Category Archives: Strategy

Are you squirreling away nuts for a rainy day?

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saving nuts for a rainy dayThe squirrels have been out in force lately pulling acorns down from the trees. They seem busier this year than in past years. And if you believe the news, it is supposed to be colder and wetter in the Northwest than in past years. It makes sense that the instinct is to stock up on an appropriate level of supplies to get through the winter. As these are grey squirrels, they actually remember where they buried their nuts (according to “Grey Squirrels Remember the Locations of Buried Nuts,” published in Princeton University’s journal “Animal Behavior”) and will be able to find them when they need them.

An area that is not always thought through adequately in business is the rainy day fund, the availability of cash when you need it. Depending on the type of business you are in, the seasonal and cyclical nature of the market will cause swings in cash flowing through your business. It is important to understand how deep and wide the downtimes can be. This allows you to know how to minimize cash outflow when times are bad. It also tells you how much cash you need to have available and for how long. When thinking through this, all sources of cash should be considered, including credit lines and the ability to reduce working capital. By going through the exercise ahead of time, you will know if your sources of cash are adequate or not. If not, you have the ability to secure those sources before you need them. How are you making sure you are prepared for a rainy day?

The health of your people may be a sign of your health of the company

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healthy people, healthy companyHave you ever walked into a company and everyone is sick? Not just sniffling, but full fledged colds, flus, pneumonia, etc. And they come to work, no matter how sick, because things need to get done. And the pile of things never ends. So, people are stressed and give priority to showing up rather than being effective and focused on the right things that lead to desired results.

When people get into a heightened state of stress, little problems seem big, reactions become more extreme, the ability to prioritize becomes diminished, the lens in which they see the world tends toward negative, and illness creeps in. When people are in a healthy, balanced state and have time to think, they become more creative, more focused, enjoy their work more and are more engaged. Studies show that companies with engaged people outperform their peers.

Here are three ways to keep your people and your company healthy and focused:

  • Provide clear priorities – There should be no more than 3-5 priorities at any given time. More than that becomes difficult to address. These priorities should be reviewed every week to ensure progress is being made and people remain focused on these items. Don’t get sucked into the never ending stream of little stuff that doesn’t really need attention, but can suck lots of time.
  • Ensure an appropriate balance of skills and capabilities – A company can only be successful if it has the right people in the right places, there are enough people for a company of your size, and the people have the appropriate skills for what they are doing. If you hear people saying there is too much work for the time available – make sure the priorities are clear, the tools are available, and the skillsets are appropriate.
  • Walk the talk – You are setting the example for your company, department, etc. It is important to make sure you are clear and focused on priorities, balance the strategic and the tactical appropriately, and find balance to manage your stress and health. Make sure you are taking time to get exercise, clear your head, and eat healthy foods that work for your body. By being clear, focused and grounded, you set the example for your team.

As we head into the fall and winter, how are you providing leadership to keep your team healthy and engaged?

 

 

The Truck Blockade

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truck blockadeEver since the port closed in Portland for cargo shipments, the volume of trucks on the road has increased. It makes sense – if the goods aren’t going out on ship, you’d expect the rail and truck volumes to increase. The highways are three lanes each way, sometimes two lanes. The trucks typically travel in the middle lane, in very close proximity to each other. I call it the truck blockade because it is incredibly difficult to get from the right lane to the left lane as the trucks are typically too close together and too many of them to maneuver easily. After a bit of research, it turns out that the reason for this is safety (being in the center lane – more opportunity to maneuver) and fuel efficiency (driving close together – drafting).

It may or may not be obvious why certain actions are being taken based on your background and experience. Within a company, helping people understand why actions are being taken can help keep efficient, forward momentum. At the same time, it is important to understand if there are unintended consequences to the actions being taken that rise to the level of needing to make tweaks to the actions to keep efficient, forward momentum. How are you making sure that you the actions in your company are intentional, efficient and effective?

Chasing Your Tail

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chasing your tailIt was a great plan. I had an hour of time blocked out for getting some marketing work done. But my new dog had other plans for me. Most of the time she is well behaved. Not today. Today, she decided to race through the place at full speed and shred her bed. Up and down I went trying to settle her down and divert her attention to something more productive. Each time I thought she was there, she started back up. My focus was in and out and I accomplished pretty much nothing in that hour. As the saying goes, I spent a lot of time doing a lot of things and accomplished nothing – chasing my tail.

It is a concept that has been the subject of many conversations lately. People talk about a lot of activity in their work, but can’t demonstrate results. Being clear and focused (and having an environment free of distractions) is crucial to achieving results. How are you creating an environment that keeps you and your people from chasing their tail?

The Rearview Mirror

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the rearview mirrorOver the last few days, I’ve been on the road quite a bit. Looking at the path ahead and the rearview mirror to scan the environment to ensure a safe path. Some cars were weaving out of their lane, some were speeding ahead, others were moving slowly. By looking forward and behind me, I was able to adjust my course appropriately to make for a safe trip.

The trip got me thinking about a friend describing meetings he had recently attended. There were some new people in the organization. They were thinking about how to improve and innovate. Fantastic! What they didn’t realize was that road had already been traveled with considerable effort, ultimately discarded as not workable. Circumstances had not changed such that revisiting the effort would result in success. It was only in the meeting that the history surfaced and gave new light to the best road to travel.

