Business Management

Incentives for Key Managers

As the year ends and goals are set for the new year there may be a key role for incentives in managing and retaining key executives for the company. Rewards and incentives in the workplace have benefits for both employees and employers.


Here are some reasons for and examples of how to structure effective incentive programs for the management group.

1. Monetary Incentives
Monetary incentives reward workers for performance and productivity through money. These incentives include employee stock options, profit sharing plans, paid time off, bonuses and cash awards.

2. Non-Monetary Opportunities
Non-monetary incentives reward employee performance through perks and opportunities. These rewards can include flexible work hours, training opportunities and the ability to work independently. The rewards and incentives are valuable to an employee because they may allow workers to learn new skills and pursue advancement opportunities.

3. Turnover. 
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.

4. Enhance Growth.
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.

5. Setting the Bar
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 growth.

6. Improve Profits.
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.

7. Share.
Pay executives for overachieving by sharing profits. As profits goals are exceeded rewards can continue to be major incentives if shared fairly. Reward contribution. 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.

Incentives are important tool to maintain a motivated and dedicated management team and a well-designed plan can bear fruit over the long term. 
I trust these suggestions may help with goal setting in the new year. Please let me have your thoughts. gerry@polarisgroumc.com
   

Business Management

Are you a Decision Maker or Procrastinator?

Decision-making is the key to moving forward and in doing so the greatest obstacle is procrastination.

Think the time you spend answering e-mail, composing and trolling Twitter doesn’t have an impact? Think again. Procrastinating in making business decisions generates enormous costs from time wasted and decisions delayed.

There are several approaches that may be considered to eliminate this waste.

1. Don’t delay. 
Any time you put something off the problem often gets bigger leading to more stress and possibly more procrastination. Recognize this behavior.

2. Reduce the issue to small tasks. 
Work in short bursts to complete each portion. This focused activity for short periods allows you to get the feel for accomplishment. Concentrate on results, not on being busy.

3. Learn to prioritize. 
You may never get caught up with everything you need to do. To be an effective leader you have to prioritize and decide what’s important and manage your time effectively.

4. Turn off distractions. 
If necessary, turn off email, stop answering the phone; give 100% attention to the task at hand.

5. Create a daily plan. 
At the end of each day spend 3-5 minutes setting up the next day’s schedule. It may save an hour the next day while you try to determine where to start your work activity.

6. Be accountable. 
Make yourself accountable to someone for what you want to accomplish. This could be an associate, friend, or business mentor. 

A task can more easily be tackled if you visualize it completed. Remember the “Law of Expanded Time”. Work will fill the time available to complete it. By making less time available to complete a task, you will spend less time completing it.

JUST DO IT.

I hope these ideas help with your decision-making process. Please let me know your thoughts. Gerry@polarisgroupmc.com

Business Management

Keys for successful managing

Let’s look at some key factors that contribute to business success. The role management plays is critical and management must focus on and achieve the goals and objectives set for the business. This can be facilitated with effective use of these skills:





1. Effective Interpersonal Relationships
Staff members and colleagues respect managers that demonstrate trust and treat people with dignity and respect. Strong managers keep their word, and show character even under challenging conditions.

2. Leadership
An effective leader has a vision, a drive, and a commitment to achieve beyond that vision. The leader must then also have the skillset to enlist the support of the organization to achieve the stated goals.

3. Communication
An effective manager communicates effectively in person and through all communication channels. That person also is open to feedback and listens well to input from staff and colleagues.

4. Understand the business’ finances
Understand the financial aspects of the business and sets goals and measures and documents staff progress and success. This allows the team to feel a sense of progress, that they are reaching goals and exceeding expectations. Staff want to know how they are performing against expectations and that needs to be openly communicated.


These are just a few characteristics of management success. I trust this outline provides an opportunity to expand opportunities to reach new levels of success in your business.

Please let me know your thoughts. gerry@polarisgroupmc.com

Business Management

Communication issues in business

Communication is the foundation of every single relationship you have in your personal life; it's no different in business. Without effective communication, there can be misunderstandings, problems and conflicts among your staff, your clients and everyone else you come into contact with. Poor communication can make effective delegation, productivity and an enjoyable work environment virtually impossible.


Here are a few issues that you may want to address:

1. Failure to Listen.
The inability to listen is a huge problem. Often you will see co-workers interrupting speakers or planning what they will say next instead of effectively listening. and still others just forget to pay attention, they are too distracted or have a short attention span. Obviously these all reflect on their failure to listen.
To resolve this stress the need to listen before you start a discussion. Focus on content of discussion and make notes later. Maintain eye contact to facilitate understanding. Turning off cell phones, email, or even closing an office door can help ensure the speaker has your full attention.

