Thursday, January 9, 2020

Leadership, Communication and Mister Rogers

Leadership, Communication and Mister Rogers

[Editor's Note: Happy New Year! I went to see "It's a Beautiful Day in the Neighborhood" (Mister Rogers) over the holidays. I would heartily recommend it as an uplifting and thought-provoking start to the new year. It reminded me of an article we have shared previously about Mister Rogers and leadership, and communication. Some of the most important points about what made Fred Rogers such a great communicator:
  1. Be present
  2. Be curious and interested
  3. Be direct, open, and honest
  4. Be compassionate
  5. As Mister Rogers said..."If you can mention it, you can manage it" 
Many of you may be faced or will be facing difficult decisions about how and what information to share with your managers and employees. The following article may seem to some to be an unusual addition to our collection, but it has a poignant message for CEOs and business owners from that renowned management guru, Mister Rogers. Simple, direct, honest and open communication is always best. Even if you can't fix it, explain it. I once asked my then toddler daughter why she liked to watch Mister Rogers. She replied, "Because he talks to me, Daddy."
This following article, when we first shared it in 2003, evoked a visceral response and had the highest reader response rate of any other single Issues for Growth e-letter. February 19th marks the 52nd anniversary of the debut of Mr. Roger's Neighborhood. Somehow, in today's world, when we need direct, honest, open communication, it seems like a great time to republish this.                                                                                           -dpm]

He Was Not Afraid of the Dark¹
If you remember Mister Rogers as being as warm, fuzzy and innocuous as a cardigan sweater, then you did not really know Mister Rogers. It is true that Mister Rogers' Neighborhood was an island of tranquility in a children's mediasphere of robots and antic sponges. And in real life, Fred Rogers, who died last week of stomach cancer at age 74, was evidently as sweet and mild mannered as the kindly neighbor he played on TV. An ordained Presbyterian minister, he didn't smoke, drink or eat meat, prayed every day and went to bed by 9:30 each night. To cynics and parodists, Mister Rogers' Neighborhood was a namby-pamby zone of pint-size feel-goodism, and Mister Rogers himself a wimpy Stuart Smalley for tots.
But part of what made Mister Rogers' Neighborhood great and unique is that, for all its beautiful days in the neighborhood, it was also the darkest work of popular culture made for preschoolers since perhaps the Brothers Grimm. Mister Rogers was softer than anyone else in children's TV because so many of the messages he had to impart were harder. That your parents might someday decide not to live together anymore. That dogs and guppies and people all someday will die. That sometimes you will feel ashamed and other times you will be so mad you will want to bite someone. He even calmed fears that may seem silly but to a child are real and consuming - like being afraid to take a bath because you might be sucked down the pipes. Mister Rogers gently sang, "You can never go down/Can never go down/Can never go down the drain."
In other words, Fred Rogers knew that childhood, which we mis-remember as carefree and innocent, is a time of roiling passions, anguish and terror.
His show, the first version of which debuted in 1963, was his professional way of doing what he had done as a boy in Latrobe, Pa., when he played with puppets to calm himself after hearing scary news reports. And perhaps one reason his death touched adults so deeply is the feeling that Mister Rogers left us when we could especially use someone to teach us to manage our children's fears, and our own.
The last original episode of Mister Rogers' Neighborhood aired on Aug. 31, 2001 - a scant 11 days before we needed him to explain the biggest Big Inexplicable yet. He returned to tape public-service announcements on how to talk to kids about the Sept. 11 anniversary, but the anxiety has only built since then. War jitters, a polarized country and world, and misinformation everywhere, have rendered literal our most childlike, monsters-under-the-bed fears: that a tall building can collapse like a house of cards, that something bad can seep in ghostlike through your window and hurt you. ...
... We relied on Mister Rogers to explain death and hurt and sadness, not to eradicate them. All of us, including CEOs, business owners and senior executives, might take a few lessons from Mister Rogers. For instance, that an explanation of a bad thing is only reassuring if it is straightforward and direct. Mister Rogers spoke softly, but he never soft-pedaled. And he knew how to be both compassionate and authoritative. He was "Mister" Rogers, after all, never "Fred." He wore a tie even when he dressed down. He also respected children's intelligence, and while he used the Land of Make-Believe to teach lessons, he never puffed up kids with false promises and fantasy. There is no more un-Disneyfied sentiment in children's pop culture than the title of his song "Wishes Don't Make Things Come True."
The PBS' website offered tips for helping children cope with Fred Rogers' death. "You may be surprised," it said, "(as adults) to find that you're more upset than your child." But that should surprise no one. Kids, after all, have hundreds of Mister Rogers' Neighborhood reruns to help them through their spooky moments (Check out YouTube). But who is out there today, in any neighborhood, to reassure grownups that we can never go down the drain?
¹ In a nervous age of orange alerts, who will take the place of Mister Rogers?
By James Poniewozik Monday, Mar. 03, 2003 Time Online Edition

