Category Archives: Strategy

Not Quite Broken

Many CEOs have dealt with the prospect of a business collapse

Down But Not Out

I wanted to write on this first day of 2015 about what a great time this is for the CEO to be engaged in planning.  I had planned to offer a few comments on the value of strategic planning, a discipline many of us resist.

But a couple days ago I saw the movie Unbroken.  I had read the book of the same name by Laura Hillenbrand about a year ago.

Let me explain why this changed my blogging plans.  The subject of this movie, Louis Zamperini, served in World War II as a bombardier on a B-24 in what was then the U.S. Army Air Forces.  His plane went down in the Pacific Ocean 850 miles south of Hawaii.  He was one of three crew members (out of eleven) who survived the crash.  They had no fresh water, little food, and a life raft.  He was afloat on the ocean for 47 days before reaching the Marshall Islands, where he and Russell Phillips were captured by the Japanese.  (The third survivor, Francis McNamara, had died at sea on the 33rd day afloat).  Zamperini was held captive by the Japanese, brutally beaten and generally mistreated, until the war ended in August of 1945.  He had been assumed dead and, in 1944, his parents had actually received a formal condolence note from FDR.  (His actual death occurred 70 years later, in 2014.)

Many CEOs I know have faced extremely serious struggles with their businesses as well as in their personal lives.  Some have faced life-threatening illnesses and business-threatening near-collapses.  Many have downsized significantly.  For the most part, these challenges are not quite in the same league as surviving a plane crash, then a month and a half drifting on the open sea, followed by two years of brutal captivity by a wartime enemy.  But the parallel is legitimate.  Running a business can be brutal.

There are many stories of survival that inspire.  I am in awe of the Louie Zamperini story.  And I’m also tremendously inspired by the survival of so many businesses that have been through something akin to a plane crash.

Maybe this is your story that I’m telling.  Or maybe you know somebody who has lived this scenario.  Someone who has been through hell personally or professionally but was not quite broken.  If so, I would urge you to begin 2015 by celebrating their (your own?) survival.

Quickly thereafter, get your strategic plan together.

Are You Asking the Right Questions?

2015 again holds a high degree of uncertainty for CEOs

Deja vu?

You’re racing to the end of another calendar year and, guess what?  For a CEO, this one ends just like the last!  Not the details, of course, but you’ve been here before when it comes to the overall uncertainty about the business environment.

The U.S. economy has experienced its fastest 6-months growth in the past ten years, and yet the rest of the world economy looks much less sanguine, and many are concerned about how this may affect the U.S. economy.

On the national political scene we will have both a Republican House and  a Republican Senate come the New Year, and yet the most credible voices are predicting that gridlock in Washington will continue.

Technology continues its relentless advance, providing new tools for operational efficiencies; and yet it simultaneously confounds and frustrates most of us when it comes to marketing and the “promise” of social media.

With regard to finance, the business bankers are speaking more sweetly, but their banks are still behaving like the man who offers you an umbrella when the sun is shining but can’t seem to find one for you when it’s raining.

This uncertainty is nothing new to you!  A CEO deals with it, planning for it and managing through it.  But the real rub for most CEOs is on the personal side.  With the holidays upon us, and with the end of another year at hand, I encourage you to ponder:

  • Are you having any fun?
  • Are you making money?
  • Are you becoming more skillful at something?
  • Are you generally headed toward your destination, toward your vision?

Underlying these questions is the really big one: “How ARE you??”  That is, how are you doing intellectually, physically, and spiritually?

Do yourself a favor. Find a few minutes, no later than January 1st, to answer this question, in writing:  Indeed, how the heck are you?

 

Specifically, address your intellectual state, physical state, and spiritual state.  Then commit to taking actions that will result in progress in one, two, or all three areas in 2015.  After you’ve done this, go back to those four questions regarding fun, money, skills, and vision, and take a crack at them. It’s a great way to clean out the cobwebs and launch your next twelve-month journey.

I wish you the very best in the New Year!

What if your car came without a dashboard?

