Friday, March 10, 2017

Strategic Coaching to Accomplish Results

Over the past few years, I have been asked repeatedly why Mead Consulting Group does not promote the coaching we do with CEOs and business leaders. My response has typically been that it is such an overused and “abused” term. We have not wanted to be lumped into the bucket of people who bill themselves as business coaches but who have limited or no real life business experience.
For many years, helping company leaders execute and grow as leaders has been a core part of our DNA. Our entire consulting practice is built around helping companies reach the next level – helping them to get results. Leadership, communication, strategic thinking, setting priorities, motivation, team development, alignment, accountability, and personal development are all part of the process. These are developed by close interaction with our client’s leaders. We refer to it as CEO coaching or strategic coaching, but in truth it usually involves the entire senior team.

A recent conversation with a client brought back to mind my personal situation - when I was thrust into the CEO role by the death of the Founder. My best strategic coach was one of the Board members who took me under his wing. I was 27 and he was 73. He had lived quite a life, from growing and selling businesses to failed partnerships, lawsuits, large acquisitions, employee issues. He had forgotten more than most people ever experience. He was an irascible cuss and didn’t suffer any fools. I was able to leverage his failures and successes. He helped me achieve my goals, and made sure I was prepared for almost any situation that came my way. He was the person who helped me understand the importance of developing and focusing on strategic plans that can actually be executed.

I saw an article a number of years back that listed some reasons why business leaders could benefit from having an experienced strategic coach. Long ago I turned these into my own list – which I will outline below. It is this same focus that our senior consultants bring to every one of our clients.
  • You gain a needed confidante
  • They force you outside your comfort zone
  • You get personal attention from someone who knows your business inside and out.
  • You hear the hard truth - that people inside your company won’t share
  • You get objective, unbiased opinions
  • You learn how to turn your ideas into reality… Or hear why you are chasing too many shiny objects and need to focus
  • You are held accountable for getting important things done – focus on strategic issues not what shade of mauve the office furniture will be.
  • You get exposed to a huge external network
  • You gain confidence in your decisions and actions
If you want more information about how we help CEOs and business leaders continue to grow and accomplish their goals, please contact me.

Tuesday, February 28, 2017

What you didn't know about Mead Consulting might surprise you.


 
 
The Mead Consulting Group has been helping lower middle market companies for many years.We don't toot our own horn...we don't advertise....We let our clients' success speak for us...But there are some things about us that may surprise you.

 Did You Know?
 
We don't put junior people on your projects.  
We've been there before!
 
 
Our senior consultants have been in your shoes and have fought the same battles.
Did You Know?
 
36 years in business
 
 Most people are surprised to learn that we have been in business for 36 years  
and have  
30+ senior consultants focused on helping lower middle market businesses
Did You Know?
 
We work with companies at inflection points
 
We typically engage with companies with revenues of $10M -$250M, but  we have clients that range in size from $5M-$2Billion in size. The common point is that all are at "crossroads."

   
Did You Know? 
 
Our clients have been  
very successful
  
Our clients get results! We focus on the execution of strategic plans and operational improvements 

 Did You Know?
 
We work with companies through all stages of growth
 
> Strategic growth & execution
> Improving profitability & Cash flow 
> M&A and Integration 
> Maximizing Value for Exit
> Generational transition
 

Did You Know?
 The Healthcare market has fundamentally changed!

Our Healthcare and Life Sciences Practice helps companies with market positioning, accelerating market access, market revitalization and reimbursement 
 
 

 Did You Know?
 

We have experience across a number of industries
 
> Industrial
         ---Manufacturing  
         ---Distribution
 
> Business Services
 
 > Software
> Technology   
 
> Healthcare & Life Sciences
 
> Consumer Products 
 
> Education    
 
> Building Products / Specialty Construction
 
Did You Know?


We have helped numerous clients dramatically improve profitability and cash flow
 
 


 
Did You Know?   

We have helped many clients prepare, add value and navigate through successful sales transactions and generational transfer
 
  
Value/Succession/
Exit Planning
 

If you want to move your business from a good business to a great one, contact
Dave Mead at (303) 660-8135 or
meaddp@meadconsultinggroup.com for a free consultation.

