Incentives to Keep Key Managers

There is a key role for incentives in managing and retaining key executives for the company. Here are some reasons for and examples of how to structure effective incentive programs for management.


1. You want to retain key management personnel for a number of reasons. High turnover destabilizes the company and can have severe effects on moral of employees and the bottom line.
2. You want to retain high performing managers to enhance your own company’s growth potential. Keep key managers from moving to competition.
3. Good managers don’t expect a bonus without achievement but don’t set the bar so high as to be unachievable. That becomes a disincentive to achieve.
4. Set goals that help improve your bottom line; achieving new sales records is not a priority if the costs exceed the benefit. Sales executives should be just as concerned about profitable sales as the CFO.
5. Pay executives for overachieving by sharing profits. As profits goals are exceeded rewards can continue to be major incentives if shared fairly. Reward contribution.
6. Be competitive but unique and allow key employees to participate in goal setting. When they are part of setting the goals they are more likely to increase efforts to reach the bar.
7. Conduct periodic reviews to ensure all incentive participants know where they stand. Let’s not have surprise results announced at year end….good or bad.
8. Be completely transparent. If goals are profit based show actual revenue/profit results so that there is a clear understanding of achievements.
9. Roll plans forward and allow incremental bonuses for achievements in consecutive years. That’s a great way to keep a key person from leaving; that extra bonus for additional achievement may be too juicy to walk away from.
10. Stock options are often used as a tool for key employee retention. The chance to be a part of ownership can be major motivator. However recent issues in corporate governance have tended to dilute and weaken some incentives. Try to strive for balance without risking responsibilities to shareholders.

Incentives are important tool to maintain a motivated and dedicated management team and a well-designed plan can bear fruit over the long term.

Those are a few on my thoughts. Let me know what you think.
Gerry@polarisgroupmc.com

Are you a Successful Leader?

Leadership is learned behavior that becomes stronger over time. The process of making decisions comes from an accumulations of experience. The most successful leaders are instinctual decision makers who are more tolerant of pressures associated with decision making and leading the business.

Here are a few traits of successful leaders:

1. Allow subordinates the opportunity to speak freely.
Leaders sometimes intimidate colleagues and subordinates with their position and power when they enter a room. Successful leaders deflect attention away from themselves and encourage others to voice their opinion. They are always approachable.

2. Make Decisions
Successful leaders are expert decision makers. The facilitate dialogue and empower colleagues to reach decisions. They “make things happen”

3. Communicate Expectations
Successful leaders are great communicators particularly with respect to performance expectations. They clearly communicate organization core values and mission statements so that objectives are properly executed.

4. Measure and reward Performance
Great leaders have a strong pulse on the business and on those individuals who lead with strong performance. Successful leaders never take consistent performers for granted and always reward performance appropriately.

5. Use talent effectively.
Successful leaders know their talent pool and how to use it. They facilitate growth in individuals and deploy their skills to maximize their contribution to the business.

6. Avoid Procrastination
Successful leaders tackle issues head-on and know how to get to the core of the issue. They don’t procrastinate and move quickly to solve problems or empower colleagues to make decisions.

There are a few examples of traits successful leaders demonstrate; there are many more. I hope as business leaders your colleagues see these traits in your leadership.

Know your Competitive Advantage?

It is important in building your business to understand your strengths and where you can increase your competitive advantage and produce better results.

What gives you a competitive advantage?
It is your ability to bring together every attribute of your business, to work seamlessly to deliver a standard of excellence your competitors cannot achieve.

How can I assess my organization's competitive advantage?
Check your pulse by asking yourself key questions about your products vs competition; your market share, ability to attract key contracts and customers.

Are you ahead of or lagging competition?
If ahead, you want to maintain that gap and if lagging you want to close the difference in performance. One major way to improve and stand out is to ensure your key brands or services offer unique attributes that competition cannot offer.

Strategically it may be time to invest in a positioning review. A great source to help you through this process is Ed Roach, The Branding Expert. I highly recommend his service.

Contact Ed at:

Ed Roach
ed@thebrandingexperts.ca

Do you have a handle on the finances of your business?

Keeping up with all of the day-to-day demands of operating a small business can cause owners to lose sight of the company’s overall fiscal situation. Owners should be proactive with company finances; here are a few tips that may be useful:


• Benchmark
Know where you are and what your targets should be. A plan is useful and need not be too formal. As milestones are reached know how you are going to get to the next level and what financing may be needed.

• Liquidity
How liquid is the business? Having immediate access to cash can reduce borrowing costs. With funds available you are able to make the most of capital-intensive business opportunities.

• Profitability
If sales are growing but there seems too often to be a cash shortage after bills are paid, the business may have profitability issues. Monitoring profit margins instead of gross sales will help determine what the business is actually earning.

• Stay involved
Business liquidity, profitability and other key ratios are important to evaluating the business – but only if owners spend time reviewing the information. It is necessary to schedule time every month to actually review the data.


While it is not necessary to review financial data daily, consistent reviews are the only way to know if the business is improving or regressing. Owners owe it to themselves and to shareholders to stay aware of the financial health of the business.

I hope the tips are useful, let me have your thoughts.

gerry@polarisgroupmc.com        
               
       

Avoid those killer start-up errors

Are you planning to start a new business?  There are many hazards that might be faced and avoiding these can help improve the chances of success.
Here a few hazards new entrepreneurs should try to avoid.

