Management New Year Resolutions Part II
There are so many analogies that can be drawn between being a successful parent and a successful business owner. Just as a parent has to master a multitude of skills, perform a myriad of tasks, and deal with every conceivable human circumstance in order to raise a newborn to self-sufficiency, the same can be said of a small business owner taking his or her dream from start-up to divestiture. And just as no one article can cover all the particulars of parenting, the same is true of managing a small business. In this article I offer some thoughts on the last six management resolutions I have recommended to you.
Resolution Five: I resolve to read whatever I can get my hands on about trends and new developments that, whether threats or opportunities, will be part of my company's future.
When you get up in the morning, I'll bet you turn on the Weather Channel. You want an atmospheric report to help you decide how to dress, and find out if the weather is going to alter your plans. While you're there, you also check on the week's forecast. And even though you can look out the window, or go outside to check the weather yourself, you rely on the experts because they are the experts, and because the information is available.
It's the same with your business, your industry and the marketplace. There are people whose job it is to observe the industry environment and market atmosphere. They study and report on marketplace precipitation that might fall on you, paradigm winds that may be shifting, and economic tides that may lift your boat or leave you high and dry.
It's your job, as a manager where the rubber meets the road, to read, listen, and digest all of the current reports and forecasts you can get your hands on, and consider that information as you make plans for your business's future. Failing to do this could result in your business wandering around outside in shirtsleeves during a winter storm.
Resolution Six: I resolve to take my banker, accountant, and lawyer to lunch at least twice a year.
Every business should have outside advisers who challenge ideas and temper vision. Small business owners need to take a lesson from our big business cousins who have professional boards-of-directors. But at our level, "the board" takes on a different shape: It's most likely made up, in whole or in part, of the professionals mentioned in the resolution above. In addition to the services and products they sell, these three add value to the relationship by being sounding boards and counselors.
These three "directors" want you to succeed, and are willing to help. You'll meet with them plenty of times during the year professionally, but at least twice a year, find a setting, like lunch, and talk with them about things outside of their professional role. You might be surprised at how much you can learn from them. Give them a chance to add value.
Resolution Seven: I resolve to create (or update) my company business plan.
If you don't know where you're going, any road will take you there. I like repeating that old adage, as those of you who are long-time subscribers know only too well. But my nagging notwithstanding, it's a sentence we should all have printed on a banner and hang on our office wall.
There was a time not too many years ago when creating and maintaining a written plan required no small degree of technical background, plus quite a lot of effort and time. No longer. Today there are multiple computer software products available, at very reasonable prices, which virtually take you by the hand and lead you through the business planning details and process.
If you have a computer and can read and perform basic math, you can create a business plan that will become an invaluable management tool, and a document you can use to get the working capital you need from banks and investors. In other words, there is no excuse for not having a business plan. (At the end of this article I will provide you with more information about how to get started.)
One last thing: Unlike during the twilight zone dot com days of the last decade, if you intend to use your business plan to acquire capital, it must be based on solid operating fundamentals, as well as economic and marketplace substance. If your plan doesn't project profitability within a reasonable time, don't plan on getting the money.
Resolution Eight: I resolve to encourage more creativity in my company, including from me.
Creativity is one of the greatest of human characteristics. It's especially exciting in the marketplace because of the products and services that manifest as a result of someone's creativity. And creativity can reach even a higher level of excitement in a small business because of our ability to go from thought to reality so quickly.
But creativity has an enemy named Waditw (We've always done it this way). The only way to root out Waditw and eradicate it from your organization is for creativity to be encouraged from the top. Not at the expense of proven policies and operating systems. But you must find a venue where the creative minds in your organization can pose an unfamiliar and unproven idea without fear of being slapped down by Waditw.
The ability to implement creativity quickly and efficiently may be small business's secret weapon. Don't let Waditw hold your business back. Be creative and encourage creativity from your employees.
Resolution Nine: I resolve to create a management team that can successfully operate my company if I am not around.
In the timeline of the life of a small business, there is typically a significant period early on when the founder finds himself or herself in the business virtually at all times. There are at least two reasons for this:
1) They LOVE being in the middle of this wondrous thing they've created;
2) They are afraid to leave because the business operates so thin financially and organizationally that even the slightest hiccup could be disastrous.
One of the benefits of growth is the acquisition of managers necessary to operate the larger organization. As you add these key people, hire those who not only work well when you are present, but just as well in your absence.
It's a great day in the life of a business when the founder knows he or she can take a day off without fear. It's also good to know that should you become ill, injured, or God forbid, die, that everything you worked so hard for won't collapse just because you weren't there to hold things together.
One more thing: A very critical part of your business plan is the management section. The more you can demonstrate the ability to find and manage a strong management team, the more likely your bankers and investors will look favorably on a request for funds.
Resolution Ten: I resolve to create an exit strategy (even though I may not be quite ready to exit).
It's difficult to imagine exiting the business you just started yesterday, or even five years ago. And even if you may be too young to retire, contemplating your divestiture is good business fundamentals.
Here's a fact: You will exit your business someday - dead or alive, as planned or not. With something so preordained, why not make it work for you?
Here's the good news: A planned exit presumes a sale. Operate your business the way you keep your house when you know a realtor may bring a prospective buyer over during the day. If you operate your business as if you were going to sell it tomorrow, you'll always stay close to operating fundamentals.
We never know when we may get a visit by a motivated buyer, an unfortunate physical disability, or the grim reaper. Even if you're not ready to exit, it's smart to begin the process years before you expect the event to happen.
Write this on a rock... Being a successful manager, like being a successful parent, isn't easy. Don't try to be Super Manager. Like a good parent, show up every day, focus on the fundamentals, pay attention to details, ask questions, and ask for help.
