Growth: Revenue and Changes 1976 - $2MM 1986 - $21MM 2000 - $90MM 2003 - $240MM 2004 - Sale of ABS 1996 - $40MM 2005 - Founded GC 1947– Inception - XGI • Implemented incentive bonus plan • Closed first of several major acquisitions $ Revenue • Established risk management program • Established CT management and stock option program • Implemented customer satisfaction procedures (quarterly) • Implemented relational counseling for team building • Implemented Birkman testing • Professionalized hiring process • Implemented customer and employee appreciation • Implemented strategic planning Years
About Change If you do what you’ve always done, you get what you always got – Alvin Ruben, Personal Weight Trainer
Hits Close to Home… • I’m a season ticket holder for the Houston Texans NFL team • The Texans made the playoffs in the past two seasons….but that isn’t likely to happen this year. • We’ve lost 8 in a row, some in spectacular fashion. • But – We have the same coaches, players, stadium, and supportive fans that we had in years past. Nothing seems to have changed! So why aren’t we winning?
The Answer We aren’t winning BECAUSE nothing has changed. • Just because you do something and it works DOESN’T mean it will continue to work • In football, as in life, change is REQUIRED if you want to enjoy continued success
Case Study – 49ers • Jim Harbaugh (the 49ers head coach) understands the need for change… • He benched quarterback Alex Smith and brought in a backup – Colin Kaepernick…. And the 49ers went to the Super Bowl
Business Life Cycles Courtship Infancy Prime Stable Adolescence Early Bureaucracy Bureaucracy Death Go-Go Aristocracy Premature Aging or Unfulfilled Entrepreneur Divorce Founder or Family Trap All businesses experience life cycles… Infant Mortality For a complete treatise on the Life Cycles concept, go to www.adizes.com Affair
Some Fundamental Truths About Your Journey • All organizations, like all people, have certain lifecycles. • All living organizations have issues that are common to each other. • Knowing where your organization is at on the corporate lifecycle can be critical to its success. • With the aid of this concept, you can determine where your business is in it’s life cycle.
Some Fundamental Truths About Your Journey • As your business grows, your greatest strengths can become your greatest weaknesses. • If you know what’s ahead of you, you can reach your goal of achieving the next level faster, easier, and more efficiently (and have more fun doing it). • Your role as a leader is to accelerate your company’s ability to resolve problems.
Some Fundamental Truths About Your Journey • Keep in mind – These stages aren’t ‘Mutually Exclusive’, and a business is never in just one stage • Also, a business is always moving along the life cycles continuum, it is rarely static • It is your job to determine where your business is along the cycle, and what direction it is going (an expert is often needed for this determination).
An Interesting Comparison… Common Business Cycle Courtship Stable Infancy Adolescence 1976 - $2MM Prime 1986 - $21MM 2000 - $90MM 2003 - $240MM Sale 1996 - $40MM Go-Go Divorce/Premature Aging Unfulfilled Entrepreneur ABS Experience Founder or Family Trap Infant Mortality Affair
Example: ‘Go-Go’ Stage (1 of 2)* • Some Characteristics of the ‘Go-Go’ Stage (1 of 2) • Company with a successful product or service, rapidly growing sales, and a strong cash flow • Key customers are raving about the products and ordering more • Prone to rapid diversification and spreading themselves too thin; so many ‘irons in the fire’ that they cannot give the necessary attention to each one • Sales driven, and has an insatiable appetite for growth • Every opportunity uncovered in the marketplace looks promising; agreements are often signed before the company really knows if it can do the work • Everything is a priority; strategically important projects often get pushed aside for the latest ‘hot’ project • Leaders often don’t listen to criticism or warnings; this is left over from what initially made them successful in the ‘Infancy’ stage *Please refer to the ‘Business Life Cycles’ handout
Example: ‘Go-Go’ Stage (2 of 2)* • Some Characteristics of the ‘Go-Go’ Stage (2 of 2) • Management is often ineffective and frustrated; Go-Go leaders often have little time to manage due to their personal involvement in the company • Information and accounting systems are weak; useful cost accounting and accurate reporting is often a distant dream; management reports are often published so late that they are of little use for day-to-day operations • Company is organized around people and projects • Employees are frustrated due to overwhelming workload, unclear responsibilities, and fuzzy goals • As the company continues to succeed, procedures and systems expand in response to emerging opportunities or unexpected problems, rather than a long-term plan • Continued success may eventually cause a major crisis that could threaten the loyalty of major clients, or jeopardize the entire business *Please refer to the ‘Business Life Cycles’ handout