1. Under financing: lack of sufficient funding is probably the most common reason new businesses fail. Many entrepreneurs fail to assess the burn rate of the capital they have. Often the most costly step is hiring too many people. Try paying people with equity rather than salary, you will end up with a much more committed team and preserve cash. Don’t overspend on equipment and technology you really don’t need to get going.
Also, many start-ups fail to realize that few customers pay promptly; this can severely impact cash flow.

2. Starting without a plan: enthusiasm over a good idea is over-rated. An idea is only an idea and without a well-developed business plan chances of success are minimal. It is also very difficult if not impossible to raise financing without a plan.

3. Fear of Failing: It is natural to have some fear that the business will not succeed and certainly problems will arise and challenge your business acumen. However, if the concept is strong and validated you should not let fear of failing stop you from trying to live your dream.

4. Inflexibility: with start-ups you have to be prepared to change on the go. Rarely does the plan get executed without a hitch. Marketplace dynamics, competitive behaviour and economic conditions can dramatically impact the plan. Ability to react and change plans may be a key to survival.

These are some hazards you may face in starting a business. There are others but avoiding these may help improve your chances of a successful start in business.

I hope this helps you get underway. Let me know.
gerry@polarisgroupmc.com

How do you measure your Financial success?

How do you measure the success of your company? Many small-business owners rely on two traditional financial reports: the balance sheet the income statement. The first tells you what your business owns and owes at a particular point in time, and the second tells you what profit you’ve made over a period of time.
Although both are important here are a few other controls to monitor the health of your business:

• Cash Flow. Are you generating sufficient cash to operate? Is bank financing required to help fund growth? Ever wonder at the end of the year where all the money went? This will provide the important tracking.
• Accounts receivable Collections: Cash flow is dependent on timely collection of receivables. As receivables grow cash flow is stretched thinner. Slow collections can affect liquidity and your ability to cover short term obligations.
• Average sales per customer. As overall sales grow it is important to maintain growth with existing customers. This is often easier than finding new business and a measure of your success in gaining repeat business.
• Margin. Don’t become too focussed on net revenue and become content if this increases yearly. It is important that revenues don’t cost more to generate each year. Operational efficiencies are important to monitor continuously.
Sometimes businesses can measure their performance against competition within the industry. That may help highlight areas where improvement may be needed.

These were just a few considerations. Please let me hear your thoughts.
Gerry@polarisgroupmc.com

Do you have a crisis management plan?

Is your organization struggling to deal with a crisis or plans to ensure the business exposure to a crisis is minimized?  It is not uncommon to see this paralysis because managers often prefer not to deal with the situation.
Let’s look at some steps that can be taken to help build a safety net.

1. Maintain sensitivity for even minor events. Some could have the potential to develop into major issues that could be a blow to the business.
2. Plan ahead with a look to long term strategies as a guide. Work out best and worst case scenarios to help prepare for unseen events.
3. If a crisis arises act quickly; procrastinating rarely improves the situation.
4. Create a crisis management team with a mandate to identify potential problems and empower them to enact changes to protect the business.
5. Provide effective training to key employees and take steps to eliminate small issues so they don’t erupt into major problems.
6. Explore optional solutions and look for new ground to operate from if standard solutions prove inadequate. Think outside the box for solutions.
7. Don’t panic in a crisis situation. As the leader employees want strength. Keeping a cool head may facilitate focussing on the issues and getting a solution right.The key to avoiding or minimizing the impact of crises that may arise is to be proactive ahead of adversity.

I hope these tips provide insight into ways to fight through any situation that may arise with minimal damage to your business.

It’s Time for an Effective Business Plan

Creating a road map for a business may be a key to growth and success but how many entrepreneurs do it right. Here are suggestions for developing a solid plan.

1. Shorten the planning horizon. With the speed of change today the 5 year plan has become obsolete. Shorten the timeline to 3 years. You can have great vision and well developed strategy but unless you can connect the dots between where you are today and where you want to be you will fail.
2. Manage what you can measure. Knowledge is power. Monitor the right information and your plan will have a greater chance of succeeding.
3. Increase planning frequency. When the 2-3 year plan is complete, management meetings should be held at least quarterly to review where you are and what to do next. This will enable the organization to assess progress and realign targets to meet new business conditions.
4. Write the plan yourself. This is an element of business that entrepreneurs love to delegate to a consultant. A plan is better understood if it is created within the organization. The elements contained within the plan vary depending on the size and complexity of the organization. Only when there truly is a lack of the skillset for developing plans should the process be delegated to an outsider like a consultant.
5. Share the process. Entrepreneurs who keep their plans close to their chest, not revealing them to anyone, do so at their own peril. Making other managers part of the process provides the opportunity to hold them accountable and share ownership of the plan.
6. Be realistic. Plans that are overly optimistic or too safe are both wrong. Optimistic plans project revenues and a resulting spending scenario that may not be achieved. Deficits will result. Plans that are too conservative may result in limitations on spending because revenues are not expected. This may result in lost opportunities. Every effort to achieve realism should be undertaken and frequent reviews help keep the business on track.
7. Share the plan. Once completed the plan should be shared with the management group so everyone understands expectations and the yardstick for success. The organization should, where possible, tie performance bonuses to result attained in the plan.

When employees feel a sense of ownership about the future you may be amazed what they will be willing to do for the organization to help ensure success.

Are you ready to pass the baton?

How much time have you spent recently preparing your organization for the future with a succession plan?

Too often I have spoken with owners of business who have given no thought to how their business continues past their time or even who should be in line for succeeding others in key positions.
There is a fine line between structuring an organization so strong back up is available for key positions and being top heavy with management staff.

While it is important to develop and maintain an organization chart that identifies potential replacements for key positions it is a plan that must be kept confidential among only a few very senior managers. Clearly if the succession plan was broadly known the group of subordinates would constantly be chafing at the bit to move up the ladder.