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Monday, February 6, 2017

Is it time to start getting prepared to sell?


[Editor's Note: At a recent gathering of business owners and CEOs, the subject of timing to sell came up. One business owner offered that, with the election of Donald Trump, we could expect another 4 to 8 years of economic growth. He said that he was not going to consider selling his business at this time. While I did not counter his argument directly, I suggested that history tells us that in general terms business cycles are politically agnostic - the cycle does not care who is in the White House. I hope you find this article thought-provoking         -dpm]

FACT: History tells us that this economic expansion cannot continue much longer. The last 3 economic expansions in the United States have averaged 7.9 years, the 7 expansions before those averaged 6.2 years. We are currently at 7.8 years in this expansion. While most economists expect 2017 and 2018 to be good years, a few reliable forecasters (and there are only a few economists who are reliable in forecasting) predict that the 2nd half of 2018 may usher in a downturn through 2019-2020. Whether that timing is precise or not, it is highly unlikely that we will see this current economic expansion continue for another 4 years.
Are you thinking you might be selling your business in the next 3-6 years? If so, then you may be surprised by the following: It is time to start the preparation process RIGHT NOW!
Selling a business can be one of the most significant events in the life of an entrepreneur. Not only is there a lot of emotional capital to deal with, but many business owners often have the bulk of their wealth and retirement assets tied up in the value of their business. Sell it for the right price and retirement is fantastic! Sell it for far less than you expect, and retirement may not be retirement at all. Sell it in the right way, and your legacy continues; sell it without forethought and planning, and your employees may be out on the street.
Today's sellers' market may be transformed into a buyers' market. The last few years have been an extraordinary time for sellers. Interest rates make borrowing for buyers inexpensive, and there have been many more buyers on the market than sellers. Competition among buyers for good companies is intense and sales multiples are at record high levels,
What most business owners don't realize is that there is a coming buyer's market for businesses. Here's why: there are a lot of Baby Boomer entrepreneurs who have built great companies and run them for 10, 20, 30 years or more. They are thinking about harvesting their investment and doing something else for a lot of good reasons. Some believe that they have met their financial retirement goals and they can back off, others have just lost enthusiasm, and some, unfortunately, have personal or family issues that preclude them from the continued necessary time and energy investments. Some have been advised that it is risky to have "all of their eggs in one basket", and want to sell a portion of their business to diversify their retirement portfolio. Many, including me, expected this bubble of sellers to occur before now, but with the stock market boom, changes in retirement age expectations, etc., this boom has not disappeared, it has merely shifted. (After all, none of us are getting younger!)
At the same time, the next generation of workers are very entrepreneurially focused themselves. They often want to start their own businesses rather than buy an existing one, even though the risk of failure is much greater. That means there may be fewer interested buyers for your business when you need them most.
Why think about it now? It may take longer than you think. If you plan to sell in several years, you have a lot of time to think about it, right? Not really. Most owners and CEOs of middle market companies may not realize that it can take 3 - 6 years to make the most graceful and profitable exit. At a high-level, the timeline can look something like this:
  1. Prepare the business for sale (18- 36 months)
  2. Locate buyers, negotiate the deal, and execute the transaction (6-12 months)
  3. Owner or CEO commitment to support the transition to new ownership (6 -36 months)
You can always "sell now, as is" if you want, but you may be leaving MILLIONS of dollars on the table by doing so. Preparing your business for sale today means that you will have a lot of flexibility as to when and how you execute the transaction.
Another critical reason to prepare your business for sale is simple: life happens.Any number of unexpected and unfortunate events can disrupt your operations and your plans, and frankly, the older you are, the more likely some of them are to occur. These nasty little possible surprises include:
  • Death,
  • Disability
  • Divorce
  • Dissenting Owners and
  • Declining Markets

