Author Archives: 5-dimensionz

“Denial is not a river in Egypt”

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“Denial is not a river in Egypt”

“Denial is a very human trait. Sometimes we’d rather not know. We like our delusions. Our favourite bird is the ostrich, head firmly in the sand. Denial may be comfortable, but it’s rarely smart (and it isn’t a river in Egypt)”
Michel Hogan

The above quote is from a marketing article by Michel Hogan, published in 2012. It really caught my attention and made me reflect on why too many businesses fail when they should not. As managers and business owners it is very comfortable and even re-assuring to deny the current circumstances are the result of our actions or inaction and place the blame elsewhere. This is not leadership but an abdication of our duties as a manager.

My business is about working with business owners and managers to improve the profitability and performance of their business. As a result I come across a large cross section of business owners, from the really ‘switched on’ who want and seek outside advice and assistance to those that are in total denial of their current situation. Over a year ago I met a business owner who after discussing his situation was advised that ‘everything was under control’ and no assistance was required. I was not able to really delve into the issues and I left the meeting thinking I was missing something. After some self-analysis I concluded that I did not manage the meeting well and ask the right questions. Less than a year later, the business went into administration with the loss of dozens of jobs. I subsequently found out that at the time of my visit the business was losing millions of dollars per year but as stated earlier I was assured ‘everything was under control’. In other words, the owner was in a state of denial and ultimately he lost his business.

Whether it was pride, ego or ineffectiveness that made this business owner not recognise their problems I do not know. It was probably easier to blame the economic conditions or customers than to look at yourself and say “Am I the problem?”
Perhaps, it was because the owner could not see the problem even though it was obvious. Unfortunately, we have all seen businesses fail because management is in a state of denial and fails to take the necessary action

As the quote above says ‘denial may be comfortable, but it’s rarely smart (and it’s not a river in Egypt)’. As business owners, managers or supervisors we have responsibilities not only to ourselves, but our employees and customers.
A very important part of these responsibilities includes ensuring we are fulfilling our roles to the best of our ability. This includes self-analysis, removing the emotions and determining where there are problems and opportunities and seeking ways to grow and improve.

Remember egos destroy businesses and careers.

There is kudos in recognising there is a problem. Look at the facts, be open to new ideas, seek advice, get out of your comfort zone and leave denial behind…………

Being Late. Is it good business etiquette?

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Being Late. Is it good business etiquette?

“Etiquette means behaving yourself a little better than is absolutely essential”

Will Cuppy.

Manners is about respect for other people, whether in business or in a social setting. It is not old-fashioned to have good manners. It has nothing to do with ‘fashion’ or ‘generation’.

Is it OK to be late for a meeting or an appointment?

Too often in business, people run late for meetings and when they arrive, are often ill prepared. They think nothing of drifting into a meeting, 5, 10 or 15 minutes after starting time.

Professional managers do not find this acceptable.

I was recently at a meeting where 6 people were kept waiting in a meeting for 20 minutes, until one team member idled their way in, unprepared and 20 minutes late. That equals 6 people times 20 minutes each or 120 minutes wasted. Yes, 2 hours wasted. How much has that cost the business?

The best thing to do to prevent this wastage is to start the meeting without them. They are unlikely to be late next time.

Although cost is a factor, it is the lack of respect for the other six people in the meeting that is also important, whether you are their manager or the business owner is not relevant.

This lack of respect can flow through the whole organisation and it can tell you a lot about the values being promoted within an organisation.

There are other actions in meetings that are NOT acceptable and show lack of respect:

Making and taking phone calls during meeting. It is both rude and disrespectful.

  1. Checking emails or texts during a meeting.
  2. Not being prepared.

If you can’t give the meeting your time, don’t attend. It is as simple as that.

This manifests itself in other ways. Failure to return phone calls or reply to emails is just plain rude. It is like someone saying good morning to you and you ignoring them. In my experience, most of the people who are late for meetings are generally the same people who are not prepared for meetings and check their texts and take and make phone calls during the meeting.