The succession plan should be updated regularly. Performance of employees change, new stars arise and training of key individuals to broaden their experience become important elements of the plan.

In small family organizations a succession plan may be even more important. The owner may have family members who he would wish to carry on the business but is he/she qualified? Are there competing siblings who vie for the role of president? How does the current owner resolve that issue?
A well-developed plan not only provides for a smooth transition when needed but also can be a critical tool in situations that result from an untimely injury, illness, or death of the owner. You do not want a vacuum created from the absence, for any length of time, of leadership in the business. A prolonged absence of an identified leader can destabilize the business.

The owner or president of the business has the fiduciary responsibility to be proactive and protect the business and ensure survival is optimized. That means an active role in preparing for his/her exit and change in other key management positions.

You never know when there will be a need to pass the baton.

Use Networking to Improve Results

Business Networking is a really valuable way to expand your knowledge, learn from the success of others, attain new clients and tell others about your business. Here are benefits that you could enjoy by expanding networking activity.

1. Generation of referrals/Increased business
This is probably the most obvious benefit and the reason most business owners decide to participate in networking activities and join networking groups. Referrals that you get through networking are normally high quality and most of the time are even pre-qualified for you. You can then follow up on these referrals/leads and turn them into clients. You get much higher quality leads from networking than other forms of marketing.

2. Opportunities
There are always lots of opportunities that come from networking. Opportunities like joint ventures, client leads, partnerships, speaking and writing opportunities, business or asset sales… the list goes on, and the opportunities within networking are really endless.
The opportunities that you get involved in should align with your business goals/vision, otherwise you might find that you are spinning your wheels chasing after opportunity after opportunity and getting nowhere.

3. Connections
“It’s not WHAT you know, but WHO you know”. If you want a really successful business, then you need to have a great source of relevant connections in your network that you can call on when you need them. Networking provides you with a great source of connections, and really opens the door to talk to highly influential people that you wouldn’t otherwise be able to easily talk to or find.
In addition that person will have a network you can tap into as well.

4. Advice
Networking is a great way to tap into advice and expertise that you wouldn’t otherwise be able to find. Just make sure you are getting solid advice from the right person – someone that actually knows about what you need to know and is not just giving you their opinion on something that they have no experience in.

5. Raising your profile
Being visible and getting noticed is a big benefit of networking. Make sure you regularly attend business and social events that will help to get your face known. You can then help to build your reputation as a knowledgeable, reliable and supportive person by offering useful information or tips to people who need it.

Look for groups to join that can expand your knowledge base and your business. Take no opportunity to network lightly – strive for excellence.

Are you a Good Communicator?

There are a number of ways managers can increase effectiveness of communications. Here are a few suggestions to consider for your business.

• Bring life to your vision. Anyone can write a mission statement. But you aren’t communicating that vision unless you repeatedly signal how those values translate into concrete actions. What people learn from your routine decision-making matters far more than what you pack into your speeches.

• Ask good questions. When you want to persuade someone, questions can be more powerful than statements. The reason: you engage another person more strongly. You get him or her thinking about the ideal answer – and the steps necessary to get there. By being less dogmatic, you let people on your team build game plans that they believe in.

• Be aware of things you don’t know. If your subordinates are any good at all, you often won’t know the details as well as they do. Expect to be learning constantly. Find ways that your in-house experts can quietly bring you up to speed on emerging issues. You’ve got vital strengths that other people don’t, particularly in terms of experience, broad perspectives and judgment. As you work toward important decisions, make sure your remarks and conversations are opening the way for other people to keep augmenting your knowledge base.

If you’re conveying a clear vision, asking good questions, setting the right priorities you’re creating that winners’ aura that is the ultimate reward for great leadership communication.

Are you a Great Leader?

Organizations succeed for many reasons but those that have strong leadership improve the odds of maximizing profitability.
Here are a few important principles to consider in order to strengthen leadership skills.

1. Listen. Listening is the most valuable--and probably the most underrated--skill CEOs need to succeed. Great leaders listen to what their customers and prospects want and need, and they listen to the challenges those customers face. They listen to colleagues and are open to new ideas. They listen to shareholders, investors, and competitors.
2. Be Authentic. Great leaders are who they say they are, and they have integrity beyond compare. Vulnerability and humility are hallmarks of the authentic leader and create a positive, attractive energy.
3. Be Transparent. There is nowhere to hide anymore, and businesspeople who attempt to keep secrets will eventually be exposed. Openness and honesty lead to happier staff and customers and colleagues. More important, transparency makes it a lot easier to sleep at night - unworried about what you said to whom.
4. Be Responsive. The best leaders are responsive to their customers, staff, and investors. Every stakeholder today is a potential viral sparkplug, for better or for worse, and the winning leader is one who recognizes this and insists upon a culture of responsiveness. No matter the medium, responding shows you care and gives your customers and colleagues a say, allowing them to make a positive impact on the organization.
5. Show Passion. Those who love what they do don’t have to work a day in their lives. People who are able to bring passion to their business have a remarkable advantage, as that passion is contagious to customers and colleagues alike. Finding and increasing your passion will absolutely affect your bottom line.

Above all, treat others as you would be treated. By showing others the same courtesy you expect from them, you will gain more respect from coworkers, customers, and business partners.

Need to Conserve Cash?

