We learned last month that another national store, Sears Canada is currently closing dozens of its stores and laying off over 2900 staff across Canada. I'm struck by the number of businesses that were once thriving and are now no more or in the process of massive restructuring.. What happened? The answer is quite simple: The market shifted while the business didn't shift with it. It reminds me of the saying, "if we don't keep up, we will be left behind."
Just look at some of the market shifts that have taken place in the past five to seven years:
Businesses of all sizes need to keep their eye on the “shifting winds of change” if they want to survive. They will either have to close, adapt or continually diversify their products and services.
Two Important Questions: What is happening in your marketplace that will affect your business? Are you keeping abreast of emerging trends and technologies that will impact your business? Keeping a close eye on future developments may allow you to survive the next shift in your marketplace..
Richard P. Fontanie, MSW, FCMC Up-dated from the archives Fontanie Learning Solutions
Image: Clip Art
We are experiencing gigantic swings within our economy. Business owners are cautious and uncertainty appears to be their by-word. Yet given all this hesitation many businesses are optimistic and expanding their workforce; others are holding the line but still need to hire new employees due to employee retirements or employees leaving to improve their education or find work elsewhere.
The bottom line suggests that whether you are expanding or strategically maintaining your business position you still need to hire strong leaders and managers, or people who can eventually move into those positons. That being the case what skills should you look for to grow your business and meet todays challenges? Here are some clues:
The ability to work within a diverse work environment. Many businesses and organizations have four generations of employees within their workplace. Each generation brings something different which may be expressed in their attitude towards work and the way they build relationships with each other and customers. Leaders, managers and employees need skills to work within this environment.
The ability to accept other cultures. Our wider communities are no longer primarily populated with people of Caucasian background. They now reflect the cultures of the world. We have a global village in our back yard and in our places of work. In order to work effectively together – to have successful teamwork – everyone requires strong listening skills and an attitude of openness and acceptance.
The ability to think strategically. Today’s work environment is on speed. Customers want faster service; employees want quicker answers to their concerns. Businesses gear up with the latest technology only to find that they are behind. The ability to respond with a mind set that is aligned with the company’s vision and values is critical when things are coming at you with a furiousness of a hurricane.
The ability to use metrics. The old saying “you can’t improve what you don’t measure” is true today as it was yesterday. Filling in data to provide the information necessary to measure performance is often a mind numbing chore. The ability to design and collect measurements in an unobtrusive way is a skill that is increasingly required. So too is the ability to provide data in meaningful pictures and summaries that is easily understood and supports critical decision-making rather than bogging it down in meaningless detail.
The ability to influence. The importance of influencing others while maintaining healthy interpersonal relationships cannot be underestimated in todays work environment. Leaders need to look for people who have positive attitudes, highly honed listening and communicating skills and the ability to read the mood of others appropriately. Strong influencing skills are required at every position and at every level of an organization if businesses are to be successful going forward.
The ability to learn. John was just let go from a company because he wouldn’t keep up with current requirements. Notice the word is “wouldn’t” and not “couldn’t.” John thought he was safe in his position because he had been with the company for many years. Employees at all levels of an organization need to be open to change – and this means learning new ways of doing things, keeping up with technology and being a continuous learner. The ability to learn from mistakes, improve oneself and move with the times are essential requirements when filling positions in today’s workplace.
When considering your next hire, whether for a leadership position or otherwise, review your requirements and keep in mind the above six qualities. People are the life blood of your organization. so take the time to hire the right person with the right qualities for today's work realities.
When sailing we keep an outlook for the changing winds as they may push us off course. This is a good analogy for keeping our eye on the changes that may affect our business strategies. Maybe this is why we refer to identifying the strengths, weaknesses, opportunities and threats (SWOT analysis) affecting our business as an environmental scan.