Great CEOs have  identified their Key Performance Indicators and track them relentlessly.Are you a better driver because you can easily determine how fast you’re traveling, how much fuel remains, and what time it is? Are you more likely to safely reach your destination because you can readily see the compass direction of travel and because you’re immediately alerted to a loss of oil pressure or tire pressure?  Does the dashboard improve your overall ability to travel efficiently and effectively?  Would you be upset if the auto manufacturers decided to reduce the cost of their vehicles by eliminating all the instrumentation and alarm lights?

Now consider your business dashboard. Have you identified and do you regularly review your key business performance indicators (KPIs)?  Here’s why every CEO should:

  • Identifying your KPIs forces prioritization of data.  The total data available can be overwhelming and you have to keep your eyes on the road.
  • The correct KPIs provide a regular monitor of business historical performance, as well as the outlook for the short-term future. They enable you to stay on track.
  • The habit of routinely reviewing your dashboard (KPIs) creates a powerful sense of having your “arms around your business”, regardless of how well or how poorly the business is currently doing.
  • Your dashboard provides a jump start for when you need to:
    • Create a long range business plan
    • Create a marketing plan
    • Apply for a bank loan
    • Discuss the business with a potential investor
    • Interview a candidate for a key position
  • As a habit, your review of your KPIs is an excellent accountability tool for you personally as well as for your entire business.

You wouldn’t drive your car without a dashboard. Is it any less dangerous to drive your company without one?

A Costly Entrepreneur Mistake

CEOs participate in professional conferences, trade association meetings, and industry gatherings In late August I participated in the annual conference held for the benefit of TAB facilitators worldwide. Since 2002, I’ve missed this conference exactly the same number of times that I’ve forgotten my wedding anniversary.

As in years past, I came away with several pages of prioritized notes listing possible strategies and tactics for improving my business. I accumulated these during the assortment of presentations, breakout sessions, and casual networking that takes place at every conference.

As I reviewed my trove of takeaways on the flight home, it occurred to me that I seldom hear from my business owner friends and clients about their awesome experiences at their industry meetings, trade associations, or professional society meetings. I’m thinking that’s because they don’t attend.

There is a tendency for an entrepreneur to start or acquire a business and then proceed to become so buried in the work that they cannot get away to sharpen their saw at an industry conference. This is a symptom of the “too busy working IN my business to take time to work ON my business” disease.

If you don’t participate in industry-wide sharing of ideas and practices, you’re starving your business. This business starvation condition presents as the sound of anxious breathing or wheezing.  Unfortunately, in most cases, the source of that sound has proven to be the business owner.

Lesson? Stay connected to your broader industry or profession!

By the way, I’ve never forgotten my wedding anniversary.

Dismount!

Every CEO sometimes holds onto a bad idea too long.

Riding a Dead Horse (not really)

There are some subjects that are difficult to approach positively.  This seems to be one of them.

Every CEO occasionally finds himself or herself riding a dead horse.  It could be that new product program that is consistently delayed and where the projected cost to manufacture is much higher than the original estimate.  Or that new employee whose performance is so far below what you anticipated three months ago during the final interview.  Or it might even be your entire company.  Maybe you’re worn out, ready to move on, and have never really created the entity that you envisioned when you founded it.

Regardless of the situation, you feel the right decision in your gut.  Your gut understands that you are riding a dead horse and that the only appropriate next step is to dismount.

Contrary to my opening statement, this negative post really does have a silver lining.  Dismounting creates a better situation.  Killing the new product program frees up resources that can be more profitably applied elsewhere.  Terminating or reassigning the failing employee eliminates drag on the organization and allows the individual to find their true niche – either within or outside your organization.  Selling your company to a strategic buyer who has the resources or market position to make it a success is good for you, your employees, and probably the overall economy.

The timely dismount can be every bit as potent for your company as any new initiative might be.  So, how are your feet stuck in the stirrups?

Is Your Dehumidifier Working?

CEOs must stay current with technology

New Technology

I bought the dehumidifier in 1979, and it lived in three different homes over the years. When I finally decided to retire it, the machine was still working! That is, when I plugged it in, the compressor began running. If the temperature of my basement was below about 75 degrees, the coils would freeze up. The simple on/off switch no longer worked. The control knob for adjusting the humidity setting did not work.  When running, it was very noisy and threw off a lot of heat.  But it still removed moisture from the air when the conditions were right.

