Increasing Flow and Igniting Fire - Winning Advice for a Tough Economy
BY Mike Foti
Do you sometimes feel like you're batting your head against a wall in your
business? Prices going south. Costs going north. Margins getting squeezed.
Where's the magic "silver bullet" of success? The quick answer - it doesn't
exist! If there was one quick answer everyone would be using it and profits
would flow as freely as water from a tap. As a leader of a business, a
department, a field crew, what can you do RIGHT NOW to move from bleeding edge
losses to leading edge profits? Consider 3 Steps:
- Think People - "Drill Down to Go Up."
- Think Strategy - "Jump Back and Get Out to Move Up."
- Think Speed, Efficiency, and Flexibility
1. Think People - "Drill Down to Go Up"
Results happen through people. No rocket science here! Saying the statement is
much easier than making it happen. Getting production, profits, results
from others is about using influence, expanding ownership, and removing
obstacles. How do you make it happen?
- Take down "scaffolding" and influence "your people's people!" - Are
you influencing the people driving the day-to-day profitability -those closest
to the action (estimators, field sales people, service technicians, machine
operators etc.)? If not, meet with these profit-generators and explain, in
plain English (no "business-speak"), the facts, the realities of your
performance, your competitive position, and what customers are telling you
with their pocketbooks! Then, ask them to get specific about how they can
deliver exceptional results in their positions. Work together to set up
measurements of performance and track actual results.
- Make matches: Reduce fires! Stop putting people into "jobs." Match
your people's talents and skills with where you need them to "show you the
money." Identify those who are unproductive. Determine if they have the
skills, talents, and values to be successful in another capacity. If not, work
them out of the business ASAP. If repositioning can work, have them start
putting out the "fires," the problems in your business. Forget "jobs" and
start working on goals. Get your talent to dig in and "extinguish fires" while
simultaneously igniting results.
- Remove barrels - Your job is to make others' jobs easier - to
remove the barrels blocking success! Are your systems giving those closest to
the action the information needed to improve results today? Are bad
managers in your organization killing innovation, dampening enthusiasm, and
bring everyone else down to their levels? You don't have time to let your
"orange barrels" eliminate "green light" performance!
- Call in the "Dynamic Duo" - No, I'm not talking about Batman and
Robin - although it would be great to see the "competitive villains" whisked
away! I'm talking about using the dynamic duo of "ignorance and intelligence."
In today's intellectually competitive world you need to identify (a) what you
know, (b) what you don't know and (c) what you are going to do to improve on
"a" and "b." Some quick ideas:
- Create an advisory board/ Find a mentor. Results magically improve
when you surround yourself with smart people (those with skills you lack) who
can both inspire and challenge your current ways of thinking without worrying
about political correctness or hurting your feelings.
- Develop a "learning plan." What are you reading, learning, and
applying right now? Be strategic with your reading. Can it help you solve a
current challenge?
2. Think Strategy - "Jump Back and Get Out to Move Up."
Most leaders are drowning in the sea of their own problems. When you're gasping
for air it is not the best time to develop winning plans! To get out of your
funk you need to "jump back" from operations, analyze your current reality, and
focus on winning approaches for the future. To do this consider these ideas:
- Fix it, Grow it, or Blow The Segment Down! - Get your team involved
and break the business in smaller segments (by products, services, markets,
geography, customers etc.). Determine your segment profitability, growth, and
competitive position. Then ask three key questions:
1. What are the critical issues facing the segment?
2. What can you do to make $ RIGHT NOW?
3. Is this segment worth the effort?
Finally, define the steps and people accountable to fix, grow, or blow the
segment down.
- Coulds vs. Shoulds" - Excitement, growth and profits require
stretching your organizational limbs. When someone says "we could do that,"
pause, then start digging into "should we do that?" I've seen many
businesses become unfocused scrap-heaps of energy, effort, and dollars because
not enough time was invested in the analysis to make the could vs. should
distinction.
- Visit the person who pays the bills - Talk to your customers. What
do they like/ not like about your performance? If they like you, get referrals
so you can start dialing for cash today. Ask them their problems,
pains, and challenges. Are there growth opportunities solving their problems?
3. Think Speed, Efficiency, and Flexibility
If you're not achieving the results you want right now, don't think happiness is
right around the corner. I could show you a business I "invested" (that is a
nice term for lost money in) $250,000 in over 4 years waiting for the "corner"
that never came! Getting "fixed" in a tough economy requires implementing a
thorough, tenacious, "cornerless," plan leveraging speed, efficiency, and
flexibility. Here's how:
- Rev Up - My Dad (a long-time construction entrepreneur) had a
saying on his desk - "Happiness is a positive cash flow." Consider these ideas
to open up the cash spigot:
-
Reduce in-process materials and increase inventory
turns.
-
Offer cash discounts to speed payments.
-
Bill quicker.
-
Pay faster (yes - not a misprint) while you
simultaneously negotiate better prices and terms.
- Clean Up - Tough times are made to clean up past "messes" (the fat
and inefficiencies built up in the "good 'ol days). Some ideas:
o Stop paying $2,976 for coffee and bottled water. One of my branches spent
this amount on coffee and water last year. Why didn't we notice? The bills
came in monthly at about $100 to $200 a pop. Our solution? Switching to
Maxwell House and putting a filter on our tap. Total cost $400. Yearly savings
- $2,576. Look at your total expenditures by vendor for last year. Cut the
fat!
- Limber Up - Are you stuck with slow-turn inventory, underutilized
equipment and people? Rethink what you see as "fixed" in your business. Look
at "rent vs. buy," "make vs. outsource" decisions and find ways to get
flexible now. On the flipside remember one person's junk is another person's
treasure. If you have cash reserves and are growing consider buying up your
competitors fixed assets at today's bargain basement prices.
Conclusion
Tough times call for tough measures. They call for you to do things differently,
take new actions. How are you planning to increase your "flows" (reducing costs,
improving margins, increasing turns etc.) and ignite the "fires" (getting people
matched with work and results required) of those around you? Take action and
watch your success overflow!
If you would like to have Mike speak to your group consider the following
programs:
"Increasing
Flow and Igniting Fire" - Winning Advice for a Tough Economy
"Leading for
Entrepreneurial Success"
"Design/ Build
Leadership - End of the Winner Takes All"
"Seeing the
Forest from the Trees"
If you want to get Mike's insights on this topic in one on one sessions
click here.
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Mike Foti is Chief Executive Officer of Cleveland Glass Block (a
Northcoast 99 recipient for best employers in Northeast Ohio and a Community
Pillar Award winner for community service) and President of Leadership Builders.
Mike is a national speaker, writer, and consultant who helps individuals and
companies get results through people. To ask Mike how he might help you, or to
receive his free tips and leadership articles, call 216-531-6085 or visit his
web site at
www.leadershipbuilders.com.
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