Completing an environmental scan is nothing other than keeping our eye on the winds of change and adjusting our course accordingly. Like sailing, sometimes there is a major storm which causes a crisis within the business, and like sailing we don't change the initial destination. We may need to sail to another port for safe harbour and when the storm passes or the crisis is resolved we set sail again to our original destination - unless of course there is no longer a business case for that aspect of the business.
During the strategic planning process we complete an environmental scan to determine the push and pull of the winds buffering our business. How do we do this? First we don't wait until we have a strategic retreat to complete the scan. Environmental scanning is an ongoing process and we use the strategic retreat to review the information to get a clear sense of what will affect our business in the coming one to five years. And since it is an ongoing process we may be able to avoid a business crisis in advance of it hitting the business. We shift the strategies to meet the winds of change but we don't change the destination barring the exception stated above. This allows us to view our Strategic Plan as a "living document" and we adjust it to meet changes in our marketplace.
Here are eight ways to keep an eye on the winds of change within the marketplaces:
The winds of change in the broader market place are outside of our control, but constantly having our antenna up will pay dividends in managing our strategies and will keep our businesses in a constant state of renewal.
Up-dated from the Archives of Fontanie Learning Solutions.
Much has been written about Toyota’s approach to Lean Production, Manufacturing companies throughout the world have spent millions of dollars on learning the system. More recently the service industry in health and education are imitating or modifying the practice, with varying degrees of success. Again with a great investment in consulting, training and process improvement measures.
But what about small businesses who can't afford such a huge investment? Well, there is a way to become "Lean" without breaking your bank account and without going through all the seemingly complicated consulting and training. The easiest way for a small business to initiate a cost effective "Lean" process is to understand the principles behind Toyota's Lean approach and apply them to the business. Let's break those down into four easy principles that you can begin using today.
1. Create value for customers.
The most effective strategy that a small company can have is to focus on the customer. Customers are the lifeblood of any business, without them there is no business. Cost effective and value added services develop customer loyalty and referrals. Review the way you service your customers. Here are several questions to get you started:
Are we customer-centric? Do we have a customer service purpose and values statement? Do we provide customer service training that will add value to the way we relate to customers? Do we have reward programs for our customers? Do we invite customers back when we have something new to offer them? Do we periodically follow-up a purchase with a thank you note? Do we make it easy for customers to buy our products? Do we know our customers' wants and needs? When was the last time we sat down and talked to customers? Do we know our regular customers by name? What processes do we have in place to serve customers? Are they cumbersome or are they customer friendly? What do employees say about improving the way we go about serving customers? Are goods placed in easy reach? Are our offices and retail outlets attractive and inviting? How can we reduce and remove "red tape" and replace it with "green tape"?
The key to adding value for customers is to keep asking questions that will prompt you and your employees to find answers on how you can consistently deliver customer-centric service.
2. Improve efficiency and eliminate waste that doesn't create value for customers
Review the way you do business by pulling apart the processes you have in place. A process is nothing other than a series of steps you take (or procedures you have to achieve something. Clarify what you have in place. Eliminate those that are unnecessary and make those you keep more efficient. Here are some examples:
Stop printing out copies of material that you can keep in your virtual filing system (but make sure you have backup copies); send letters and invoices by email; use a simple document scanner to keep virtual copies of material thereby cutting down on hard copy file folders and filing cabinets; reduce the number of meetings or make them more productive; coordinate sales calls to an area rather than driving all over the city; recycle all recyclable waste material; centralize office equipment; reduce the number of interruptions you have in a day; review where you store inventory to make it easier to fulfill orders; keep your inventory current; call customers in advance to confirm appointments and their expectations; develop standard procedure manuals; keep your shop floor and desk free from clutter; make it easy to identify tools by having a visual tool wall and color coded containers for larger tools or small parts.
3. Continuously improve people and products
I often hear employers say "people are our greatest asset," but when I question that statement I find they invest little in providing training for their employees. If people are your greatest asset, then you need to develop a culture where continuous learning is normal and accepted.