‘Go-Go’: Pathologies* Pathologies of Go-Go: The Founder's or Family Trap The Family Trap occurs in businesses that are owned by a family where control remains in the hands of family members, and the family is unwilling/unable to place trust in non-family members. In the Family Trap, leadership is determined on the basis of ownership and bloodlines, rather than competence and experience. In these situations, the company has again failed to separate ownership from management. Companies caught in a Family Trap are particularly vulnerable when control is transferred to an incompetent family member. *Please refer to the ‘Business Life Cycles’ handout
‘Go-Go’: Solutions* • Prescription for Go-Go Success: • Reining in activities and getting the enterprise to focus; Identifying the organization's priorities is not as important as identifying what is NOT a priority. • Continuous restructuring • Developing the skills, systems, trust, and respect needed to support delegation and eventually decentralization • Transition from management-by-intuition and management-by-the-seat-of-its-pants to a more professional approach; Usually occurs only after the company finally experiences a truly major crisis (without killing the company). • Delegating to a team of people, rather than to a single individual. The development of effective teamwork among the senior management group becomes critical in Adolescence, so it is a good time to begin forging a strong team during Go-Go. When delegation is successful, the Founder and the management team can tackle decentralization, which is a much more challenging transition that involves transferring the responsibility for strategic decision-making from the Founder to other key managers. • This is a key point – We will follow up with more info… *Please refer to the ‘Business Life Cycles’ handout
Business Life Cycle Stages “Like the Eagles once said, you're the new kid in town… Until you're not. I think every manager has a period of about 2-3 years in the company, then they either need to get a different team in the same company, change companies, or do what is hardest -reinvent themselves and the personal value proposition they bring to the company and their teams. I call it shelf life.” Kris Dunn, HR Capitalist, December 21st, 2012
Managing Teams - William Allen, a director of strategy and operations for Adobe, has proposed some unique perceptions on the team building aspect of the Go-Go stage…
Not a Good Reason… - William Allen, Director of Strategy and Operations, Adobe
Managing Teams Mr. Allen sees change as essential for teambuilding in a growing business. He recommends:* • Talk, talk, talk more • Effective communication can virtually eliminate the “I’m waiting for someone else to finish” problem, among other issues • Leverage technology, but don’t force it • Use what your teams gravitate towards and need, rather than forcing the implementation of a “perfect” solution • Favor in-person conversations, not email • A few minutes of face-to-face communication can eliminate days of email threads, plus not as much is ‘lost in translation’ • Hold ‘all-hands’ meetings • Actively build these short meetings into your calendar • When it stops working, stop doing it • The single worst reason to continue doing something is because you did it before * For more information, refer to the ‘How Your Team Can Stay Nimble While Growing’ article
Life Cycle of a Democracy Bondage Spiritual Faith Abundance Liberty Complacency Apathy Dependence Bondage Great Courage • “The average age of the world’s greatest civilizations…has been about 200 years. During those years….they progressed through this sequence” - Alexander Tyler, 1887
Something to Think About… Bondage Spiritual Faith Abundance Liberty Complacency Apathy Dependence Bondage Great Courage Where is the US on this life cycle? “One of the penalties for refusing to participate in politics is that you end up being governed by your inferiors”.Plato
The Good News… • These cycles are common to everybody and every living thing • They are predictable • They are all solvable
The Bad News • There are NO REAL SHORTCUTS • If you don’t solve these issues, they will come back and continue to teach you this lesson over and over again • It takes a lot of work to keep from getting ‘stuck’, and even more work to get ‘unstuck’ • So why don’t leaders do the right thing?
