Tag Archives: Balance

Why Do We Keep Trying to Grow? Three Thoughts

Situation: A CEO is looking at the strategic plan of her company. They are planning for growth but a question arises – what is the balance between work for the sake of the work and work for the reward that it brings? What are the thoughts of the other CEOs around the table? Why do we keep trying to grow?
Advice from the CEOs:
• Step back and ask – what do I seek? Do the same with the members of the leadership team – what do we seek?
• Define what you want and what enough is. There is always the question of whether when reaching the goal will it be enough? Work with your team to discuss and seek a consensus on what their objectives are both for themselves and the company. You may be surprised at what this discussion yields. Two books may help you to deal with this question: The Gap by Dan Sullivan which deals with growth, motivation and satisfaction and Small Giants by Bo Burlingame of Inc Magazine which tells the story of a number of companies that decided that growth is defined by the impact that they have on their employees and communities as opposed to growth in revenue or profits.
• Repeat this discussion with the team at least annually. Expectations develop and change over time. An annual review of plans and opportunities empowers the team to make interesting and valuable contributions.

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How Do You Make the Most of People, Processes and Technology? Four Points

Situation: A CEO wants to improve efficiency and use of people, processes and technology. What have others learned from their experience? How do you make the most of people, processes and technology?

Advice from the CEOs:

  • One CEO gained new insights on the importance of details within the decision making process. She learned that details have had a much greater impact on the outcome of the decision process than her company had previously appreciated.
  • Cost reductions may cost more than they save. If the longer-term vision for the company isn’t considered a company may make short-term decisions that actually cost more in the long-term.
  • Difficult times equal opportunity. The key is keeping your head together and approaching challenges objectively, with an eye to long-term consequences of the choices made.
  • Always maintain balance in both choices, decisions and execution. There will be surprises along the path. Open eyes and balanced consideration will help to address these surprises constructively.

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How Do You Unlock Your True Profitability with Sound Cash-Flow Trade-offs? Six Points

Situation: A CEO has her company on a positive growth track. The company has a solid customer base. Their products and accompanying services are increasingly well-accepted. She is ready to take the company to the next level of growth and profitability. How do you unlock your true profitability with sound cash-flow tradeoffs?

Advice from the CEOs:

  • Profit is different from cash flow. Make this distinction clear and act to boost cash flow.
  • Tracking Cash & Forecasting:
    • Watch the company’s bank balance. Frequently track cash inflows and outflows by period.
    • Carefully assess and project the pattern of customer buying habits and payment performance to develop sound revenue assumptions.
    • Compare the company’s margin dollars and billings with norms for peer group businesses.
  • Issues to consider in forecasting:
    • Hiring means commitment of future cash outlays. Consider contingent work force options.
    • Project and plan for future large payments (equipment, technology, marketing, loans, etc.)
    • Differentiate between investing in ongoing business capacity as opposed to incremental add-ons.
    • Look at cyclical trends and issues. Understand your customers’ purchase habits and patterns.
    • Develop likely “what if” scenarios (good and bad) and develop plans to reduce the impact of surprises.
    • Analyze the company’s business model and determine exactly how cash flows through the company’s operations.
  • Analyze important upcoming decisions: hiring equals investment; outsourcing equals expense. Evaluate needed support for each.
    • Differentiate investment versus outsourcing decisions. Smooth cash flow through selective outsourcing – especially when dealing with sudden or cyclical peaks. Avoid the risk of committing long-term resources by staffing up to address short-term peaks.
  • Focus on the opportunity cost of money. Add this focus to both planning and assessment.
    • Operate with a mix of other peoples’ money and ownership funds. The latter are more expensive than bank interest because the trade-off is what you could earn through alternate investments.
  • Fine-tune the company’s planning tools. Analyze budget and cash implications of alternate plans through detailed budget projections and follow-up by tracking cash expenditures.
    • Use Cash Flow Statements to analyze and project trends in investments, operations and financing and how each of these affects cash balances.

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How Do You Prepare and Engage in an Effective Negotiation? Five Points

Situation: The CEO of a company is engaged in an important negotiation. There is a debate within the management team regarding the best way to prepare and engage in this negotiation. How do you prepare and engage in an effective negotiation?