Consider learning opportunities that will enhance personal and organizational productivity, influencing and building relationships, problem solving, decision making, planning projects, selling goods and services, servicing customers, strengthening teamwork or any other area that is specific to your business.
People are genuinely open to learning when given the opportunity, and they think highly of an organization that invests in their on-going development. Individuals who are kept current with new or renewed skills contribute more effectively and work towards improving results.
Continuously improving and renewing your products or services is critical in today's changing marketplace. I see and hear the catch phrase "new and improved", but sometimes I wonder whether it's just a marketing gimmick so that customers will buy a product that is often on the decline. The phrase is overused as often little is new and even less is improved. It's time we became serious about improving and renewing products.
Continuously improving products is all about understanding your customers demand for your goods and services and developing a process to respond to them in a timely fashion. Small businesses can:
Keep an eye out for new products that complement and add value to their existing line; remove products that don't sell and add real value to a "renewed" product; market test a new product before launching it to understand how it adds value for customers; visit customers to assess how the goods or services they purchased met their needs and satisfaction; ask customers for suggestions on how you can improve your product or service; send out satisfaction rating forms with space to answer the question 'How can we improve our service or product?"; provide current information to customers that help them with the product or service they purchased from you.
Customers need to see and feel that your company is acting on their behalf by providing them with quality products and services they perceive as having real value. They become sceptical when they perceive the only thing that has been renewed is the packaging or the marketing slogan.
4. Live respectful values.
Spend considerable time in developing a positive values-based culture. One of the first things I do when I walk into an organization is to take a quick temperature of the culture. I watch how people interact with each other. I look at the "organizational graffiti" on the wall, for instance: are their motivational posters or are negative images lurking in individual offices, at the cooler, or in the photocopy room. I listen to the language and messages that employees, supervisors and customer service representatives use; I observe if people are being told what to do rather than being involved in finding solutions.
One can tell a lot about how people live company values in a relatively short time. Whether we agree or not, customers feel this as well, and their first impressions stick. They will walk out of a place of business with that impression and will tell their friends about what they saw, heard and felt.
The key in developing a positive values-based culture is to encourage everyone in an organization to act with respect, honesty, integrity, trust and collaboration. Small business owners can clarify their own values with employees, be positive examples, and engage employees in developing a set of values for the business.
Once the values are clarified then everyone has a responsibility to hold each other accountable to ensure they are carried out. This is viewed not as a negative or punitive act but one where people are genuinely committed to upholding them. Living respectful values increases employee satisfaction, improves customer service, and strengthens a business's reputation.
As an owner of a small business you don't need to get hung up with using the words that explain Toyota's concepts such as Kaizen, Kanban, Mudo-Murii, Gumba. You may want to learn what they mean but use language that your employees and customers understand. Use simple language similar to the four points above and seek solutions to the questions:
Throughout the clarification process be genuine and supportive of employees and always keep your focus on what is in the best interest of your customers. In the end (which is a bit of an oxymoron as there is no end) you will create an on-going process that has invaluable rewards, such as:
A culture focused on continuous learning designed to improve people, processes and products
Here are a few more resources for you to check out:
Up-dated from the archives Fontanie Learning Solutions
Each year I look forward to receiving the top 50 and 100 employers list. I receive both the local as well as the top 100 for Canada. My interest for receiving them is somewhat selfish but it is also fuelled with a sense of pride and admiration. Selfish because I primarily want to work with successful companies, pride because many of the companies I have worked with make the top list, and admiration because it takes a concerted effort for companies to reach the top.
Top performing organizations are found across our economic landscape. They come from the private, not-for-profit and cooperative endeavours. All of them mirror attributes that stem from their vision for the future, strong leadership, employee commitment and excellent customer service. When I look closely at them, here is what I find.
