the value of humility

I have worked with a number of companies over the last 20 years that were extremely successful in their markets. If I look at where they are today, on the list of successful companies, they are no longer near the top.

Curiousity got the best of me as I wondered why - having been involved with each organization I was very familiar with not only the hard numbers but the soft cultural and people side. I put together a chart highlighting what these organizations had in common:

- strong contacts
- strong contracts
- dominated a market, or portion of a market with a niche product
- were early adopters taking risks in new areas - more wins than losses there

Surely all these points foster growth so I looked a little deeper and the answer popped off the page; humility.

None of the leaders in these organizations were humble enough to look take their contribution out of the equation and look at the key underlining factors that made their organizations grow at the rate they have. The 20 / 80 rule. In dropping the ball on that small percentage of key inputs, the house comes tumbling down.

On the operations side humility is the biggest contributor to optimizing a factory or production line - if you assume you know it all you'll never succeed, if you are not humble enough to cultivate the knowledge within the staff and workers you will never gain support.

Keep an eye on why your organization thrives (or maybe has hit a rough spot) but be humble enough (at least with yourself) to highlight that main ingredient that you were able to spot, foster and grow - is it sustainable? Can you make is sustainable?

Minding the Store

I had a very interesting conversation at an event this weekend, it was with three colleagues that all have their own businesses. Most of what they were saying concentrated on the financial side of their business and when I said ‘is that all you guys concentrate on?’ the response was, in concert, ‘what else is there?’
Well, there is the ‘machine’ that utilizes resources, consumes cash and generates income. “you remember, that thing you started that became a business that you are so busy running that no one is minding the store”.

Who is minding the store while everyone is doing the ‘important’ work?

Some things to consider, keep in mind or at least glaze over during the course of the week.

- Where is the business going? Not just $$$ or lack of $$$ in the bank or sales in the funnel but where is the business going – new products, old products, new markets to enter, current markets to exit, channels, offerings, service…..
- Why are you doing what you are doing? Are you making decisions based on the market conditions – what about your plans, your strategy, did the market turn ‘eat up’ all the risk mitigation that was built into the plan?
- If you are making changes be sure you can give them time to stick (assuming they were the right decision). Be sure they are in line with the overall plan.
- Is management behind all the initiatives (don’t answer – ask someone on the factory floor).
- Are you pooling your team together and utilizing the talents and experience of your staff. Maybe there is someone new or young that has some experience that should be capitalized on. Don’t think that the core group has to come up with all the ideas.
- As the leader are you creating the right atmosphere. The rumor mill is working overtime these days, speculation can generate a number of very ‘believable’ scenarios….are you spending time and effort on ensuring the right message is getting out.
- Keep in mind that what you believe is happening, what you implemented some time ago, what people say is being done may not be….keep a list of key initiatives and ask about them regularly, to different people at different levels within the organization.

Take some time to reflect and plan. Times like these have people running on the need to the latest information, don't get overwhelmed, step back, reflect and validate your plans.

Suppliers / Defects - the liberty taken with definition

We work across a number of industries with our portfolio companies and one of the many things I see over and over again is how suppliers define defects - BEWARE, is all I can say.

I sat in on a meeting as an observer to a company we were looking to work with and I was stunned at the supplier's behaviour; I couldn't figure out if they were that arrogant, ignorant or thought that their client grossly lacked any sense of intellectual acuity.

This particular supplier (a globally recognized brand) kept defining defects as 'anything that stopped production'. By 'their' definition they had an outstanding performance record that they were only too happy to promote.

Taking a closer look at supplier performance there are a number of factors that come into play:

= on time delivery
= order accuracy
= incoming inspection defects
= product quality
= cost fluctuations
= program management & effort
= returnable containers
= defective component handling
= cost of rework

Add these factors in and one quickly sees the suppliers true colours - one not to do business with.

A well balanced supplier scorecard is key to understanding the impact a supplier has on your business.

Is it too late to save?

More and more I hear about business owners and managers discussing the utilisation of cost cutting measures to compensate for lack of sales in hopes of maintaining margins.   

Not to say that cost cutting is not a valid undertaking, optimization is key in manufacturing / operations but it really isn't an overnight exercise.  No doubt savings will be found however, if you are seeking a sustainable process (sustainability - the key in any business initiative) you need to address the cultural side of costs; how does your staff feel about and treat (your) money. 

Building a sustainable cost conscious culture means you'll have to deal with 'change' - it becomes a bigger undertaking.

If you are hiring a firm to find cost savings - ask what they will do with respect to developing the proper culture - if that isn't addressed the initiative will end with the end of the consultant's contract.

The Old Model for Finance is Dead - MoneyMagnet Blog

Jacoline Loewen had an interesting post on her MoneyMagnet blog....I thought I would parallel her financial thoughts with some operationally orientated ones.

http://moneymagnetbook.blogspot.com/2009/03/old-model-for-finance-is-dead.html

Not the TEAM speech again......

At a client today and, well, another TEAM analogy – 9 times out of 10 when I get a plant / office tour I hear the TEAM analogy. I have to wonder if managers really know / understand what TEAMS do.

A very good friend of mine is a professional football player and I got to shadow him for a couple of days – jog, train, run plays, watch videos about good plays, rerun plays, watch videos of bad plays followed by laps, run drills and a quick game.

I have to be honest I didn’t see the link - all I saw was EXECUTION. Executing, watching how to execute, watching how not to execute, practicing to execute followed by more executing. TEAMS win because they work together, no doubt, but they work together because all they do is practice executing and then execute.

Google “professional services” and you will be bombarded by help with ‘your strategy’, ‘your costs’, ‘your planning’. All that is important but the reality of it is that most initiatives fail during execution.

I really wish I could hear the Execution speech and not the Team speech.