Tuesday, November 12, 2019

Mentor Colorado

Make a Difference for Colorado's Kids

Right now, 1 in 3 children and adolescents will grow-up without a mentor of any kind, yet we know that young people who have a mentor are much more likely to participate in after-school activities, be leaders in clubs and teams, volunteer and go on to college. 

According to a recent report from the CDC, a trusted adult also helps mitigate the effects of childhood trauma.

MENTOR Colorado is increasing capacity to provide quality mentoring relationships to the more than 1.6 million young people in Colorado who lack a positive caring role model we know they need!

Dec. 10 is Colorado Gives Day, a day where thousands of Coloradans 
will support local nonprofits. 

Make an impact on Colorado’s youth by supporting MENTOR Colorado and your local mentoring agency!

Monday, October 7, 2019

Common misconceptions about selling a business

[Editor's Note:  I recently spoke to a group of business owners and CEOs about preparing businesses to maximize the value of the business in a transaction. I was surprised by how many misconceptions the group had about the process. I decided to publish this article again. I hope you find it useful.      -dpm]

I know the buyer - they are in my industry
Many business owners think they already know the prospective buyers - from their industry.  However, in many cases where a sales process is conducted by an investment banker, an "outlier" (either a strategic or financial buyer) surfaces with an offer significantly higher than from those you may know. Many times these come from outside your industry.

The market will be better next year
Procrastination can cost you. Sellers in 1999 or 2007 will tell you that they wished they had sold while the market was hot.

I don't want to sell until I have to (Dismal D's)
You want to sell when your business is healthy and when you don't have to sell. Life can take cruel twists and turns. Business owners without a plan can find themselves subject to the "Dismal D's" - Death, Disability, Divorce, Dissenting Owners, Declining market, Debt overload, or just pure burnout. It is hard work to sell your business. You'll need plenty of energy and motivation to maintain performance during the sales process.

The investment banker or M and A firm will build value.
No they won't - that's not their job! A good investment banker can help you yield value, attract a broader market of potential buyers and get a deal closed, but they don't have the skills or background to build value.  Some small M and A firms will offer services and advice in order to get your transactional business, but these are either very young, inexperienced associates or people who have not really run a business. They are very good at selling your business, but what they don't know can hurt you.

My lawyer (or CPA) (or Wealth Manager) will help me find a buyer
Finding a buyer is very different than finding the best buyer, the right buyer.  Investment bankers do this every day. Most professionals understand what they do well....and what they don't.  Find the right tool for the job!

I met a guy in my CEO peer group / My investors know a banking firm
Selling your business may be your most important business decision. Get help in making an informed decision about selecting an investment banker or other professionals. Learn about possible (but undisclosed) conflicts of interest, differences between firms, level of expertise that will work on your company, etc.  Have you checked with previous clients that were both successful and unsuccessful? Mead Consulting clients use a checklist of questions and we coach them so that they make the appropriate choice and the best fit for their business.

