Sunday, August 28, 2011

Good Managers Show Empathy and Firmness.

"Understand that most problems are a good sign. Problems indicate that progress is being made, wheels are turning, you are moving toward your goals. Beware when you have no problems. Then you've really got a problem...Problems are like landmarks of progress." ~Scott Alexander

Dealing with staff is one of the most difficult things a manager must do. A great manager must have both empathy and firmness. One without the other just will not cut it.

We've been helping a hard-working office manager who had tremendous empathy — so much in fact, that she always tried to find homes for stray animals that wandered into her yard.

Many of this manager's staff continually came in late — always for a good reason, she thought. The staff took her overabundant empathy as weakness and never accepted any of her rulings. They would always come back with an excuse, which she would always buy.

We discovered that her lack of firmness was caused by doubts she had about her ability to lead. As we helped her build her confidence, she became much more comfortable being firm. Amazingly, the staff really seemed to like her transformation as well. They preferred her firmness, since now they knew exactly what was expected of them.

Another manager brought his military background with him to the office, managing his staff like a sergeant in the Army. There was never an exception to the rules, and he had a serious lack of empathy. In fact, he thought empathy was a weakness, and it was a trait he despised in his fellow managers.

If an employee was one minute late, they got a severe tongue lashing in front of the entire staff. Employees hated him, and those who stayed only did so because they needed the job.

In the military, a soldier must follow commands no matter what the situation; but in civilian life, it is not like that. We had to get this manager to see that there is more than one way to manage, and his way was not working.

To show him how his behavior was affecting his staff, we had him listen to interviews with several of them. We had him shadow other managers so he could see how smoothly their departments operated with just a bit of empathy and flexibility.

This very strict manager had to be reacquainted with a feeling that had been forced out of him in the military. We developed several role-play scenarios where he had to show empathy and we evaluated how he did. Through this process he learned what empathy really meant and felt like. His staff could see the subtle changes in him, and their behavior improved, too.

Now go out and make sure that you manage with a balance of both firmness and empathy.

You can do this!

Sunday, August 21, 2011

Mistakes, A Wonderful Teaching Tool

“We made too many wrong mistakes.” ~Yogi Berra

Think for a second about which you learn the most from, success or failure.

In my life, though my successes have been great, I have learned the most from my failures, which incidentally are many. I would venture to guess most people would say the same.

As human beings, it is natural to enjoy success, but these good feelings are fleeting. Mistakes, on the other hand, have a much bigger impact. Their effects tend to stay with us much longer.

A person's success can be five times bigger than their error, but odds are they will remember the error and forget the success. Using this knowledge, we can help our staff overcome their mistakes in a positive way.

Too often, I hear managers and entrepreneurs talking about how they wish their staff would not make mistakes because errors decrease productivity. This may be true, but mistakes also create coaching opportunities, which are invaluable. This was the approach an accounts receivable manager took when one of the clerks misplaced some checks.

Instead of reacting negatively, the manager used the situation as a coaching opportunity. She and the clerk discussed what had happened, the consequences of the error to the business and how the clerk could avoid having it happen again. In doing so, the manager transformed what could have been an extremely demoralizing situation into a very positive experience.

While the clerk felt bad about her mistake, she came through it feeling like her manager was really trying to help her improve.

Many years ago I was working as an outside plant engineer in Tampa. An outside plant engineer designs the cable layout for the telephone company and makes a multitude of decisions to ensure necessary communications. Determining cable size and pole location are just a couple examples.

On one design, I completely underestimated the size of the cable and specified a 200 pair cable when it should have been a 600 pair cable.

Just before the supplies were purchased for the job — which would have cost millions of dollars — my boss caught my error. He chewed me up one side and down the other without stopping for even a second to talk about how this error occurred or how it could be avoided in the future. He thought yelling at me would stop me from making the same mistake again.

He was partially right, I guess. My reaction to this situation was to begin asking for his OK on every decision that could have a major impact. No doubt, this was a nuisance for him, but it kept me out of hot water.

His bullying had a couple of detrimental effects. One, it killed any desire in me to be innovative and original in my thinking. My only concern now was staying out of trouble. And two, it ultimately pushed me to leave the company and start working toward my MBA.

The truth is mistakes are inevitable. You can use them either to tear the employee down or help create a positive learning experience, which is the key to being a great manager and leader.

Now go out and make sure that you approach your staff's mistakes as opportunities to coach them into becoming the best employees they can be.

You can do this!

