Best Strategies to Manage Unpredicted Business Growth



True entrepreneurs are adventurous and bold.

When a company enjoys fast growth, it’s the envy of every other company. However, things aren’t always as they seem.

Fast growth can present difficult challenges for a business, if it isn’t prepared. That goes for any sector – from service businesses to manufacturers.

For instance, rapid growth creates challenges preventing efficient operations or fulfillment of products or services for customers.

If not anticipated and solved, such challenges can lead to drastic losses in market share or even deaths of businesses or being acquired by competitors at fire-sale prices.

The good news is that there are proven strategies that will help a company succeed during unexpected business growth.

Here are the five strategies for success:

1. Flexibility planning for all contingencies

Sure, it’s great to plan for the short-term and to dream for ultimate success. Strategic planning should include needs between the short-term and long-term.

That means developing strategies for flexibility in involving financial, human resource capital, and operational elements of your business. It also requires being prepared for course-correcting.

2. Honing skills for satisfying customers

You will succeed if you keep your customers happy. That’s easier said than done. So, plan for growth in delivering products and services with scalable back-end procedures and structures.

Where startups fall short is not adequate planning to provide the quality products and services in a timely fashion, and all while meeting the expectations of their customers.

Many founders are so busy putting out fires to manage customer demands, they don’t delegate or timely increase the size of their workforce in order to satisfy customers.

What they should be doing is to develop solid operations checklists.

Again, businesses lose profits because they inconvenience customers. This not only results in lost revenue, but tarnished branding and narrower profit margins, too.

So, make certain your company doesn’t become high maintenance to your customers.

3. Financial planning 

Don’t forget your necessary financial tools. Start with a finance checklist for strategic planning for growth.

Just because you might experience new revenue from unexpected growth, it does not necessarily result in good cash flow and profits.

So, at the least it necessitates that you determine your break-even point.

You should know your full operating costs as you grow as well as your daily needs for capital. Plan to increase cash flow and profits.

4. Knowing which customers are profitable

Savvy business owners know who their ideal clients or customers are.

You can’t make profits from every customer. Some customers pay too slowly. Others may be too hard to please. So be prepared to drop such customers.

This, of course, means knowing your four profit drivers – they are what drive your profit.

5. Develop your company’s leadership

Finally, your success will be largely determined by your leadership and team. You will need vision and flexibility to deal with obstacles that evolve from growth.

Whatever your situation in pursuing growth, the mindset and best practices in strategic leadership means maintaining a delicate balance – preparing for details and keeping an open mind regarding business uncertainty.

So, you must have the right mindset and use best practices in strategic leadership.

You will also need to recruit and hire the right people to successfully scale upward. Therefore, hone your talent-recruitment strategies.

Then, plan to develop employees as strong leaders to help your business grow efficiently and enjoy excellent profits. That’s because, as role models, they’ll be instrumental in helping you develop a performance culture.

From the Coach’s Corner, here are complementary strategies:

Strategies to Measure, Boost Your Business Performance — If healthy revenue and profit margins are your goal, you must determine the critical factors that lead to success. In essence, business is war in commerce. In order to win, you must know how, why and when to attack.

For Profits, Manage Your Growth at the Right Pace — Entrepreneurs frequently try to rush their business growth. Certainly, growth is great but if you scale too fast, you’re looking for trouble. The key is to prepare.

8 Change Management Tips for an Unpredictable Marketplace — For a business to win despite facing an unpredictable marketplace, there are eight strategies to implement. Among the key concepts to remember: Double-down on effective management.

Tips for Strategic-Thinking in Finance: Your Staff, Individuals — Many companies want accountants and finance professionals who are strategic thinkers. But that’s not happening at most companies. Here are tips for managers and employees.

10 Red Flags Your Business Needs Strategic Planning — Many entrepreneurs are so busy putting out fires, they fail to take care of business in two ways. They fail to plan strategically and they don’t make marketing a priority each day.

“It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you’ll do things differently.” 

-Warren Buffet


__________

Author Terry Corbell has written innumerable online business-enhancement articles, and is a business-performance consultant and profit professional. Click here to see his management services. For a complimentary chat about your business situation or to schedule him as a speaker, consultant or author, please contact Terry.






The Planning That’s Vital to Pay Competitive Wages for Performance



Two of the most salient steps you can take in management – create a compensation plan that competitively pays your employees and rewards them for excellence.

Enlightened compensation plans inspire performance and incentivize productivity.

So a well-planned strategy to compensation planning will enable you to be astute in making decisions about your budget and pay schedules.

In this way, you’ll get a strong return on your investment in time and money.

ID-100333247 stockimagesHere are strategies for good planning:

Design a winning compensation philosophy

Your compensation philosophy should delineate how you want to differentiate your organization with competitors. The process starts with determining the salient tenets for your compensation program.

You need a perspective to analyze your marketplace data and where you stand in competitiveness.

Acquire relevant data

An effective wage and benefit study will help you pinpoint your standing with competitors. Identify reliable sources of data that swathe all your job descriptions.

Ascertain which positions are key to your organization and those that warrant extra consideration for higher compensation.

Look for trends

You should identify trends in marketplace budgets for salary increases. Monitor the trends to see how you stack up. Strategize what you must do to offset any pay gaps.

Continuously fine-tune your process

Don’t stand pat. Your compensation planning should be an ongoing process. Make sure your data includes what competitors are doing in salary-structure adjustments.

