Tag Archives: Crisis

How Do You Change the Company Structure to Support Growth? Ten Points

Situation: A CEO is concerned that her current company structure may not be set up to support envisioned growth. She is not sure how to differentiate managers from developers. She also seeks guidance on how to evolve the CEO role. How do you change the company structure to support growth?

Advice from the CEOs:

  • How do you differentiate and select managers versus developers?
    • Use an organizational development process to facilitate this selection.
    • First, outline the organizational structure that will evolve as the company expands. Share this with key staff and listen to their input.
    • Next, with key staff, determine the metrics. For example, what revenue or net profit before tax milestones will trigger the addition of managerial staff.
    • For each managerial position create a position description and a list of talents and skills that a candidate for that position should possess. Review these with staff and adjust with their input.
    • Let the company know the plans for the organization, and the positions that will be created as the company hits the milestones that will trigger growth. This will prompt anticipation of the opportunity and professional growth for staff that will accompany expansion.
    • Schedule a 1 or 2-day planning meeting with staff to discuss how to develop and improve both the organizational structure and operations. Continue this discussion in staff meetings at least quarterly.
  • The CEO’s role within the company.
    • The first question to ask is “what do you enjoy?” Is it being CEO, or is it leading the development teams? These are different roles.
    • Look at immediate needs. If the CEO is doing the books, it may be time to either choose or hire a COO – someone who can handle accounting, HR, and all the back-office functions.
    • Up to this point, the company has had a flat organization. The difficulty with this is that the first real crisis will take up so much CEO time that the company will fall behind in key areas currently overseen by the CEO.
    • Maturing the organizational structure is the right way to go. It will remove CEO from a “doer” role and allow the CEO to take the “leader” role – moving from working IN the business to working ON the business.

[like]

How to You Generate a Predictable P&L? Three Solutions

Situation: The CEO of a consulting company is frustrated by lumpy revenue and profits. From quarter to quarter it has been difficult to predict either number. Unpredictability reduces options in valuation and exit exercises, as banks and acquirers favor predictability. How do you generate a predictable P&L?

Advice from the CEOs:

  • The objective is to construct a revenue base built on predictability, even if this is at lower margins. Given a predictable base, the company can complement predictable revenue and profits with higher dollar and margin opportunities as they arise.
    • Analyze the projects that the company contracts for both revenue and profitability. Some projects will be bread and butter situations which are more common and predictable, but which generate less revenue and profit per project. Others will be customer crisis driven. These latter projects will have higher revenue and profit, particularly if the company is the vendor of choice; the tradeoff is that the frequency of these contracts is unpredictable.
    • If the objective is predictability, the company’s base should be built on bread and butter projects. As the company grows, focus on this base. Customer crisis projects can then be added as they arise to bump both revenue and profit.
    • The objective will be to become one of the top 2-3 outside vendors of the choicest clients. Target projects may be ongoing maintenance of older projects in the client companies’ portfolios.
  • How would this model be pursued?
    • Focus on the company’s top 5 customers. Reduce risk by optimizing customer leverage as a proven entity and offer them strategic deals.
    • The focus is long-term project based with guaranteed delivery at lower cost.
    • Identify the fear or insecurity that exists within the customer and provide sleep insurance.
    • This model works well in the new economy – get lean, manage infrastructure size and cost, and grow with the economy.
    • Alternately, identify an area where the customer may not have enough resources and provide a solution that allows them to address this without adding additional personnel or by using existing personnel more efficiently.
  • Another option is to develop a virtual office model. Provide resources for $X per month, with an evergreen provision.

[like]

How Do You Manage in Crisis Situations? Four Foci

Situation: From time to time companies face crisis situations. A company, planning ahead, wants to establish a culture that can deal with crises effectively. What are the most important elements that should be part of this culture?

Advice from the CEOs:

  • Everything starts with a brutally honest SWOT Analysis (Strengths, Weaknesses, Opportunities, and Threats) of your company and operations. Identify where you are Strong, where you are Viable, where Urgent Care is Necessary, and where you have No Reason to Be. Based on this assessment, cut your losses – for example, eliminate exposure to the No Reason to Be activities and efforts – and focus resources on your strengths and what is necessary to assure your future.
  • Support all efforts or activities that you will keep or pursue with a Bottoms-Up Financial Analysis. This will include a P&L, Balance Sheet, Cash Flow Analysis, assumptions, variables, and best, most likely and worst case scenarios. This Financial Analysis is an essential part of facing up to the Brutal Facts of your business and environment. From this exercise you will gain clarity on where to focus first.
  • The greater the potential crisis, the more frequent this exercise must be.
  • When dealing with creditors, remember their priorities: honesty, eventual payment, fair treatment and long-term customers. Present them with a credible plan, don’t make commitments you can’t keep, keep all commitments that you make, keep in touch monthly, and pay what you can. The development of trust makes it possible to negotiate incredible terms.

Special thanks to Tom Spanier of Spanier & Associates for his contribution to this discussion.

[like]

What are the Challenges Facing Distributed Organizations? Part 1

Interview with David Van Wie, CEO, and Paul Brody, President, Sococo, Inc.

Situation: Research shows that 65% of teams within companies are now geographically distributed. This is driven by both telecommuting and the desire to access the best talent, and is enabled by technology. What are the implications of distributed teams for company and project success, and how can these be addressed?