2. Culture Differences.
The office has become a melting pot stocked with people of diverse backgrounds and cultural customs. People tend to “hang" with others familiar to their culture or habits. When these individual groups assemble, managers face the challenge of team communications vs small group dynamics.
People often cling to “like-minded" individuals or want to share space with others in their culture. Try to mix them together and make sure that during brainstorming sessions, everyone is contributing—even if you have to walk the floor to listen. If someone is reticent, ask them for feedback. The most important thing however, is to repeat back what you’ve heard. Make sure that your understanding is clear. By reframing your understanding, it allows others to know you are listening and fosters better communication.

3. 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.

4. Gender Bias
The battle over which gender makes the best leader is taking the focus away from the real issue. Sometimes workers only want to relate to people of the same gender.
Don’t wait for an invitation to speak. Speak loudly and make sure your viewpoints are expressed; establish eye contact, and own your space. Never issue disclaimers, engage in demeaning yourself—and avoid unwarranted apologies.


Effective communication can be important to your business success. It may be worthwhile taking the time to reinforce practices in your organization to ensure improved results.
I hope these suggestions help. Please let me have your thoughts. gerry@polarisgroupmc.com

Business Management

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 and even a 3 year time horizon may be a stretch. 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.
I hope these suggestions help you focus on building an effective plan for your business. Please let me know your thoughts. gerry@polarisgroupmc.com

Business Management

Succession Planning Tips for Small Business

Many small-business owners know what it is like to take risks, work long hours and juggle multiple priorities. Even many successful ones drag their feet when it comes to succession planning, but there are steps they can take to cut down on succession headaches.

It's not hard to understand why. Succession planning can be complex, expensive, time-consuming and emotionally wrenching. But business owners who don't have a succession plan are putting a lot at risk if they hope to someday cash out at a fair price and/or ensure that their companies survive them.
Succession planning isn't a cookie-cutter process. The amount of time it takes is often dictated by the size of a business and the particular issues involved, as well as the approach of the advisor or other professional overseeing the process. Yet successful planning hinges on some of the following considerations:

1. Don't wait too long to begin
It can take as long as a year to put together a succession plan, and plans are often implemented over the course of many years. Succession planning can involve wrestling with emotionally difficult issues, such as deciding whether a relative or longtime employee is most qualified to eventually take over.


2. Shop around for the right advisor
Advisors may collaborate with other types of professionals, including lawyers, accountants and those who specialize in valuing businesses. Valuations prepared by objective third parties tend to be viewed more favorably by potential buyers, including internal successors, than those calculated by business owners themselves.
There are estate-planning issues, tax-related concerns and money-management considerations involved in succession planning. Nobody is an expert at all of those things.

3. Evaluate your own retirement savings and insurance.
As part of the succession planning process, business owners may want to consider whether they have sufficient retirement savings and life and disability insurance. Some owners opt to buy a "key" person insurance policy, which generally compensates a business for financial losses arising from the death or extended incapacity of a critical member of the company.

4. Discuss succession plans and update
A good succession plan should clearly delineate the individuals responsible for  management, governance and ownership positions. The players involved in all three areas are likely to change over time, as will tax laws and other important matters. Therefore, succession plans should be revisited periodically and updated when necessary.

I hope this provides some ideas of the importance and necessity of business owners having a well developed Succession Plan. Please be sure to work proactively with key expert professional to develop a plan. The business may be at risk without a plan.
Please let me know your thoughts. gerry@polarisgroupmc.com

Business Management

Effective Cash Management Tips

As a small business owner, one of the key focus areas that determines your success is effective cash management. In fact, the interest rate and loan amounts from banks and lending institutions are primarily based on how well your business is able to manage cash.

If you are floating money and creating bad debt other businesses know about it. Managing cash is not just about perennial success. Having a healthy cash balance in your balance sheet will also help demonstrate effective management to potential investors by helping secure a better valuation of your business.  … no one wants to buy an unstable company.

Here are a few tips for better cash management.

1. Track cash flow monthly.
Use a budget to track anticipated cash inflows and outflows so you can assess your situation and react to problems such as the loss of a key sale. Cash flow forecasts and variance analysis against actual should be performed monthly in order to identify improvement opportunities. This frequent monitoring allows you to delay discretionary payments if necessary.