Top performing companies have longevity. It goes without saying that the passage of time gives them longevity. However it is what they have done during that time that's important. The ability to work through economic swings, changes in the marketplace and crises earns them their stripes. They have been in business usually for over 30 years and many for over 100 years. They grew incrementally, usually from small beginnings to what is now for many a global outreach.
The leadership team is clear about the company's vision and mission. More importantly leaders model the company values. They know why they exist and what they deliver and protect the company's image with integrity and sound stewardship. They keep their vision, mission and values in front of their customers through strong branding strategies.
If you go into any of the top performing organizations, you can't help but notice their branding power. Their vision, mission and value statements are present for anyone to see. They provide consistent messages to the outside world and often only a word or a phrase or a logo is needed for anyone to recognize the brand.
Their leaders and managers "walk the talk" to use an old cliché. The leaders and managers have a strong allegiance to the company and are committed to achieving not only financial gains for their shareholders but to developing an organizational culture where people want to work. They realize that financial gain only comes about by strong team effort built on trust, recognition and just rewards. The leader managers are optimistic about the future, respect their colleagues and employees and reflect the values the company deems important.
Top performing companies don't leave things to chance. They develop contingency plans to soften the blow of a crises or to meet changes in the marketplace. They allocate resources to scan the marketplace to ensure their products are relevant and cull those that aren't. They recognize that developing contingency plans to meet changing circumstances is not easy. Sometimes contingency plans call for the need to reduce employees. When Top Performing Organizations are confronted with the people reduction scenario, they do so in the most humane way possible by: searching for all possible ways to retain staff, building in internal on-going career coaching, and calling upon external career transition coaches when necessary.
Top performing companies are employee centric. They are concerned about their employees careers, and find ways to continually upgrade employee knowledge and skills. They view learning as an investment in their future and understand that even if the employee leaves the company they will be their ambassador for years to come. By placing emphasis on their employees careers, they know they will benefit in the long term as they will have a natural pool to draw upon when the time comes to find successors for those leaving the company. I also find that they have strong team practices, experiment with differing organizational models to meet new requirements, engage employees in the decision-making process, and promote a pleasing and flexible work environment.
They are customer centric. Top performing companies know that the ultimate key to their success is the promotion of customer service next to none. They have a strong customer service strategy that ties in with their overall strategic direction and values. They spend an enormous amount of energy in making sure that their employees understand who their customers are and how to best serve them. They know that a culture built on customer service means that everyone in the business treats everyone else as if they were their customer.
Top performing companies work hard at becoming top performers, but they are not perfect. They have issues and problems like any other company. These could include hiring staff in times of a heated economy, continually training employees when the economy is weak, dealing with employees who don't take appropriate responsibility and accountability for their actions, making sure they have an appropriate mix of products and services, or resolving a host of strategic or organizational issues. It's not that they don't have problems, it's how they deal with them that counts. They recognize that they can't take things for granted and rest on past successes but always need to keep going forward with continued discipline and agility.
Lessons Learned: When top performing companies begin to lose those attributes which have propelled them to the top, they begin to slide off the list. To keep themselves on the list they keep their leadership team working at peak performance. If businesses want to join this elite group then they need to have in place disciplined leaders who: maintain strategic focus on the changing requirements of their marketplace, commit to the business's vision, mission and values, develop an organizational culture with an engaged workforce, provide top notch customer service, and have the flexibility to meet unforeseen contingencies when they arise. What is encouraging to me is that I find that many successful small businesses have the same attributes as their big brother counterparts, only on a smaller scale. They won't make the top 100 list but they are top performers just the same. To these businesses, I also salute.
Author: Richard P. Fontanie MSW, FCMC From the archives of Fontanie Learning Solutions.