Then, regularly update your salary ranges to stay competitive.

Don’t fall into the trap of adjusting salaries without updating salary ranges. You’ll risk having employees being paid too much for their salary range.

Ultimately, this will mean you won’t have an accurate snapshot of your compensation program compared to your competition.

“Sure, sometimes guys pass you up in salary, and maybe it’s a lesser player, but it’s all based on what a team has as far as value in that person.”

-Brett Favre

Keep an open mind about performance pay

Spend your money on what you value. You should budget enough money to pay your employees well if they deliver.

But keep an open mind in your compensation planning. You might want to consider incentivizing performance across your entire workforce.

For example, if a high-performing business is your goal, be conservative in your pay schedules but consider profit-sharing on a monthly basis. That’s right. Give your employees immediate gratification – with profit and loss bonuses – if they effectively work with their team members to deliver profits.

Give extra weight to high performers

You’ll want to pay high-performing employees more than average-performing employees. To determine pay for them, you should have a matrix with performance ratings and pay ranges.

Develop lucid communication principles

Determine the ground rules about sharing compensation information. You must train your managers to communicate effectively with their employees.

Your managers must comprehend how your process works, including criteria for deciding on pay increases, and what can and cannot be shared with their employees.

You must determine whether your staff can retrieve information about their salary ranges, the higher pay schedules, and your organization’s pay makeup. Be consistent in how you communicate such information.

Get a strong return on your pay raises

A common practice in giving mild criticism is to use the “pancake sandwich” approach. Like a pancake restaurant menu item, the pancake sandwich comes with an over-easy egg and sausage sandwiched between pancakes.

Therefore, to mildly criticize employees, some managers compliment the employee, then give a criticism followed by another unrelated compliment. The employee is more likely to accept the criticism and respond well because the manager uses a positive approach.

The converse is true with giving a raise. Praise the person’s performance accompanied by a raise and another compliment. In this way, you’ll get maximum mileage out of paying the person a higher salary or bonus.

From the Coach’s Corner, here are more management strategies:

Risk Management When Competitors Raid Your Employees — If competitors raid your employees, here are risk-management tips.

Optimize Talent Management with 5 Coaching-Culture Tips — When managers become coaches, you get a higher-performing workforce. You will have replaced mediocrity with strong performance. Here’s how to develop a coaching culture.

Management — 4 Mindsets for Leadership in Performance Reviews — Are you nervous at the thought of giving employee-performance reviews? You’re not alone. Your employees aren’t exactly thrilled, either. Typically, employees aren’t convinced they can get valid feedback. If they’ve experienced poor managers, they likely dread the performance-review process or are skeptical of the outcome.

Sales Management: Motivate Your Staff in 10 Seconds — All too-often when sales managers are busy, they’re task-oriented. Not to be critical, but they’re focused only on what’s at the end of their noses. For effective management and revenue, the trick is to guard against it.

13 Management Tips to Solve Employee Absenteeism — Absenteeism causes migraines for a lot of bosses. Obviously, your company will make healthier profits, if you don’t have an absenteeism problem.

“Sure, sometimes guys pass you up in salary, and maybe it’s a lesser player, but it’s all based on what a team has as far as value in that person.”

-Brett Favre


 __________

Author Terry Corbell has written innumerable online business-enhancement articles, and is a business-performance consultant and profit professional. Click here to see his management services. For a complimentary chat about your business situation or to schedule him as a speaker, consultant or author, please contact Terry.





Photo courtesy stockimages at www.freedigitalphotos.net

Mindset, Best Practices in Strategic Leadership for Growth


Whatever your situation in pursuing growth, the mindset and best practices in strategic leadership means maintaining a delicate balance – preparing for details and keeping an open mind regarding business uncertainty.

When companies fail in their expansion plans, it’s because management is inflexible and relies too heavily on past formulas that aren’t applicable in the new economy.

In essence, they have a poor mindset for effective risk management.

stockimages hairSuch companies fail to stay committed in terms of their behavior and matching their overall objectives. They focus too much on opportunities without making sure they’re a good fit.

Instead, management should be asking, “Do our strategies apply for our opportunities?”

Their mindset must always be maintaining and improving their brand presence, working for sustainable growth and profits, and increasing their market share.

That means they must understand the new markets – in particular, the cultures. But managers can’t understand the new markets and the cultural gaps if they don’t even understand themselves.

They must have a strong sense of self awareness – fully understanding strengths and weaknesses, and how much flexibility is required without compromising on essentials.

It’s all in the details – the structure and controls without micromanaging and losing a company’s identity. (This is especially true presence in forming partnerships for a global presence in foreign countries.)

Never go into a marketplace unless you understand its environment.

For strategic leadership, management must create a vision – a roadmap – to remain competitive and adjust in the ever-changing technological and economic environment.

True strategic leaders convey the mission and target customers, and motivate their employees to be unified and instigate change and efficiencies.

“Progress is impossible without change, and those who cannot change their minds cannot change anything.”

-George Bernard Shaw

The roadmap also includes a strategy for action – what changes are needed to achieve the objectives.

Five skills of such leaders:

  1. They understand the underlying causes of their challenges.
  2. They anticipate the moves of their competitors and their reactions.
  3. They determine how to balance the short-term pressure for profits against the long-term strategies while weighing the needs to satisfy the needs of their stakeholders from customers to employees and shareholders.
  4. They deduce what’s needed before making decisions.
  5. They continuously implore organization-wide learning and fine-tuning strategy should course corrections are necessary.

