Leading For Results
Leading
people is a topic that gets a lot of management and conference time. There are uncounted books, seminars,
workshops, and discussions on the subject.
To me this suggests that we still have difficulty in defining what makes
for an effective leader. In my
experience in nine different markets and countries, the ability to manage three
main aspects are critical:
Task:
Understanding exactly what it is you have
to do (you may have to make some intuitive leaps). You then need to plan it. I use an “Internal” framework (People, Systems,
Equipment, Premises, Legal) for issues that are within my organisation’s
control and an “External” one (for issues outside its control but that impact
on the success of the project). These
could include suppliers, regulators, the local community, etc.
Finally, I add in Kipling’s “Six Honest
Serving Men” (What, Why, When, How, Where, Who) to make sure I understand how
everything will fit together and can explain it to others.
Then you have to be able to explain it clearly to your team (even if it’s just
a team of one) so that they know what needs to be done, why, how, by whom, by
when and what limits (if any) there are on how to proceed. Without going through the planning above, how
can you do this? Remember: what seems
clear to you may not be as clear to others.
Team:
Understand group dynamics and how people
interact. Is your team “balanced” in
terms of skills? If you have a team
consisting of nothing but thinkers, nothing will get done. If there’s noone keeping an eye on overall
progress, you may miss your deadline, or quality may suffer.
You need a mix of doers, thinkers,
controllers and investigators. Different
management thinkers have come up with different descriptions for the roles that
team members play, but what they have in common is that there are different roles. Remember, some people may fulfill more than
one role and others feel more comfortable in one role as opposed to others.
How do team members interact with each
other? Is there one person to whom the
others always listen (or whom they ignore)?
How do they approach things? How
are they likely to react in certain situations?
Individual:
The management cliché says “there’s no ‘I’
in ‘Team’”. The smart answer is “but there’s
a ‘me’ if you look hard enough”. Teams
consist of individuals. If their needs
aren’t acknowledged and addressed, they won’t give their best. Results will be mediocre.
The team member who continually feels
“sidelined” or that their opinions aren’t listened to won’t be engaged or
committed to the success of the project.
Equally, one who continually tries to dominate may provoke resentment
amongst the other team members, resulting in lack of commitment, potentially
delaying the project.
From the above, there are many
considerations when moving people towards a goal. Balancing them is tricky. Just to complicate matters more, some
situations will suit some people more than others, so that the effective leader
in one situation may not be as effective in another.
Self-knowledge is the only way to really
understand yourself as a leader and therefore how you impact on others.
I have spent more than half my life
delivering change in different world markets from the most developed to
“emerging” economies. With more than 20 years in the world financial services
industry running different service, operations and lending businesses, I
started my own Performance Management Consultancy to offer solutions for
improving performance, productivity and risk management. I work with individuals, small businesses,
charities, quoted companies and academic institutions across the world. An
international speaker, trainer, author and fund-raiser, I can be contacted by email. My website provides a full picture of my portfolio of
services. For strategic questions that
you should be asking yourself, follow me at @wkm610.Labels: Career, Productivity, Strategy, Teamwork
Professional Practice
There comes a happy time for small businesses when, because of successful growth, they need to hire people with experience of working in larger businesses to introduce processes, practices and procedures to take the business on to the “next level”.
The arrival of someone used to working in a large organisation can be disruptive for both the newcomer (the “professional manager”) and for the business for a number of reasons. From the business’ side:
- Staff may be all used to covering a number of tasks - everyone performs more than one role when needed because the business doesn’t have the luxury of a specialist for each position.
- They may be used to a relatively “informal” hierarchy where the boss is always available and where everyone talks to everyone else.
- Such processes and procedures as exist may all be in people’s heads, rather than written down in manuals - and are changed quickly.
- Things get done when they get done, not on a certain date every month.
From the new arrival’s side:
- Communications may seem highly informal as opposed to the structured meetings, memos and newsletters that someone in a large organisation might be used to;
- They will have to settle into a much smaller team, where relationships may be stronger than in a larger organisation.
- People will be used to doing it “the boss’ way” and may be reluctant to change things, even when asked by someone who may be their new direct manager.
- The new arrival may be used to specialising in one particular aspect of a business; working in a smaller business where people have to be multi-skilled means they themselves have to learn new skills (or dust off skills that they haven’t used for some time).
- Equipment and services may be less abundant than they are used to.
Both will take time to get used to each other. Problems often arise when both the “professional manager” who has come in and the owner (usually the founder) of the business fail to understand their differences. Founders are often reluctant to “let go”, despite the fact that that’s the very reason they hired a “professional” in the first place!
Equally, the “professional” may not realise that they need to earn the trust of the founder. They may have to engineer a delicate “handover” process rather than expecting to have fully delegated rights from day one.