2. Protect capital expenditure.
It is important to preserve the cash that your business generates. One way to do this is by slashing your capital expenditure. While you’re in a growth phase, slashing capital expenditure may not always be feasible. However, you should perform your due diligence on expenses and ensure they are backed by a thorough return on investment (ROI) analysis.
If cash is tight don’t pay cash for long term investments in equipment. It is better to use debt or leasing to finance these projects. Debt can be used to re-finance fixed assets to free up capital. 


3. Build in a culture of cash consciousness.
This is especially important if you have separate teams handling sales and finances.    Typically the sales team would consider cash management to be the responsibility of the finance team and would offer liberal credit terms in the hope of increasing sales numbers to make quota or get that bonus.
One way to overcome this hurdle is to incentivize cash conscious behavior. Instead of sales incentives based on sales figures, you can offer sales incentives based on collections. This will ensure that your sales team focuses on not just achieving the numbers, but in the quality of sales.

4. Be aware of incentives.
No matter which part of the world you are operating in, there are typically a lot of   incentives available for small businesses operating in specific industries.

Take time to research available incentives at a federal, provincial or municipal level. Some of the programs may help improve your company’s cash flow and profit margins.


Ultimately, where cash flow becomes an issue is when small business is operated like “small business.” You can’t arbitrarily spend money on things that may be working or go months without analyzing your expenditures.
Being your own boss is great but there’s much to learn from “big business” management. 

I hope these ideas help. Please let me know: gerry@polarisgroupmc.com

Business Management

Issues Facing Small Business Today

Starting a business is a big achievement for many entrepreneurs, but maintaining one is the larger challenge. There are many standard challenges every business faces and these include things like hiring the right people, building a brand and so on. However, there are some that are unique to small businesses, ones most large companies have grown out of long ago. Here are a few thoughts:





1. Client Dependence
If a single client makes up more than half of your income, you are more of an independent contractor than a business owner. Diversifying your client base is vital to growing a business.

2. Cash
Finding it and managing the cash flow. Cash is hard to get and there is never enough. If you are a fast-growing company you can rapidly outgrow your available resources, if you are an under performing company you can’t get enough cash. Many companies do not manage cash well.

3. Fatigue
The hours, the work and the constant pressure to perform wears on even the most passionate individuals. Many business owners, even successful ones, get stuck working much longer hours than their employees. Moreover, they fear their business will stall in their absence, so they avoid taking any time away from work to recharge. Fatigue can lead to rash decisions about the business, including the desire to abandon it completely. Finding a pace that keeps the business humming without grinding down the owner is a challenge that comes early (and often) in the evolution of a small business.

4. Lack of a Clear Plan
Many businesses don’t know how to plan. Lack of a plan worsens the cash problem by wasting cash chasing tempting diversions, and throwing money at problems. Equally important is updating your plan according to changing economic and business conditions and to ensure your survival in weaker economies.

5. Ineffective Leadership
This issue takes many forms. It is frequently in the form of depth of leadership. The founder of the company is too much hands-on and a) does not concentrate enough on his primary role as a leader rather than a manager; and b) fails to enlist support of competent managers and staff behind him or her either through recruitment or by outsourcing. This eventually causes the company to stop growing and eventually could lead to failure. Directors should always remember their core role and responsibilities.

I trust these ideas provide thoughts to resolving some issues faced daily by many businesses as they strive to develop and grow.
Please share your thoughts. gerry@polarisgroupmc.com

Managing Change

Businesses face change all the time, driven both by internal or external influences. Growth, innovation, redundancy, outsourcing, relocation, diversification and competition all can force change in a business.
In is important to make the necessary changes before they are forced upon you – minimising change that can impact on profitability and maximising change that creates opportunities. Most people, in particular employees, are uncomfortable with change because it interferes with their routine and exposes them to the unfamiliar.

Drive Change
It’s better to drive change than let change control your business. It’s also important to identify any need for change early on. Think ahead to where your business needs to be in one, three and five years’ time. What do you need to do to get there?

Prioritize
Decide which changes are most important and focus on the changes with the biggest potential benefits – not the easiest ones to implement.
Aim for continual smaller changes rather than a few large ones. Large changes are harder to digest and can interfere with one another, while small-scale changes are easier to manage.

Network
Change usually involves going into unknown territory, but others will have been there before you, so seek their input and advice. Talk to business associates and learn from the experience of people who have made similar changes.

Communicate
Whatever the area of change, you will need the co-operation of your employees. However, resistance from employees is often the biggest stumbling block to successful.  The key to managing change successfully is to keep staff informed. Start communicating the change as early as possible, so people have time to come to terms with it.