Sunday, August 14, 2011

The Three Keys to Starting a Successful Business

“Only passions, great passions can elevate the soul to great things.” ~Denis Diderot

I give many speeches every year, and in each one I always include time for questions. By far, the most frequently asked question is what attributes are needed to be successful as an entrepreneur.

After observing more than 3,000 entrepreneurs, I can tell you there are three simple keys to success: passion, purpose and knowledge. Most folks have two of these down, but you really need all three if you are going to be successful.

Passion is the burning force that keeps you going no matter what happens. Many of the entrepreneurs we deal with have cash-flow crises, but they just do not quit. Somehow they find a way to make payroll or pay that bill. Instead of getting discouraged, they just make a commitment to never end up in that situation again.

Entrepreneurs who lack passion are almost guaranteed to fail. I have seen many aspiring business owners start a company because they either got laid off or could not find a job. This is a recipe for certain disaster, because not having another option does not provide the pure and unbridled passion that you must have to be successful.

Passion alone, however, is not sufficient. You must also have purpose to be successful, because purpose is the force that focuses your passion on a specific activity or industry.

Too often, people tell me they want to start a restaurant because they are good cooks. Being passionate about being a great cook is OK, but it is the combination of passion with purpose — serving clients and making money, for instance — that makes for success.

The third piece of the entrepreneur's formula is knowledge. I cannot overstate the importance of knowledge, because this is how you are able to avoid costly mistakes.

There are three critical knowledge areas entrepreneurs must master. First, you must have a great understanding of marketing and feel comfortable promoting yourself and your business. After all, there is no better salesperson for your company than you.

The second is finance. You absolutely must be able to interpret your financial statements and have a clear understanding of the financial ramifications of your decisions.

The third and final element is knowing how to manage people effectively. All businesses need people, and being able to manage those people is a requisite to success. Knowledge takes passion and purpose and transforms that light into a laser beam for your business.

Before you start a business, make sure you have the three attributes that are vital to success: passion, purpose and knowledge. If you are unsure if you have these components, you probably do not, in which case, I would advise you to wait. If, on the other hand, you are sure, now is the time to move ahead.

You can do this!

Sunday, August 7, 2011

Beware of Industry Shifts

“Any change, even a change for the better, is always accompanied by drawbacks and discomforts.” ~Arnold Bennett

The only thing that is truly constant is change. Some entrepreneurs make the incorrect assumption that they can resist change by working harder, but the truth is that if we do not adapt, our business will pay a high price.

In most cases, change in an industry is caused by technology. Take, for example, the complete demise of camera shops and the closing of the Borders franchise. The advent of digital cameras made the services provided by camera stores obsolete, and e-readers are replacing paper books delivering a blow to traditional bookstores. On a related note, with electronic communication becoming the norm, quick-service copy shops are also seeing falling sales.

The emergence of new product delivery methods can cause disruption in an industry as well. A perfect example of this is the frozen yogurt franchise. For a long time, frozen yogurt was served to the customer by a clerk behind a counter and payment was accepted by another clerk located at the other end of the counter. New yogurt stores are now completely self-serve with only one clerk to man the register.

Consider also how much education has changed. We are moving quickly to online classes as a cheaper and more effective alternative to traditional methods of learning.

With all these examples, the important thing to note is that whatever the cause of the change, industry disruptions will always occur. No matter how much we wish they would not, disruptions like these are the rule rather than the exception.

So, we know these disruptions are going to happen, but how do we anticipate them? I think the answer to this question is twofold. First, you must continuously monitor your sales and make sure that you have an early warning system in place to alert you of any significant changes.

Because many changes happen relatively slowly, you will typically have plenty of time to adjust your business. The key is being aware of them and giving yourself the opportunity to respond.

In monitoring your sales, it is important to know that a decline does not necessarily mean an industry shift is occurring. It could just indicate increased competition or lower prices. Whenever you see a change in sales, it is critical that you determine what caused it.

Whatever the cause, declining sales should be vigorously investigated. Are they falling because the firm is inefficient, because there is more competition or because a structural change has taken place? Obviously, we cannot take action to fix sales until the cause of the decline is understood. If, in fact, the cause is an industry shift, the next task is to figure out what other markets you might be able to effectively enter.

The second piece of anticipating change is watching the health of your industry and listening to what others are saying about it. The more you know about what other people are saying and doing, the better off you will be. You should still be cautious though as the “experts” often completely miss the structural changes.

Now go out and make sure that you have a plan in place to recognize falling sales and identify the cause of the decline. If it was caused by a permanent change in your industry, you will need to find other avenues in order to remain competitive.

You can do this.