Business Management

Want to Make Better Business Decisions?

Making a decision is one of the most powerful acts for inspiring confidence in leaders and managers. Yet many bosses are sometimes squeamish about it. Some decide not to decide, while others simply procrastinate. Either way, it's a cop-out -- and doesn't exactly encourage inspiration in the ranks.

It can help to learn how to make better decisions. You'll be viewed as a better leader and get better results overall.

Here are five tips for making quicker, more calculated decisions:

1. Stop seeking perfection. Many great leaders would prefer a project or report be delivered only 80% complete a few hours early than 100% complete five minutes late. Moral of the story: Don't wait for everything to be perfect. Instead of seeking the impossible, efficient decision makers tend to leap without all the answers.
2. Create a constructive environment. For successful decision making, make sure you establish an objective, involve stakeholders, hear others opinions, and ask the right questions.

3. Generate Good Alternatives. This step is still critical to making an effective decision. The more good options you consider the more comprehensive your final decision will be. When you generate alternatives, you force yourself to dig deeper, and look at the problem from different angles. If you use the mindset ‘there must be other solutions out there,' you're more likely to make the best decision possible.

4. Don't problem solve, decide. A decision can solve a problem, but not every problem can be solved by making a decision. Instead, decision making often relies more on intuition than analysis. Deciding between vendors, for instance, requires examining historical data, references and prices. But the tipping point often rests with your gut. Which feels like the right choice?

5. Communicate Your Decision, and Move to Action! Once you've made your decision, it's important to explain it to those affected by it, and involved in implementing it. Talk about why you chose the alternative you did. The more information you provide about risks and projected benefits, the more likely people are to support the decision.

An organized and systematic decision-making process usually leads to better decisions. Without a well-defined process, you risk making decisions that are based on insufficient information and analysis. Many variables affect the final impact of your decision.

Managing Conflict

Good leaders are great at resolving conflict. Great leaders keep conflict from arising in the first place.

Conflict in the workplace can have a negative effect on the day-to-day working of your business, or result in a large scale strike or other employment dispute. It can also affect the general health and wellbeing of your employees. Here are a few ideas illustrating how you can manage relationships in your business and minimize conflict between individuals, teams, and larger groups of employees.

1. Signs of conflict
Conflict can arise at work for a number of reasons. For instance, two employees may have a personality clash, an employee may have a grievance against their manager, or a manager feels an employee is underperforming
Conflict can have a negative impact on your employees and this may be demonstrated by:
• a lack of motivation - fewer people volunteer to take on new tasks or providing input at team meetings
• unpleasant behaviour - people start to make derogatory remarks towards each other and there are fewer social events organized
• falling productivity - people are not cooperating with each other
• increased sick leave and absence of staff
By spotting signs of conflict early, you have a better chance of: identifying causes, resolving the conflict.

2. Causes of conflict
Every employee has needs and certain expectations at work, and conflict could arise when people feel that these are not being met or are being ignored.

Conflict could be the result of:
• poor management communication
• unfair treatment
• unclear job roles
• inadequate training
• poor work environment
• lack of equal opportunities
• bullying and harassment

3. Preventing conflict
To minimize and prevent conflict in the workplace, you should try to learn as much as you can about why conflicts occur and develop processes to address them. Common action points that employers should consider are:
• developing a strategy for managing conflict with managers, employees and your representatives
• having sound policies and procedures in place
• explaining plans for change and making employees feel involved
• listening to and consulting with employees on decision-making
• rewarding fairly with pay or bonus schemes
• ensuring work safety
• ensuring that managers are properly trained

4. Managing conflict 
When a conflict arises you should try to take a calm approach and not react in a challenging way. You should also not ignore the problem and hope that it will go away.
The best way to handle conflict is to face it and have a planned approach. If you have policies or procedures in place, you can use these to determine how you approach the issue or to give your employee an idea of how you will approach addressing the problem. It may help to have an employee representative and/or a senior manager available who can help when employees find it difficult to confront their managers or when you are not able to speak to each employee individually.

Business Growth

Manage Your Business Growth

The do’s and don'ts of business expansion

At one time or another, every business goes through a growth spurt and, whether it’s a multi-national corporation or an entrepreneurial enterprise, expansion is a tough process to navigate.
The real danger for any expanding business is that it does so too quickly or in an uncontrolled way. When this happens, cash flow and customer satisfaction are usually the first casualties and, in extreme circumstances, these can result in the demise of a once flourishing business. The trick is therefore to manage the growth process so you reap the benefits in the medium- and long-term.

Plan your expansion
It may seem obvious that any entrepreneur going through an expansion phase should do so with a game-plan, but many businesses expand in reaction to circumstances and don’t draw up a solid plan. Without this roadmap, it’s easy to get lost along the way, making changes to your business that are either too costly or not well thought out.

Don’t over-expand
While planned expansion can take a business to a whole new level, over-expansion is one of the biggest dangers of a growth phase. It’s easy to get carried away in the heat of the moment and to expand beyond the needs and the financial capacity of the business.
As a rule of thumb, plan capacity based on a five-year projection of demand and allow an additional 10% of capacity over and above that for periods of heavy demand or for partial down-time in any part of your business. More than this could be very risky and leave a business with overheads it can’t cope with.