Even small changes can backfire if they’re not handled sensitively. Consult with those affected before implementing any changes. Those involved may be able to suggest alternatives that deliver the same results more effectively or more efficiently.

Remember life in Business is about change. Growth is optional. Choose wisely.

I hope these thoughts are of value as you move your organization ahead through change.

Please let me know your thoughts. gerry@polarisgroupmc.com

Business Management

Success factors in Business

What separates winners from losers? Business analysts almost daily come up with a list of factors or definition of key success factors.

Here are a few to consider:





1. Plan for success. 
A good plan increases your chance of success by defining objectives, framing costs, forecasting revenue and defining risks.

2. Managing and developing people
 People today want some direction and structure, but they also want freedom and encouragement to develop their skills and knowledge. Effectively managing people requires balancing direction, structure, organization, with liberating forces encourage personal growth, development and creativity. If you as manager/leader err too much in one direction or the other, your organization will be either too rigid or too chaotic.
A strong management group is critical. Entrepreneurs should have the confidence to surround themselves with strong people; this will pay dividends in productivity and growth of the business. Those owners who seek individuals who will follow and not lead will be constrained by their own failings.

3. Strategic focus
 In today’s rapidly changing world, it’s not just enough to have a purpose for existing. Leaders have to focus the organization’s resources on the greatest opportunities, which shift with each new day. Doors open and doors close. Major customers or income sources can change or even go out of business at any time. So it’s necessary for leaders to keep focused on the desired end results such as increased sales and profits, or more satisfied customers, while constantly steering the organization across the stormy waters of the marketplace.

4. Consumer focus
 An unwavering commitment to the consumer is invaluable. Understanding the consumer’s wants and needs provides the best way to gain customer loyalty. Repeat business is the lifeline to continued success. This also strengthens your reputation in the marketplace.

5. Know your strengths. 
An honest approach to management of the business can help generate growth. Don’t waste time chasing dreams or ill-conceived ideas that do not match your core values or strengths in the business.


These are just a sample of key factors for business success. I hope they provide some food for thought in your operations.

Please let me know. gerry@polarisgroupmc.com

Business Management

Stress Management

As a business owner, every part of your business has the potential to create stress. Slowly developing sales, debt, poor cash flow, employee issues, equipment or operational issues. You think about the business 24/7 and this makes you tires and anxious.
You cannot escape the reality that business ownership s stressful but perhaps the following comments will help with stress management.





1. Positive Focus
Remind yourself of the many accomplishments you may have achieved no matter how small. Stress will increase if you always focus on things behind schedule, unfunded or that need repair.

2. Be aware of your body signals
Excessive heart rates, headaches, anxiety may be signals and suggest a need to find time to wind down.

3. Don’t procrastinate
Do not postpone decision making. Difficult decisions are not made easier because you postpone them. At times conditions may worsen if issues are not resolved.

4. Purge your Brain
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.

5. 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.

6. Stay Aware
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 they may help keep stress at a manageable level. Please let me have your comments.

Gerry@polarisgroupmc.com

Business Start-up Management

Challenges for Small Business

Starting a business is a big achievement for many entrepreneurs, but maintaining one is the larger challenge. There are many standard challenges every business faces whether they are large or small. These include things like hiring the right people, building a brand and so on. However, there are some that are unique to small businesses. Here are a few challenges that may be faced:


1. Client Dependence
If a single client makes up more than half of your income, you are more of an independent contractor than a business owner. Diversifying your client base is vital to growing a business.


2. Cash Management
Having enough cash to cover the bills is a must for any business. To avoid shortage small businesses owners must either be heavily capitalized or be able to pick up extra income to shore up cash reserves when needed. This is why many small businesses start out with the founders working a job and building a business simultaneously. While this split focus can make it difficult to grow a business, running out of cash makes growing a business impossible.


3. Fatigue
The hours, the work and the constant pressure to perform wears on even the most passionate individuals. Many business owners, even successful ones, get stuck working much longer hours than their employees. Moreover, they fear their business will stall in their absence, so they avoid taking any time away from work to recharge. Fatigue can lead to rash decisions about the business, including the desire to abandon it completely. Finding a pace that keeps the business humming without grinding down the owner is a challenge that comes early (and often) in the evolution of a small business.

4. Owner Dependence
If you get hit by a car, is your business still producing income the next day? A business that can't operate without its founder is a business with a deadline. Many businesses suffer from founder dependence, and this dependence is often caused by the founder being unable to let go of certain decisions and responsibilities as the business grows. To meet this challenge a business owner merely has to trust that he can give over more control to their employees or partners.


