What’s a customer worth? If you roll the dice, you could “crap out!”

In a recent manager’s meeting I attended, there was a discussion regarding a poor performing employee who was disrupting co-workers and exemplifying very poor customer service.  The Boss’s initial knee-jerk reaction he said, “Fire her!”. The employee’s supervising manager was lobbying The Boss to keep her on duty until he could hire a replacement to take her place.  This is a service business already operating in an understaffed position due to a low unemployment environment and lack of qualified applicants. A position that most employers are experiencing in today’s economy.  As I listened to the discussion, I began to hear The Boss’s position change as he was being sawed by the supervising manager. After a while, I began to ask a few questions to get their attention.  What does it cost to lose a customer? How hard is it to gain a new customer?  We already know how challenging it is to find good workers in today’s world. I continued, in my experience when a company retains a bad employee, it is hard for the very good employees to justify staying with the company.  The good employees leave not because they cannot do the job, they leave because they do […]

“We’ve got to get shit done and we can’t afford to lose anyone!”

I recently began to work with a company that had a problem with employees not showing up for shifts and/or often leaving shifts early.  We called a meeting of the management team and began to discuss the problem and how to correct this type of damaging behavior.  I asked The Boss if the company had a disciplinary policy and the proper forms for the managers to use to correct these types of activities.  The Boss said no, the company never had anything like that.  The Boss said in the “old days” he would just threaten to fire any employee the next time “stuff like this” happened and that would be enough to correct the problem.  Today with the unemployment rate so low, The Boss says he is afraid to discipline anybody because of the worker shortage and as The Boss says; “We got to get shit done and we can’t afford to lose anyone!” As we continued our discussion, The Boss was not comfortable saying anything to the employee because he was afraid to lose another worker.  I stressed the fact that at least disciplining the employee or even letting the employee go would be the best action The Boss […]

What is your company’s competitive advantage?

In my work I have often been approached with these questions; “Do you think this is a good idea” and “should I go into business?”  I usually asked them to further describe their business idea for me.  They begin by speaking calmly and at an average pace, then, as they begin to get excited, their voice tone starts to rise, the pace of their speech increases and they often become animated.  This is a great sign since it shows they have a true passion for what they are describing.  Passion for what you’re doing is one of the critical ingredients for success as a small business owner. Next, I ask them to describe their competitive advantage.  If they respond with, “What’s that?”  I tell them not to quit their day job; end of discussion. Having and identifying a competitive advantage is so important that if a business owner cannot describe their competitive advantage then I believe they are destined for failure. As the owner of your business, you must identify or develop your company’s competitive advantage.  Once you’ve done that, you have to teach your key management and employees how you plan to use your competitive advantage to outsell the […]

Begin to change the culture with weekly manager’s meetings

After a few months of working in an organization and strategizing with The Boss I begin to know the business in a more intimate manner. At first, I want to understand the operations of the business to determine if the organization has a sustainable business model to build upon. I also begin to have extended conversations with the employees, beginning with the department heads and then the rank and file employees. By doing so I begin to understand the company culture. I determine if the culture is a healthy culture or if the culture is hindering the business in any way. I often find company cultures to be either one of accountability or one of enablement. If the culture is one of accountability, it is much easier to accomplish The Bosses goals for the business. If the culture is one of enablement, I often find an atmosphere of blame and mistrust between The Boss, management, and the employees. If a culture of enablement exists, change is necessary. Change of responsibilities and often a change of staff. Everyone is encouraged to accept the changes The Boss and I implement as we move towards a culture of accountability. This change can result […]

Give Your Employees a Forum to Improve Communications

When I enter an organization, I am considered a “change agent” and The Boss expects things to be different after I have engaged with the company.  After a good bit of time observing the culture and interviewing the employees, I set off to improve the organization’s profitability and ultimately the owner’s equity.  I usually have the top five areas that I look at for improvements.  One of those areas is communications. Recently I began working with an organization with five department heads.  I asked The Boss how often they meet as a group.  He stated they did not and there was no reason to as he had an “open-door policy” and anyone of his people could come and talk with him at any given time.  After more discussions, I found the main reason was money.  He ultimately said he calculated the hourly salary cost of each manager and to have them all in one meeting at a time would be too expensive for the company as they were experiencing lean cash flow.  I said I understand as I would do the same calculations in my companies, but I did not see the salaries as an expense but an investment. After […]