Get professional financial advice
Whatever the nature of your expansion, there are financial implications for the business and it’s always best to seek professional advice. If you need to build or purchase your own premises, for instance, it’s important to speak to a financial institution that has experience in this area.
For plant and equipment, you may need to consider a flexible financing option, either a loan or a combination of a loan and an equity investment. Again, an institution with experience in the field and in your own industry is essential.

Develop a Project Management Schedule for the expansion
Again, this may sound self-evident, but many businesses expand without treating the expansion like a project – one of the most significant it will ever undertake.
When drawing up a project management schedule:
• Identify key deliverables
• Attach dates to these deliverables
• Identify key responsibilities
• Set up a regular review schedule
• Identify procedures for managing non-delivery on any part of the project
• Build in appropriate timing and financial contingencies
Managing the process is as important as planning it and it’s important to commit to this in a formal way, building in the appropriate checks and balances.

Keep your customers informed
Expansion of any kind can cause disruptions in your day-to-day operations and it’s important that your customers know what to expect. Before commencing an expansion, tell them what you’re planning and what the expected completion date is. If possible, tell them what disruptions to expect and how you’re intending to deal with them.

Announce the completion of your expansion
Once the expansion phase is complete, it’s important to let both existing and potential customers know about it. Tell them about the increased capacity of the business and the additional products and services you can offer. Develop a special marketing drive to announce the occasion and send out media releases, especially to the local and regional press.

Celebrate this moment in your business – it’s one of the best marketing opportunities you could ask for.

What makes a business successful?

The keys to success for any organization are directly related to what an organization is, and how it operates in the world. Once you understand what an organization needs to survive, you can better understand how to succeed.



Here are a few factors that may be applied to your business.



1. 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 constraining forces (providing direction, structure, organization, some rules) with liberating forces (encourage personal growth, development and creativity).

2. 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 can shift with each new day. If you review what has happened in the world or your organization in the past year or two, and you’ll understand what we mean by the reality of constant change. Opportunities come and go. 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 goal of increasing sales and profits, or more satisfied customers, while constantly steering the organization across the stormy waters of the marketplace. The job of focused leaders is to optimize business in a changing environment.

3. Operations, or what people do all day
 What the people in your organization do day in and day out to create value for customers, to earn or justify income, strongly determines whether you succeed or fail. You can’t separate operations from strategic focus which gives direction, people who do the work, customers who pay the money and physical resources needed to do the work.



4. Resources 
Finances, facilities and equipment are the big 3 physical resources. If you don’t have enough money, you can’t start or sustain an organization. And one of the biggest expenses is providing adequate facilities and equipment for people to work in and with. Experienced managers learn that cash flow is king. It doesn’t matter how much customers owe you, it’s when their money enters your bank account so you can use it to sustain the organization. Failing to manage cash flow is the No. 1 reason for business failure.

5. Customer relations
Customers are where the money comes from, so in many ways this is the most important success factor. As the famous business guru Peter Drucker said years ago, the purpose of a business is to get and keep customers. Getting customers involves marketing – indeed this success factor includes all kinds of marketing and sales. The key to successful customer relations is to give them what they need, not just what you want to sell. Effective sales and marketing begins with asking existing and potential customers what they need, what problem they want solved or deficiency filled. By keeping in touch with customers and asking these questions often, you’ll do a better job of developing customer loyalty and keeping competitors away.

I hope these ideas help understand the keys to success in your organization.  Please let me know your thoughts.
gerry@polarisgroupmc.com

Thinking About Staffing Additions?

The following outline identifies issues small businesses may deal with on staffing:







1. Should the business hire permanent staff or contract help?
Staffs usually provide more continuity and stability but add to cost due to employment taxes and perhaps benefit programs.
Staffs provide the advantage of employee loyalty and an edge in a more positive morale and productivity.
Contract people can be terminated at any time negating the costs of severance programs.
Contracting can add flexibility by allowing the adding or deleting of staff as demand requires.
Compatibility is sometimes harder to than competence so staff can be more productive within a group or department.
Hire a contract person as a temp. If the person works out you can make the job permanent.

2. Should business promote from within or add new employees.

Promoting from within does enhance employee morale and loyalty to the company. Employees who see the company as interested in career development and loyal to staff tend to make a greater effort in supporting company goals and success.
Introducing new employees from the outside does provide a fresh approach to some positions and can re-energize the company. Also, securing new outside talent may reduce the cost of training and development of current staff.

3. Full time vs part time staffing

Businesses should be careful not to add staff too soon. Temp or part time staff can be used as the business grows and changes to permanent positions can be made as the business matures.
If the business has seasonal peaks and valleys, use of part time staff provides the flexibility to adjust to demand.
In some situations, job sharing can provide the opportunity to maintain a larger pool of employees who are familiar with the work but prefer to work part-time.
Let growth, profitability, and demand dictate when to expand permanent staff.

I hope these ideas provide a little insight into options for staffing as the organization grows.

Keeping Key Managers

Keep Key Management Personnel

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.


 Reduce 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. 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

 Set Goals
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.
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.

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


 Be Transparent
Be completely transparent. If goals are profit based show actual revenue/profit results so that there is a clear understanding of achievements. 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.

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

Do your business ethics measure up?

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.






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.

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.

Larger organizations often 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.

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.

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.