With important meetings, I always try and be 5 minutes early just in case there is a problem. If you are unavoidably late, call or text 15 minutes before the scheduled time. Its good manners and also shows respect. Much more can be achieved when you show respect. If you show respect, in most cases it will be returned not only making your job easier but by achieving a constructive outcome for the business.

Before I went into business I worked for a business owner who was extremely successful and wealthy. He always opened the door for you, allowing you to enter and leave first and was never late for meetings. Even when we had company team gym sessions, he always made sure he was the last person to take a shower. It goes without saying he was highly respected and managed an exceptionally successful business.

We all lead ‘busy lives’. It’s a cop-out to use that as an excuse. Do you really think that your time is more important than someone else’s?

Apparently much of the success achieved by Nelson Mandela in finally toppling apartheid in South Africa was his ability to treat everybody with respect, including his prison guards on Robben Island. I can remember watching a TV documentary program on Mandela, where he was described as giving people his undivided attention and time. It made people feel valued and important. In the TV program there was a section graphically showing Mandela publically chastising the then President, Thabo Mbeke when he showed a lack of respect for arriving late to a meeting he was to address where Mandela was also a guest of honour.

Remember good etiquette and manners pays off………….so as a business owner, manager or supervisor are you showing people adequate respect?

Questions and Answers

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Questions and Answers

“Judge a man by his questions rather than by his answers.”

Voltaire

One of the biggest mistakes  we can make  as managers is to talk too much and  ask too few enough questions.

Are you a manager who suffers from “I” strain? – I did this, I do this, I, I, I, …

Furthermore, if we do ask questions do we listen to the answer?

Asking questions is one of the most effective ways of gaining information and eliciting team co-operation. It is therefore one of the best tools available to managers.

The skill in asking questions is to know what type of question to ask, when to ask it and how to ask it.

There are 2 main types of Questions:

  1. Closed Questions – these are those questions that require a yes  no, or one word answer. They should be avoided unless you are clarifying a position or answer
  2. Open Questions – these are questions that elicit an open response where if handled carefully you can obtain valuable information and opinions and have your staff committed to the organisation.

A useful technique in asking questions is to start the question with one of the following………Why, Where, When, Who, What, and How

You can continue a conversation and explore ideas by rolling through the five Ws and H:

‘where’ did it happen?

‘when’ did it happen?

‘who’ was involved?

‘what’ happened?

‘why’ did it happen?

‘how’ did it happen?

Other types of questions include

Direct Questions (can be used to slow down a fast talker, confront an obstructionist or draw out a reluctant participant),

Leading Questions (should be generally avoided  but can be used to gain support or bring a meeting to a close),

Ambiguous Questions (when more than one answer is possible. Can also  be used to provoke a response, slow down a domineering talker, start a discussion or spark some action),

Provocative Questions (should be used with care and often used to provoke a response or defend a position),

Rhetorical Questions (very effective in putting an issue ‘to bed’ and moving on)

and

Re-directed Questions (used by politicians to avoid answering the question).

Questions are good tools to have when conducting a meeting.

More importantly we should avoid asking questions that are:

  1. Closed questions (yes/no) unless you follow up with a direct or factual question
  2. Invoke antagonisms
  3. Of a personal nature which may embarrass
  4. Sarcastic

So now the question I ask is “how active is your listening?”

Are you getting the feedback desired and does the person you are questioning feel that you are interested and actively listening to their answers?

Déjà vu All Over Again

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Déjà vu All Over Again

The following advertisement for the International Commercial Truck, circa 1910, is on display in Maine’s Owls Head Transportation Museum:

“That the motor truck is an excellent substitute for the horse has been proven in every instance where businessmen have given it a fair trial. But the man who uses his motor truck simply as a substitute for horses neglects to make the most of his opportunities. The horse is not a machine – five to six hours’ actual work – fifteen to twenty-five miles – is its maximum day’s work. A motor truck can be used twenty-four hours a day if necessary, and it will travel the last hour and the hundredth mile just as fast as the first.  Businessmen who are using the motor truck in place of the horse and wagon equipment with the greatest success are men who have given this problem careful study. In most instances it was necessary to change the plan of routing – delays which were necessary to give horses rest were eliminated – plans were laid to keep the truck busy the entire day with as few delays as possible……….”