These are some of the challenges a new business faces and the challenges should be considered before leaping into a start-up. A competitive drive is often the catalyst to start a new business but time invested in a well thought out plan will be rewarded.

Please let me know your thoughts. gerry@polarisgroupmc.com

Managing Change in Business

When implementing change in an organization no singe methodology fits every company. Here are a few ideas that may help facilitate change in your business.



1. Address the “people side” of the business.
Any significant transformation creates “people issues.” New leaders will be asked to step up, jobs will be changed, new skills and capabilities must be developed, and employees will be uncertain and resistant. Dealing with these issues on a reactive, case-by-case basis puts speed, morale, and results at risk. A formal approach for managing change — beginning with the leadership team and then engaging key stakeholders and leaders — should be developed early, and adapted often as change moves through the organization.


2. Start at the top.
Because change is inherently unsettling for people at all levels of an organization, when it is on the horizon, all eyes will turn to the CEO and the leadership team for strength, support, and direction. The leaders themselves must embrace the new approaches first, both to challenge and to motivate the rest of the institution.

3. Involve every layer.
As transformation programs progress from defining strategy and setting targets to design and implementation, they affect different levels of the organization. Change efforts must include plans for identifying leaders throughout the company and pushing responsibility for design and implementation down, so that change “cascades” through the organization. At each layer of the organization, the leaders who are identified and trained must be aligned to the company’s vision, equipped to execute their specific mission, and motivated to make change happen.

4. Communicate the message

This stage cannot be overly stressed. Clear communication of objectives, involvement of staff at the early stages, and empowering them will facilitate involvement and buy in for the company.

5. Prepare for the Unexpected
No change program goes completely according to plan. People react in unexpected ways; areas of anticipated resistance fall away; and the external environment shifts. Effectively managing change requires continual reassessment of its impact and the organization’s willingness and ability to adopt the next wave of transformation.

It is obvious to most business owners that people matter. Sometimes however the organization gets lost in plans and processes rather than facing the difficult and more important people issues. Making the initial steps to involve the entire organization starting at the top will help achieve success.

Please let me know your thoughts. gerry@polarisgroupmc.com

Business Management

Tips for Successful Networking

Effective business networking is the linking together of individuals who, through trust and relationship. Networking is about being genuine and authentic, building trust and relationships, and seeing how you can help others.

Here are a few tips to consider:

1. Set goals to achieve in networking meetings

Pick groups that will help you get what you are looking for. Some meetings are based more on learning, making contacts, and/or volunteering rather than on strictly making business connections.

2. Hold volunteer positions in organizations

This is a great way to stay visible and give back to groups that help you.

3. Ask open ended questions

Questions that ask who, what, where, when, or how as opposed to those that can be answered yes or no open up discussion and show others you are interested in them.

4. Be a resource

When you are known as a strong resource people turn to you for ideas and references and this strengthens your visibility.

5. Be clear when identifying your needs.

If someone askes “how can I help you?” be certain you have a clear answer.

6. Follow referrals

When you receive a referral follow-up quickly. This is a reflection on the person giving the referral. This respect will help obtain further referrals you may need.

I hope these suggestions help you improve the use of time spent in networking sessions. It is rarely productive to merely meet and chat with the same contacts at every session merely because it may be more comfortable.

Please let me know your thoughts: gerry@polarisgroupmc.com

Business Management

STRATEGIC PLANNING

Strategic planning is an investment in the business. 

Let’s review a few key factors on Strategic Planning that can help business owners determine the value of this process.


1. WHAT IS STRATEGIC PLANNING?

- A planning tool for management to formulate high-level business strategy.
- the foundation for the development of a more detailed Business Plan.
- Strategic Planning is top down: Strategic – Tactical – Operational.


2. WHY DO STRATEGIC PLANNING?

- To define the precise mission of the firm.
- To measure the competitive environment.
- To prioritize external opportunities and assess potential threats.
- To help manage growth.
- To focus on key objectives.
- To satisfy succession planning needs.
- To focus on internal strengths and overcome weaknesses.
- To formulate strategy to maintain a competitive position.


3. WHEN TO DO STRATEGIC PLANNING

- When the business needs to establish guidelines for a new or updating of a Business Plan.
- When a review is needed to maximize resource utilization.
- When the business needs to prioritize growth options.

4. WHAT ARE THE GOALS FOR STRATEGIC PLANNING?

- Quantify objectives for the business.
- Establish indicators of achievement.
- Develop an implementation plan.
- Assign responsibilities and accountability.
- Identify resource requirement for plan achievement – financial, personnel, equipment, facility, products.


