strugglingsmallbusiness

Conflict Doesn't Have To Be A Bad Thing

The risk of conflict is always looming its ugly head in business especially when you consider the different participants and agendas that have such an influence on what we do and why we do it. Customers, staff, competitors and suppliers are all part of that influencing mix and, for small business especially, this means your vulnerability comes to the fore when you see the ominous signs of conflict heading your way. In fact, if you are able to see them before they hit, that at least allows time to prepare. Sadly, they usually come straight out of left field without any warning. So, what to do?

Firstly, keep calm and try to salvage some thinking time to switch shoes, figuratively speaking of course. This means kicking off your shoes and stepping into the other party's. This will give you some ideas and offer assumptions as to where they are coming from. Another well-heeled metaphor to illustrate this is to remove your spectacles and delve into the box containing a variety of different ones. These are to give you a different view of the matter causing potential conflict: maybe longer sighted, shorter or even tinted (though probably not rose-coloured!)

The Participation Company provides some useful approaches towards the next steps. So, if you've chosen your lens of preference, offering either avoidance, competition, collaboration, accommodation or compromise, consider the pros and cons of that preference. Next, look at the alternatives and what steps you need to take, maybe changing from your natural default position in order to reach the ideal

Finally, conflict is not always a bad thing. Whilst it may highlight shortcomings within our operations it can also bring into the limelight opportunities and the changes we need to make to capitalise on them.

Ted Beecher
BLA Director

Which way is it Flowing?

Keeping a close eye on our cash, sometimes even to a point of paranoia, is an essential discipline in running a small business, particularly during its immediate post-start up period. Why? Because, we are so often unaware of the likely highs and lows of our business at this embryonic stage, what competitive forces are out there, what is affecting our customers' buying habits and so on. Then, of course, in the back of our mind, we need to remember that insufficient cash is a major reason why so many small businesses barely get off the ground and eventually fail.

So what is cash flow? Put simply, view it as how much is coming into the business as a result of your technical skills, sales and promotional efforts and, you've guessed it, how much is going out to repay any loans and, of course, to cover the expenses required to run the business. These would include rent, salaries, accounting costs and consumable items etc. If we lived in a COD (cash-on-delivery) world this task of constant monitoring would be a lot easier as we would have a day-by-day picture of money physically coming into the till and, likewise, what is going out. In the real world of course, customers often don't pay at the time of buying your products or services as a result of which your cash flow is dependent on collections of 'accounts receivable'. On the other side of the ledger (accounts payable) you have some suppliers who are happy to provide you with their goods or services on credit. As a result you need to balance what you are expecting to come in from your customers and what you owe your creditors.

So what if your business is impacted by seasonal fluctuations at different times of the year? Imagine if we were a business located in a ski resort or if you're one of the building trades which invariably go quiet over the Christmas and New Year months. This can really test us as we need to ensure that we create sufficient reserves during the 'good times' to ensure our survival in the lean ones.

There is a lot to say about this important topic but the more we are aware of the ins and outs of our business and the trends that affect these two way money streams, the more effectively we can Manage our cash flow as you will see by way of the tips offered in this helpful link.

Ted Beecher, BLA Director

Is A Leader Born or Made?

On the back of our last posting covering the similarities between followership and leadership, this week we're going to take a brief look on the personal characteristics of a leader. A popular myth is that an effective leader is one who dominates and possesses high degrees of intelligence, confidence, initiative and limitless stamina. Even their height can be deemed a contributory factor. That is until we look at the physical stature of leaders like Napoleon or Gandi as well as the more infamous examples who turned the tides of history such as Hitler and Stalin.

Early theorists who supported these myths also assumed that leaders could only be born and not made whilst often forgetting that leadership characteristics can differ significantly. Take, for example, a general leading an army, a politician, a priest or team leader in a supermarket.

In running a small business, effective leadership embraces a number of factors:

1) Deliverables - this all about the goods and services. Things like quality control, customer satisfaction, competitive pricing and the numerous efficiencies that ultimately determine what is usually referred to as our business' bottom line.

2) People - an empathetic and considerate approach that leads to the motivation and job satisfaction of the team.

3) Education and coaching - linked closely with 2); these are the influences that govern our team players' growth in terms of knowledge and skill sets.

4) Values and culture - This ties together all of the story so far by being able to answer key questions, like exactly WHO we are, WHAT we are and WHY we do what we do. (If you're wondering about the 'HOW' and the 'WHEN', they usually sit in 1).