Why Don’t Leaders do the Right Thing? • The 1992 movie ‘Scent of a Woman’ gives us an idea… • At the end of the movie, Al Pacino (Col. Frank Slade) comes to the defense of Charlie, a young boarding school attendee (Chris O’Donnell). • Charlie witnessed a prank on the school’s headmaster, and now he is threatening to expel Charlie (an action that could prevent him from being accepted to Harvard) unless he reveals who is responsible for the prank. • Col. Slade defends Charlie, and in the process, imparts some wisdom about tough choices and hard work…
“Too Damn Hard…” * The entire speech can be downloaded from www.gershenconsulting.com/scentofawoman.wmv
Texas A&M – Managing Elite Talent • A recent Forbes article about Texas A&M head coach Kevin Sumlin identifies several of the concepts we have been referring to: • Success can be a leader’s worst enemy • Nothing halts progress like taking for granted that one’s past victories will continue into the future • Every battle, every game, is different, and one cannot assume that what worked before will work today • You can have the most talented players in the world, but if you’re inconsistent in your leadership and strategy, it will prove fatal for you every time For much more information, you can read the entire article at http://www.forbes.com/sites/jasonbelzer/2013/10/08/texas-am-football-and-the-secret-to-managing-elite-talent/
What Determines How Fast/Well? Culture Management Team CEO
The CEO • Notes about the CEO • Everything starts here • Has enough ego strength to be able to ask for help • Many roles – Chief optimism officer, chief pessimism officer • “The day you’re no longer solving problems is the day you’re no longer leading” • Colin Powell • Strong enough to know what he knows, wise enough to know what he doesn’t know • This may be the most important trait… CEO
The CEO – Knowing What you Don’t Know • In 1872, The Battle of Little Bighorn, commonly known as ‘Custer’s Last Stand’ was a crushing defeat for US Army forces…. But could the outcome have been different? • As he was preparing for the march to the battle, Custer was interrupted by a salesman who insisted his product would be very helpful to the US forces. However, Custer was busy preparing for battle, and brushed the salesman aside. He was too busy for a sales pitch…. • Why was the salesman so insistent? What was he selling?
The CEO – Knowing What you Don’t Know • A relatively new technology….called a Gatling Gun • Custer was too busy to listen, and he didn’t take the time to consider ‘what he didn’t know’….
The Management Team • Notes about the ‘Management Team’ • Focused on shared results – Mission / Vision / Goals • Impeccable with word • Constantly reaching for next level • Always focused on doing their best • A bias for action • Self-policing • Succession plans Management Team CEO
The Culture • Notes about the ‘Culture’ • Small, continuous improvement • Pay for results, not activities • Discipline • Consistency • Management by values • Open communication • Transparency • “We have met the enemy, and he is us” • “To thine own self, be true” • Polonius, Hamlet Culture Management Team CEO
So Now What? Plan your work, and work your plan! • Your business is stuck, and you want to get it ‘unstuck’. • You are developing a plan. • Now, how do we execute the plan? Develop a shared vision, and from that vision, Develop ‘Best Practices’…
Shared Vision (Mission/Vision/Goals) • HAVE A MISSION – “The reason you open the doors” • Example: “To profitably provide the best building maintenance services in (your city, your state, USA, earth, galaxy)” • HAVE A VISION – “Where you are, where you want to go” • Example: “We are currently at $10MM in 2014?, we want to get to 20MM by 2018?” • HAVE KEY OBJECTIVES – S.M.A.R.T.S. • Example: Increasing sales, increasing customer retention, increasing profitability, building the best team, strategic issues…see next slide
Tactical Plan/Best Practices • A procedure for developing a corporate Tactical Plan and Best Practices should occur in 3 stages: Best Practices Tactical Plan Repository • This is a list of all tactics/tasks discussed • All ‘good ideas’, as well as items that cannot be addressed during the particular quarter will be placed here • Refer to this list in each of the quarterly meetings to see what is ‘in our arsenal’ of new tasks that could be implemented to support our objectives • Drawing from the repository, tasks/tactics that will be implemented in the upcoming quarter are placed on the tactical plan. • The Tactical Plan should be thoroughly reviewed in the quarterly meeting, but ideally, this would be reviewed monthly at each financial meeting. • Drawing from the Tactical Plan, tasks that have been successfully implemented (having been measured, managed, assessed, and corrected) will be placed in the ‘Best Practices’ list • Only completed tasks go here • These will become part of the job descriptions for each person so that they will be completed as a part of the culture of the organization.