On the positive side of the coin, there are any number of wonderful things that might come your way, too, such as:
  • An opportunity to purchase a competitor,
  • A significant offer by a competitor or private equity firm,
  • A great expansion opportunity, or
  • A buyout offer from a partner.
If you are prepared for sale, then your company has a higher value to competitors, partners, private equity firms, and lenders. You will absolutely be in better shape to take advantages of the opportunities that come your way, too.
So here's the bottom line: if you want to sell your business on your terms, then you need to begin right away to run your business to increase its value and develop a business transition strategy.
Preparing your business to be ready for sale. In order to sell quickly and for a great price, you have to have exceptional value. And as with a private home, you will be far better off working ahead to prepare your business for sale.
When you stage a home for sale, you paint the walls, fix the roof, take out half of your stuff, landscape a little, and remove the personal distractions. You work with a real estate agent / broker to sell your home and you get out of the way. The process is disruptive, but hopefully only for a few months.
When you stage a business for sale, the process is dramatically different. You want to present a picture of healthy profitability trending upwards with a management team that will stick around after the sale. You need to communicate with great confidence that the customers and partnership relationships you have spent years developing will transfer to the new owners. And as with selling your home, you need to get out of the way - the new owners need to be convinced that the business will operate smoothly without you.
In summary, the five things that most purchasers look for are:
  • A solid performance history
  • A capable management team
  • A great growth story, including recent steady growth and strategic growth opportunities
  • Consistently improving cash flow and EBITDA
  • A smooth and thoughtful transition plan and no due diligence surprises
Unfortunately, the sales process is often disruptive to the business. Handled poorly, it can take months and you may lose valuable customers, momentum, and employees. The more carefully you plan for the transition, the less time it will take and the more business value and momentum you will maintain.
The Mead Consulting Group has been helping middle market companies for over 20 years to add value and prepare for a successful transition. Our clients have consistently enjoyed better results. Investment bankers have told us that our clients are among the best prepared that they have seen.
If you would like to discuss how we might help your company begin the process of adding value and being better prepared, please contact me. 

Tuesday, January 10, 2017

As Business Owners and CEOs – Are we our own worst enemy?


Editor’s Note: In our work with middle market companies, we focus on identifying the barriers and obstacles to growth to the next level that that companies can build over time. In a 2016 book, The Founder’s Mentality¹, authors Chris Zook and James Allen identify that when companies “fail to achieve their growth targets, 90 percent of the time the root causes are internal, not external. These include increasing distance from the front lines, loss of accountability, and proliferating levels of processes and bureaucracy, to name only a few. What's more, companies experience a set of predictable internal crises, at predictable stages, as they grow.” As we look at 2017, perhaps we can all benefit from some self-examination. I hope you find this article helpful.         - dpm]
As Business Owners and CEOs – Are we our own worst enemy?
Many times we are our own worst enemy. This is certainly true when it comes to companies failing to grow and thrive. As referenced above, 90% of the root causes that impede company growth are internal. For many years, our consulting business has begun virtually every assignment with a scan of the company to identify barriers and impediments to growth to the next level and recommendations to overcome these barriers. As we identified in a recent article, “Are your Strategic Planning Efforts Doomed to Failure before You Start” the following are some of the typical barriers:
Barriers to Planning Success
  • History of only partially developing plans
  • History of unreasonable expectations and unachievable goals 
  • Lack of internal understanding about customers, competitors, and the market

In addition to barriers to planning, company teams have a lack of confidence and skepticism about their ability to execute plans. This could come from a company history of abandoning projects, a history of unclear objectives and metrics, too many strategies and plans, a history of poor communication, a history of poor delegation and leadership, gaps in management capability, or a lack of true accountability.

Barriers to Execution Success
  •  Gaps in management depth
  • History of abandoning projects
  • History of lack of openness and poor communications
  •  History of poor delegation and leadership development
  • Lack of true accountability

Organizations that have barriers to planning and execution have one characteristic in common: there is little or no connection between the plans they create and management behavior around execution. Most management teams quickly get swept away with the urgency of the day-to-day business and the plan is forgotten.