Think about this. In larger corporates, each of the categories above may come under the responsibility of a single executive with a CEO at the top whose job is to periodically run her or his thermometer across each of the 4 cells in order to report authoritatively (and hopefully with a few 'smileys' in tow) to shareholders and board members.

It's all a bit different in small business. An owner rarely has the luxury of being able to delegate these types of roles but rather embrace a little bit of everything themself and that's really the long and the short of it. Sound familiar?

In previous posts we've touched on a lot of things associated, directly or indirectly, with this topic. So, because of its importance, make no apology for any repetition. Indeed, we are confident, small business owner and writer, Susan Ward's take on leadership will help you on your journey, particularly the bit where she says, 'Leadership can be learned'. Enjoy the read.

Ted Beecher
BLA Director

Good Leaders Know How To Follow!

In Praise of Followers!

This is the title of a paper posted by Robert E.Kelley in the Harvard Business Review back in 1988 (Nov - Dec edition, pp 142-148).

The writer reminds business people of the emphasis we all place on leadership, and rightly so of course. He then quickly switches to the question of what about the people they lead? He cites Napoleon as being, without the support of his massive armies, ' merely a man with grandiose ambitions'. In the case of a business, Kelley states that they survive or fail partly on the basis of how well their leaders lead and partly how well their followers follow.

Recognising the importance of good followership, back in the last century when Jack Welch took over the reins of the massive, yet crippled, GE Corporation, he came up with an intriguing yet effective plan to save the Company. Put simply, it involved delegating responsibility by cutting through the many management layers and empowering those of the so-called lower echelons to make decisions which would collectively transform the organisation. In other words he created an army of effective followers.

Now hang on! I know BLA is all about small business, but don't be put off as the principles here can easily be applied in any size operation; even a one man band who is often a sort of leader/follower hybrid!

OK, back to Kelley. He explains that what distinguishes an effective from an ineffective follower is enthusiastic, intelligent and self-reliant participation - without star billing - in pursuit of an organisational goal. Culturally, self-confident followers see colleagues as allies, not competitors, and leaders as equals. Organisationally, more often than not, they can also see both the forest and the trees!

But how does the boss create this sort of environment? Simple!! (as that pesky meerkat would say!) Good leaders know how to follow and, in doings so, set an example for others.

By the way, do let us know if you want to know more about Jack Welch's pitch in the followership arena as we realise we barely scratched the surface by giving it the cursory air time above. In the meantime, here's another great article on the subject which hopefully will foster some practical tips on the roles of leaders and followers in the successful running of your business.

Ted Beecher
BLA Director

Finding Our True North

Anybody who's succeeded in the sport of orienteering, or pursuits like flying, sailing and other activities which involve navigating skills, will know the importance of maintaining a watchful eye on True North. Just to get technical for a second, True North (also called geodetic north) is the direction along our Earth's surface towards the geographic North Pole or True North Pole. Because it differs from Magnetic North, which is the direction a compass points toward the Magnetic North Pole, the navigator has to plot his or her course in order to make the necessary adjustments for that difference.

In running a small business, we must keep a keen eye on our True North. This means, figuratively speaking of course, we are standing up there on the bridge with the ocean all around us, having to constantly navigate the changes, conditions and environmental factors that impact on our plans and budgets etc. Of course, it's all a test of our leadership role and, as such, worthy of occasionally taking time out to ask ourselves a few pertinent questions, such as:

  • What's keeping us awake at night?

  • How do we want to be remembered (sorry if that sounds a bit morbid!)?

  • Who inspires us?

  • What is the one word that describes us?

'C'mon!', we hear you say. 'Isn't this all a bunch of airy fairy stuff that is so far removed from the nuts and bolts of my business. Wouldn't we all be better off if it's left in the domain one of those highly paid psychologists?'

Not so! These are just some examples of the kind of questions posed by Harvard Professor, Bill George, who emphasises the importance of finding True North in many of his postings and books. Have a peruse of his full list of questions in the link, noting that most are of a personal nature and a timely reminder of the synergy between our business world and private life. ............And perhaps a reinforcement that, since starting at 8 years or so ago, BLA's catchcry remains, Business is Personal and a key consideration when seeking our True North.

Ted Beecher
BLA Director

It Takes A Community To Run A Small Business

They used to sing it at Funerals before they realised the value of COMMUNITY!