The use of new technology is the key to increasing productivity. However, often pre-conceived ideas or environmental pre-conditioning of our thoughts prevents us from realising the potential of new technology. There are some great examples. With the advent of the motor car in the late 19th century in England, the Locomotive Act 1865, otherwise known as the Red Flag Act stipulated that self-propelled vehicles have a man with a red flag or lantern walking at least 60 yards (55 m) ahead of each vehicle at walking pace to warn horse riders and horse-drawn traffic of the approach of the vehicle. On a recent visit to Japan I had to wait until 10.00 am for the ATM to open (which was when banks opened) to access my bank account. None of these examples make practical sense.

In an earlier career as a transport manager, I was confronted by the long distance truck drivers I was managing telling me that each driver must have their truck (even though it was owned by their employer). This limited the distance that could be travelled per week to less than 3,500 kilometres, due to legal driving hour restrictions and the driver’s physically being unable to safely drive much further each week. Breaking this thinking was difficult. However, multi-driver trucks were introduced, with drivers rostered to the legal driving hours and with the trucks operating 24 hours per day for over 6 days per week. The average distance travelled per truck exceeded 9,000 kilometres per week (with some trucks doing 12,000 kilometres). This high truck utilisation resulted in significant increase in company profitability as fixed costs were covered early in the working week. Correspondingly, the number of kilometres per driver increased. As they were paid by the distance travelled they were winners too!

The challenge for managers is to do away with pre-conceived ideas based on history and experience and objectively look at where new technology can increase productivity and lower costs. My former accountants (note that I said ‘former’ accountants) continued to increase their charges each year, charging me for postage, when they could have emailed me documents, charging my business a direct debit fee for paying our account rather than sending a cheque and so on. When I queried why our fees kept on increasing I was told it was because their costs kept on increasing. Clearly they were not passing on the savings of implementing new technology and were trapped into the ‘old way’ of thinking. Not only did they lose our business they lost other businesses I was associated with.

Remember change is inevitable and what we did yesterday will not be good enough for tomorrow. If you don’t recognise this I can guarantee that your competitors have.

Are you trapped in your ‘old ways’?

Are working in your business rather than on it?

Focus for Success

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Focus for Success

“Vilfredo Pareto was an Italian economist who in 1906 observed that 80% of the land in Italy was owned by 20% population. He further developed his theory noting that 20% of the pea pods in his garden contained 80% of his peas”

Do you hear today people say “Things are not what they used to be” and “Years ago there were more opportunities”?

Do you really think this is the case?

I would venture that the real issue is that today we face too many opportunities and we have too little focus. We get busier and busier and seem to achieve less and less, fighting bushfires rather than preventing them in the first place.

The reasons for this are many.

Often we place our attention on things ‘we enjoy doing’ rather than what we should be doing. We are in our comfort zone. For example, a manager meets with the people they like or get on with, avoiding dealing with those who are difficult or are problematic. A sales person calls on those clients and prospective clients who are close by or are easy to deal with. We are all guilty of doing this.

Have your heard of the Pareto Principle? This is often called the 80/20 rule where:

80% of sales come from 20% of our customers

20% of our customers give us 80% of our problems

20% of our customers demand 80% of our valuable time

80% of sales come from 20% of our products

Time, expertise and money are a limited resources.

Therefore it is important to try and apply Pareto’s Principle in our business and work life to get the best return. I once worked for a transport company who identified a market niche and specialised in this niche. They were extremely focussed on staying in this niche and were not tempted to expand outside this niche. The company had less than 6 customers, the profitability was many multiples of the industry average and was eventually sold for an exceptional profit.

