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
Leaders

What are your thoughts? 

The Need for Focus

Over the years we have found that the strategic planning processes for companies in the middle market vary widely and some are counterproductive. There are some common issues that are listed in this article. Do you recognize any of them? 
Too many strategies and initiatives
Often we see plans that have numerous strategies and initiatives. In one $60M revenue company, there were 17 major initiatives and strategies - so many that all of them couldn't be listed on an 11x14 sheet. When we asked the senior managers to list the top 3 priorities, we got a different answer from each of the managers. An organization can't tackle that many priorities at once. Not surprisingly, this organization had a history of not completing projects. 

Shiny Rocks - moving quickly from one idea to another                              
Sometimes the CEO has one great idea after another and overwhelms the team by abandoning one strategy or initiative to move to another. In these companies, strategies are never fully executed. There becomes a tendency for employees to just duck their heads down and wait for the current "new project" to blow over. There is little commitment to the "strategy du jour." These companies have flurries of activity, yet few accomplishments.  

No "what we are not going to do now" list
As important to narrow the focus of a company's strategic priorities, it is important to develop of list of things that the organization won't do. This is the most difficult task for companies. No one wants to move worthy projects or initiatives to this list. However, if an organization is to accomplish the top priorities, the others must be tabled - at least for the current cycle.  

No agreement on the priorities  
In some organizations, the plans are developed but there is no agreement among key functions and managers about the priorities. These organizations fail to mobilize to necessary resources to execute well.

Developing strategies that the organization cannot execute well
Many organizations develop strategies that either the market won't accept, or that the company does not have - nor can get - the resources or talent required to execute. I tell a story (somewhat tongue in cheek) about a mythical meeting at Kmart where some manager recommends a strategy to emulate the Nordstrom model. No matter how much money is spent, there is no way the market will accept Kmart adopting a Nordstrom model.

The Power of three 
We believe that for lower middle market companies, there should be no more than three major strategies undertaken in a planning cycle. When companies execute two of these strategies +well, they will be very successful.
The Mead Consulting Group has been helping clients develop and execute Strategic Growth& Execution plans for many years. 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 of adding value and moving your company to the next level of performance, please contact us for a free consultation.

 What are your thoughts? Is your company as focused as it should be?

Wednesday, June 5, 2019

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

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



It's June. Your plans for 2019 should be well on their way. Many organizations are beginning the process to think and plan strategies for 2020 and beyond. 
What about your organization? Are you floating up with the rising tide that floats all boats? What will happen when the tide changes? 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 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.

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
  • Make sure plans and metrics are aligned up and down the organization
  • 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.


The Mead Consulting Group has helped many companies identify and overcome the barriers to successful planning and execution. Our process is simple and effective at uncovering the key obstacles and barriers and developing recommendations for improvement. If you would like to have a conversation about this, please contact Dave Mead

Friday, March 29, 2019

One Fix for All That's Wrong: Better Managers

[Editor's Note:  When I read this article in The Wall Street Journal, I was struck by how relevant it is to many of the questions and issues facing companies today. It also should cause us to ask two questions: 1)How effective are our managers at "infecting their teams with a sense of purpose and function." and 2) How effective am I at "infecting my team with a sense of purpose and function." I hope you find the article thought-provoking.  -dpm]

One Fix for All That's Wrong: Better Managers

This article by Sam Walker appeared in the March 23, 2019, print edition of The Wall Street Journal 


