Recently, while working with a client, I had the opportunity to lunch with two business owners from Europe. We began with casual conversations, and I was impressed with their understanding of our NFL football teams. Eventually, our conversation turned to business and the similar challenges we all experienced. The most interesting subject was people. It didn’t matter what continent we were on; people offered the greatest challenges. More specifically, we agreed we each had good workers and decent managers but were lacking enough leaders to go around. Some questions we discussed were: Is leadership taught or is it innate in an individual? We discussed personal growth plans and what types of training newer leaders needed. We discussed the benefit of giving candidates for leadership the opportunity to lead before being promoted into a leadership position. Will people like this person as their leader? Will they follow this person? Will employees trust this person as their leader? Great questions that needed to be answered prior to promoting a person. By this time in the meal, I think we were more interested in what we were discussing than the food. Those who know me will find that hard to believe! We discussed the […]

The Boss asked me to help him understand his financials better. I asked what his main issue was, and he stated that he thought the profits were too low. We had developed a budget earlier in the year and he was comparing the actual financial reports to the budget. We knew the budget was not perfect as it was our first budget we wrote together and the first budget The Boss had ever written for his company. After reviewing the profit and loss, The Boss pointed out the net income was running behind budget for the YTD. We began to discuss what could be causing this effect on the P&L. I had The Boss initiate a job costing SOP and The Boss said he had been doing this religiously with good results. So why was the profit not showing up on the financial statements? After calculating some percentages, we could estimate what the dollars should be for the cost of goods sold (COGS) and overhead. We reviewed the balance sheet and calculated purchases versus the COGS on the P&L. Here we found the beginning of the problem Purchases versus COGS according to GAAP. I explained this as simply as I could […]

I recently took on a new client and in our first meeting, The Boss expressed how frustrated he was with his bank. I asked, “How so?” The Boss said their line-of-credit (LOC) was too small and every time he went to the bank asking to increase his LOC, they routinely asked for a profit and loss statement and a balance sheet. Soon afterward, the bank refused his request. I asked The Boss if he ever asked his banker for a reason, and he said “No, he was too frustrated”. I looked over his profit and loss statement (P&L) and asked to sit with The Boss to answer some questions I had. Frankly, the P&L was a mess. The Boss was a great technician but a poor bookkeeper. He tried his best to input the information to keep the P&L up to date but his day-to-day duties often won out over accurately inputting financial data. We spent hours trying to organize the P&L according to General Accepted Accounting Principles (GAAP), a term The Boss did not understand until we started working together. We isolated his profit centers and calculated a gross profit per center. We separated the direct costs and the […]

With the fishing season upon us, I thought of writing this newsletter about fishing guides. Therefore, this newsletter is not for The Boss but for you! When you decide to hire a fishing guide, you pick a guide with years of experience and someone who knows the waters you are going to fish. She knows the various lures that you should use and will share with you some of her best techniques so you can catch that trophy fish of your dreams. As a novice angler, you are eager to learn from your guide and therefore you ask many questions about the proper rod and real, the best way to rig your line, and you are eager to learn how to read the fish locator. You are attentive and heed every word your guide says. At the end of the day, you and your fishing guide have a mutual goal, your success on the water. Now imagine your first week at your new job. You have sought out a company in an industry you think you might like. Your goal is to do a good job and maybe advance in the company to earn a better wage than you earn […]

I recently had a conversation with The Boss regarding one of his younger employees who was an underachiever. I asked if I could talk with the lad and see if I could help to motivate the young man to improve his work ethic. The Boss agreed and the conversation went something like this. We were in the middle of March Madness and I asked if the young employee had ever played any sports. He said he was on the basketball team in high school. I asked what position he played, and he said he was the starting guard on the team. I then asked how his bracket was going. It was early in the tournament, and he said his bracket was blown up by Kentucky losing to St. Peter’s. I said mine too! I said I was also a Badger fan, and they didn’t help my bracket by exiting as early as they did. We chatted sports for a while and eventually got down to the topics that needed to be addressed. I must say that I am partial to hiring athletes and folks who have been raised on a farm. Farmers understand the responsibility and hard work from young […]

I recently met with The Boss who was frustrated with a newly promoted manager. During our discussion, I found out the new manager was young and not very experienced. I asked how did this person become a manager if he was not ready for the responsibility? The Boss expressed that he had no choice, there was no one else he trusted to promote within his company. I then asked what qualifications did The Boss see in this person that caused The Boss to promote him? The Boss said the new manager was one of his top technicians and had an excellent attendance record. I asked if the person had ever been in a position of authority before? The Boss answered, “not really.” This scenario is happening more often than we’d like in today’s crazy environment where we do not have a sufficient workforce to fill open positions, including open management positions. We begin to promote new managers up the managerial ladder skipping rungs that are important for the person’s professional development. Back in the day, when an employee began to climb the managerial ladder, they began as a supervisor and next was promoted to an assistant manager. After several years, […]

I met with The Boss today and discussed the challenges businesses are facing with their workforce and what to do about it.  We talked about how the economic conditions of the early 2000’s forced business to reinvent and adapt their business models back then.  We remembered when The Boss had to change the business model again when customers forced businesses to create an on-line presence and sell using the web.  Today, our workforce has challenged businesses to change and adapt the business model. The Boss is realizing the younger workforce of today has different values and expectations verses the older workforce of yesteryear. Back in the day, when us older folk first got into business, the workforce we managed came to work Monday through Friday and put in the normal 40-hour work week, had a cubical or desk, and if they were senior associates, had the weekends off.  Today The Boss must manage a workforce, which is made up of several generations, each of which has quite different opinions and attitudes about work life balance and what accountability should look like. The main discussion revolved around, not having enough people to field a workforce team!  Today, The Boss must employ […]

As the challenges continue to pile up in business today, especially in staffing needs, I see organizations lowering their qualifications for new hires. This is done not because The Boss wants to but because The Boss has to! The latest unemployment numbers are telling us we have a 4.6% unemployment nationwide and in Wisconsin, we are looking at 3.2% unemployment. Those of us who are long in the tooth may remember doing business in 1998 when we were also at 3.2% and lower unemployment in Wisconsin. What does The Boss need to do this time around? Because organizations are hiring people who do not have industry experience and may not have the foundational skills desired by new employees, The Boss must do things differently to help these new hires to succeed. Training programs for their new employees and implementing a mentoring program will help the newcomers to assimilate into the company culture. Having a procedure for “onboarding” new people will also help. But above all, The Boss needs to establish SOPs in the workplace for those critical processes. Standard Operating Procedures (SOPs) are an investment The Boss can make in the business and investment in all the employees. Developing an […]

I was in Canada fishing for muskies with my son and we were using surface baits when I saw this huge “V” heading for my bait. I immediately became excited and, in an instance, could see a large trophy size muskie hanging on my wall in the Man Cave. I watched the lure and asked my son to man the net. Then, in an instance, I pulled back the rod to set the hook and — nothing. In my excitement, I forgot everything I knew about the art of fishing and I set the hook before the fish bit the lure. I pulled the lure out of the water and my trophy catch was gone. It makes for a good story at the lodge, but I have nothing to show for my efforts. In the past few weeks, I have seen this happen to more than one of my client’s businesses. The Boss was working to land a huge account. He was getting excited and even planning what to do with the excess profits a large job like this could bring. The issue I saw in every case was the larger the job, the lower the profit margin. The Boss […]