Advice from the CEOs:

  • In any situation where a decision between two parties is to be decided preparation is critical.
    • Start with the basics. What is the bottom line that the company wants or needs to achieve?
    • Once the bottom line is identified, determine the strategy and what will be required to achieve this.
  • The most important question is why an agreement is being sought. What is the objective and what does a win or a win-win look like? How are they different if they are?
  • When meeting with the other party, listen with understanding.
    • Start by establishing norms to govern the discussions. These may include: one person speaking at a time, being up-front about objectives and positions, and the length of the discussion.
    • Avoid the distraction of thinking about the next move – know the possible moves in advance as well as the conditions and consequences associated with them.
    • Be prepared to tell the story of where the company wants to go any why the goal is important for both parties.
  • Good decisions between parties are based on trust.
    • Be trusting until given a reason not to be.
    • Point out items or statements that challenge trust and ask for clarification.
  • A Peer-to-Peer approach is the best alternative.
    • Look for equal give and take. Keep the conversation and negotiation balanced.
    • Don’t start with your real bottom line. Ideally, work with the other party in give and take until it is achieved.
    • Be willing to walk away if the discussion won’t fulfill the company’s needs; but if this is necessary, do it courteously. Leave the door open for possible future opportunities.

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Where Do You Focus to Build a Strong Company? Four Considerations

Situation: A company has just hired a new CEO. Historically the company has focused on high quality and good customer service but has lacked good financial management and has experienced financial difficulties. As a result, they could not support their staffing needs. Where do you focus to build a strong company?

Advice from the CEOs:

  • Critical areas where the CEO should focus:
    • Quality – assuring that the company continues to produce high quality products.
    • Customer service – assuring that the company continues to offer excellent customer service.
    • Quality and customer service must remain one and two, though they can be in either order.
    • Financial soundness; but not so focused on the bottom line that either quality or service suffer.
  • How do you achieve or maintain focus on these areas?
    • High quality and good customer service are already well established.
    • What has been lacking is sound financial management. Evaluate whether the right people are in place, and what financial and financial record systems are in use. If expertise is needed, bring in an expert to evaluate both personnel and systems and recommended changes that need to be made.
  • What other important factors should be the CEO’s focus?
    • Ethics – particularly when evaluating the company’s financial system, assure that both people and systems support a strong and reliable department. This may result in some hard decisions that are necessary to turn the situation around. If this is the case, be determined but fair.
    • Sustainable business practices – assure that any new practices that are instituted are sustainable. Look at case studies of similar companies that have turned themselves around.
    • Fun – an enjoyable workplace as far fewer issues than one that is difficult. It is important to build strong teams, and to give them the autonomy necessary to do their jobs well without overly taxing team members.
  • Build a company that has a good balance between the first 3 critical factors. When new hires are necessary look for people with an established track record and business background who also have strong ethics.

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How Do You Balance the Demands of Work and Family? Five Views

Situation: A CEO struggles to balance time and responsibility commitments to his business with demands of his family. This is not an uncommon struggle for executives. The question is: what strategies are effective to address the needs of both. How do you balance the demands of work and family?

Advice from the CEOs:

  • One Member: It takes a plan to find a solution.
    • Decide what you want and write a business plan to get there.
    • What relationship do you want with your soul mate? Make this part of the plan.
    • Have a conversation and test whether your and your spouse’s long-term visions are complimentary.
    • Don’t take on additional work – this is good both for family relationships and the role as CEO.
  • Another Member: My spouse and I talk about this a lot – particularly around time.
    • We have agreed on how the week is carved out – family time/work time.
    • We agree to honor each other as we are – not how we want the other to be.
    • Watch work commitments because – long-term – your spouse and children more important and more lasting than work.
  • Another Member: I’ve lived through the same issues.
    • I probably erred on side of family vs. career. The benefit is that now, I can’t get enough time to play with my kids. It’s great!
    • Attention to children is very important during the early years. While infants are not as capable of communicating as they will be later, the basic emotional and learning patterns – as well as affection patterns – are created early in life. It’s like the foundation of a building – not much to look at from the street, but it allows the whole building to stand.
  • The same mind that developed your business can solve this.
    • Stay open to solutions.
    • Make a choice.
    • This is uncomfortable, but not bad. The struggle proves that you care.
  • View your spouse as somebody who cares enough about herself so that she thinks she deserves a class act from her mate. Isn’t this what you want in a mate?

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How Do You Manage a Business Transition? Five Thoughts

Situation: A company is moving from sole focus on servicing a market to a split focus including developing and marketing their own products. This is a significant transition for the team. What is the best way to organize this effort? How do you manage a business transition?