Step 1 - Repository The repository is a list of all future tactics and tasks that are recommended, but cannot be done this quarter Think of this as a ‘Tasks in Waiting’ list, everything that we don’t want to forget goes here When we come up with additional tasks, we put them on this list so we don’t deviate from the 4 or 5 that are currently being worked on (see next slide) This list will be referred to in each quarterly meeting to see what new tactics/tasks we have available to support our objectives Repository (tactics in Waiting) • This is a list of all tactics/tasks discussed • All ‘good ideas’, as well as items that cannot be addressed during the particular quarter will be placed here • Refer to this list in each of the quarterly meetings to see what is ‘in our arsenal’ of new tasks that could be implemented to support our objectives
Step 2 – Tactical Plan The Tactical Plan is a list of tasks that are currently being implemented, each one supporting one of the key 5 objectives (Increasing sales, Increasing customer retention, increasing profitability, building the team, and strategic) This plan will address 4-5 tasks PER each key objective (Example: 4-5 tasks that address Increasing sales, 4-5 tasks that address Increasing profitability, etc.) This is a somewhat ‘short term’ plan, in that these tasks will be implemented over a specific quarter, and then reviewed at the end of the quarter to determine success/failure Process for developing this list includes defining the objective, agreeing on tactics (through mutual negotiation) that support the objective, and then putting them on the tactical plan (drawing from the ideas in the repository) If tasks are not successful, move back to repository, if they are, move to best Tactical Plan • Drawing from the repository, tasks/tactics that will be implemented in the upcoming quarter are placed on the tactical plan. • The Tactical Plan should be thoroughly reviewed in the quarterly meeting, but ideally, this would be reviewed monthly at each financial meeting.
Step 3 – Best Practices This list contains tasks that have been completed, and are currently being used successfully At this point, these are known as ‘Best Practices’, and should be removed from the Tactical Plan and included on this list These Best Practices should be included in the job descriptions and performance evaluations of each person so that they will be completed as part of the culture of the organization Best Practices • Drawing from the Tactical Plan, tasks that have been successfully implemented (having been measured, managed, assessed, and corrected) will be placed in the ‘Best Practices’ list • Only completed tasks go here • These will become part of the job descriptions for each person so that they will be completed as a part of the culture of the organization.
Tactical Plan Review • Just making the Tactical Plan isn’t enough – It’s your job to lead the charge for regular review of the document • The leader reviews the plan first, and then holds a quarterly strategic planning meeting (all hands) to review effectiveness and see what needs to be started, stopped, and continued. • Make sure the results of these strategic planning meetings are used in each employees performance evaluation. By doing this, you will be paying for results, not just activities.
Three Questions for the Leader to Ask: • If not this, what? • If not you, who? • If not now, when? (Time is Money)
How Do you Decide? • What if you’ve got 50 or 60 tactics, and you want to narrow the field to the top 5-6 for each category? • The 80/20 rule can help..