Strategic leaders employ five strategies:

  1. They analyze, make plans and execute.
  2. They adapt to quickly evolving conditions in their marketplace.
  3. They continuously foresee opportunities for revenue.
  4. They collaborate and form partnerships.
  5. When faced with quagmires and poor cash flow, they rejuvenate their businesses by reinvention.

The definitive leadership strategies mean adapting and improving a company’s position with vision, planning, flexibility and strong execution.

From the Coach’s Corner, here are more relevant articles:

Leadership Tips for Executing Strategy to Defeat Threats — Multiple solutions might work to triumph over a threat, but a global study in 20 sectors in 20 countries shows execution trumps strategy. Here’s how leaders execute strategy.

How to Grow Your EI for Leadership Success — Emotional intelligence (EI) is important for communication and leadership. A person who has EI is able to evaluate, understand, and control emotions.

Leadership: How Leaders Employ 11 Strengths to Grow Businesses — Ascension to the C-suite doesn’t automatically qualify an executive as a leader. Leaders have 11 strengths that enable them to manage their companies for greater effectiveness and elasticity despite a fast-changing marketplace.

To Become a Leader, Develop Strategic-Planning Skills in 5 Steps — A salient characteristic of leadership is strategic thinking. If you’re ambitious, the ability to be a strategic planner is critical for your success. Here are five ways to achieve your goal.

Executives Target 5 Technology Threats to Company Value — Corporate executives see new strategic risks as a result of technological changes — from big data and cloud computing to social media  — according to a 2013 global Deloitte survey. Deloitte queried more than 300 executives, risk managers and board members — 81 percent said their strategic-management focus has evolved with technology.

How to Avoid Failure in Risk Management and Strategic Planning — Incredible as it might seem, companies fail because they underestimate strategic risks – yes, strategic blunders instead of common sense – according to an authoritative study. Here are three recommendations.

 “Progress is impossible without change, and those who cannot change their minds cannot change anything.”

-George Bernard Shaw


__________

Author Terry Corbell has written innumerable online business-enhancement articles, and is a business-performance consultant and profit professional. Click here to see his management services. For a complimentary chat about your business situation or to schedule him as a speaker, consultant or author, please contact Terry.




Photo courtesy of photostock at www.freedigitalphotos.net

10 Little-known, Common-Sense Tips to Win as a Small Firm



Thoughts to ponder: Every now and then it’s important to use philosophies from different sources for business success. One such example in old-fashioned courage and common sense comes from history thanks to Thomas Paine.

Mr. Paine was an English-American corset-maker in the 1700s. He was also one of the Founding Fathers of the United States and was most influential before the American Revolution.

He’s best known for writing an inspirational pamphlet called “Common Sense” in late 1775. He wrote about the importance of independence from England.

ID-10074884 (1)It was sold and widely circulated and read aloud at various meeting places including taverns. He published it anonymously because the British would consider it treason.

Ultimately. Mr. Paine played a great role in the success of America’s origin.

Now in the 21st century, common sense and courage are needed in everyday life and business. After all, entrepreneurs need both qualities to succeed.

Don’t let anyone dissuade you from using these tips:

1. Have a P. O. Box and pick up your own mail

Embezzlement is a widespread problem for small business. Unless you’re fortunate to have honest employees in starting out, make sure you’re the only person to see the mail first.

You’ll want first peek at all checks, invoices and other correspondence. Obviously, you’ll need other checks and balances but this will help.

2. Perform credit checks in addition to background checks

It isn’t enough to do a background check on applicants. Your job applications should indicate applicants will undergo a credit check, too. They must sign it before doing a credit check and before they’re hired.

Periodically, perform background and credit checks after a person is hired.

Otherwise, not only are you at-risk but so are your customers. Should an employee steal from a customer, you’ll be liable for damages both financially and to your business reputation.

3. Establish an approved vendor list

Don’t let employees order product or services from any company not approved by you in advance.

4. When you add employees, include women

If you have male customer-service staff, get the opinion of women in your company. Have the women interview male applicants. Look for chivalry and good manners. Savvy women can spot men who might alienate your female customers.

5. Watch your cash flow to build your reserves

Know how much cash is needed to operated your business. When you’re fortunate to have extra cash, don’t keep it on hand. Put it in an interest-bearing account to build your cash reserves. You can instruct your bank to do it.

… in the 21st century, common sense and courage are needed in everyday life and business.

6. Use talent-photo releases

Testimonials are good for business. But make certain to ask people whose pictures you take for testimonials on your Web site and sales collateral for their written OK. This is what we call in the marketing business as a talent release.

7. Prevent plagiarism

Double-check the work of anyone who writes in your behalf, especially marketing materials. Check for copyrights. If you use someone else’s content, you could be sued.

Many employees are tempted to take shortcuts and plagiarize competitors’ copy. You can check copy with free plagiarism checks and search engines.

That goes for the use of photos, too. If you use Google, you can right click on a picture to see if it’s used by anyone else.

8. If you have one vehicle or a fleet of vehicles driven by employees, install GPS tracking

Many companies have been hurt by their moonlighting employees. To save money, customers are tempted to let workers perform services at a discount. So reduce the odds that an employee will double back to moonlight with your customers – by performing work off the clock.

You’ll also benefit in productivity and safety. GPS tracking is also a great tool if you have disputes with your customers.