Don’t underestimate what your employees don’t know

While evaluating a new client, I participated in their management meeting where The Boss and the department managers were reviewing their financial performance from the past month. They were evaluating the financials by department, going over the expenditures line-by-line. I began to ask questions about the sources of the expenses. I received some very vague answers in some cases and in others, I was told, “I have no idea”. I observed that the department managers didn’t know what “success” looked like. They didn’t have a year-over-year comparison to benchmark their performance, nor did they have an annual operating budget to use as a goal for the month, quarter, and year. I asked The Boss if he set goals for his managers. He said he shouldn’t have to, they are the managers and they should know what they must do to be profitable. “That’s what I pay them for” was one of his responses. I said I understood his position and I often run across owners who have this same viewpoint. But this approach by The Boss will not create the results in the owner’s equity that The Boss desires. After interviewing each of the department managers, I gained some more […]

“What “The Boss” stresses the employees accomplish, make it the right message!

When I first begin working with a company I sit in on the manager’s meeting and just listen.  What I often find is that the staff is focused on what The Boss stresses as important. They instruct their direct reports to accomplish the goals set forth by The Boss in these department meetings.  The problem I sometimes see is that The Boss is sending the wrong message or a partial message. For example, in one meeting during a review of the prior months’ financials, each department head reported out to The Boss what their actual revenues were compared to the annual budgeted numbers.  Then The Boss asked what the budgeted revenue goals were for the next month and how each department manager was going to achieve those revenue goals. Afterward, The Boss was expressing frustration to me in the lack of gross profit from each department as it pertains to the annual budget goal.  During our discussion, I asked if the departments were hitting their revenue goals and The Boss said “Yes, as a matter of fact, the total revenue for the company was ahead of last year and ahead of budget”. I said I was not surprised as that […]

Guident Newsletter – December 2018 – Issue 31

The Boss needs to be “The Coach” for the team I began working with a company where “The Boss” was frustrated and exhausted.  The Boss was playing the roles of operations manager, sales manager, and being The Boss over the entire company.  The Boss had begun the company many years ago and the revenues had grown into the millions of dollars. Now The Boss felt like he had a “tiger by the tail” and was just hanging on without really controlling anything.    I asked The Boss why he felt he needed to fill the management roles for all the departments and The Boss stated none of his employees were ready to take on the responsibilities.  The Boss was a big sports fan, so I used a sports analogy to explain what I was seeing. The Boss had several key positions open on his team and was waiting for an MVP player to show up to occupy those positions.  Because The Boss felt he did not have an MVP player on his team, The Boss left the positions vacant or tried to fill them himself. Imagine if he was coaching a football team and the right tackle position on the […]

Guident Newsletter – November 2018 – Issue 30

How do I begin to change from an “enablement” culture to an “accountability” culture? In past newsletters, I have written about the challenges facing business owners when they have an “enablement” culture versus an “accountability” culture.  Recently I began working with The Boss to change a company’s enablement culture to an accountability culture. I asked the six supervisors in this organization to list the eight most critical job duties of each of their direct reports.  Then I asked the employees of these supervisors to list what they thought their eight most critical job duties were. In the next step, we compared what the supervisors identified as critical and what their employees reported as their most critical.  In most cases, the supervisors and direct reports were in-line on about five or six of the most critical job duties. This left us with an opportunity to improve efficiencies and workflow. Efficiencies can be gained when employees understand what The Boss sees as most critical to the company’s success and in turn their success.  The other duties listed by employees, but not seen as most critical by The Boss, were taking valuable time away from the truly critical duties necessary for the organization […]