Staff also will need to understand the limits of authority of the newcomer, and the founder needs to respect these as well (in other words don’t let staff come to him/her “behind the new manager’s back” if they disagree with what he/she wishes to do).
To ease the transition (for everyone), the business owner needs to:
- Advise all staff in advance of the new arrival.
- Explain how the business works to the new arrival.
- Introduce them when they arrive.
- Ensure that everyone understands what the newcomer is there to do, their limits of authority, and that they have the owner’s full support.
- Hold regular reviews with the newcomer to discuss progress and concerns on both sides.
- Gradually let go.
This will ensure that the owner enjoys the benefits of a “professional manager” as well as the increased freedom to build their business that can be the result.
I have spent more than half my life delivering change in different world markets from the most developed to “emerging” economies. With more than 20 years in the world financial services industry running different service, operations and lending businesses, I started my own Performance Management Consultancy to offer solutions for improving performance, productivity and risk management. I work with individuals, small businesses, charities, quoted companies and academic institutions across the world. An international speaker, trainer, author and fund-raiser, I can be contacted by email . My website provides a full picture of my portfolio of services. For strategic questions that you should be asking yourself, follow me at @wkm610.
Labels: Productivity, Strategy, Teamwork
The Cost Of Not Costing
People say that being in business is about “making a difference” or about “making a profit”. These are good reasons and are the reason that businesses stay in business. as well. What people forget is that being in business is about making sure that the money coming in exceeds the amount going out and that it comes in at the right time.
I recently tweeted that failing to plan financially is planning to fail financially. Not only should you plan ahead to make sure that you will always have sufficient resources to cover expenses as they fall due, you should also look at your pricing.
I recently saw a case of a successful business which won a new contract from a large client. When I asked about what equipment and changes they would need to pay for, the owner said that he would have to “watch costs”…
Why? When I took him through the likely costs of doing business with that client, it was clear that he had based his pricing on his desire to get the business, rather than on what it might actually cost him in terms of property, equipment, staffing and other expenses.
He also assumed that the fees from the new business would start when the client said they would. As it was, the client delayed the start of the contract by several months, meaning that the business incurred costs up front, but had to use its own cash to cover them, leaving much less available for its existing activities.
Finally, he hadn’t left any margin for error or unforeseen costs.
Result? He needed to penny-pinch to make things work (I won’t say profitable). It meant delayed purchases of equipment that was needed, demoralised staff and a client who wasn’t impressed. Had there been a problem, the contract would have been barely profitable, and he risked losing money.
So do you avoid this? First, set up a simple spreadsheet with months of the year across the top (with a total at the end) and then work out your costs, e.g:
- Rent
- Utilities
- Staff
- Other services/support costs
- Cost of new equipment
- Contingency
Depending on your business, you may add others, or some of the above may not be relevant. Put the different costs down the left side of the sheet.
Next, are the costs monthly, quarterly or even annual costs (you might, for example, need to renew a particular permit every year in April)? Adjust the spreadsheet (or get your accountant to help). In the case I witnessed, the business’ bookkeeper wasn’t able to support the boss (and the latter wasn’t interested in details like this, he just wanted the business).
Once you’ve got your spreadsheet set up with the costs in the proper places, look at what you need to charge just to break even. You may be charging them a flat fee per transaction per event or per month. Work out what the result will be. Underestimate rather than overestimate. Your breakeven is the minimum you can charge.
You need to understand what you’re likely to make per month and when you will actually get paid. Remember, you will incur certain costs during the month, but if you give credit terms, you won’t get paid until later.
Once you think you have a realistic view of:
- What costs you will incur and when AND
- When you will actually receive payment
Subtract each month’s costs from the payments you expect for that month only (so you may be subtracting January’s costs from payments arising from December’s activity but received in January). Until the new business is working properly, you may have a shortfall to finance. Your spreadsheet will show you this very quickly.
If you have a shortfall, how will you finance it? Do you have the cash available in the bank, or will you need an overdraft?
The beauty of this approach is that you can play with any number of cases to see how things change. What happens, for example, if you only do half the business that you thought you would? Or if your costs change for some reason?
Whilst this exercise may seem tedious and time-consuming, it’s better than the potentially longer (and more stressful) time you may have to spend desperately looking for emergency cash when things go wrong. You can also show it to your banker (or anyone else whom you approach for finance) to prove that you have thought things through and allowed for contingencies.
I have spent more than half my life delivering change in different world markets from the most developed to “emerging” economies. With more than 20 years in the world financial services industry running different service, operations and lending businesses, I started my own Performance Management Consultancy to offer solutions for improving performance, productivity and risk management. I work with individuals, small businesses, charities, quoted companies and academic institutions across the world. An international speaker, trainer, author and fund-raiser, I can be contacted by email . My website provides a full picture of my portfolio of services. For strategic questions that you should be asking yourself, follow me at @wkm610.
Labels: Customer Care, Financial, Productivity, Risk, Strategy