9. Follow up with customers

Every time you send an employee to perform work for a customer, follow up with a courtesy call. Ask customers if they’re satisfied and whether they were at home. Regarding the latter point, you might need to know later in an investigation of an employee.

10. Follow your instincts

Whenever you sense something is wrong, act on it. You might not know why you feel uncomfortable, but act on your subconscious concerns in all situations – from hiring people to monitoring their performance.

From the Coach’s Corner, here are more entrepreneurial tips:

10 Small Business Tips for Time Management, Profits — For small business owners, here are 10 tips to save you time and money to increase profits.

4 Tips to Protect Your Business with a Trademark — The last thing you want as a business is for your company logo and name to be stolen. The trick to avoid such a travesty is to be trademarked by the United States Patent and Trademark Office.

10 Tips for Hiring the Right Attorney for Your Business — In running a successful business, you typically need the services of three professionals — a good tax accountant or CPA, insurance agent and an attorney. Know that talent and skill levels are crucial for your success.

11 Tips for the Best Business Mobile Web Site — If you operate a retail business, it’s increasingly important for your Web site to be easy-to-use for mobile users. The use of smartphones and tablets is skyrocketing, especially among Millennials — young adults aged 32 and under. Studies also show the majority of mobile aficionados use their devices to access the Internet. Such data continually changes — mobile sales and use of the Internet is consistently rising.

No Cash? 8 Tips to Organically Grow Your Business — Organically growing a business is lot like organic farming. Organic farmers rich sources of organic matter for growth. If you’re like many entrepreneurs, it probably makes sense to grow organically.

“Common sense is not so common.”

-Voltaire


__________

Author Terry Corbell has written innumerable online business-enhancement articles, and is a business-performance consultant and profit professional. Click here to see his management services. For a complimentary chat about your business situation or to schedule him as a speaker, consultant or author, please contact Terry.





Photo courtesy of imagerymajestic at www.freedigitalphotos.net

3 Crucial Tactics Are Needed to Maintain Your Culture



As your company grows, you can expect growing pains and threats to your culture. Whether you create it or not, your business culture happens. There are at least three steps needed to fashion your culture the way you want.

Therefore, you should take every precaution to insure your culture remains intact.

Simultaneously, you need to productively grow while retaining your talented employees and recruiting the right people.

ID-100224048You should devote equal resources to employee programs and communication. So, you need to plan accordingly.

Here are three strategies:

1. Make internal communication a priority

Running a micro one or two-person business is a lot different than employing a big staff. That goes for communication. Communication is more challenging for a large number of  employees. But it’s a No. 1 priority in order to achieve an engaged, productive team of workers.

The last thing you want is for employees to feel is their work is less-important than before. You want to engage them so they don’t feel as though they’re isolated. That’s a frustrating feeling for people.

Employees will appreciate an open, transparent communication. Also, don’t make the mistake of ignoring your telecommuting employees or workers in multiple locations away from your office. That’s how rumors and poor morale start.

Communication promotes trust, which is important. Make sure you don’t have a trust gap with workers.

2. Invest in your human capital

Investing in your employees starts with listening. Employees will feel validated and will be more content to work for you, if you listen and respond whenever feasible.

From time to time, you’ll identify workplace policies that need to be updated. But you’ll want your policies to be accepted and followed by your employees. Employees are often uncomfortable with change even if it’s necessary for a business turnaround.

You’ll need high morale, which propels profits.

So market your HR-policy changes to your employees.

If you haven’t regularly appraised your employees with feedback and expectations, start now. Continue the practice of conducting performance appraisals.

This will give you a mechanism to be responsive to their concerns as you convey your values and vision, and monitor their progress so they hit your targets.

Take steps to recruit the right staff for your culture.

You should devote equal resources to employee programs and communication.

3. Incentivize your staff

Recognition for good work is appreciated by 70 percent of workers – a great motivator for high performance. But it’s not always about money as non-financial incentives motivate most employees.

Recognize and reward your workers for performance publically and individually. Devise social activities for team bonding and a great work environment.

Savvy employers know how to profit from their human capital. Such knowledge is a powerful weapon for high performance in a competitive marketplace. Furthermore, there’s a correlation among excellent sales, happy customers, and high employee morale.

Proverbially speaking, employees are where the tire meets the road. They daily experience firsthand a wide variety of problems so it behooves you to motivate employees to offer profitable ideas.

From the Coach’s Corner, here are related tips:

10 Management Attributes for Effective Communication — Communication skills are critical for managers. People with enhanced abilities in communication typically have successful relationships at work and home. Good communicators typically have 10 attributes.

Increase Profits by Hiring Talent with the Best Trait — Enthusiasm — You’ll increase your odds for profits with high-performing employees with the right culture — if you hire for the right personality trait – enthusiastic people. That’s right. Look for people who have the makeup to being committed and who will care for the welfare of your company. You’ll increase your chances for the strongest results.

Hiring for a Small Operation? Conduct Behavioral Interviews — In this economic environment, whether you run a small operation in a big company or you own a small business, you’re wearing many hats. So you need employees who can successfully wear multiple hats, too. What does that entail? It entails several things. To compete successfully, small businesses especially need people who are a good fit culturally.

Management: How to Help Employees to Grow Professionally – Managers owe it to the organization to help their employees grow professionally. It’s hard, time-consuming work. But the return on investment is terrific. The organization benefits from higher employee performance and lower turnover. Strong employee retention obviously saves the employer a lot of time and money.