Conserving cash can create benefits in economic conditions facing business today. When business is in a slow growth pattern, cash is very important and if you don’t have cash when you need it the most operations can be constrained.
Conserving cash may not be easy for those businesses that have been used to having the money to spend at any time. However, when some belt-tightening is necessary, some practical cash conservation methods may be prudent.
Here are a few tips to conserve cash:
• Spend wisely. Make sure that purchases are made for need to have not nice to have items. Items should have a focus on producing revenue where possible.
• Ensure new employee hiring is necessary. Employee salaries are a significant cash drain so efforts to maximize productivity from current employees are paramount.
• Lease equipment. Leasing vs buying can be an important option since equipment purchasing can be a serious cash drain.
• Plan ahead. Make sure you forecast financial activity. A plan outlining expected revenues and expenditures is vital to understanding cash needs. You certainly want no surprises on cash flow activity.
• Renegotiate leases. Rent is often a sizeable fixed cost that can be negotiated. Speak with your landlord; there may be an opportunity to downsize or even temporarily obtain rent reductions. Landlords often prefer to accept lower income than losing tenants.
• Go to the clouds. If your business is large enough to have in-house servers you are aware of the maintenance costs. If business is increasing this may be a cost effective way to create additional capacity without buying expensive new servers.

Business owners should share their cash flow objectives with other key managers to ensure every opportunity to maximize cash savings is realized.

Make Better Decisions

Decision-making is a crucial part of good business. The question then is ‘how is a good decision made? One part of the answer is good information, another part is experience in interpreting information.
Managers can be trained to make better decisions. They also need a supportive environment where they won’t be unfairly criticised for making wrong decisions. A climate of criticism and fear stifles risk-taking and creativity; managers will respond by ‘playing it safe’ to minimise the risk of criticism which diminishes the business’ effectiveness.

Decision-making increasingly happens at all levels of a business. The Board of Directors may make the strategic decisions about investment and direction of future growth. Managers may make the more tactical decisions about how they may contribute most effectively to the overall business objectives. But employees are increasingly expected to make decisions about the conduct of their own tasks and responses to customers. As a result careful recruitment and selection, good training, and enlightened management are important supports to good decision making.

How do you make the best possible decisions, knowing they will have an impact on your company's future?
There are strategies you can use to hone your decision-making skills.  Making better, faster decisions will help you take advantage of business opportunities.

1. Review the problem/decision in a broad context to include as many perspectives as possible. But don’t procrastinate just to get another opinion.
2. Make decisions as much as possible on facts rather than emotion. It is good to challenge your gut instincts; use objective data to reinforce decisions.
3. Don’t hesitate to challenge the status quo. Staying in your comfort zone in order to be comfortable may lead you on the same path. Change does not necessarily take more effort.
4. Be open to others opinion but trust your own ability and ability of employees to make a well-reasoned decision.
5. Recognize that some constraints may influence the decision; financial constraints, practicality, and lack of resources to implement the decision may influence the path taken.

Decisions are not taken in isolation and the effects of any decision will depend on reactions of others. Competitive behaviour should be anticipated and can influence choices. In the end, the review process needs to be completed with minimum delays and decisions finalized. Respect for action taken with a firm unwavering approach or allowing responsible employees to decide will earn respect from the organization.

Exiting the Business

Determining when and how to exit a business can present issues often more challenging than starting the business.  Here are a few thought starters for owners looking for a way to exit their business.




•  Is the business operated from strong principles of strategy with a clear vision? Can that vision be expressed and understood by those who manage the business or potential buyers? If you the owner cannot clearly state the purpose or reasons that you exist don’t expect new owners to invent it for you.

• How will you get the maximum return if you plan to sell? In cases where management/ownership is dominated by a single individual there is a risk that customers will not have confidence in new ownership unless the current owner can provide an effective transition plan that ensures continuity of the business operations. Current owners may need to plan for extensive transitional training.

• Factors that may support your decision to leave can grow out of many conditions. The most common are age or health related. A long career leading to a desire for more personal time; reap the rewards of your career. Age may not be the prime driver but longevity at the job could be creating burn out. It may be time to move on.

• Look for opportunities to exit from positions of strength. A well trained and competent management group may provide the opportunity to offer your staff a management buyout.  Managers may be able to pool resources to fund the buyout, you as owner may offer to finance all or part of the buyout or there may be an option to use company assets to finance the loans needed for the buyout. It also provides good opportunities for maintaining stability in the organization.

• Finally, the marketplace may facilitate determining the right time to exit. Poor economic conditions or competitive activity can have a huge impact on if or when you should exit. Positive conditions too might bring a competitor to the door with a buyout offer.

So the options are many but not always easy to sort through. Timing is critical, business life changes, choose wisely.

Do your Employees Share Ownership Goals?

There are a number of ways to encourage employees to support ownership goals and enhance the success of the business.

Here are a few ideas:
• Show the big picture. Sharing the business strategy allows employees to see beyond their individual role. Allow upward communication as a channel for employees to share their ideas.
• Reward employees who go beyond the norms of their job description. This recognition and expression of appreciation will ensure that efforts will continue.
• Be transparent. When employees see the full context and options considered in a decision they are more likely to support the organization even if they disagree with the decision made.
• Use collaboration. Higher participation in the decision process yields better buy-in for decisions as employees are more likely to support ideas they help develop.

I hope these options provide a better insight on how to improve employee support for achieving company goals.

Are you tuned in to Modern Leadership?

The work environment is in constant change and qualities of managers leading organization also need to change. Here are a few qualities of Leadership I think help organizations succeed in today’s marketplace.

1. Lead vs Direct
Remove roadblocks for employees in order to help them succeed.  The traditional idea of management was based on command and control.  Employees used to work hard to allow their managers to succeed. Let the managers work to make sure their employees succeed. 