What was the lesson?

I think it is obvious. Identify the areas that give you the greatest return for your time and resources and do not be distracted by other issues. Focus on what is important and not what you like doing. This requires discipline and is more easily said than done.

Here are some practical applications:

To reduce costs, identify which 20% of your customers are using 80% of the resources. With those who are not top profit generators, charge them for the resources they consume.

To maximise personal productivity, realise that 80% of your time is spent on the many trivial activities. Analyse and identify which activities produce the most value to your company. Then focus and concentrate on the vital few (20%). With the ‘left overs’ delegate or discontinue doing them.

To increase profits, focus your attention on the vital few customers (top 20%). Identify and rank your customers in order of profits. Then focus your sales activities on them. The 80/20 Rule predicts that 20% of the customers generate 80% of the revenues, and 20% yield 80% of the profits, however these two groups are not necessarily the same 20%.

If you wish to use the Pareto Principle to your advantage, the first step is to get started. Put your ideas down on paper – do not think too hard about it as you may become distracted. Once down on paper you can then work through your list and prioritise. A great tool to use is the 4 Segments diagram below…………. it makes decision making so much easier.

 

Achieve

Do you want it?

If YES then achieve it.

Preserve

Do you have it and want it?

If YES then keep it.

Avoid

Do you want it?

If NO, then avoid it?

Eliminate

Do you have it and don’t want it?

If YES, then eliminate it.

Now it’s up to you…………..

Beware the Operations hero…

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Beware the Operations hero…

Effective leadership is putting first things first. Effective management is discipline in carrying it out.

Stephen R Covey

Did you hear about the transport operations manager who worked all night to get the freight loaded  on the trucks and out on time? Or the warehouse manager who worked all weekend to relocate stock in the warehouse to make it more efficient?

If you were running these companies, what would you do?

(a) recognise them in the company newsletter

(b) promote them; or,

(c) reprimand them?

As  managers and business owners, most of us  would probably choose (a) or (b) wouldn’t we?

But is it really the right thing to do?

I recall working for a major transport company  many years ago. The company was characterised by a ‘can do’ culture where anything would be done to get the load out – in particular working long hours for at least 6 days per week. The operations managers like our examples above were treated as heroes. They embodied the values prized by the organisation – tough, persistent, and long hours of work. These managers were celebrated and promoted.

However, when you probed the situations in greater depth, it was clear that the real underlying problem was that these operations heroes had not been doing a good job of managing their day-to-day activities, in particular planning and training. In other words, the more mundane tasks were often not recognised. If these tasks had been done the crisis would have been prevented. However, by celebrating the ‘heroic’ actions, the company’s top management was telling the organisation that it was okay to not do the quiet, unobserved day-to-day work, as long as they responded forcefully to the problems that inevitably resulted. The quiet achievers were not recognised (nor rewarded).

The message was –  crisis response is more important than crisis prevention.

The transport company was subsequently taken over as it struggled to  provide the required returns to its shareholders. The top management left. Subsequently a new management team was installed that reorganised operations. The new top managers understood the importance of crisis prevention, and developed a new focus on planning, both daily and in the long term. One of the biggest problems was that the middle and upper-middle managers who were in place had been promoted for managing a crisis not for their management skills. They were not skilled in crisis prevention, and importantly, their personalities were more suited to the action-oriented crisis response than the more systematic and analytical process of crisis prevention. They soon followed top management out of the company.

We also see this in sales. When a major customer has a problem, the alarm sounds and everyone rushes to fix the problem. The sales manager is celebrated as a hero as they have saved the account and maintained the relationship.  Picture the leader on a white stallion leading his troops in a cavalry charge – noise action and recognition. By contrast, the sales reps who are skilled at maintaining and slowly growing major accounts often remain in the shadows, unappreciated and unrecognised.