It is true that you can’t be successful by looking strictly in the rearview mirror to manage a business. But understanding history is important too. How are you creating a learning environment that understands your history and the circumstances that supported it?

Are you diverting people without notice?

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are you diverting peopleThe economy is coming back. You read about it in the papers, see it on the news. It really becomes apparent when you experience it in the form of increased traffic and construction. Driving to an appointment recently met me with two unexpected adventures in the form of road closures. While many times there are signs down the road indicating a closure is ahead, in both cases, there were no signs. In the first case, the closure was temporary as construction was being performed on the road and flaggers would periodically let people through. The second closure was for an extended period of time. Looking ahead two blocks, I was able to see the closure and make a turn down the appropriate one-way street. Had I not seen it, I would have been on an adventure going the opposite direction.

In the grand scheme of things, the adventure was not a big deal. It was 15 extra minutes. I plan for the unknowns – something will come up, I just don’t know what it will be. But many people do not. And in business, the diversions down different paths and adding difficulties into the lives of your people or your customers in an unexpected way can strain the relationships. If only once, it may not be a big deal. But if people are diverted from the objective regularly, you may lose them. How are you making sure you don’t divert people without notice?

Why buy the Cadillac when the Chevy will do?

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why buy the cadillac when the chevy will doTimes have changed since this saying came about, when the Cadillac was the gold standard. The point is still incredibly valid – why pay a lot of money when your needs are satisfied by less. I was reminded of this saying this weekend while looking for a barrier to keep my new dog from running up stairs. The pet stores had pet gates, and I was shocked by the sticker price. So, I looked at baby gates at Target. The price differential between a low end baby gate and a low end pet gate was 2-3 times, and nearly 15 times differential between a low end baby gate and a high end pet gate. I don’t need a bunch of bells and whistles, just a barrier to put on the stairs. So, the baby gate met my needs.

These types of situations arise all the time in business. Whether it is systems, equipment, design, space, or pick your project, too much money is spent regularly because the scope and outcomes are not clearly understood. Money is poured into bells and whistles that aren’t really needed. It is pretty amazing when you start focusing in on the actual scope – your time and money can be dramatically reduced. This is different from wanting a Cadillac, but only willing to pay for a Chevy. The difference is knowing your needs, the scope. How are you ensuring you are clear on your needs and not getting a bunch of bells and whistles that aren’t really needed?

How do you find your blind spots?

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blind spotRecently, an out of town acquaintance was in Portland for the summer. Being from a major city, she never learned to drive. Not a big deal as she was staying close to downtown and could bike to work and around the area for fun. We were talking about how to get around and I suggested she be careful how she navigates the bike lanes. They are on the right hand side of the road and if a car needs to turn right, they would cross through the bike lane to turn, making it incredibly important to always watch for vehicle blind spots. Having never driven a car, she did not understand the concept of a blind spot, so I explained it to her.

Blind spots exist in business too. They are danger lurking in the wings that can’t be seen. And the only way to find those blind spots is through experience or, if it does not exist, help from someone who has the experience. Even if you think you have the experience, you may be too close to the situation to see the blind spots. How are you watching out for blind spots?

Circling the Drain

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circling the drainHave you ever seen this? The economy, lack of desire for a product/service line or some other event causes a dramatic drop in revenue. As a result, staffing is cut. A few of the most talented people depart, leaving a weak team. A theoretical new revenue stream is discussed, but the specifics around how to make that happen never quite get there, making it difficult to attract the people that buy the goods or services. The ostrich approach moves into full gear as people discuss the plan (but don’t execute it), thinking the business has turned the corner, but miss the warning signs that things are not actually getting better. Lots of meetings happen, and people are focused on the activity rather than the results. Emails fly with large numbers of people being copied for no apparent reason and people feel better because there is activity. In the meantime, the business is circling the drain. The only question is, can someone put the plug in before all the water drains?

While it is difficult to turn a business around when it has gone too far down a path, the key is to have a flexible approach and ability to refocus as the markets change. Things to watch for include: dramatic changes in revenue, dramatic changes in the goods purchased or services provided, strength of the team in place, and a trajectory that is different than competitors or the market in general. To have forward momentum in a business, it is critical to have the right people in the right place focused on the right things. How are you having honest dialogue in your business to make sure that changes creeping in the business don’t cause you to circle the drain?

Are your metrics misleading?

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time for factsA recent article in the paper was based on research published by a university. It was an interesting article that had a significant number of statistics. The results were counterintuitive to both the researcher and the writer of the article, both having indicated they expected the opposite of what actually happened. The results were listed in a table off to the side, showing the absolute occurrences in two different groups, along with the population size. The numbers became very small very quickly in the percentage of occurrences. The percentages in most cases between the groups were very close because there were few occurrences. But the article focused on the percentage change between the two groups, which became a big percentage and misleading as to how often the occurrence happened between the groups.

For example, in group one there is an occurrence 1 time in 10,000. In group 2, there is an occurrence 2 times in 10,000. In group one, the occurrence happens 0.01% of the time, and 0.02% of the time in group 2. In either case, it is negligible. But framed another way, it could be stated that occurrences happen twice as frequently in group 2. That seems like a lot more!

How information is presented can have a significant impact on perceptions and form the basis of how decisions are made. How are you making sure the data presented in your organization is fairly representing what is actually going on so appropriate decisions can be made?