Field trips were an amazing part of growing up. Living in Southern California, we went to the La Brea Tar Pits and Forest Lawn Hollywood Hills. La Brea Tar Pits gave a perspective of dinosaurs and the like. While on paper it seems strange to visit a cemetery for a field trip, Forest Lawn back then had an amazing exhibit on US history. Being able to see history put it into context, at least as much as you can without a time machine, took the learning to a different level. Trips as I got older took me to Checkpoint Charlie and Auschwitz during the cold war. An experience that cannot be had from books. Seeing something in real life gives context. The same is true in leadership. Walking around a facility, talking to the people, visiting customers gives an unfiltered, contextual experience. It is one that is critical to really understanding your business, your customers and your people. How are you making field trips into your business on a daily basis?
The best surround themselves with the best. Top performing companies hire the best talent, work with the best partners and surround themselves with thought leaders. They continue to get better because they are constantly innovating and growing. They are constantly looking for top talent and hire them when they find them. How are you surrounding yourself with the best?
Running your business well isn’t just for show. A business is worth exponentially more when it is well run. The math bears this out. An example of the same business, pre- and post-transformation based on a real business transformation:
- Pre: $10MM EBITDA x 3 multiple = $30MM value
- Post: $30MM EBITDA x 8 multiple = $240MM value
As EBITDA grows, the multiple expands dramatically. And that’s all due to running your business well. How are you positioning your business?
Recently, an individual was touting the mark of high performance as hours worked. In other words, it is a matter of activity rather than results that garners the mark of high performance. The reality is top talent produces at a rate of 3 to 17 times the average in the same amount of time depending upon the industry. High performers are clear about what they are trying to accomplish. People work together to accomplish a common goal. High performing leaders set the tone, attract top talent, focus on results and have financial results as evidence. How are you focusing on results rather than activity in your organization?
Businesses exist in an ecosystem that comprise the business, the community, the people who work in the business and the stakeholders of the business. The strength of the business has a profound impact on those that it touches. As the business becomes more successful, it employs more people and generates a host of benefits in the community and for stakeholders. How is your business contributing to the ecosystem?
I was getting ready to head north to Seattle. The drive time according to GPS was 2.5 hours. That might have been the case at the moment, but many times the traffic clogs up around mid day. By the time I was nearing Seattle, surely I would hit traffic that GPS wasn’t forecasting. And I did. It added about an extra hour to the drive. Good thing I planned for it, as I would have missed my first appointment had I not.
In business, there are many situations that are known, but don’t always show up in the tools you are using to plan for the future. It could be seasonality or cyclicality in your business. If you take your current month or annual sales and project them forward, you are likely to miss your projections all together. This happens more than you would expect. How are you taking predictable changes into how you run your business?
Have you ever noticed cars slow down going up hills or to the top of a bridge? Once the peak has been reached, traffic speeds up and gets back to speed limit drives. This happens because the gas is not applied a bit more to maintain speed going uphill.
Headwinds can be experienced in business in the form of choppy market conditions, new competitors, supply chain disruptions, etc. Businesses that excel step on the gas. They figure out how to move faster. By doing so, they are way out ahead of the competition when the market conditions ease. How are you making sure you step on the gas at the right time?
Have you ever heard this situation? A company makes changes to its strategy and people development plans to grow, only to find it is stumbling significantly after the changes are made. This exact situation came to light in a conversation recently. A few decades ago, the company underwent an initiative to address cyclicality in its business, leading it to change its strategy and expand its offerings to minimize the impact of the cyclicality. It also undertook a deliberate effort to match the right people to the right position to minimize risk in the business and grow skillsets.
Years later, the company backed out of the newly expanded offerings. The cyclical part of the business was doing extremely well at the time and the newly expanded offerings were not quite as profitable, so resources were reallocated. And to meet the needs of the business, people were promoted more quickly and did not have the full skillsets. As a result, the company found itself in the same spot it was a few decades before. The history lessons had not transferred between generations of leadership. How are you making sure history does not repeat itself in your business?
Making a mistake isn’t the problem. People will make mistakes as they grow in the company and their career. The trick is getting them to a place where they can make mistakes without major consequences. And if you are hiring senior people, you need to learn what mistakes they’ve already made and what they learned. Otherwise, you run the risk of them making a needless mistake with you.
Recently, the city of Portland installed parking meters on a street where a business I frequent resides. I’ve gone there regularly for the better part of seven years. And the street was always packed, making it difficult to park. That was until last week when the meters went in. I was shocked. No cars were parked on the street. I was told a letter from the city explained this would happen. After all these years, the cars disappeared. I did not expect that result, but then, I’m not an expert on the patterns of behavior after parking meters are installed. The goal was to make more parking available. Goal achieved.
Have you ever found yourself in a situation where you are being advised by an expert to take specific actions to achieve your goals? Sometimes it is worth listening to and acting on the advice when demonstrable results exist. How are you finding different perspectives to get the results you desire?