Creating, articulating and sticking to your vision is the single most important job you have as a leader. Strategic planning isn’t a one-time event. Once you’ve laid out your strategy, it’s crucial to stay focused over the long-term.

I hope you are able to plan for success.
   

Business Management

Crisis Management

Unplanned events can have a devastating effect on small businesses. Crises such as fire, damage to stock, illness of key staff or IT system failure could all make it difficult or even impossible to carry out your normal day-to-day activities.
At worst, this could see you losing important customers - and even going out of business altogether.
But with good planning you can take steps to minimise the potential impact of a disaster - and ideally prevent it happening in the first place. Here are a few ideas to consider:

1. Plan
It's essential to plan thoroughly to protect yourself from the impact of potential crises since you may lack the resources to cope easily in a crisis.
Failure to plan could be disastrous. At best you risk losing customers while you're getting your business back on its feet. At worst your business may never recover.
As part of the planning process you should:
             -    identify potential crises that might affect you
             -    determine how you intend to minimise the risks of these disasters occurring
             -    set out how you'll react if a disaster occurs in a business continuity plan
             -    test the plan regularly

2. Assess the impact
You need to analyse the probability and consequences of crises that could affect your business. This involves:
- assessing the likelihood of a particular crisis occurring - and its possible frequency
- determining its possible impact on your operations

This kind of analysis should help you to identify which business functions are essential to day-to-day business operations. You're likely to conclude that certain roles within the business - while necessary in normal circumstances - aren't absolutely critical in a disaster scenario.

3. Minimize the Potential Damage
Once you've identified the key risks your business faces take steps to protect your business functions against them.
Premises:
Good electrical and gas safety could help protect premises against fire. Installing fire and burglar alarms also makes sense.
Think what you would do in an emergency if your premises couldn't be used. You might consider an arrangement with another local business to share premises temporarily if a crisis affected either of you.

Equipment/machinery:
If you use vital pieces of equipment, you may want to cover them with maintenance plans guaranteeing a fast emergency call-out.
IT and communications
Installing anti-virus software, backing up data and ensuring the right maintenance agreements are in place can all help protect your IT systems. You might also consider backing up your data offsite on a secure server.
Printing out copies of your customer database can be a good way of ensuring you can still contact customers if your IT system fails.
People:
Try to ensure you're not dependent on a few staff for key skills by getting them to train other people.
Consider whether you could get temporary cover from a recruitment agency if illness left you without several key members of staff. And take health and safety seriously to reduce the risk of staff injuries.
Insurance:
Insurance forms a central part of an effective risk-management strategy.

4. Continuity
You should draw up a business continuity plan setting out how you will cope if a crisis does occur.
             It should detail:
- the key business functions you need to get operating as quickly as possible and the resources you'll need to do so
- the roles of individuals in the emergency
Making the most of the first hour after an emergency occurs is essential in minimising the impact. As a result, your plan needs to explain the immediate actions to be taken.

These are some steps that can be taken to ensure that damage from any crisis is minimized. Proper planning can be critical to survival.

Business Management

Need Coaching?

As a business grows owners may be in a position of managing more and more areas of the business that they are less familiar with.

The owner’s original background may be manufacturing but now oversees finance, sales and HR issues.

An experienced business advisor may help develop these skills and improve decision making as the business grows.


Here are a few examples of situations where a coach may help:

1. Development of managerial skills for owners or senior managers.

2. Refocusing management to a strategic vision and plan.

3. An objective business performance review of results against planned objectives.

4. Improving operations by reviewing decision making processes and staff communications.

An independent coach can facilitate change with some of these issues if the environment welcomes an outside, fresh perspective.

If the process is not welcomed by all participants the results will be more than counterproductive so owners should proceed carefully to ensure success.

Business Management

Challenges Facing Small Business

There are many problems that are encountered by business owners throughout the course of managing their business. All entrepreneurs must be prepared for solving problems that come their way. However, creating a startup is not an easy task.
New entrepreneurs are usually not prepared for the problems coming their way. The first thing to do is to understand that problems are an everyday part of every business and then face each problem with determination and a proper solution.

Here are some common faced problems in new businesses and their solutions.

1. Financing
Money is known to be one of the major causes of problems that can lead business to failure. For a new business, the biggest mistake is expecting instant profit. Young and eager entrepreneurs start up a business with little money, assuming they will earn big and then invest that money again in their business. It is significant to understand that you cannot get an instant profit at the start of your business. Before starting a business, ensure that you have enough money to sustain you at least up to two years. Start slowly and patiently.