Not so long ago, in celebrating the life of 'so-and-so', and especially when the deceased was once a sharp shooter in the business world, their funeral service would often end with the famous Frank Sinatra recording of, 'I did it my way'.

Invariably there would be at least one of the mourners quietly cringing in the pew thinking, 'His way (or hers, of course)? ' 'What about the time I got him out of that hopeless mess-up with the books? Without my team's intervention, we would've soon had the liquidators knocking at the door?' Then there'd be others recalling and mumbling to themselves about all those situations where the 'My Way' factor was completely trumped by the time, effort and specialist knowledge of others.

Now let's be fair. Resilience, fortitude, tenacity, leadership and all those other 'power-words' may well be part of the DNA being eulogised on behalf of the subject in the coffin. And so they should.

But...Remember the old African proverb, ' It takes a village to raise a child '. This means that it takes an entire community of different people interacting with children in order for a child to experience and grow in a safe environment. How easy it is to apply this to the small-business world. Think about it, 'An entire Community interacting'. Not a bad legacy to take with you if you were the driver behind it (and the mourners smiling at your photograph on the crematorium wall instead of glaring at it indignantly!)

Moving away from all this morbidity, let's take a look at the value of integrating into our business life the topic of community engagement as articulated in the link.

You may well be saying this Forbes HR Council article is all very well but I'm not there yet. Alternatively you may be struggling to get things started or have hit a rough patch. Come and talk to us and let's explore the ways and opportunities that may be available to you.

More to the point, let's go far beyond the undertaker's reach with another song, courtesy, Lennon and McCartney, 'I'll get by with a little Help from My Friends !!!!!'

Forget Perfection - Get Something Down!

Unless you're a novelist (or blog-ist!), you'll be wondering what on earth has this topic got to do with running a business. Writers earn their living from using their gifting in the written word to create plots, twists, romance and all sorts of other page-turning tactics. The purpose here is to, not only get their readers to buy their books, but to share their 'take' on a particular tale with other fans of the author. After all, becoming a much talked-about writer is the obvious short cut to fame and fortune (especially if, later on, Netflix come knocking at the door!).

When the writer is impacted by what is known as 'Writer's Block', it's usually because he or she has run out of ideas, creativity or originality and struggles to put pen to paper. This can be de-motivating and, if allowed to fester, will have a negative impact on the writer's standing and, in the longer term, their bank balance.

The condition is so common in the literary world that the famous writer, George Orwell, wrote a novel called, Keep the Aspidistra Flying where the central character struggles to complete a poem about a day in London. It turned out to be too big for him and never really progressed having crumbled into a series of unconnected sub-stories. Now, doesn't that sound familiar when likened to all the different elements of running a small business?

Let's put it into the context of a new year and we're sitting down to articulate that dream plan that is going to bring in the results like we've never seen before. OK, we may be lucky but, chances are, we soon find ourselves stuck, just like the poor old writer staring into the ceiling and waving her pen around in frustration.

One particular literary practitioner's ideas about how the writer might address this is to give himself or herself permission to write rubbish . Yes, you heard it right, rubbish. Otherwise, they're as likely to be only focused on that masterpiece of perfection . Your rubbish may be that dream of a business plan. Whatever, type it into your phone, PC or write it down and put the timer on for 3 minutes using that time to add any other supporting rubbish.

Better still, this can be done in a group where everyone is given permission to go for the rubbish, no different from the time-honoured 'no holds barred' principles in brainstorming. After all it's well known how this can help a business move forward especially when embedded into its decision-making culture.

So what happens next? Despite sounding contradictory, rarely is this type of rubbish actually wasted. The writer's golden rule is to never dump any of your original writing in the WPB as, even though it might not be applicable now, it may come alive in another text later on. Likewise those pieces of rubbish that emerged from your business' brainstorming efforts may be anything but rubbish in another context at another time!

For the moment, however, you've as likely now got a collection of wild ideas and goals. Take each in turn and apply the SMART 'litmus test'. Are they?:

  • Specific

  • Measurable

  • Achievable

  • Relevant

Ted Beecher
BLA Director

Smart Goals & Know Roles

As businesses dealing with a world of constant change, we are now going to take a quick look at a couple of the things we need to embrace in order to remain truly effective. Let's dive into the important subject of goals and roles.