In the book, The Founder’s Mentality, the authors identify three crisis points experienced by companies:
1.       Overload. The first crisis, overload, refers to the internal dysfunction and loss of external momentum that management teams of young, fast-growing companies experience as they try to scale their businesses.
2.       Stall –out. The second crisis, stall-out, refers to the sudden slowdown that many successful companies suffer as their growth gives rise to layers of organizational complexity and dilutes the clear mission that once gave the company its focus and energy. Stall-out is a disorienting time for a company: the accelerator pedal of growth no longer responds as it used to, and faster competitors begin to gain ground. Most companies that stall out never fully recover. 
3.       Free Fall. The third crisis, free fall, is the most threatening. A company in free fall has completely stopped growing in its core market, and its business model, until recently the reason for its success, suddenly no longer seems viable. The management team often feels it has lost control. It can’t identify the root causes of the crisis, and it doesn’t know what levers to pull to escape it.

The authors go on to describe characteristics of Founders that need to be maintained and encouraged if companies are to continue to be successful:  
1.       Insurgent mission - Founders have the focus of waging war on behalf of under-served customers, or redefining the rules of an industry, or creating a new industry.  If that passion wanes within the company, or the mission becomes unfocused, employees will no longer be operating on the same page.
2.       Owner’s mindset – Founders have an aversion to bureaucracy, a bias for action and a strong cost focus. Their teams tend to feel and act like owners, treating expenses and investments like their own money. Analysis paralysis, multiple levels of decision-making, risk averse and slow to act companies begin to wither as they miss opportunities. Managers and employees who are just getting through the day or picking up a paycheck will slowly suck the life out of a company.
3.       Front line obsession – Founders are obsessed about their customers, always wanting to learn more about their changing needs, making certain that they are well-served. Founders are obsessed about the front-line employees, making certain that they have what they need to be successful providing the best product and serving the customer. When decisions are made at corporate levels with managers who are removed from customers and front-line employees, bad things happen.

As you begin the new year, I would suggest that every business owner or CEO could benefit from reading this book and take stock of what is going on in your company. Does your company have the characteristics of a Founder’s mentality?
If you would like to discuss how to identify and overcome the barriers to successful growth, please contact me.

¹ “The Founder’s Mentality: How to Overcome the Predictable Crises of Growth” by Chris Zook & James Allen, 2016

Tuesday, December 13, 2016

Too Many Shiny Objects and the "Not Going to Do Now" List

[Editor's Note: As we have worked with companies over the years, one characteristic we have noted about successful companies is the ability to prioritize and focus. Many companies have a seemingly endless list of opportunities; the question is "what do we focus scarce resources on first." I hope you find this article thought-provoking. - dpm]
Too Many Shiny Objects and the "Not Going to Do Now" List
On a number of occasions, we have come into new client situations to "validate" an existing strategic planning process. In many instances, we find that the company has documented strategies and initiatives too numerous to fit on an 11X14 sheet of paper - with small font size! We then proceed to ask each of the managers which is the most important strategy or initiative for the coming year. Not surprisingly each manager has a different idea of what is most important.
Too many opportunities... Too little focus
These are not companies without opportunities. To the contrary, these are typically companies with compelling products and services. The problem stems from too many opportunities without an appropriate filtering or prioritizing process. Sometimes, it stems from a creative/innovative Founder or CEO who can see potential technologies, products, services, markets, partnerships, etc. everywhere. In the race to not miss out on these possibilities, the Founder /CEO can push the organization in many different directions. This behavior is so common that it has been coined the "Shiny Object Syndrome." In these situations, the organization pursues many different opportunities, executes poorly, distracts management attention, and in many cases, abandons projects partially completed in order to pursue new ones. Resources are wasted, time is sacrificed, and most importantly, attention is diverted away from core activities.

The "Not Going to Do Now" List
In determining strategic direction for a business, it is far easier to decide what you are going to do, than what you are not going to pursue now. The most important tool is the "Not Going to Do Now" list, which outlines projects, initiatives, strategies, acquisitions, etc. that might be interesting to explore at some time in the future, but are distractions to the current strategic direction. During the planning process, items are added to this list. The management team agrees that in order for the organization to pursue an item on the "Not Going to Do Now" list, something must be come off the current strategic planning list.