2. Lack of Skills/Knowledge
This is one of the top mistakes made by entrepreneurs. It is important that you have ample knowledge about the industry you are entering, your competitors, your target market, current trends, as well as financial know-how. You must possess the skills needed to start up a new business. If you are not prepared, educate yourself. Do proper research, ask other business owners, read relevant books and websites. You may end up with a huge loss if you start your business without having the required knowledge and skills.

3. Lack of Planning/Direction
This problem prevails when owners do not develop a thorough and detailed business plan. Many entrepreneurs are so excited about setting up their business that they fail to prepare a proper business plan. It helps in focusing on the goal and mission of the business. It determines the financial structure, market research and analysis of the competition. A business plan is the roadmap to follow.

4. Innovation
Unfortunately, there are many new startup companies that stick to the age old book of rules. They don’t try to create an innovative culture. People get accustomed to the work culture and they don’t think outside the box. Owners often stay away from change and resist whatever changes that could improve operations. The best thing to do is to be open to innovation. When bringing a change, ensure that all your employees are prepared for it. Discuss it with them, tell them how important it is to be innovative, and how beneficial it will be.

5. Attracting New Customers
For a new business, it is difficult to attract prospects and retain customers. With a small marketing budget, new entrepreneurs are unable to reach out to a wider audience. Potential customers are usually hesitant to using a new supplier. They prefer going for companies that have experience and a large customer following. However, the good news is big companies charge more. There are many clients and customers who are looking for companies that provide cheaper, but good quality service. Providing excellent service to them will ensure that they remain your customers and even recommend you to others.

These are just a few issues but I hope the outline helps owners recognize some key pitfalls to avoid. Let me know what you think. gerry@polarisgroupmc.com

Business Management

Business Failure or Failure of Leadership?

Why do businesses fail? If you strip away all the excuses, rationalizations, and other justifications and drill down you may find the major reason for failure is poor leadership.
Here are a few reasons businesses fail and how leadership failure is key.





1. Lack of Vision
It is the role of the CEO to clearly define and communicate the corporate vision. If there is no vision, a flawed vision, or a poorly communicated vision, the responsibility falls squarely in the lap of executive leadership.

2. Poor Branding
A poor brand generally means leadership has failed. Brands fall into decline for only one reason – leaders have abdicated their responsibility. They have allowed their brand equity to erode, and failed to deliver on the brand promise. Leaders who don’t steward their brand as one of the greatest corporate assets deserve the fate that awaits them.

3. Flawed Strategy
A flawed strategy simply reveals weak leadership. While there are exceptions to every rule, companies tend to succeed by design and fail by default. Show me a company with a flawed strategy and I’ll show you an inept leader.

4. Lack of Capital
Sometimes well capitalized ventures fail miserably, and severely under-capitalized ventures eventually grow. Raising, deploying, and managing capital is ultimately the responsibility of leadership. The amount of capital required to run a business is based upon how the business is operated. If leadership operates the business without consideration for capital constraints, or irrespective of capital formation issues, then the blame should fall squarely on the shoulders of leadership.

5. Isolation from Advice
Nobody has cornered the market on knowledge and wisdom. If leadership doesn’t seek out the best quality advice available to them, they will likely not make the best decisions. All CEOs and entrepreneurs need top quality professional advisers. When a leader has a “miss” or a blind-spot, he or she is simply showing the arrogance of operating within the limitations of their own thinking and poor results may follow.

6. Failure to Act
Failure to anticipate or react to competition, technology, or marketplace changes can lead a business into the danger zone. Staying innovative and aware is a key responsibility of the business leadership.


There are many other reasons for business failure and I hope this stimulates thoughts that may prevent your business from failing. Let me know your thoughts.
gerry@polarisgroupmc.com

Business Management

Time Management – Tips that May Help

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. Time management myth
This is the first thing you have to understand about time management. No matter how organized we are, there are always only 24 hours in a day.
Time doesn't change. All we can actually manage is ourselves and what we do with the time that we have.

2. 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.

3. Prioritize ruthlessly.
You should start each day with a session prioritizing the tasks for that day and setting your performance benchmark.
If you have 20 tasks for a given day, how many of them do you truly need to accomplish?

4. Delegate and/or outsource.
Delegation is one of the hardest things to learn how to do for many business owners, but no matter how small your business is, there's no need for you to be a one-person show—you need to let other people carry some of the load.