Advice from David Van Wie and Paul Brody:

  • Broadly, the most important challenge is that of team “presence” – the feeling of people collaborating and working together. As social beings, we are used to establishing trust and mutuality face-to-face. Trust and mutuality are more challenging when we are limited to audible communications.
  • Working at a distance becomes a challenge when different members of a team are on the same stage of a workflow issue and there may or may not be shared understanding of technical requirements or timelines.
    • Team members need to understand requirements to a “T” – across functions, technical requirements, and needed skills.
    • Consider the challenge of keeping team members in synch when project requirements are continually shifting, as frequently happens when new technical breakthroughs are involved and there is no preplanned predictability to the project. This challenge is exacerbated when the team is designing at light speed.
    • The agile design model focuses on people and talent over process and dictates a continuous ongoing meeting. In a distributed setting, the whole team is never stronger than the most remote and linked-up member.
    • These are the challenges that we seek to address at Sococo through our Team Space application.
  • Let’s look at an example of resolving a conflict based on miscommunication of information.
    • In this case, a young employee was tasked with drafting an email campaign around a product. Other team members were time zones away and on their own schedules. The night before campaign launch a misunderstanding developed around one of the core features of the product.
    • Because of the Always-On nature of Team Space, all of the team members working on the project were right there and on call to ensure a smooth product launch. When the problem arose, they were able to have a quick online meeting to share spreadsheets and analysis, understand the issue and resolve the misunderstanding on the fly.  The campaign launched the following morning.
    • When people are in the space, you know they’re part of the team and they’re at work, ready to solve problems. They haven’t given up. Having to bring someone back into a conversation (to resolve a problem) takes more time, effort, and energy and is draining for a distributed team.

For more information on Team Space, visit www.sococo.com

Key Words: Distributed, Teams, Presence, Collaboration, Workflow, Project, Agile, Conflict, Crisis, Silo  [like]

What are the Challenges Facing Distributed Organizations? Part 2

Interview with David Van Wie, CEO, and Paul Brody, President, Sococo, Inc.

Situation: Research shows that 65% of teams within companies are now geographically distributed. This is driven by both telecommuting and the desire to access the best talent, and is enabled by technology. What are the implications of distributed teams for company and project success, and how can these be addressed?

Advice from David Van Wie and Paul Brody:

  • A second example of a critical challenge occurs in crisis mode – for example when a major system is down and service is impaired.
    • You need the right people with the right information talking real time. Those without complete information are at a loss. If they respond from emotion rather than fact, it hinders crisis resolution.
    • Having an avatar in Team Space yields a positive emotional response, primarily in that you then interact with other avatars instead of just names on a list. It gives you an increased feeling of presence.
    • This emotional investment positively correlates to increased trust, as you feel more connected to your peers.
    • You want an environment in which you can bring distributed people together on the fly, provide them with complete information, raise and candidly discuss issues and alternatives, and come up with a solution with all parties involved, all while reducing the emotionality of the situation.
    • Emotionality of tense situations is reduced because of the trust built amongst team members through our unique spatial UI.
  • Third, organizations beyond a certain size tend to form silos by function. This can help to build strong functional organizations, but has drawbacks when different functions have conflicting priorities.
    • In a distributed organization, a visual layout becomes important. You want to be able to include and intertwine all functions in a visual space, and provide access between and across functions.
    • This entails a philosophical shift to an open culture where teams don’t feel defensive or protective. It is facilitated by a visual space where it is easy to bring in the right expertise to resolve issues based on information.
    • Likewise, the underlying open structure of Team Space and its ability to promote quick conversations as well as hefty meetings helps solidify trust in a distributed group.

For more information on Team Space, visit www.sococo.com

Key Words: Distributed, Teams, Presence, Collaboration, Workflow, Project, Agile, Conflict, Crisis, Silo  [like]

What are the Challenges Facing Distributed Organizations? Part 3

Interview with David Van Wie, CEO, and Paul Brody, President, Sococo, Inc.

Situation: Research shows that 65% of teams within companies are now geographically distributed. This is driven by both telecommuting and the desire to access the best talent, and is enabled by technology. What are the implications of distributed teams for company and project success, and how can these be addressed?

Advice from David Van Wie and Paul Brody:

  • A fourth question which arises with distributed organizations is whether you have to have different processes to manage a distributed organization.
    • We don’t think so. Each company has developed their own set of process to address the challenges of distributed personnel. Rather, we focus on communication tools that adapt to clients’ existing processes by humanizing communication – enabling people to easily find each other and share information.
  • Fifth, some of the most challenging environments occur in organizations which span extreme time zone differences. How is this addressed?
    • You want an audio and visual system that lets you know who is available at a given point in time or could be made available easily. This facilitates bringing the right expertise into a conversation.
    • When different parts of the team are widely separated by time zone, it is important to create a more social and effective environment during the times when all team members are available. We believe that Team Space helps to create this environment.
    • In one company, Indian team members stay at the office until 7:00pm – thereby avoiding the worst traffic – and can be available online at home after dinner. This increases the time that they can interact with their American counterparts.
    • It is also important to be able to record meetings and presentations so that members who are absent can play back the meeting to stay up to date.
    • Our experience is that visual presentation is superior for communicating visual information, and we accommodate this.

For more information on Team Space, visit www.sococo.com

Key Words: Distributed, Teams, Presence, Collaboration, Workflow, Project, Agile, Conflict, Crisis, Silo  [like]