HR Management – 8 Best Practices in Employee Delegation — Avoid frustration in delegation. Save yourself time and develop your staff for the welfare of your organization. Delegation is a fundamental driver of organizational growth. Managers who are effective in delegation show leadership. They know they’ll be more effective in management and that they’ll develop their employees.

If you fail to plan, you plan to fail.


__________

Author Terry Corbell has written innumerable online business-enhancement articles, and is a business-performance consultant and profit professional. Click here to see his management services. For a complimentary chat about your business situation or to schedule him as a speaker, consultant or author, please contact Terry.





Photo courtesy stockimages www.freedigitalphotos.net

To Become a Leader, Develop Strategic-Planning Skills in 5 Steps



For an organization to succeed, leadership is needed. A salient characteristic of leadership is strategic thinking.

So if you’re ambitious, the ability to be a strategic planner is critical for your success.

Keep in mind that true leaders aren’t arrogant or complacent.

They know arrogance is really a sign of ignorance, and makes strategic planning an impossible dream.

CEOWhat entails developing strategic-skills?

It means you must see the big picture.

In other words, you must be able to take a long-term approach in anticipating and solving problems with objective analysis and making decisions regarding customers, employees, finance, operations, and vendors.

Leaders are innovators. They look ahead.

They don’t waste time daily just reacting and putting out fires.

Here are five steps to becoming a strategic planner:

1. Elevate your thinking by gathering information.

Read, read, read. Become a thought leader by studying relevant information affecting your sector, company, customers, workers and technology.

Don’t overlook finance. Strategic thinkers know how to prevent companies from falling into the zero-sum game trap. They focus on business profit and the four profit drivers.

2. Get a mentor.

A strong mentor will pay big dividends. Find someone known for strategic thinking — a person who is successful in ways you want as a role model.

The best mentor will keep you on target — focused on strategic thinking — and to anticipate the results of your actions. Here’s more on the mentoring process.

3. Ask the right questions.

When it comes to strategies in your company, think like a premier journalist — ask who, what, when, where, why and how.

Query your mentor. Ask questions of your boss.

Always strive to know the impacts on all stakeholders, including customers, employees and suppliers.

4. Learn what’s needed for your company’s growth.

You need to understand your organization’s situation and your marketplace.

Next, plan how you will contribute, and act accordingly.

5. Continually work to anticipate problems.

Anticipate quandaries and identify solutions. For every problem, there are multiple solutions.

The trick is to identify the best solutions that provide the best long-term benefits for the overall welfare of your company.

Don’t forget to reward yourself. A series of rewards will generate confidence leading to more success.

From the Coach’s Corner, related content:

10 Key Differences between Leaders and Managers — Published reports in Google News are an eye-opener. If you Google “leadership crisis,” you’ll get at least 9,000 search results for business and the public sector. If you enter the key words, “management crisis,” you’ll see twice the results.

5 Reasons Why Managers Are Promoted to Leadership Positions — In selecting candidates for leadership, the risks can be great for both the company and managers in lost time, effort, and money. So when deciding which of their corporate managers should be promoted into a leadership positions, companies naturally don’t want any surprises.

18 Leadership Strategies to Earn Employee Respect — Eighteen strategies to profit from good labor relations, and to leverage the perspective of employees – your company’s human capital.

Trust Gap between Managers and Workers — How to Drive Engagement — While it’s true there are companies that are aware that good morale among employees propels profits, many businesses are missing opportunities for growth. It’s not because of marketing. It has to do with internal issues.

Art of Persuasion — Marketing Ideas to Your CEO Boss — If you’re a human-resources or marketing professional seeking to be a partner in the C-suite, it’s vital to communicate effectively with senior executives. To market your ideas to senior management, here are the four keys in best practices.

“In preparing for battle I have always found that plans are useless, but planning is indispensable.” 
-Dwight D. Eisenhower


__________

Author Terry Corbell has written innumerable online business-enhancement articles, and is a business-performance consultant and profit professional. Click here to see his management services. For a complimentary chat about your business situation or to schedule him as a speaker, consultant or author, please contact Terry.




Planning – Tips for Avoiding Growing Pains in Your Startup


After reading my article, How to Start a New Business Before You Quit Your Job, a reader asks:

Q: Terry, Going into management and learning leadership skills (self-develop and mentored) are great tools no doubt. These can be vital once your new biz is off the ground. Can you explain how to fill the void between start-up to when you have your first employee(s)? Also examples of when the right time to “pull the plug” on your job without burning bridges? TIA

A: Good questions and they require a complex response. Every situation is different, so here are some broad answers.

stockimages hairBy filling the “void” I assume you mean how to get work done. Starting and operating a business is the most difficult undertaking of anyone’s career choices. It’s not easy.

The void is filled by working long hours with full support – if there’s a family situation – and outsourcing where necessary.

That’s also assuming there’s enough cash flow for freelance help and the ability to sustain it – with the preparation of sound financial statements and knowing what drives profits.

Unpaid interns can be useful, in general, as long as they’re not used to create business profit and the work experience clearly benefits and complements their education.

It’s important to be a good entrepreneur, and also avoid the wrath of regulators. (See Unpaid Interns: Safeguards to Avoid Legal Issues.) Candidly, in my experience as a consultant, interns require too much direction and time.)