5. 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 best 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

Challenges of a Growing Business

Growing businesses face a range of challenges. As a business grows, different problems and opportunities demand different solutions - what worked a year ago might now be not the best approach. All too often, avoidable mistakes turn what could have been a great business into an also-ran.

Effective leadership will help you make the most of the opportunities, creating sustainable growth for the future.

Here are a few highlights of risks and mistakes that are common to growing businesses:

1. Keeping Up
Market research isn't something you do as a one-off when you launch your business. Business conditions change continually, so your market research should be continuous as well. Otherwise you run the risk of making business decisions based on out-of-date information, which can lead to business failure.

2. Planning Ahead
The plan that made sense for you a year ago isn't necessarily right for you now. Market conditions continually change, so you need to revisit and update your business plan regularly

3. Cash Flow management
Good cash flow control is important for any business. For a growing business, it's crucial. Cash constraints can be the biggest factor limiting growth and overtrading can be fatal. Making the best use of your finances should be a key element in business planning and assessing new opportunities. With limited resources, you may need to pass up promising opportunities if pursuing them would mean starving your core business of essential funding.

4. Problem Solving
New businesses often run in perpetual crisis mode. Every day brings new challenges that urgently need resolving and management spends most of their time troubleshooting. As your business grows, this approach simply doesn't work. While a short-term crisis is always urgent, it may not matter nearly as much as other things you could be doing.

5. The Right Systems
All businesses produce and rely on large volumes of information - financial records, interactions with customers, employee details, regulatory requirements and so on. It's too much to keep track of - let alone use effectively - without the right systems. Responsibilities and tasks can be delegated as your business grows, but without solid management information systems you cannot manage effectively.

I hope this helps as you face the daily challenges of growing your business. Please let me know what you think.  Gerry@polarisgroupmc.com

Business Management

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.

1.  Time. There may be conditions that exist that do not allow management to take the time to invest in days of planning.

2.  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.

3. 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.

1. 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.

2. Challenge. Brainstorm to ask “why not” when faced with the inevitable “that won’t work”. Test whether initial negative positions are really valid.

3. 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 Management

Challenges Facing Small Business

There are many problems that are encountered by business owners throughout the course of managing their business. All entrepreneurs must be prepared for solving problems that come their way.
Here are some common  problems faces in businesses today.






1. Cash:
Finding it and managing it. There is never enough. Fast growing companies can outgrow available resources. Underperformers can’t acquire cash.
Leasing vs purchasing can lesson stress while commercial loans, credit cards and overdrafts are expensive. Care is needed to protect the business’ overall credit rating.

2. Lack of Planning
Many business owners don’t know how to plan. Lack of a plan can aggravate cash problems by wasting cash chasing tempting diversions; it is wasteful to throw money at problems hoping for a quick fix. Equally important is updating your plan according to changing economic and business conditions to ensure long term success.

3. Information Overload
The only thing constant is change! Change is continuous. New facts and data keeps emerging and replacing old beliefs and trends. This information overload sometimes makes it gets difficult to find effective solutions.

4. Lack of Execution
This may be the largest issue facing small business. This lack can be in a number of forms including: Poor execution of strategy, failure of new product development, owners spend only minimal time on strategy and are too much involved working in the business instead of on the business.

I hope this summary provides additional clarity and ideas on addressing daily business challenges. Please let me know your thoughts. gerry@poalrisgroupmc.com

Business Management

Important Yardsticks for your Business

Good financial management is essential to allow business owners to make proper decisions through the year as business conditions change. Periodic quarterly or annual reviews are not adequate.
Performance should be reviewed monthly against goals established for the year.



Key indicators to review include:

1. Revenue Growth: 
are sales increasing year over year and meeting targets?

2. Profitability: 
is the business making adequate profit compared to goals. Are profit margins improving?

3. Liquidity: 
are short term obligations covered? What cash and easily converted assets are available for current operations?

4. Cash Flow: 
are you generating sufficient cash to operate? Is bank financing required to help fund growth?

Sometimes businesses can measure their performance against competition within the industry. That may help highlight areas where improvement may be needed.

It is important to not only make money in a business but it should be professional is its management approach and managing financials is an important step to achieving both goals.

These were just a few considerations. Please let me hear your thoughts.

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.







1. Vision
 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.
2. Return
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.
3. Why Exit?
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.
4. Sell from Strength
Look for opportunities to exit from positions of strength. A well trained and competent management group may provide the opportunity to offer 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.
5. Know the Market
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.

I hope these suggestions help with any consideration involving exiting the business. Please let me know your thoughts. gerry@polarisgroupmc.com