In effective companies, sales leaders understand the process of quiet, steady account development. This involves mapping a customer’s buying process, understanding how to increase a customer’s profitability, and seamlessly involving operations managers with their customer counterparts to reduce the costs for both customer and supplier. This is a long, steady process, but it creates customer relationships with high sustainability, profitability and growth.

The question is: who is the real sales hero? The second question is:  are the operations managers – the ones who quietly drive major sales increases and cost reductions – the real operations heroes?

In my experience, most of these “heroes” are skilled at managing a crisis that was avoidable. Often their companies were suffering problems that should not have occurred in the first place due to poor management and systems. The real heroes in an organisation are those managers who have the wisdom and insight to develop systematic information, processes, and behavioural drivers that enable their managers and staff to coordinate their activities  to achieve more together. The result is that their management teams form effective coordinative processes and develop a culture of profitability. Effective leaders are not those on the white charger but the opposite. They are not dramatic, romantic, heroic or exciting – just very effective.

Like teaching, one of the truisms of management is that you get what you expect. If you celebrate the mythical operations and sales heroes, you will get mediocre performance and continual crises punctuated by occasional ‘heroic’ displays. A good manager must have the foresight to systematically create the conditions that enable your managers to improve performance and prevent crises thus creating a great business.

As a manager you have a choice…………

Leadership v Management

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Leadership v Management

“Management is doing things right; leadership is doing the right things.”

Peter Drucker

Management is the act of exerting influence on individuals, therefore wielding control over a business or organisation. Good management achieves this in such a way that a positive outcome is achieved. Bad management is the opposite!

Competent managers organise, summarise, administer and communicate with other people, departments and organisations. However, management is not a substitute for leadership. People cannot be managed into responsibility or competence, however they can be lead there. A competent leader may also be a good manager, but a good manager may lack the inspirational or creative traits to be a ‘real leader’.

Leadership is ‘the ability to influence the opinions, attitudes and behaviour of others’. Note the difference between control (management) and influence (leadership). An effective manager normally displays leadership qualities. Think of Winston Churchill as the Prime Minister of Great Britain during World War II. He worked in the War Rooms beneath Whitehall with the War Cabinet (management-control) whilst the bombs rained down on London. He also provided inspiration and leadership (leadership – influence) to the British people through his speeches and walking and talking to Londoners during the ‘Blitz providing hope and vision for overcoming the Nazi threat. He was both an effective manager and leader.

Here are some of the characteristics of managers and leaders :

Managers

Leaders
Rely on control of the situation Inspire trust in their followers
Have a short range view Have long range perspectives
Generally accept the status quo Usually challenge the status quo
Administers and maintains the organisation Motivate and develop the organisation

Having compared the two, most managers develop leadership qualities over time, given circumstances, training, support and ability.

There are 6 main characteristics of being an effective leader:

  1. Having – clear sense of direction (vision and goal setting)
  2. Communicating – the vision to others
  3. Being – innovative and searching for opportunities (taking risks)
  4. Empowering – by building and encouraging strong teams
  5. Leading – by example, having clear views and being consistent (moral authority)
  6. Knowing – your own and followers strength and weaknesses

As leaders, whether at the local sports club, charity, department, organisation or business we need to develop our leadership skills and understand the main characteristics of being an effective leader?

How can you become a more effective as a leader?

Technology

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Technology

“Men have become the tools of their tools”
Henry David Thoreau

Today in business we are confronted with a mass of technological innovation that has become increasingly more sophisticated, expensive and difficult to keep up with; iPhones, iPads, tablets, GPS and so on. We often we become so intoxicated with new technology – its speed, power, gadgetry and the potential to solve our business problems that we neglect to solve problems in a simple and cost effective way.