Knowing when to hire

Expanding entrepreneurs should have an awareness of where the talented employees are. Before hiring, there must be a need but an adequate cash flow.

That means a full command of budgeting basics, maximizing prices for goods and services, knowing the break-even point and profit margins to cover all costs associated with employees.

When to resign

The time to resign is when a person has all the underpinnings for success, which includes an action plan. I can’t emphasize cash flow enough – to have adequate income from marketing and customer retention — and minimizing costs.

Incidentally, no employer is thrilled to lose a valued employee who’s destined to become a competitor.

But whatever the situation, a person can’t be too concerned about resigning. “People-pleasers” don’t make it as entrepreneurs. In any event, I’d give adequate notice and take precautions to keep the relationship on a friendly basis for possible networking in the future.

Hope this is helpful.

From the Coach’s Corner, more resource links:

Tips for Moms Who Want to be Entrepreneurs from Home — So, you have a job and would like to fire your boss to work at home. Let me caution you. Starting a business at home might be the biggest challenge of your life. Starting a home-based business has risks. It can sap your energy and time.

You Have a Great Business Idea, but You’re Stuck in 1st Gear? — New entrepreneurs often have great ideas but many hit self-created stumbling blocks. Here’s how to avoid the pitfalls.

The 8 Best Practices in Small Business Marketing — True, the constant drumbeat of uncertain economic news can be disconcerting. For many small businesspeople, the uncertainty can be so unnerving it leads to fear. But fear can be healthy if used as a motivator to act.

“Always deliver more than expected.”

Larry Page


__________

Author Terry Corbell has written innumerable online business-enhancement articles, and is a business-performance consultant and profit professional. Click here to see his management services. For a complimentary chat about your business situation or to schedule him as a speaker, consultant or author, please contact Terry.




 Photo courtesy of stockimages at www.freedigitalphotos.net


For Profits, Manage Your Growth at the Right Pace



Entrepreneurs frequently try to rush their business growth. Certainly, growth is great but if you scale too fast, you’re looking for trouble. The key is to prepare.

Note: You aren’t ready to grow if you haven’t developed a business model that will enable you to attract customers – at less cost – than what they pay you.

How do you get there? Success comes after you develop habits that will help you build your brand, develop sound business operations and successfully deal with people.

bwi ambro www.freedigitalphotos.netHabits that lead to success:

1. Develop viable goals.

It’s OK to dream long term, but you must develop a foundation for growth with short-term goals. You must do all you can to alleviate uncertainty.

Think profits, not revenue, in order to create wealth, meaningful jobs and business sustainability. Develop a plan with the right strategies to create pricing power.

2. Evaluate your strengths and weaknesses.

Socrates is famous for “Know thyself.” He was right. You need to know what you don’t know and plan accordingly.

Anticipate challenges. Half of them involve your employees.

So prepare. That includes motivating your staff when you’re facing adversity.

It also means proper delegating.To propel profits, maintain high morale.

It’s also in your best interest to motivate employees to offer you profitable ideas.

3. Monitor your improvement.

Get an objective analysis by making the best investment possible to sustain your growth — find a mentor. With the mentor’s coaching, measure your progress at frequent intervals – each week is ideal – to make certain you’re on schedule.

Success comes after you develop habits that will help you build your brand, develop sound business operations and successfully deal with people.

4. Schedule your time.

Many entrepreneurs find themselves trapped into fighting proverbial fires and get easily thrown off track.

By Thursday afternoon, you should know your schedule for the following week. But, of course, allow for flexibility.

5. Network with others.

Find a group of people with whom you can trust to share your concerns, problems and goals.

6. Keep learning.

Do what you have to do for continuous learning. That might mean voraciously reading, or attending classes and workshops.

7. Be discerning.

Don’t chase every opportunity just to make revenue, but be careful before turning down new business.

8. Continually scout for the best talent.

Hire enthusiastic people who will complement your talents to help you realize your vision for success. Give particular consideration to hiring key employees and top salespeople.

Once your habits are ingrained, start thinking seriously about growth.

Plan to grow your business at the right pace:

1. Anticipate how your cash burn rate will be affected by growth. Your burn rate is how much money you spend.  Understand how much cash is needed to grow. Learn to manage your inventory costs and continually strive to increase your cash flow

2. Use caution in hiring. You’ll need more employees, but beware of the costs – recruiting, hiring, paying and retaining. Consider outsourcing wherever feasible.

3. Plan your milestones. Focus on your goals with pragmatic timelines, and increase enough cash to finance your acceleration and goals.

4. Create the right systems. Make certain to have the right systems in place – from solid operations checklists to financials and debt collection

5. Strategize to stay in the black. Because scaling requires cash, know what the four drivers that influence your profit. If you think you’re ready to grow, first anticipate your break-even point

From the Coach’s Corner, additional tips:

When there’s No Cash, 8 Tips to Organically Grow Your Business  — Organically growing a business is lot like organic farming. Organic farmers pay attention to the signs of nature as a planting guide. They use rich sources of organic matter to build and maintain soil fertility. If you’re like many entrepreneurs, it probably makes sense to grow organically. You might not have another choice.

Insights to Grow Your Business by FranchisingSome micro-business owners like their situations and don’t want to grow. Most entrepreneurs want to expand. If you, too, want to grow and if you use the right methods, your company can grow profitably. Also, when there’s no cash, you can organically grow your business.