It only takes 6 months to exit a business
Nothing could be further from the truth. In order to realize the maximum value it may take you 1-2 years to prepare the business, 6 -12 months to do the transaction, and then you may have to remain for 3 more years with the company after the sale. Rushing a company to market without proper preparation will cost you as buyers will discount values for companies without an adequate strategic growth plan, strong management, or a clean review of due diligence issues. We call those issues that pop up during due diligence as "gotcha's".

Selling will only take some of my time
The biggest mistake business owners can make is to allow business performance to slip during a sales process. The primary reason for deals to either fall apart - or become heavily discounted - is because of deterioration of revenue and earnings. Business owners can dramatically underestimate the amount of time and energy it will take to both sell the business and maintain performance during the process.

Even if you are not planning to sell soon, the process of maximizing value will lead to a more profitable - and therefore more valuable - business.

The Mead Consulting Group helps business owners navigate through a successful sales process, including preparation, selection of the team (investment bankers, transaction attorneys, tax counsel, etc.), and the sale process itself. We focus on maximizing value and leverage the business owner's and management's time so that they can focus on maintaining business performance. Contact us for more information.

Tuesday, September 3, 2019

Benefits of a Strategic Business Coach - Someone who has been in your shoes

Benefits of a Strategic Business Coach
(Someone who has been in your shoes)

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 the term “Coach” is much overused and “abused.” 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 and his incredible perspective. 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.

Benefits of a Strategic Business Coach
  • You gain a needed confidante
  • Strategic Business coaches force you outside your comfort zone
  • You get personal attention from someone who knows your business.
  • 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.

Monday, September 2, 2019

Strategic Plan Execution: Keys to Making It Happen

At an initial strategic planning kick-off session for a client company, the senior vice president of marketing spoke up: "I've been through these strategic planning processes before at other companies. Over the course of three months, our management team spent several days together, we put together a fantastic looking plan, then it sat on the shelf and it was never looked at again."

 I looked the seasoned executive in the eye and offered this challenge: "It's obvious to me that the CEO and management team at those companies may never have been truly committed to executing the strategic plan in the first place."