Have you heard of the story about NASA in the 1960s when the space astronauts found pens would not work in space? NASA spent tens of thousands of dollars to develop a space pen while the Russian cosmonauts used a pencil! This is actually an ‘urban myth’, however it illustrates the need to try and solve problems in a simple, practical and cost effective way. In the first Gulf War, the fleeing Iraqi army set fire to hundreds of oil wells creating an environmental disaster. Red Adair the famous Texan oil fire expert was called in by the Kuwaiti government to ‘solve’ the problem. The solution was a complex technique of explosives to remove the oxygen from the flames thereby putting out the flames. It was complex, costly and dangerous and would take many years to complete the task. Instead, a team of Bulgarians were contracted. Their solution was simple, practical and cost effective. Using large bulldozers being driven by men in fire resistant suits they covered the burning oil well heads with sand in a fraction of the time and cost compared to the solution as advocated by Red Adair.

So next time you are confronted with a problem or the latest technology – stop and think. Can the problem be solved simply and cost effectively without technology that can often be unnecessarily complicated and expensive?

Life Cycle

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Life Cycle

“All product categories have a specific life span called the product life cycle. Brands or products typically go through five stages of growth: development, introduction, growth, maturity and decline”

Yes, we all know about a product life cycles, just look at what car manufacturers do by redesigning car styles. Business leaders and business owners have a life cycle too! The issue is to know where you are in your career or business life cycle and to then plan and act accordingly.

CEOs of family businesses often have great difficulty in “letting go”. The issue is often an emotional one. Many business owners have invested so much time and money working long hours that they see stepping down as being “put out to pasture”. Ego, loss of self-worth, so called RDS (relevance deprivation syndrome – which retiring politicians claim they suffer from!) and perceived lifestyle all play a part.

Great leaders know when it’s time to pass the baton. We saw how John Howard, the former Prime Minister refused to hand over the leadership to Peter Costello. The result was a lost election in 2007, Costello leaving politics, Howard losing his seat (only the second prime minister to do so) and the Liberal party having 3 leaders in 3 years.

All businesses must have a succession plan. There are two types of succession plans; short term or emergency succession plans (the “what happens if you are hit by a bus?” scenario) and long term succession plans which protect your company’s culture, value and future. If you are a family owned business you owe it to your family, employees and customers to have a well planned and executed succession plan.

There is no greater satisfaction than mentoring and training a replacement successfully. If you do not plan for your succession then you have failed as a leader and have failed your business.

So know where you are in your career and business life cycle and start succession planning. It is not a sign of weakness but of strength and you will be recognised for it. I have seen too many companies suffer because there was not a well planned and executed succession plan.

Start planning now…

Problems

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Problems

“Insanity: doing the same thing over and over again and expecting different results”.

Albert Einstein

Many of us in business are confronted with problems;  whether it is the business failing, parts of the business not performing or relationships at work deteriorating. I suspect that you have agonised about the reasons for the problem.  These reasons are likely to be complex and there are probably no simple solutions.

However, the first step is to admit there is problem.  I have seen many leaders in business refusing to admit that there they have a problem, even though it is obvious to everybody around them (and often to themselves although they refuse to confront it). This problem can be due to ego, ignorance, incompetence or an unwillingness to face reality. It is highly unlikely to go away and is probably only going to get worse and become more complicated as staff and customers begin questioning your judgement and leadership.

Admitting that you have a problem either to yourself, your family or your staff is essential. The second step is critical.  This is where you either become a success or continue to fail to resolve the problem. The failing business person tries to justify the failure – it’s the market, it’s the internet and so on.

As a manager or business owner it is only a problem or a failure if it continues. Like the Albert Einstein quote above which implies we must change something to get the desired result, the status quo is not an option. Do not identify an external reason for the problem as this is a ‘cop out’. You are disowning the problem – ‘it’s the economy’, ‘it’s the high exchange rate’, ‘it’s poor staff’.

The key to success is to take a few steps that will not allow you to justify the problem. The first step is to take action, even if it is just one small step. Using personal fitness as an example, the hardest step in improving your fitness is putting on your gym gear. By taking the first step you are on the way to solving the problem. Momentum has now commenced and this will help solve other problems, both now and in the future.

There is no shame in recognising a problem or failure, providing you do something about it. Learning from mistakes is only common sense. That’s what good leaders do !