When Should You Develop an Exit Strategy? Now…Here’s How — You should always have an exit strategy in place – no matter what. Whether you’re just starting out or you’re a veteran business owner, you should always have an exit strategy.

“I don’t want to do business with those who don’t make a profit, because they can’t give the best service.”

-Richard Bach


__________

Author Terry Corbell has written innumerable online business-enhancement articles, and is a business-performance consultant and profit professional. Click here to see his management services. For a complimentary chat about your business situation or to schedule him as a speaker, consultant or author, please contact Terry. 





Photo courtesy of Ambro at www.freedigitalphotos.net

Where the Action is for U.S. Small Business Growth


Valuable insights for getting a competitive edge are contained in a financial-service firm’s report – it provides details on the U.S. markets experiencing rapid small-business growth.

With so many businesses having trouble getting capital and some Silicon Valley startups facing a Series A funding crunch, this is obviously a soft economy. So, it’s important to look for competitive edge.

My sense is that the study provides insights for entrepreneurial growth in different ways. That includes where to launch a startup, expand into new markets, or deciding where B2Bs might target small businesses.

The financial services firm, Biz2Credit.com, released its 2013 report on U.S. markets in four categories.

By category, here are the No. 1 ranked cities:

  1. Average Annual Revenue – Riverside-San Bernardino, CA ($508,538)
  2. Average Number of Employees – Houston (7.1)
  3. Youngest Average Age of Business (in Months) – Houston (34.0)
  4. Highest Average Credit Score – San Francisco-Oakland Bay Area (643)

File:Sb 2004 dt skyline 006a.jpg

San Bernardino, CA

“Houston has had sustained growth, thanks to an influx of immigrants who have started their own businesses” says Biz2Credit CEO, Rohit Arora.

“The city’s small businesses have created the highest average number of jobs (7.1) and are the youngest in age (34 months), meaning that these are new businesses that have started up only in the past three years,” he explains. “If local governments want to promote small businesses, they cannot handcuff entrepreneurs with fees and costs.”

Parameters of study

Biz2Credit analyzed data for 15,000 small businesses from 2011 to 2012. The firm defines small businesses as companies operating for more than a year and having fewer than 250 employees with less than $10 million in annual revenue.

“When we embarked upon this study, we expected cities such as New York City, Boston, and Philadelphia, which both have well deserved reputations for business innovation, to be atop the list,” says Mr. Arora.

“However, the costs of doing business are much greater in big cities along the east coast,” he adds. “In other sections of the country, the cost of living is much cheaper. Technology levels the playing field.”

For example, Mr. Arora says New York hampers growth potential for small business in multiple ways:

  • State and local tax burden
  • Government fees
  • Cost of living (property taxes have risen about 30 percent in past few years)
  • Prevalence of unions
  • High insurance costs make it unattractive for knowledge-based businesses, which don’t have to have a presence in the Big Apple to be successful.

“While sales in New York are higher than in other places, the operating costs are also higher. Thus, revenues are up, but profits are down,” says Mr. Arora. “These realities do not bode well for small business growth.”

Drivers of small business growth include the arrival of large numbers of Latinos and south Asian immigrants, who are starting companies in metropolitan areas in all sections of the country, including cities in southern California, Texas, and Florida.

Average annual revenue

The top-10 metro areas with the highest small-business loan-application growth by annual revenue: Riverside-San Bernardino, CA, New York City, Los Angeles, Boston, Houston, Washington, DC, Jacksonville, Detroit, Cincinnati, and Cleveland.

Average number of employees

Small businesses in Houston had the highest average number of employees. Mr. Arora astutely points out that this measurement is significant, as smaller companies have created the lion’s share of new jobs during the past decade.

“Houston was well ahead of the other cities in the average number of employees at small companies,” explains Mr. Arora.

The top-10 metro areas with the highest small-business loan-application growth by the number of employees: Houston, Miami-Fort Lauderdale, Los Angeles, Washington, DC, Phoenix, Charlotte, Philadelphia, Chicago, Atlanta, and Cincinnati.

Youngest average age of business (in months)

When sorted by age of business, Houston was again the leader.

“The small number of months in business indicates more startups in the area,” explains Mr. Arora. “Cities such as New York, Detroit, Los Angeles, Cincinnati, and Boston tend to have older, more established companies, which raise the average.”

The top-10 metro areas with the highest small-business loan-application growth by age of business: Houston, Tampa-St. Pete, Denver, Seattle, Dallas-Fort Worth, Orlando, Atlanta, Charlotte, St. Louis, and San Francisco-Oakland.

Highest average credit score

When sorted by average credit score, the San Francisco-Oakland Bay Area was No. 1.

“Small businesses in cities such as San Francisco, New York, Boston, and Los Angeles tended to have higher credit scores,” says Mr. Arora. “Many of these cities are tech hubs with small, nimble and profitable small businesses. They are also areas with a long history of innovation and success, and thus achieve higher credit scores.”

The top-10 metro areas with highest small-business loan-application growth by highest credit score: San Francisco-Oakland, New York City, Boston, Los Angeles, Seattle, Chicago, San Diego, Philadelphia, Baltimore, and Washington, DC.

Having arranged $800 million in funding throughout the U.S., Biz2Credit touts itself as the No. 1 online credit resource for small business loans, lines of credit, working capital and other funding options.