2. Be aware of technology
This isn’t the same as technical expertise.  Managers do not have to all of a sudden become IT professionals. However, managers do need to understand the overall technology landscape and how it is impacting the way work is conducted.

3. Lead by Example
 It used to be good enough for managers to say they supported something, to approve the budget, and say “go for it.”  Managers need to commit to more than just funding collaboration.  They need to be the ones on the ground level using the same tools that the rest of the employees are using. 

4. Welcome vulnerability
Vulnerability is about having the courage to show up and be seen. Vulnerability is part of the key to innovation and creativity.  There can be zero innovation without vulnerability.”  Being vulnerable isn’t about being weak it’s about being courageous; a key quality that every manager must have going forward.

5. Share
Today managers cannot believe in hoarding information. There needs to be sharing information and collective intelligence.  Managers need to make sure that the employees can connect to each other and to the information they need to get their jobs done, anytime, anywhere, and on any device. 

Managers should rely on employees to help make decisions instead of isolating them from this process.
These a few thoughts to establish yourself in a modern Leadership position that can enhance the organization’s success.
Perhaps you can share some of your thoughts. Let me know.

Want to retain Key Personnel?

There is a role for incentives in managing and retaining key executives for the company. Here are some reasons for and examples of how to structure effective incentive programs for management.

1. You want to retain key management personnel for a number of reasons. High turnover destabilizes the company and can have severe effects on moral of employees and the bottom line.
2. You want to retain high performing managers to enhance your own company’s growth potential and to keep key people from wanting to look at other opportunities.
3. Good managers don’t expect a bonus without achievement but don’t set the bar so high as to be unachievable. That becomes a disincentive to achieve.
4. Set goals that help improve your bottom line; just achieving new sales records is not a priority if the costs exceed the benefit. Sales executives should be just as concerned about profitable sales as the CFO.
5. Pay executives for overachieving by sharing profits. As profits goals are exceeded rewards can continue to be major incentives if shared fairly. Reward contribution.
6. You don’t have to give everything away in this process. Be competitive but unique and allow key employees to participate in goal setting. When they are part of setting the goals they are more likely to increase efforts to reach the bar.
7. Conduct periodic reviews to ensure all incentive participants know where they stand. Be completely transparent. If goals are profit based show actual revenue/profit results so that there is a clear understanding of achievements.
8. Roll plans forward and allow incremental bonuses for achievements in consecutive years. That’s a great way to keep a key person from leaving; that extra bonus for additional achievement may be too juicy to walk away from.
9. Stock options are often used as a tool for key employee retention. The chance to be a part of ownership can be major motivator. However recent issues in corporate governance have tended to dilute and weaken some incentives. Try to strive for balance without risking responsibilities to shareholders.
Incentives are an important tool to maintain a motivated and dedicated management team and a well-designed plan can bear fruit over the long term.
I hope you find these thoughts of help in your business. Let me know what you think.
Gerry@polarisgroupmc.com
 

Does your business have high standards for business ethics?

Have you ever wondered how many of the successful businesses get caught in the public spotlight and are criticised for the lack of integrity in the organization.


Clearly culture counts and it starts at the top with senior management or the board of directors. Organizations need to understand that ethics drive compliance and the leadership is responsible for setting the tone.

There are different levels of ethical issues; there is workplace fraud and corruption, sometimes conducted at the highest levels of the organization, and ethical issues relating to how employee and customer relations are handled.

Checks and balances require care in how the organization structure is designed, how human resource decisions are made, and how overall business is conducted. Organization integrity is paramount; when difficult decisions are faced the instinct must be to default to core values.

Too often larger organizations pressure smaller business for concessions they can ill afford but if they don’t concede an entire contract may be lost. This happens even if the original pricing were agreed between the parties. Where is the pride in living up to one’s word? What values are at the core of that behaviour?

Ethics are derived from values and they make integrity a way of life in the organization. Honesty, respect, and responsibility can be pillars on which to build. It is essential that these values are shared throughout the organization through practice in decision making.

Corporate governance is used to promote business ethics and social responsibility. It also creates the framework for guidelines used by all individuals who are part of the organization. Fairness is one of the very basic business ethics concepts as it covers how the organization treats people in its commercial dealings.

The vast majority of businesses are ethical and at least have informal standards expressed through the behaviour of the CEO and senior managers. Anyone working in an organization that seems to behave in an overtly unethical way and chooses to stay or ignore the behaviour is part of the problem.

Are you stuck in a pressure cooker?

In need of tips to reduce the stress you are under?
You may want to consider some of the following options in order to lessen the impact or negative effects on your business operations:


- Know your body signals: excessive heart rates, headaches, anxiety may be signals and suggest a need to find time to wind down.
- Don’t procrastinate and postpone decision making. Difficult decisions are not made easier because you postpone them. At times conditions may worsen if issues are not resolved.
- Take 10: Without really ducking a decision, stress can be relieved if you just take a short break or switch tasks for change of perspective.
- Stay fit. A program of regular exercise can help your body and mind deal with difficult situations that may arise from time to time. Try to maintain a healthy diet to support your overall health.
- Achieve balance between work and other family and personal activities. Enjoy time away from the job to let you recharge your batteries. Plan periodic vacations or days off. The organization is unlikely to collapse because the boss is away for a short time.
- Delegate:  No one has a monopoly on all of the good ideas and ways to resolve problems. Let staff participate as part of team that enjoys successes and faces difficulties on the job as well.
- Network: within and outside of the business to share ideas and issues with. Trust people to help with business issues. Working in isolation is rarely a good idea.
- Manage fairly: It’s nice to want and demand high standards but an obsession with perfection can destroy a business and the people that surround you.
- Monitor: Make sure key support people including those managing the finances keep you up to date. Since cash flow is a key marker make sure expenses are kept under control and systems to improve productivity are reviewed often. A well run business with good information flow is a key to stress reduction. Eliminate surprises.