In 2018, the U.S. economy benefited from historically low unemployment, brisk spending, an aggressive tax stimulus and hordes of game-changing advancements in technology. This singular combination of tailwinds yielded a growth rate of 2.9%.
That's not terrible, especially compared with many wheezing economies abroad, but it's not even in the ballpark of historic highs.
For the better part of three decades, economists have worn out their chalkboards trying to map a path back to the glory days of 7% growth. So far, the only point they agree on is that we must be doing something wrong.
If it's a superior team you're after, hiring the right manager is nearly three-fourths of the battle. Here's a crazy idea: What if it's something simple? What if companies could fix the problem by hiring better middle managers? Five years ago, the Gallup organization embarked on one of the most ambitious deep dives it has ever conducted; an analysis of the future of work based on a decade of input from nearly 2 million employees and more than 300,000 business units. The results confirmed something Gallup had seen before: a company's productivity depends, to a high degree, on the quality of its managers.
What no one saw coming, however, was the sheer size of that correlation-something Gallup calls "the single most profound, distinct and clarifying finding" in its 80-year history. The study showed that managers didn't just influence the results their teams achieved, they explained a full 70% of the variance. In other words, if it's a superior team you're after, hiring the right manager is nearly three-fourths of the battle.
No other single factor, from compensation levels to the perception of senior leadership, even came close. "That blew me out of my chair," says Jim Clifton, Gallup's chief executive.
The study's conclusions, laid out in Gallup's forthcoming bookIt's the Manager, struck a particular chord with me. I, too, had exhaustively studied teams-although my subjects were the top dynasties in sports. I'd reached a similar conclusion: The overwhelming driver for sustained excellence in sports was another kind of middle manager, the team captain.
Only a third of employees in the U.S.are highly engaged. Gallup's favorite metric for rating business teams is "engagement," or a belief among employees that they're doing meaningful work in a climate that supports personal growth and development. Gallup and others have shown, over many years, that highly engaged teams have significantly lower turnover and higher productivity and profitability, among other things. 
Roughly a third of employees in the U.S. are highly engaged, Gallup found, but inside successful businesses that figure can run north of 68%. It's not surprising that many companies have started measuring internal engagement and tinkering with new perks and initiatives to juice their scores.
Gallup's deep dive reconfirmed all of this, but it also pointed to something many companies don't fully appreciate: why engagement is so important.
In previous decades, when Gallup asked people to order their priorities, they ranked family, having children, owning a home and living in peace above having a good job. Starting in 2002, around the time millions of people started comparing their lives on social media, the order shifted. Today, Gallup found, having a rewarding job ranks first.
Put simply, having a great job means having a great life.
This finding, which Gallup's Mr. Clifton calls "seismic," suggests that some portion of the vast number of people who feel disengaged at work experience an inspiration gap. While many jobs haven't changed, the expectations we bring to them have metastasized. The wider that chasm becomes, the unhappier we are.
In theory, then, a shortage of good jobs and inspiring bosses might explain why some companies struggle to recruit and retain purpose-driven millennials. It could also explain why lavish perks don't always produce the desired effect on worker engagement.
It's also conceivable that this inspiration deficit helps explain America's stubbornly stagnant levels of worker productivity and, if you game it out, why the economy isn't growing faster.

There are human consequences of feeling unfulfilled at work.To state the obvious, dreadful bosses are not the sole barrier to growth. In this newspaper, we've explored the shortage of bold, innovative ideas and a lack of genuinely transformative business models. Some theorists say the gains promised by radical innovation haven't kicked in yet because the technology is still too costly and complex for many businesses to adopt. Nevertheless, those explanations don't address the emotional, illogical human consequences of feeling unfulfilled at work. It's fair to wonder whether this problem explains recent polls that suggest 70% of Americans would support a presidential candidate who promised to reform our economic system, or the growing number of young adults who hold an unfavorable opinion of capitalism. If you have a bad boss and a purposeless job, Gallup's Mr. Clifton says, you might conclude that "whatever this system is, it doesn't work for me." 

In any event, when it comes to hiring managers for the modern world, there's no question business can do better.
Promoting superstar individual contributors is part of the problem. One highly questionable tradition is the persistent urge to promote superstars into management roles. A growing body of evidence suggests there's a weak correlation between an employee's isolated talent and their leadership ability, and that quiet, selfless, middling performers often would be better choices. Gallup advises companies to seek out managers who infect their teams with a sense of purpose and function more like "coaches" than conventional top-down bosses.

It's also important to understand what engagement really is. Some companies try to measure it by asking employees to rate their "satisfaction" on a five-point scale. But the threshold for feeling satisfied is pretty low-decent pay and reasonable hours might accomplish that for most people. Today's workers aren't truly engaged unless their jobs generate feelings of purpose and personal growth.
Finally, there's the problem of "culture." It's fine for companies to embrace a set of values and impose a culture of positive engagement. But for most workers, the real company they work for is the team they're on. The only way to make a culture stick is to install middle managers who transfer it to their teams.
What sort of return can businesses expect from doing this? According to Gallup, the top 10% of companies, ranked by engagement, posted profit gains of 26% through the last recession compared with a 14% skid at comparable employers.
As for the future of free-market capitalism, it's impossible to say whether hiring more superstar middle managers will provide the rocket fuel we seek. In December, U.S. officials issued a gloomy forecast calling for three straight years of declining growth. It's possible that future economists will unearth this column someday and laugh at its naiveté.
Then again, maybe they won't. Maybe they'll marvel at how simple the fix turned out to be.


Mr. Walker, a former reporter and editor at The Wall Street Journal, is the author of "The Captain Class: The Hidden Force That Creates the World's Greatest Teams" (Random House). 






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