 "Oh, but we were!" he replied. "We just never converted the great strategic dialogue and consensus into strategic actions. Then we got so buried in our day-to-day duties that we never took the time to focus on executing the plan."
A good plan well executed is better than an excellent plan poorly executed.
The point is clear. To receive value for the time and money invested in strategic planning, you must employ a well-defined continuous process, execute strategic actions and routinely update and refresh your plan.
Seven key checkpoints
The key to securing this value is a CEO and executive team disciplined enough to ensure that the organization stays focused on plan execution. Value exists in the strategic process of analyzing current strategic direction and determining future strategic focus. However, this value is greatly reduced without commitment and focus to implement the plan.
Seven key checkpoints can ensure that you place adequate focus on strategic plan execution during the planning and development process.
1. CEO commitment from the outset
The first checkpoint: determine whether the CEO and management team are truly committed not only to developing the strategic plan, but also focusing resources on executing the strategic plan. Commitment to execution is particularly challenging for entrepreneurial-minded CEOs of closely held companies who tend to be very opportunistic. These CEOs often view the strategic plan process as limiting their ability to "jump at good opportunities." In other cases, significant company-based barriers and issues may exist that must be resolved before the CEO and management team can focus on strategic plan development and execution. Regardless, it's critical at the outset that the organization challenge itself to ensure that it is truly committed to strategic plan execution and follow-through.
2. Overcome the Barriers to Planning and Execution
Every organization has barriers that are built over time that prevent or limit their success with strategic planning and execution. These barriers include such things as a history of unreasonable objectives and unachievable goals, too many strategies, lack of management depth, lack of delegation and accountability, etc. (See the Mead Group eLetter -  Are Your Strategic Planning Efforts Doomed To Failure Before You Start
 Unless these barriers are overcome BEFORE an organization proceeds, it will be disappointed with the results.
3. Fewer, but better-defined strategies
Many CEO's want to take on more than the organization can absorb. Remember, a few key strategies well-executed are better than many initiatives that overwhelm your organization. This is a tough job for the CEO. It's easy to identify many strategies or initiatives that the organization should pursue. It's difficult to prioritize the three or four most important ones and remove the others from the company's plate.
4. Validate your plans with the market
Just because you decide on a sexy new strategy does not necessarily mean that your company can be successful implementing it. It is important that you understand how customers and prospects perceive your company and that you have an honest appraisal of your strengths, weaknesses, and core competencies. Suppose the strategic planning team at Kmart were to decide to that they needed to adopt a strategy to become a high price/high service retailer like Nordstrom. Do you really think the market would accept that from Kmart?
5. Translating strategic direction to strategic action plans
Before preparing to facilitate the strategic planning process, strategic planners often ask CEOs to produce a copy of their most recent strategic plan. Usually, a direct correlation exists between how long it took the CEO to find the document and whether the strategic plan included clearly defined strategic action steps.
Many strategic plans assess the current company situation, market, industry and competitive environment. These plans may also provide a clear strategic framework for the company. However, they often fall short in translating defined strategic direction into strategic actions. Without clear strategic actions that identify who's responsible, deadlines, strategic plan execution and follow-through, it will be difficult, if not impossible, to achieve your goals.
6. Implementing a process for strategic plan follow-up and execution
More sophisticated organizations may implement integrated strategic execution processes. For example, the "Balanced Scorecard Approach" builds the strategic plan around key business success drivers. It links measurable corporate and business unit goals and related strategies with the performance management system. And it builds regular plan execution reporting into the process. However, many companies don't have the resources to develop and implement an integrated approach. If you fall into this group, consider the following options:
  • Hold quarterly planning update sessions to review status against plan.
  •  At key manager or board meetings, create a standard agenda item that requires some discussion/review of the strategic plan.
  •  Report and update employees on major elements of the strategic plan. A commitment to employee communication will keep execution of strategic initiatives top-of-mind with the management team.
  •  Assign a key member of the planning team to help the CEO keep execution of strategic initiatives foremost on the management team's "to do list."
  • Create opportunities through strategic assessment tools that force the organization to periodically review results and performance against key strategic objectives (e.g., benchmarking, customer satisfaction surveys, etc.).
 7. Allow sufficient time for the process
Successful companies begin the process in June and July for the January 1st new fiscal year. It takes time to overcome barriers to success, identify the best key strategies, develop clear and detailed action plans, assign accountability, gain organization buy-in, and integrate into next year's budget and business plan. However, some companies can compress the schedule and conduct the process in the fall. It's better to start a bit later than not to do anything.
A valuable asset to any organization
A continual strategic planning process can be tremendously valuable to any organization. However, its ultimate value is significantly reduced if there's a lack of commitment and focus on implementing the plan. Make certain that you can execute your plans in order to get the real benefits.   

Contact us at Mead Consulting for more information.

Monday, July 15, 2019

Prepare your company to be bought

Editor's Note: Over the last three years, several of our clients received unexpected offers to sell their businesses. Because they were prepared, they held the line and the prospective acquirers significantly bid up the offers to a range that the owners decided they could not refuse. Two of them closed in 60 days. Two companies decided to run a competitive process and generated exceptional interest from additional buyers. This is still a sellers' market. Well-prepared companies are receiving very high selling prices.

Many business owners fail to prepare their businesses for a sale either because they believe that a potential sale is far off in the future or because they are focused on current issues and do not consider preparation to be a priority. We would submit that companies need to be "prepared to be bought." Sometimes lucrative offers come unexpectedly for companies that are well-positioned. We typically recommend that a company engage an experienced investment banker to assist them in a sale - often even if they have received an offer - in order to generate a competitive environment.