These suggestions won’t eliminate all of the stress in your business but I find they help keep stress at a manageable level. Please let me have your comments.
Gerry@polarisgroupmc.com

Are you Productive?

No matter your job or profession there is an interest in improving productivity. Here are a few ways to improve your daily routines and increase personal productivity.

1. To Do’s: managing your workload with a “to do” list can be effective but it cannot be obsessive. Consider using calendar notations to identify tasks and a date to accomplish each item as an alternative.
2. Take breaks: periodic breaks from continuous work helps refresh the batteries. Take a walk, eat, or workout to clear your head and recharge your energy level.
3. Manage Stress: stress is unavoidable but need not be debilitating. Focus on what you can control, recognize stress and understand you don’t have to panic. Create a network of support to help deal with critical issues.
4. Focus on priorities: don’t start the day with email replies; that shifts focus to the needs of others and keeps you from setting your priorities.
5. 80/20 rule: as with most activity, 20% of what you do every day produces 80% of your results. Try to minimize the activities that really don’t matter much.

The old adage  ”less is more” may also apply when working to improve your productivity at work. I hope this helps you get through the day more easily.
Please let me know. Gerry@polarisgroupmc.com

Exit Strategy

When is the right time to go?

One of the more interesting and challenging questions I run into when providing consulting support is “when should I be thinking about exiting this business? There are many factors to be considered but here are a few thoughts.
What kind of shape is the business in today? Is the business operated from strong principles of strategy with a clear vision? Can that vision be expressed and understood by those who manage the business or potential buyers? If you the owner cannot clearly state the purpose or reasons that you exist don’t expect new owners to invent it for you.
How will you get the maximum return if you plan to sell? In cases where management/ownership is dominated by a single individual it is important to maintain a high degree of confidentiality so that employees do not become insecure and unsure of the stability of the company or their jobs. This instability can easily be communicated to a potential new buyer and create a poor impression.
Factors that may support your decision to leave can grow out of many conditions. The most common is an age derivative. A long career leading to a desire for more personal time; reap the rewards of your career. Age may not be the prime driver but longevity at the job could be creating burn out. Time to move on.
Another good time chosen is driven by a need for change. You may feel you have achieved all that can be achieved and you wish to quit while on top of the game. This may also provide a high rate of return if the business is at a high level of performance. Selling now may produce the equity needed to finance a new opportunity.
Look for opportunities to exit from positions of strength. A well trained and competent management group may provide the opportunity to offer your staff a management buyout.  Managers may be able to pool resources to fund the buyout, you as owner may offer to finance all or part of the buyout or there may be an option to use company assets to finance the loans needed for the buyout. This is often referred to as a LMBO – Leveraged Management Buy Out. It also provides good opportunities for maintaining stability in the organization.
Finally, the marketplace may facilitate determining the right time to exit. Poor economic conditions or competitive activity can have a huge impact on if or when you should exit. Positive conditions too might bring a competitor to the door with a buyout offer.

So the options are many but not always easy to sort through. Timing is critical, business life changes, choose wisely.

Business Growth

Keys to Growing Your Business

There is always interest among owners in taking their business to a higher level. It is more than the tired cliché of “work smarter and harder”. Many factors are involved in attaining growth and here are a few thoughts to consider:

1.  Embrace Change: The road ahead has many turns and you either come to a screeching halt or head for the cliff. The only way to survive is to turn with the road. Change can be scary and unsettling for some but you should welcome the challenge. This may also require eliminating preconceived notions about growth.
2. Define your target market with laser accuracy. Many businesses have drifted along and survived on low hanging fruit; perhaps it is time to refocus. Take a step back and define your market strategy. Where is your best bang for the buck? Are you headed for where the market is going? Imagine where you want to be in 3 to 5 years and what the business can become. Without this, you’re shooting blind hoping to hit the target.
3. Boost R&D. Times are not going to remain down indefinitely. When the next “up” wave comes around, you want to be ready with new solutions for the market. This is when weaker companies scale back on R&D and smarter companies invest in their future.
4. Engage your employees and listen. Your employees can be a goldmine of ideas. They know your customers, your market, and your operations. Actively encourage them to come up with ideas to improve revenue generating operations, product innovation, cost cutting measures, etc., and listen to them. You’d be surprised at the level of ideas you’ll generate simply by asking. This also gives your employees a great sense of inclusion.
5. Stay physically fit.  You need to keep healthy to handle the pressures of working harder while managing change. Stress compromises your system and induces depression and anxiety. Regular exercise has the exact opposite effect and has myriad of other benefits.

I hope you find this outline of value as you try to expand growth. Please let me know what you think.
Gerry@polarisgroupmc.com

Guest Blog

U of W link – EFMD Vision 2020

This week’s blog provides a link to a great news story involving two students from the University of Windsor.
The link was created by the Odette School of Business and the Centre for Enterprise & Law.