Advice from the CEOs:

  • While the company’s financials are great for their market, cashflow may be insufficient to fully fund a development company.
    • Internal development of new products can create conflicts if it creates competition for resources between internal and external projects.
    • To avoid this, create an independent company or entity – in a separate location. Seek outside funding whether bank, angel or partner financing. The independent entity can then buy resources from the primary entity at competitive rates.
  • Several years ago, another CEO utilized the strategy just described. The important lessons were:
    • Assure that venture is properly resourced.
    • Assure that there is a balance between proven structure and creative application development.
    • Utilize best resources available at same rates that key customers pay.
    • Offer free guidance but not free services – peer reviews are key.
  • A third CEO had an opportunity to open a new business using the spin-off model.
    • They allowed infrastructure sharing – with proper compensation and incentives (equity ownership).
    • Ultimately both entities were successful.
    • Lesson: Properly implemented, this model works.
  • There are four aspects to the challenge.
    • Product concept
    • Talent for execution
    • Financing
    • Distribution
    • The business plan for the new venture must address all four.
  • Building internally (vs. externally) creates natural conflict. Workers will tolerate change in direction from clients better than they do from insiders.

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How Do You Balance Multiple Businesses? Eight Thoughts

Situation: A company has had one primary focus for the last few years. They are now developing another capability which takes significant attention from the CEO. How do you balance multiple foci, while maintaining a balance with family life? How do you balance multiple businesses?

Advice from the CEOs:

  • Find people you trust and delegate – ask them for help. Give them lots of leeway – just ask for updates.
  • Prioritize your weeks – big boulders and small rocks – decide weekly how you will focus. A week is a good planning time frame.
  • Identify and come to grips with your situation – the brutal facts – this will help you to prioritize.
  • Set boundaries based on time, relationships, priority – have realistic expectations of what you can accomplish. Set others’ expectations on when you will respond to their calls, emails, etc.
  • Compartmentalize your time for full concentration and focus. Focus on one thing at a time instead of multi-tasking.
  • Eliminate non-value added “stuff.”
  • Avoid letting others impose their schedules onto yours.
  • Use exercise time to refresh your endorphins, clear your head and give you time to reflect on priorities.

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How Do You Create a Family Charter? Four Guidelines

Situation: The spouse of a CEO works in the business but has conflicts with other employees. This creates personal tension for the CEO. The CEO wants to explore a different role for the spouse, and also wants to create more balance at home. The CEO believes that working with the spouse to create a simple family charter with common values, vision and mission will help the two of them to find common needs and goals both at work and at home. How do you create a family charter?

Advice from the CEOs:

  • As you build a family charter, consider both your individual and your common views. Once you have established common ground with your spouse, you can bring children into the process to reinforce values and share creation of the vision.
    • In preparation for this discussion, both you and your spouse should start by thinking about what you each want. Once you have done this, compare notes and look for commonalities where you agree on what is important. These commonalities will form the core of your shared values, vision and mission.
  • Have lunch with your spouse once a month, just the two of you. Why? Because you are telling your spouse that they take precedence over your second spouse – your job, and you are taking time and attention from work to spend time one-on-one with your spouse. Do this monthly, but not always on the same day – make it more spontaneous and special.
  • Reinforce your family charter with regular family or one-on-one meetings with your spouse and children.
  • When having a conversation, focus on listening and don’t try to “fix” things.

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What Should You Ask When Evaluating New Opportunities? Five Foci

Situation: A CEO recently sold his company and is evaluating new opportunities. What are the most important questions you should ask when evaluating new opportunities?

Advice from the CEOs:

  • Perhaps the most important thing to evaluate is your passion for the choice that you select. As you evaluate options look closely at the business involved and your enthusiasm for that business. In addition, how does the company feel to you? Does the staff and culture reflect your values? Are you comfortable with the sense of teamwork and collaboration that you see?
  • Doing a cost/benefit analysis on each opportunities, with a focus on:
    • Financial stream – financial prospects for the company as well as the financial package and incentives that you are being offered. In the case of an early stage company, what are their prospects for obtaining financing? If you will be an investor, what is the investment required on your part and what it will cost to support family until you can replace your recent salary?
    • Personal enthusiasm and satisfaction associated with each option.
    • Consult several trusted advisors throughout your selection process
  • Any new CEO assignment requires considerable work and focus, especially in the early phases. Anticipate long hours. The more that you feel compatible with the company and culture, the easier this will be.
  • Look for an appropriate balance between your personal and career priorities, and the financial opportunity offered by each option. If there is an imbalance, you will have to determine which – financial or personal priorities – you want to give the greatest weight.
  • In addition to personal, career and financial priorities, determine the most important factors that you want in your lifestyle. As you evaluate options, assess the match that each option offers to your results.

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