There is something about baking cookies that intrigues me. It's not the fact that I enjoy eating them when they come out of the oven but how making cookies is akin to developing a successful businesses. Cookies have a purpose - they are comfort food, and "that is a good thing" as Martha would say. When making them there is a recipe to follow with a set of ingredients- flour, eggs, sugar, and so on. There is a tried and true process for putting them together - put the dry stuff together before mixing with the wet stuff, and then mix in some more dry stuff and put them in the oven for a set time. And it has an outcome that we can measure - there are 12, 24, 48 or 60 baked cookies and they either taste good, are burnt or tasteless. In time we can add new ingredients or change the recipe to make them tastier. Even before making them we may have a dream of "sugar cookies dancing in our head."
So what has baking cookies got to with business?
Well successful businesses:
Many business owners have such a good recipe they franchise which is sometimes known as the "cookie cutter" approach to business. They have the recipe book for duplicating their business.
So baking cookies is a lot like developing a business. The difference is that we are able to eat our cookies within the hour whereas building a business is an on-going process that may take some time before success is fully realized. That's why I like baking cookies - it gives me a sense of accomplishment and satisfaction in the short term as I help businesses develop their recipe book for the long term. .
By the way go to http://www.epicurious.com/recipes/food/views/Chocolate-Orange-Biscotti-108470 for an excellent recipe. As a change-up drop the orange peel and Grand Marnier and add 2 tablespoons of Amaretto.
Author: Richard P. Fontanie MSW, FCMC, Updated from the files of Fontanie Learning Solutions.
Mom and Pop have worked hard to establish their business. They worked long hours, sacrificed personal wants to achieve business needs, learned from their mistakes and risked their life savings. They scraped and scratched to reach a stable income and profit. Through it all they raised their children and presented them with a role model of persistence, dedication and self discipline.
In time their children began to do odd jobs around the business At first they emptied garbage containers, swept floors, filled shelves, served customers and gradually advanced to the “till.”. They expressed an interest in working in the business full time. Mom and Pop thought this was a good idea and just maybe through their help they could begin to take some deserved time off.
As the children advanced in years and became a “fixture” in the business, trouble started brewing. The children began arguing among themselves and with their parents. Mom and Pop felt they were losing control because the children no longer “listened" to them. To add to the strain, Mom and Pop were now fighting with each other and the children were playing one parent against the other. Emotions were running high and cracks in the family and the business were widening.
Sound familiar? This scenario often plays out in a family owned business. If Mom and Pop recognize that they are in trouble they may seek out help from a Business Coach or a mentor. In most instances parents don’t reach out soon enough and the family ends up broken and the business falters. If you are in this situation, choose the former and not the latter. There are very practical ways to resolve the issues, even when in a state of emotional turmoil.
Here are eight strategies I have employed when working with family owned businesses.
1. Renew Marital Relationships. When communication becomes strained between Mom and Pop, the first order of business is for them to work on their own relationship. This requires a commitment to reduce the emotional distress and find solutions between themselves and with their children. If the issues are deep seated I recommend a marriage counsellor and without breaching confidentiality the marriage counsellor and I work as a team. He works with the couple on the marital relationship and I work with them on the business. In many instances a marriage counsellor is not needed, but what is needed is an agreement about what is important in their relationship, the different roles they play in family and business, their need for personal and business balance; and how they will move forward with strengthened “love, respect and forgiveness.”
2. Recognize the Power Shift. It is important for Mom and Pop to understand that the power and control they had when their children were young has changed. “Power” is a loaded word, but that is what parents have when children are young. Successful parents provide guidance to their children and nurture their talents and gifts. They also have “power” - the “power” to say “yes” and “no” and to set the ground rules for acceptable behaviour. They can, and often do, control their “comings and goings,” what TV programs they watch, and the use of cell phones and the Internet. Some assert their power with strict authority and don't leave much wiggle room for the children. Others are too lenient and give their children too much wiggle room. As children become adults, some parents wisely learn to relate to them as adults in their own right. Some parents don’t. – they continue to treat their adult children as young children and try to exert parental power and control with the same approach they did in the past.
