No sane personal turns off their headlines and attempts to drive down a road at night.

Cars have headlights for a reason:  to illuminate what’s ahead and help you get where you are going.  Mirrors and gauges serve similar purposes.

Businesses are no different. You need tools to help you understand how you’ve done, the health of the business, and what lies ahead.

Extending the analogy, mirrors are like financial and other reports that tell you where you’ve been.  They are backward looking.

Your speedometer, tachometer, temperature, and fuel gauges tell you about the current operating condition of your vehicle much like production numbers, quality control info, customer service data, and other KPIs tell you if your business is operating as expected.

And your sales pipeline, financial forecasts, and other leading indicators give you an idea of what’s ahead, just like headlights on a car or traffic warnings from your navigation system.

It is critically important that you have a set of metrics – financial and operational – to really understand the state of your business.   If you don’t, you are driving blind.

I’ve spoken with too many business executives who believe that as long as they can pay their bills, have some money left over, and production is getting product out the door that their business is doing fine.  Perhaps it is.   But maybe they don’t see warning signs of troubles ahead because they aren’t looking at the right gauges.  Trouble could be around the corner.

Hemingway says it best in The Sun Also Rises:

“How did you go bankrupt?” Bill asked.
“Two ways,” Mike said. “Gradually and then suddenly.”

Don’t let your business slowly steer off course and force you to suddenly deal with simmering issues that may have been prevented or corrected if you had only known.  Make sure you are using the right metrics to understand your business and not driving blind.

If a fractional COO can help you with your metrics, CONTACT US or reach us at http://linkedin.com/in/cmatt.

Growth: Can you afford it?

“Grow or die!” is a common, well-accepted business principal. Businesses must innovate, stay relevant, seek new customers, add locations, and offer new products.

But growth brings its own challenges. You have more products/services to support. You need more people. Rapid hiring makes maintaining culture harder. New tools and technology – and the time to integrate and use them – are expensive.

Your bottom line may suffer from your growth!

You may need to take steps to grow your bottom line instead of your top line. Eliminate products/services that aren’t profitable. Eliminate processes or activities that don’t add value. Don’t do things just because you’ve always done them. And, as hard as it may be, let go of employees who no longer fit culturally and don’t contribute to you vision.

Your bottom line profitability ultimately decides if you can afford top line growth and how long you can sustain it.

Read more about the good and bad of business growth here:  http://opalpg.com/2018/08/21/growth-good-bad-ugly/

 

Are you searching for a software solution that will transform your business?

Or maybe your company is just one great hire from kicking it into another gear.

Perhaps you are on the verge of implementing a new program rally your team.

You are hoping for a silver bullet.

The harsh reality is that no program, software solution, or employee is the silver bullet you seek.  It could be a component for creating success or moving to the next level but it is only one component. 

Success – no matter how you define it – will be a product of your hard work.  As the leader, no one is going to understand your business or work as hard on it as you do. 

You must channel your energy and vision into building success.  To do so requires a plan, determination, and accountability.  Ask yourself hard questions, be willing to make agonizing decisions, and recruit people you trust to walk the journey with you and hold you accountable. 

Start with a vision.  Create a plan.  Measure your progress.  Be held accountable.  Be ruthless in making tough decisions for the right reasons.  Treat those who have joined your journey well. 

You can’t do it alone.  Make sure to ask for help in the areas where you are not strong. 

When many people hear the word “structure” in a business sense, they immediately think about the organizational structure or the org chart.  That’s an important element of structure, but it is not the only one by far.

In the Operations hierarchy, Structure is any framework that allows you to measure the outcomes of your efforts or that helps protect you by planning for the unforeseen.

Structure is focused on performance, protection, and compliance.  Elements of Structure for your business may include:

  • KPIs
  • Financial reports
  • Protective agreements (MSAs, NDAs, customer and vendor contracts)
  • Business continuity plans
  • Disaster recovery plans
  • Compliance with governmental rules and regulations

Why Structure is Vital

Certain aspects of Structure are readily identifiable.  People are inherently that employees need to know who they report to or who has the authority to make decisions that affect customers and the business.

Going further, most business owners and executives know they need to measure how their business is doing.

Are you succeeding or heading for troubled waters?
Financial reports are necessary to understand the fiscal health of your business.  Look for trends in your financials to ensure a problem isn’t slowly overtaking you.

Likewise, your team needs and wants to know if they are winning.  Having good Key Performance Indicators (KPIs) or published team goals allows everyone to know if they are on track.

Other aspects of Structure aren’t as obvious but just as important.  Planning ahead for a negative event isn’t fun but it cannot be avoided.  You don’t want to figure out what to do when you lose a big customer, your building burns, or the economy tanks after it happens.  If you wait until disaster strikes, you may be operating out of fear and emotion.  Having a clear plan of action determined in advance makes navigating tough events easier. 

Other elements of Structure include being compliant with rules and regulations, having strong contracts, and having good documentation so you can have the best possible outcome if a legal issue arises.

Structure connects your Process to your Strategy by gauging your company’s performance and protecting your investment.