We all know the flight attendant’s instructions to “put your oxygen mask on first,” before helping others. Why is this an essential rule for ensuring survival? Because if you run out of oxygen yourself, you can’t help anyone else with their oxygen mask.
In a corporate environment, I consider this to ensure that the business model and processes are working before embarking on a new venture, product, or market. With COVID, I see several CEOs, moving their organizations in new directions without the company having its core culture, business model, and processes working. With COVID, all CEOs are now what Ben Horowitz referred to as “Wartime CEOs.” To understand the difference, read Horowitz’s Peacetime CEO/Wartime CEO. However, as a wartime CEO, you need a robust organization framework to provide the agility to win.
Without a robust framework, it will be difficult to:
- know what is driving any change in performance;
- push decision making down the chain of command;
- be agile in responding to market conditions; and
- make informed decisions.
Many companies have problems with their culture, business model, processes, or just the wrong employees. As I have said before, COVID is ripping back the curtain and exposing these weaknesses. Business leaders don’t have the luxury of ignoring them anymore.
Many CEOs I know have avoided addressing the problems within their organizations for years as the growing economy helped paper over them, and I think they hoped the issues would right themselves with time. This failing to deal with the difficult choices is a failure by these leaders because dealing with hard decisions is why they get paid the big bucks. As Ben Horowitz so aptly put it, CEOs make decisions that not everyone agrees with, because if everyone agreed, then they wouldn’t need the CEO. Now is the time for many business leaders to face those hard decisions and do what is right for the organization.
Examples I see are that plague some companies are:
- Wrong people in the jobs they have. They need to be moved
- No core values or corporate culture. During COVID there are more crises because “the employees are not stepping up.” This will get worse.
- Bad financial reporting. You can’t change direction and know the results if your financials are 6+ months late or usually wrong.
- No idea about the underlying product or service costs. Thus focusing on nonprofitable items and clients during a cash crunch.
- Headquarters in another country has to approve all online content and publish the website and online stores; however, they are distracted and don’t understand the U.S. market. In this instance, there is no agility, which is essential.
If you are struggling with this, I would recommend joining a Peer Group like Vistage and presenting the issue to your Peers. When I was a Vistage member, I found the advice was what I deep down usually knew was needed, but hearing it from my Peers provided me no choice but to commit to something I was avoiding. Also, I would have to do it, as I could not face them again, having committed to doing it, but then backing out. As I tell Vistage prospects, “there is no public flogging in Vistage, but monthly humiliation in front of your peers may be worse!”
While COVID is creating chaos in many companies, business leaders need to ensure they have repaired their underlying problems first before trying to adapt. As the old French proverb says, “A stitch in time saves nine.”
Copyright (c) 2020, Marc A. Borrelli
Boeing’s 737 Max issues highlighted the company’s sacrifice of safety for financial performance, resulting in a tarnished reputation. The prioritization of profit over core values also damaged the FAA’s credibility and revealed a lack of accountability for top executives. This downfall serves as a reminder of the importance of maintaining core values and prioritizing them over short-term financial gains.
In reflecting on 2021 resolutions, the author scored themselves in three categories and sought to improve success in 2022 by addressing friction points. Drawing on advice from social psychologist Wendy Wood, the author identified areas to reduce or increase friction in their failed resolutions. By making these adjustments, the author aims to enhance their goal achievement and encourages others to consider friction when setting resolutions.
COVID has taken a toll on all of us. If you have not taken an extended vacation in a while where you disconnect, you need to now. You and your business will benefit.
In a previous discussion, I highlighted the importance of being famous for something. Being well-known in your niche can help you: Concentrate on your strengths Connect with your target audience Communicate your offerings more effectively Receive referrals Identify...
Understanding and optimizing the Cash Conversion Cycle is crucial for business growth, as it impacts cash flow and the ability to access external capital. This cycle consists of four components: Sales, Make/Production & Inventory, Delivery, and Billing and Payments. To improve the Cash Conversion Cycle, companies can eliminate mistakes, shorten cycle times, and revamp their business models.
As an entrepreneur, it’s crucial to specialize in a specific area and become famous for something, allowing you to generate referrals and build your brand. Understanding the “job” you’re hired for helps you stand out in the marketplace and communicate your value proposition effectively. By providing value to your clients, you can adopt a value-based pricing approach, ensuring your business remains competitive and maintains a strong market presence.
Rethink your pricing model by focusing on the value you provide and your customers’ Best Alternative To a Negotiated Agreement (BATNA). This approach can help you maximize margins while delivering better value to your clients. Assess your offerings and brainstorm with your team to identify pricing adjustment opportunities or eliminate commodity products or services.
I recently facilitated a workshop with several CEOs where we worked on the dramatic business growth model components. One of the questions that I had asked them beforehand was, "What is Your Profit/X?" The results showed that there this concept is not clear to many....
In today’s War for Talent, attracting the best employees requires a focus on value creation, core customer, brand promise, and value delivery. Clearly articulate your company’s mission, identify your “core employee” based on shared values, and offer more than just a salary to stand out as an employer. Utilize employee satisfaction metrics and showcase your company’s commitment to its workforce on your website to make a strong impression on potential candidates.
Productivity remained during WFH with COVID. However, further analysis found that hourly productivity fell and was compensated for by employees working more hours. What was the culprit – Meetings. Want to increase productivity, have fewer meetings.