Some business owners who have tried to "time the market" at some point off in the future have found that unpredictable events such as the 2007-2012 recession, credit and stock market crunches, tech bust(s), 9/11, industry issues, etc. can derail their ability to sell at maximum value. We recommend to our clients to work each year to make certain that their companies are currently desirable to buyers.      - dpm]

How best to position a company to be attractive to buyers:
1.   Demonstrate Strong Financial Performance
   a. Historical Financials
Consistent revenue growth (at least upward trend)
  • Recurring revenue is a plus
  • Strong operating margins
  • Increasing profitability
  • Importance of last twelve months
  b. Operating Cash Flow
  • Focus on hitting projected revenue and earnings numbers
  • Review net profitability of customers and products
 2.    Maintain "clean" financials

  a. Audited or "auditable" Financial Statements
  • Have your financial statements audited with a reputable firm to add credibility
  • Use GAAP accounting. If not, identify how practices differ from GAAP
  • Understand cash vs. accrual accounting - timing differences can be material
   b. Income Statement Adjustments and "Add-backs"
  • Buyers are skeptical of earnings that rely on substantial add-backs (one-time, non-recurring charges, private company expenses, etc.)
 3.    Diversify your customer & supplier base
  • Diversification signifies a healthy business and reduces risk
  • Buyers will pay less for companies dominated by one or two customers
  • Examine what % of sales your top 10 customers represent?
  • How stable are your top suppliers? How stable are their terms?
  • Do you have multiple suppliers for critical components/services?
  • What % of total purchases does your top supplier represent? Top-5 combined?
  • What % of the company's sales are related to a few key employees?
4.    Develop a Strategic Growth Plan
  • Maintain a clear strategy and be able to demonstrate your history of execution
  • Be able to articulate specific future growth opportunities
  • Position your company to take advantage of them
 5.    Build a capable Management Team
  • Invest in training and key strategic hires, if needed
  • Motivate management to add value to the company through a potential sale
  • Focus on building a deep management team that can thrive without your continued leadership
 6.    Eliminate potential "Gotchas"(these are items that could result in significant discounts to value)
  • Maintain legal documentation (licenses, regulatory filings, contracts, intellectual property, incorporation, etc.)
  • Clear title to all assets
  • Document processes and procedures
  • Resolve legal disputes
 7.    Build a team of Qualified Advisors 
  • Minimize distractions from running your business effectively
  • Get advice from professionals who have expertise in areas you do not and have done it before
  • Beware of advisors that outstep their areas of expertise 
Are you and your company ready if a buyer appeared on the radar?
Most business owners who have executed a successful sale of their business will tell you the most important thing is: BE PREPARED.
Selling a business is very different than operating a business. As a business owner you know your industry, your product or service, your customers and your markets. Most business owners will only sell a business once in their lifetimes - and it can be by far the most important financial transaction of their lifetime.
The Mead Consulting Group  has been helping clients develop and execute Strategic Growth& Execution plans for many years. We focus on helping companies "prepare to be bought." Check out our website for descriptions of some client success stories.
If you would like to discuss how we might help your company begin the process, please contact us for a free consultation.
 What are your thoughts? Is your company as prepared as it should be?

Monday, July 8, 2019

Abundance vs. Scarcity Mindset. Which do you have?

Editor's Note: What kind of Leader or Team Member are you? In many cases it comes down to whether you have an "abundance" or "scarcity" mindset.  I thought these two graphics might be good for each of us to ponder.  -dpm]

Abundance vs. Scarcity Mindset. Which do you have?

Collaborator or "Smartest person in the room"; Embrace Change  or Fear Change; Seek the credit or Share the credit; Horde information or Share information. Whether you are building a team or a company, which traits/attributes do you want in yourself and others? The best organizations do not tolerate "scarcity mindsets" - they sap the energy and votality out of an oranization.

Individuals and Team Members

What are your thoughts?