GOALS invariably sit at the top of the list of any good manager; also you'll get the same vibe if you talk to a change practitioner. Not surprisingly, therefore, much has been written about the subject. One of the most popular, well tried and tested theories is presented as the mnemonic, 'SMART'. What it simply tells us is that our goals need to be:

S=Specific
M =Measurable
A= Achievable
R=Relevant
T=Time bound

Here's an excellent link offering more detailed insight into this useful topic; please make sure you have a good read of it!

Moving on, let's ask ourselves about what our ROLE is in all of this? Even if we are a one-person-band, the interactions we have with our stakeholders are critical to the success of our business. So, here's a few pointers:

Networking skills - we need to establish the right contacts both internally and externally to our business, making them feel part of our decision making and goals.

Being champions of good communication, including listening, means we can effectively transmit and receive vital information which is important to our business.

Always foster ENTHUSIASM towards our planning and ideas to encourage participation, motivation and commitment. It also can be fun!

Remember to regularly hone those negotiating skills and other areas where influence is the key to getting things done.

From time to time pull back and then hover, yes, hover! This will give a 'Helicopter Perspective', taking us beyond our immediate focus and thus be able to spot new challenges and opportunities in good time. It also enables us to see what's working and what's not, things that we can easily miss when we get too absorbed in routine 'stuff'.

So there we have it for this week, a brief run-down on goal setting and some of the disciplines that will bring it to life and, in doing so, keep our businesses ahead of the pack!

Ted Beecher
BLA Director



Rising Influence of Stakeholders on Change

Stakeholders can be defined as individuals, groups of people or other organisations that can influence the functioning and success of a small business...

So, who's in charge here?

By now, we should all be in agreement that our small business world is constantly under the influence of change. In the last couple of postings we reviewed our readiness for change and how that can be fuelled by the simple art of asking questions. Let's just park that for a moment and consider exactly where lies our power base. This is really important.

Compared with 30 or 40 years ago, there has been a marked shift of influence within the Australian business community. That influence has diminished the power that a business owner could once wield in the market place. This is due to, not just that power shift towards other stakeholders, but the rise in the number of stakeholders that can impact our businesses, either positively or negatively.

Now, every business is different and, particularly with small or micro-businesses, the stakeholder mix can vary and, in some cases, only include:

  • the business owner

  • his or her customers

  • his or her suppliers of materials and/or services (including admin, accounting etc.).

Of course, that mix can easily change as fast as marketplace operating conditions change. As a result it is always a good idea to keep firmly in the back of our minds a list of other possible stakeholders, such as:

  • Employees

  • Shareholders

  • Competitors

  • Special interest or community groups (especially those who may have concerns over the effect of your business on the environment or the economy)

  • Politicians; Unions

If we look closely at this list it can be seen that stakeholders can represent both internal and external forces for change. In some cases, though, they can be significant forces against change!

And so it is that, when considering people's response to an impending change, we need to use this broad range of stakeholders as our litmus test to assist in determining growth opportunities as well as foreseeing obstacles.

So...

Keep probing, asking questions and, in doing so, continue to strengthen that wall of readiness to help manage the inevitability of change in your workplace.

This is just one way to ensure YOU stay in charge!

Ted Beecher
BLA Director

Are You Ready For Change?

…'If it ain't broke don't fix it'
...'Don't change a winning team'
...'Don't change horses in mid-stream'

How often we see these kind of phrases and, let's face it, they can make pretty sound sense in their own right.

HOWEVER, when small business people like us stick with these WITHOUT taking regular temperature checks in our work and market places, things can come up and bite us (and invariably do when we least expect it!).

So, what should we do? Here's a few basics:

  • Talk regularly to customers in order to keep up to speed with the quality of our products, services and processes. Continually review their needs and draw intelligence from what is really going on their worlds, not just what we think might be.

  • Listen to suppliers on things like the effects of changing market trends or shifting environmental factors. Let's make them feel like we are true and curious stakeholders in their business (and them in ours, of course).

  • The same applies to our staff and, above all, keep them in the loop in an honest and open way. Not only does this engender team work but you never know what they pick up during the day which might have a major impact on the way we run our businesses.

Some people might refer to all this as simply risk management (an important subject for another time!); for others it's a natural default position founded on common sense and a hunger to make their businesses the best in the field.

Whatever we want to call it, one thing we can be sure, it creates READINESS for change. In other words it means we are ever alert; always on the starting blocks just waiting for that gun.

So how ready are you? To get some answers to this, just take a little time out to look at some of the questions you may need to ask yourself first.

Ted Beecher, BLA Director