Please find attached a link to the video submitted to the EFMD Vision 2020 undergraduate business competition by two of the senior undergraduate students:

and 

The competition link:
http://www.efmd.org/index.php/blog/view/307-efmd-babson-launch-vision-20-20-video-contest-for-undergraduate-students

The video link for Christian and Blake:
http://www.youtube.com/watch?v=7J9pu2wKEIA&feature=youtu.be

This video is very well done and we wish the students every success.
Please let me know your reaction.
Gerry@polarisgroupmc.com

Employee Management

Conflict Management

Conflict between employees is one of the most common sources of trouble in the workplace and can lead to productivity losses, increased absenteeism and poor client service.
Moreover, when it goes unresolved, constant conflict can erode the work environment to the point where employees will even leave the organization.
Here are a few tips to help business owner’s management conflict in the workplace.
1. Clarify. Ensure job functions and procedures are clearly defined in writing so employees know what they are accountable for and to whom they report.
2. Encourage employees to discuss areas of conflict and differences so they do not fester and they become larger issues.
3. Promote trust. Involve management in open discussions that promote trust and respect. Differences of opinion and disagreement should not be confused with conflict and can be healthy in an organization.
4. Involve all parties in resolving the dispute and recognize the merits of the positive and negative factors that each party sees.
5. Review the process used to finalize any decision that successfully resolves the conflict. Management may be able to reuse the model in the future.
Effective leaders willingly address spoken and unspoken negative tensions in the company and work to transform these into positive and productive relationships.
I hope these are helpful thoughts on the topic and I welcome your comments.
Gerry@polarisgroupmc.com

Time Management

Do You Have Time Management Issues?

Business owners and managers often struggle with managing time efficiently. There are many root causes for time waste that can be addressed to improve effectiveness of the business.
Here are a few thought starters:

1. Project assignments. Have you assigned the right person to the right job? An employee may appear to have a problem managing time but they may be in a role or doing a jog they are not suited for.

2. Delegation. As owner/manager do you have poor delegation skills or do you not delegate in order to maintain control? The need to do everything yourself can dramatically impact your time management.

3. Meetings. How many meetings held are really effective? A lot of time can be wasted in unnecessary or poorly organized meetings.

4. Training. Do staff members need training to perform better? What appears to be a time management issue may be a training need.

5. Planning. Are the business’ plans well defined? If direction is unclear staff may struggle to know how to prioritize work activity.

These are samples of business issues that may mask what appear to be time management issues. There can be many others; examination of each may uncover root causes of poor productivity.

If you have thoughts to share please let me know.
Gerry@polarisgroupmc.com

Management Principles

Are your Management Principles Current?

Style of management has changes over time and new technology has dramatically affected how we communicate and interact with employees.  Transactions are completed at hyper-speed and certain principles of management are worth reviewing to ensure they optimize business operations.

Here are a few ideas that may have merit for your consideration.
1. Listen: strong relationships with employees, suppliers and customers are needed for success. Customers are particularly important and rather than creating spreadsheets to analyze customer effectiveness develop questions to ask customers and then listen to how they describe what they really need.

2. Think/Plan long term: short term thinking is an affliction. Strong relationships are built over time and create more long-term value. Today’s actions can affect long term relations with customers so think about the benefit of customer retention.

3. Structure: formal organization structures with top down authority with information flowing up through channels from the bottom are “passé”. Today with a tap on a smartphone anyone can and does communicate instantly. Collaboration and shared communications are becoming the norm without a formal hierarchy.

4. Share. Employees want to share so spend less on monetary incentives and share ideas, technology or data in order to inspire more sharing and perhaps faster innovation.

These are a few thoughts to consider on your management style. I hope they help.
Gerry@polarisgroupmc.com

How satisfied are your employees?

In most organizations the most important asset is the staff and there are many ways to maintain and improve the level of satisfaction employees feel as part of the organization. Many steps can be taken by management without spending vast sums of money to attain this goal.


1. Recognize. This may be the easiest and least expensive but very important motivator. A simple thank you may be priceless. Recognizing in public the effort and contribution of an employee can be a very effective motivator and creates a strong sense of appreciation.

2. Communicate. Keep employees informed on company goals, issues, and how individuals can contribute to the overall success of the business. Show trust, accountability and expectations through clear communications. Listening to employees is another key way to show they are part of the team.

3. Train and educate. Provide employees with the necessary training and education to show your interest and to reinforce that they are appreciated. Job rotation may be another way to enhance employee’s skills and also strengthen employees skill set and the resources of the business.

4. Monitor. Employees keep score too. So management should recognize and reward positive contributions. This can be a positive motivator for other employees as well.

This is a short list of some ways to keep employees satisfied and thus helping the organization achieve its goals. None of the suggestions need break the bank but the return can be substantial.

Business Management

Need a tip with Time Management

Time is one of the resources business managers have that is scarce, cannot be replaced once spent, and it cannot be borrowed or purchased. Here are a few tips to help manage it.
1. Plan your day. Before starting the day, schedule your activity including your own time for high priority thoughts and activity to grow the business. Schedule some time for interruptions that are bound to happen.
2. Take time. Before making calls take 5 minutes to determine what results you expect to attain and review results after to see if the goal was achieved.
3. Calls and email. Try not answering the phone every time it rings or reading an email just because it shows up. Few issues in business require an instant answer and you will be more efficient if you schedule time to return calls and email inquiries.
4. Plan the unexpected. It is inevitable that the unexpected will occur so leave open time in the morning and afternoon schedule to deal with “fires”.
5. Plan Strategic time. Plan ahead for weekly, monthly, and quarterly business reviews. It is important to continuously review and understand the business issues and if you fail to block off time some emergency may pre-empt the time and your plan will be postponed or eliminated. 
6. Downtime. Casual time over lunch can be useful for strengthening relations with employees, customers and suppliers. Use that time judiciously.