The new unit I bought 35 years after the purchase of the old one works better.  It removes more moisture, more quietly, radiating very little heat, under almost all operating conditions. And I can run a hose to the basement sump for continuous draining. With the old unit I had to empty the bucket twice daily because the plastic hose connection was stripped long ago and leaked.

I know CEOs who, like me, stick with the old technology too long. The ancient computer operating system causes all kinds of interrupts and lost productivity. The phone system is cumbersome for customers as well as employees.  The printer/copier/scanner still prints, although the paper feed jams regularly and the scanner feature has never worked right.

Inertia and penny-pinching sometimes combine to make us stupid.  Running a great business requires relatively current technology.  What’s your dehumidifier?

Uniquely Yours

It’s not just lonely, but also unique at the top. You must hold yourself accountable for certain responsibilities that cannot be delegated to others. The challenge is that, if you’re like most CEOs, you also hold yourself accountable for many items that could indeed be delegated.

If you are buried in the weeds of your business 24/7, your business will eventually bury you. Yes, most CEOs must devote significant time to working within their business. But if you haven’t already developed the discipline of spending at least 2% of your time each month (about a half day) stepping back and working on your business, your business is likely to continue to run you rather than the other way around.

What are those unique accountabilities that only you can assume?

  1. Establish your vision of where the company needs to go, and communicate it clearly and frequently.
  2. Find and retain employees who can help get you there.
  3. Lead the creation and routine updating of company goals, strategies, and action plans that will help get you there.
  4. Protect the corporate assets (physical and financial) while making sure you are using them to help get you there.
  5. Assure that the various parts of the company are coordinated and working together to deliver customer value at a profit, and to help get you there.

In a sense, being CEO has a lot to do with attitude and perspective. Consciously accepting this higher level of accountability is a way of your ultimately exiting your business on your terms.

Why not keep score for a few months? Copy the list of accountabilities and keep them close by. Make a daily or weekly note of your estimated time spent in each of the five areas. Hold yourself accountable – or get somebody else to do so – for tracking how much time you actually spend on these important areas. Then make appropriate adjustments.

Oh, just one more thing…

CEOs are alert to all inputs when making critical decisions.

Lt. Colombo

Do you remember Peter Falk’s character, homicide detective Lt. Colombo?  In almost every episode of that TV series he would interview the suspect in a non-threatening manner, start to leave, then turn and ask that incisive question that began, “Oh, just one more thing…”

As CEO, you often play the role of the suspect in the Colombo dance.  And an employee, or customer, or vendor, or creditor plays the role of Colombo.  They are wrapping up an important meeting with you when they say those fateful words, “Oh, just one more thing…”

What follows is generally another piece of information or a request, rather than the type of interrogation question that Colombo would spring on his unsuspecting target.  But it is just as important as the Colombo question, and your senses should be on full alert.

Even though the deal has all but been done, they are about to toss a grenade that they hope you will ignore in your haste to tie a bow around a decision finally reached.  Don’t be too hasty.

“Just one more thing” is often way more than an incidental comment.  “Just one more thing” is often the real crux of the matter for your Colombo character.

Being the chief decision maker in your company can wear you down.  Make sure that your weariness on any given day, regarding any important decision, doesn’t lead to your dropping your guard at the critical “just one more thing” moment.

The CEO’s Planning Omissions

It’s been my experience that many CEO’s either omit or give short shrift to three major parts of their annual business plan.  The first is how they wrestle through Critical Success Factors. These links between the upfront analytical sections of your plan and the downstream implementation sections provide a solid reality check against your objectives. They also force you to consider all reasonable alternative strategies for achieving your major objectives. Continue reading

Do You Hear What I Hear?

In the holiday season just past, I often heard one of my favorite Christmas songs. The lyrics incorporate three questions:

  • Do you see what I see?
  • Do you hear what I hear?
  • Do you know what I know?

While the poetry and melody surrounding the three questions are lovely, my mind occasionally drifts to the application of these questions to the life of the CEO. With regard to your employees, be aware that they do not see what you see; they do not hear what you hear; they do not know what you know.

This is an especially relevant point at the beginning of a new year. Continue reading