The company says it matches borrowers to financial institutions based on each company’s unique profile – completed in less than four minutes – in a safe, efficient, price-transparent environment. Biz2Credit’s network consists of 1.6 million users, 1,100+ lenders, credit rating agencies such as D&B and Equifax, and small business service providers including CPAs and lawyers.

From the Coach’s Corner, related information:

“A bank is a place that will lend you money if you can prove that you don’t need it.”

-Bob Hope

_________

Author Terry Corbell has written innumerable online business-enhancement articles, and is also a business-performance consultant and profit professional. Click here to see his management services. For a complimentary chat about your business situation or to schedule him as a speaker, consultant or author, please contact Terry.

4 Ways to Solve 6 Uncertainties in Project Management



Seemingly negative surprises have often been perceived as insurmountable, but that’s not always the situation in project management.

By innovatively spotting opportunities in uncertainties, the results often exceed initial expectations in budgeting, quality and scheduling.

That’s the lesson according to an academic report published in 2013.

“Challenging Classic Project Management: Turning Project Uncertainties into Business Opportunities” was authored by Thomas G. Lechler, Stevens Institute of Technology; Barbara H. Edington, St. Francis College; and Ting Gao, Stevens Institute of Technology.

The publisher is the Project Management Journal, vol. 43, no. 6. It was summarized by Booz & Company at strategy-business.com.

The researchers delved into 20 major projects that encountered at least three negative surprises.

They ranged in duration from eight months to three years with budgets between $500,000 and $69 million.

More than 50 percent focused on IT or product development.

Others included:

— Business realignment projects

— Clinical trials

— Construction

— Feasibility studies

–Market prediction models

— R&D

Researchers concluded there are six types of surprises to confront:

1. Contextual turbulence: external changes set off by shifts in the markets, for example, or new legal or regulatory rules

2. Stakeholder fluctuations: shifts in the fortunes of customers, vendors, investors, and others

3. Technological uncertainty: factors that can affect the functionality of products in different markets, among other challenges

4. Project uncertainty: unrecognized complexities that crop up after a project has started

5. Organizational uncertainty: ripple effects from unexpected corporate mergers or spin-offs, for example

6. Malpractice: significant deviations from accepted project management standards

According to the authors, project managers evaluated the surprises in these ways: Were they used as positive developments or not? What were the unexploited opportunities?

Sixty percent of the project managers dealt effectively with 75 percent of the surprises for strong results. They “led to a redefinition of a project’s initial baseline,” wrote the researchers. Fifty-eight percent identified positive financial returns.

The benefits included: Spotting new initiatives, developing new process and applying new technologies.

Four types of opportunities

For a “broader range of potential opportunities,” the researches recommend focusing on four groups:

1. Technical innovation. When negative surprises rear their ugly heads, don’t give up. Look for new testing solutions to save money that will also serve as an inexpensive model for future initiatives.

2. Implementation processes. In the event of a surprise, don’t panic. Develop a less-complex method to save money and time. Research showed post-implementation problems decreased by 75 percent.

3. New business. In one case study, a sponsor retired which led to lack of interest in the project. So, the project managers rolled up their sleeves and networked their way to a new sponsor. The new backer facilitated an opening to a larger audience, which meant new business opportunities.

4. Future projects. Once you solve a problem in a department, look for ways to apply the solution in different departments. One of the businesses solved a challenge in implementing software, and used the process for other successes.

Again, the project managers weren’t successful in all cases. For example, one situation lacked a tracking system. A second case led to an unfortunate conclusion because of a surprise merger that resulted in staff duplication of effort.

Senior management’s role

For success, the authors said “exceptional and innovative decisions” necessitate involvement of all stakeholders, especially senior executives.

“In these situations,” wrote the authors, “project managers should take the role of champions and use their communication skills to bring these opportunities to the decision-making level.”

Agreed. It’s important for project managers to manage the boss for better performance.

The researchers also discouraged traditional risk-management thinking by senior managers.

“In situations of uncertainty,” concluded the authors, “the adherence to a baseline that was defined without the knowledge of uncertainty could lead to neglected opportunities, forsaken value opportunities, and consequently the potential for project failure.”

True, there are eight best practices in setting goals to alleviate uncertainty.

Things aren’t always as they seem, so look for ways to benefit from adversity – even the apparent obstacles to success in project management.

From the Coach’s Corner, recommended reading:

Leadership and Planning Tips for Successful Project Management –In truth, projects fail because they’re not managed. Yes, there are varying degrees, but in reality they’re either managed or they’re not. The project manager must possess 11 leadership attributes to manage the team, stay on track and keep within budget.

18 Valuable Tips to Win in Office Politics — Most people troubled by office politics are too focused on the behavior of their adversaries. Stop giving away your personal power. Don’t think or act like a victim. Here are 18 valuable tips to win in office politics.

How to Eliminate Destructive Conflict for Better Teamwork — There are two types of conflict. For better teamwork and higher performance, it’s true that constructive conflict works. Usually, the best ideas evolve when ideas are discussed and debated. But when employees fail to exercise self control and their egos get in the way, emotions flare and cliques are formed in the workplace. That’s destructive conflict.

“We will either find a way, or make one.”

-Hannibal


__________

Author Terry Corbell has written innumerable online business-enhancement articles, and is a business-performance consultant and profit professional. Click here to see his management services. For a complimentary chat about your business situation or to schedule him as a speaker, consultant or author, please contact Terry.




Next Page »

Seattle business consultant Terry Corbell provides high-performance management services and strategies.