Remember that it is difficult to get everything done and bet results are achieved from those priority activities that are the focus of the business and future growth.
Thanks for allowing me to share your time with these tips.
Gerry@polarisgroupmc.com

Business Strategy

Strategic planning vs strategic thinking

Conventional thinking suggests all businesses should develop strategic plans and business plans to help direct the business and facilitate successful growth.
However there may be instances where strategic planning may be inappropriate for some small companies. Here are some reasons that may be the case and alternative action these companies may take.
- Time. There may be conditions that exist that do not allow management to take the time to invest in days of planning.
- Cost. The company may not have the financing to support engaging professional help and more important may not be able to take key executives like sales managers away from the jobs as it could impact revenue generation.
- Change. Smaller companies could be in an environment where change is needed frequently and long term strategies are inappropriate.

The option in this environment is for companies to adapt Strategic Thinking. Fast growing companies need to take advantage of challenges and opportunities and turn their size into an advantage.

- Plan informally on the go. All big ideas don’t have to come from formal strategy planning offsite. Quick huddles with key team members to examine key issues are effective.
- Challenge. Brainstorm to ask “why not” when faced with the inevitable “that won’t work”. Test whether initial negative positions are really valid.
- Make small bets. Large companies with major investments at stake may do exhaustive analysis before acting. Smaller companies can develop and test new potential strategies by making smaller bets by discussing an idea with a customer before the item is built, seeking out a potential supplier that is trustworthy, or discussing the idea with another person with expertise in the area.

These are some options available for strategic planning; the important issue is to make the process fit your organization. Be sure to take some action, sitting on the sidelines while competition takes the business should not be an option.
Let me hear your thoughts.
Gerry@polarisgroupmc.com

Business Performance

Do you Have A High Performing Organization?

Organizations that consistently outperform most of its competitors have a number of common characteristics. Managers use lessons that have allowed them to succeed individually within their organization to achieve similar strong results.
Here are some of these winning characteristics:
1. Strategies:
Business strategies are more consistently clear and well thought out.

2. Customer Service:
Service exceeds customers’ expectations in providing value and satisfies current and long term needs.

3. Ethics
Winners are more likely to adhere to high ethical standards throughout the organization.

4. Employee orientation
Managers in these organizations promote the best talent, ensure performance expectations are clear and promote strong team efforts. Training is also a priority.

These are just a few elements that identify high performing organizations. Clearly these winners also continue to strive for continuous improvement. This passion for improvement helps keep their organization at the top.

Do you have thoughts? Please let me know.
Gerry@polarisgroupmc.com

Business Plans

Do you have an effective business plan?

Developing a great business plan does not guarantee success but it can increase the odds. A strong business plan helps ensure that the management team has common goals and provides support to the feasibility of achieving goals established.

Here are some elements that are key to developing an effective plan.

The plan needs a concise Executive Summary. In two pages the plan should communicate what the business does and how it will make money, and why customers want the product or service.

A definition of the Market Opportunity. Define the size and potential growth of the market. Define opportunities and threats with definitions of how they will be resolved. Know the competition and how to capitalize against their weaknesses.

An outline of the Organization Structure. This is a key element for investors, suppliers and customers. The strength of the management team is important as it establishes the stability of the business and how well managed it is. Financial partners like banks are keen to know how well finances are handled if they are to risk loans for operating funds.

Financials. The projections of revenues, expenses, and most importantly, cash flows are perhaps the most important element of the plan. Past performance establishes bench marks for future projections and provides the credibility for expected performance that may be forecasted. Three year forward forecasts are a must and should include income statements, balance sheets and cash flow projections. This will provide the basics to calculate breakeven analysis to ensure investments for growth are covered.

 

These are key ingredients to a business plan and certainly additional details for sales and marketing are often added to expand on content.

I hope this provides some guidance to the needs for your business plans; please let me know your thoughts.

 

Gerry@polarisgroupmc.com

 

 

 

Business Success

New 5 C’s for Business

 

Contribution, Conviction, Culture, Commitment, Confidence

 

These 5 C’s act together in a business and support each other.  When one starts to become affected, the others may also become unstable.  This can affect the overall performance of the business. When employees have high levels of all the 5Cs, then they'll perform at their best whatever happens.

 

1. Contribution.

This is derived from the core work activities. It is important to have clear goals, striving to attain them and having management support to deal with issues that might prevent you meeting your objectives. Employees do best when they feel appreciated and valued by management and colleagues. So it’s not just about delivering: it’s about doing that within collaborative working relationships too.

2. Conviction.

This is expressed in short-term motivation both in good times and bad. The company benefits from employees who keep going even when things get tough, and maintain energy, motivation and resources that allow them to pull you through.The key to doing this is feeling resilient, efficient and effective. Employees are much more resilient than many managers realize and are often committed to dealing with problems faced in the job.

3. Culture.

Performance and happiness at work are really high when employees feel they fit within their organizational culture. Not fitting in is hugely draining and de-energizing. If you’re in the wrong job, you’ll find that the values mean little to you or political and you don’t have much in common with your colleagues.  

4. Commitment.

Employee commitment is important because it underlies the reasons of why you work. It is key that employees perceive they are doing something worthwhile, have a strong intrinsic interest in the job and feel that the vision of your organization resonates with them.

5. Confidence.

Confidence is the pathway leading to the other four drivers. If confidence is lacking in employees performance suffers. Too much leads to arrogance and sometimes poor decisions. Self-confidence with employees will produce employees who will take a risk or try new approaches to work. Confident organizations are a product of confident individuals treated with respect by management.

Management can support these elements by showing trust in employees, and recognizing good performance. This will instill pride in the organization and enhance the opportunity of success.