When children grow into adulthood there is a power-shift within the parent-child relationship. Parents relate to their children differently, and likewise children relate to their parents differently. A lack of understanding of this power-shift is particularly problematic when adult children remain part of the business. Why? Because business and family affairs remain intimately bound together and family members have difficulty separating what goes on in the family from what goes on in the business.
In a family owned business the power shifts from parent-child to employer-employee. This is a significant shift and both parents and children need to find ways to accommodate it. If they don’t it will negatively affect their relationship. Parents need to break out of the parent-child mode and relate in a more business like employer-employee relationship; and the child needs to break out of a child-parent mode and relate in a more business like employee-employer relationship. Both need to focus on what is in the best interest of their business and what is in the best interest of their family.
3. Prepare a Charter of Expectations. This is a written Statement of Expectations built on common family values. The Charter of Expectations grows out of open dialogue among the family members resulting in agreements about how they will communicate, relate and treat each other. The intention of the Charter is to remove the pent up emotion around the relationship and defuse destructive behaviour; and, develop a renewed family and business culture based on openness, honesty and respect.
4. Clarify roles and responsibilities. Set out clear roles and responsibilities for all members of the family and have them hold each other accountable in the same way a non-family employee based business would operate. Define job descriptions and create an organizational chart for each of the positions and show how they relate to each other as one team. In many businesses the organizational chart remains in the background and what comes to the foreground is people working synergistically in a positive team effort. Families in business need to understand their roles and responsibilities within the team and work effectively together.
5. Manage Performance. Apply the same performance enhancing strategies as non-family businesses. Develop fair performance expectations and measure performance against results. In other words, Mom and Pop treat their children as employees in the same way they would treat other employees by giving attention to job performance, skill enhancement and employee development. Allow the children to learn the business from the ground up; and, if they possess leadership attributes and management skills promote them to positions that fit their skills and attributes – not by a sense of entitlement. Performance management between parent and child is one of the most difficult transitions each has to make, and requires honest dialogue between them about its purpose, objectives and process.
6. Change Reporting Relationships. If possible have the children report to someone else other than the parent. This provides breathing room between the parents and their child and gives the child an opportunity to learn about employer-employee relationships from someone other than the parent. In this instance the child’s supervisor must be a positive mentor and guard against any sense of favoritism towards the child.
7. Expand Experiences. Have the children seek employment outside of the family business where they are required to produce and perform like any other employee. Their experience will bode well if they decide to re-join the family business. If they are open to learning in those other organizations they will bring back new insight and ideas to improve the business’s operations and services. Upon their return parents would be wise to listen to their children and initiate appropriate changes.
8. Develop a Business Plan. Engage adult children in assessing the strengths and weaknesses of the business and involve them in developing its future direction. Every business requires a business plan, but a business plan for a family operated business is a critical requirement. It brings the family on the same page and provides a deeper understanding of the short and long term measurable objectives for the company. I find that when everyone understands the direction of the business and how each contributes to its success there is a renewed commitment within the business and improved relationships within the family.
When the transition from parent “young child “ to parent “adult child” goes smoothly, a more collegial relationship develops and each has a deeper understanding of how the business operates and how to support each other in family. In the business they understand the employer-employee relationship, their roles, responsibilities and accountability. They have job descriptions and are clear about where they fit within the business. Everyone is involved in developing a renewed direction for the business and promoting a healthy workplace culture. Communication among the members are respectful and adult in tone. All contribute to achieving results and building a successful business. The foundation is laid for a potential “partnership arrangement” and eventually the transfer of ownership from parents to children. Outside the business the family enjoys being family with shared meals, carrying on family traditions and supporting each other. In the end the pieces of the puzzle fit together and reflect a healthy symbiotic relationship between business and family. Does this mean there are no more tensions within the business or family? The short answer is no, but the family now has the tools to resolve the differences and communicate more effectively.
For those who operate a family business where family trouble is brewing, there is hope and help – reach out and grab it. Your business and family deserve it.