Prioritize
There are a number of techniques to use in prioritizing. Some companies use the following categories to further delineate priorities. Items noted as "Critical" are the focus of the business. Once these have been completed, the "Need to Have" category items are next in priority. It is interesting to note that companies that use this approach rarely get to the "Nice to Have" items, and almost never get to the "Can Be Deferred" items.


Critical


Need to Have


Can be Deferred


Nice to Have
    
Alignment around the Critical Strategies
It is our belief that most companies should identify no more than three strategies. Companies that execute well on two of the three strategies are usually very successful. The key to success is focusing on a limited number of strategies, communicating the direction, aligning the team and incentives around those strategies, establishing solid action plans and metrics, and holding members of the team accountable for results.

Simple to identify...More difficult to do
Like most things in business, Identifying the "to do" strategies and the "Not to do" List is easy to describe and more difficult to achieve. We spend most of our time working with businesses to help them narrow strategies to ones they can execute well, focusing and aligning the team, monitoring the progress, and adjusting course as necessary.

If you would like to discuss this in more detail, please contact me.

Tuesday, November 29, 2016

Are Your Strategic Planning Efforts Doomed To Failure Before You Start?


Are Your Strategic Planning Efforts Doomed To Failure Before You Start?

It’s December. Your plans for 2017 should be in place. Some organizations are scrambling to get strategic and financial plans in place before the new year. There is still time to get it right in 2017.

Before you have that deep sigh of resignation, ask yourself a few questions:
·         Does your company’s planning process ever yield real results?
·         Do you go through a long, tedious process year after year that you and your managers dread?
·         Are there barriers in your organization that now protect the status quo and prevent you from moving forward?

Perhaps the approach is flawed!
Years of either poor planning or no planning have created unintended consequences for many organizations. These organizations unintentionally have created barriers that prevent them from developing and executing a meaningful plan. It could be because of a history of unreasonable expectations and unachievable goals, a history of abandoned projects, or a lack of internal knowledge and understanding about customers, competitors, and the market.

Barriers to Planning Success
·         History of only partially developing plan
·         History of unreasonable expectations and unachievable goals
·         Lack of internal understanding about customers , competitors, and the market

In addition to barriers to planning, company teams have a lack of confidence and skepticism about their ability to execute plans. This could come from a company history of abandoning projects, a history of unclear objectives and metrics, too many strategies and plans, a history of poor communication, a history of poor delegation and leadership, gaps in management capability, or a lack of true accountability.

Barriers to Execution Success
·         Gaps in management depth
·         History of abandoning projects
·         History of lack of openness and poor communications
·         History of poor delegation and leadership development
·         Lack of true accountability

Organizations that have barriers to planning and execution have one characteristic in common: there is little or no connection between the plans they create and management behavior around execution. Most management teams quickly get swept away with the urgency of the day-to-day business and the plan is forgotten.

So what can you do to change this counterproductive cycle? Try a better approach!

Consider the following before you start
·         Examine past strategic planning and execution efforts
·         Identify the organizational barriers to success – Develop plans to fix these barriers
·         Use a new and flexible approach to strategic planning
·         Less is more – Better to have three strategies with great focus than seven with poor focus
·         Realistic and achievable – Unachievable goals end in frustration and abandonment
·         Validate plans with the market – make certain you understand how customers and competitors will react to your plans
·         Break into small bites with near-term actions – build momentum by getting some early
Successes
·         Create 90-day action plans, recheck, and re-evaluate
·         Clear and Understandable – to everyone in the organization
·         Communicate, Communicate, Communicate
·         Metrics – develop quantifiable measurements of progress
·         Track the progress– regular monitoring and adjustment
·         Adjust and Recalibrate

Understanding the barriers to planning and execution is critical. Companies that have addressed the barriers are amazed at how much more their management teams are engaged and how the process energizes the entire organization. CEOs of companies with years of poor planning and execution history find that their organizations are far more capable than they ever imagined of achieving superior results.