Tips for Entrepreneurs, Executive Directors, Managers and other Leaders

Profit or Not-for-profit organizations are not mutually exclusive.

While there are certainly differences, they share many common issues. Entrepreneurs, Executive Directors, and Managers of small and medium-sized organizations can all benefit from collaboration between the different sectors.

Having worked closely with many successful leaders in both types of organizations, what follows are some of the fundamental lessons I have learned on how to succeed in ultra-competitive environments. 

Understand your financial statements.  Your ability to know and trust your organization’s financial statements gives you the knowledge to make the right decisions and to recognize when there are problems.  Accurate and timely financial statements are the key to your survival and ability to thrive.  

Manage cash flow daily.   The world is full of successful organizations that fail because they run out of “cash.” An organization can have sufficient resources on paper, but if it allows collections to lag and cannot meet payroll or other payables, it will never recover.  Be sure to monitor inventory levels and turns, aging receivables, and accounts payables.     

Hire smart people that you trust.  If you have to be the smartest person in the room, your organization will only grow as far as you can push it.  A hallmark of great leaders is their ability to find, hire, develop, and retain people who are better than they are.  Finding leaders with complementary skillsets to yours makes everyone better.  I once had twelve former business owners on my team: their understanding, experience, and skills made everyone in the organization better and stronger.

Purposely build checks and balances into your systems and processes.  A good entrepreneur appreciates the importance of following good accounting practices and uses external audits to objectively evaluate the performance of their organization.  This becomes even more important as your organization grows and it becomes harder or impossible to monitor every aspect of your operation.  Your should trust everyone but also protect yourself as well.

Use key performance indicators.  Have at least five KPIs that you track daily, whether you are a “for-profit” or “not-for-profit”.    Make sure you measure performance and the things you are trying to influence and share the results with your people.  Many people smarter than I will tell you that if you want to improve something, you need to measure it and review your ability to influence it. 

Encourage risk-taking and accept mistakes.  Too many owners and managers punish mistakes and stifle growth because they are afraid of the potential risk.  Use your checks and balances as safeguards to develop and encourage new ideas.  You are going to make mistakes all of the great organizations do.  Check out this post: RISK INNOVATION AND FAILURE

Work/life balance. You will always work more than the standard 40-hour week.  Owning or running a business usually requires working whatever is necessary and may range from 50-70 hours or more.  Appreciating “burnout” is only a matter of time you must find ways to share the workload with your key people.  Finding, hiring, and trusting good people and allowing them to carry some of the load will allow you to reenergize, and rest, and you will be able to “drive” your organization better.

Mentors and being mentored.  You do not have a monopoly on good ideas.  Networking with people in similar and different fields is vital for growth and seeing fresh ideas.  Learning is a give-and-take venture, sometimes you will be the mentor other times you will benefit from your mentor.

Build and expand your competitive advantages.  Constant and accelerating evolution is the environment in which all organizations exist.  Great organizations refine existing advantages and are always looking to develop new ones.  Encourage your key people to always be asking, “What makes us different, What makes us special, and How do we get there?”   At conferences or meetings seek out fresh ideas.  Look for good concepts that have failed and learn why.  Maybe you or one of your associates will have the key to making it work.

Read trade publications, attend webinars, listen to podcasts when driving to work, and most importantly, encourage your people to do the same thing.

Does your organization use and deliver your competitive advantages?  Do your associates know and emphasize what makes your organization stand out.  Do your customers/clients know?  How do they know?  I would be willing to bet the answers will surprise you.

Stay focused on what your goals are.  Each day is full of distractions, and interruptions and it is easy to drift away from your focus.  Using a retail example, some organizations overspend the appearance of their building and underspend on merchandising and ensuring their products “pop” for their customers.  Meetings for the sake of having meetings is another example, each meeting should leave your attendees “pumped” and “informed.”

Ask and encourage people to speak their minds.  Many owners and managers say they have an “open door” and they welcome fresh ideas and feedback.  In practice, this can be far from the truth, at least in my experience.  You may not always hear what you want to hear, but having your people tell you what they are thinking will make your organization stronger.  Too many owners and managers surround themselves with “YES PEOPLE” who will agree regardless of what they think to the detriment of the organization.    

Manage drama.   Ironically, drama can occur because your people don’t get a chance to speak their minds.  Many leaders can fail to see that they create much drama amongst their people, having favorites, not doing what you promise, unfair scheduling, and not addressing issues can be the causes of drama.  Drama exists, eliminate what you can and be aware of the rest.  We will be doing an entire post on workplace drama soon.

Trust your “gut.” Running a successful organization involves a combination of science and intuition.  Trust your feelings either positively or negatively as a sign that an issue may require more analysis.

Difficult decisions come with leadership.  As your organization grows some people will earn larger and different roles, some people will need to be moved into different roles, and some people will need to be moved out of the organization.  Acting decisively when these decisions must be made is important.

Build strong relationships with your suppliers.  Listen to their ideas, and insights, and appreciate their issues. The very best leaders are genuinely interested in the issues affecting their suppliers.  That personal connection is invaluable in so many ways, from getting better terms, industry insight, resolving issues, and helping the supplier when they need support; all can benefit your organization and the supplier as well.   

Have an evolving marketing/advertising plan.  Plan twelve/six/and three months ahead.  Use a multi-pronged approach to marketing and advertising.  Use social media but take the time to appreciate the nuances of this marketing, use radio, and do not ignore print even though it is declining.  Whatever you use, measure the results.  Remember BE DIFFERENT and STANDOUT, people tend to notice your advertising when they are shopping for products they need otherwise your advertising is invisible UNLESS IT STANDS OUT. 

Train and develop your people.  Each day allow 30 minutes for structured or unstructured training.  Sources could include trade magazines, business books or blogs, or listening to podcasts or audiobooks.  There is so much helpful information available, essentially free, and most people, 90% of them according to self-help expert Brian Tracy, never even look at it.  Encourage all of your associates as well.  Daily and weekly meetings focused on skills and role-playing will give your organization many competitive advantages.

Be socially responsible.  Learn what the living wage is for your region.  Ask if your people afford to purchase or use the products or services that your organization offers.  Being a profitable company and a socially responsible company is not an oxymoron.  Join your local chamber of commerce, the Canadian Federation of Independent Businesses, and join the board of local charities.  All of these groups do important work and provide information on business issues for small and medium-sized companies. 

There are networking opportunities and it is a great way to share resources, and ideas, and find areas of cooperation that will help build your organization.  Supporting local charities  SUPPORTING LOCAL CHARITIES by donating time, money, or door prizes builds vital connections to your community.  Participating in your local high school’s cooperative education program is another great way to support your community.  Whatever costs you incur are more than offset by the goodwill that will repay you many times over.

Be humble.  When asked about what makes your organization successful, regardless of who is asking, always give the credit to your family and your people; talk about yourself last.  I have been to so many meetings where owners and managers take all the credit for the success of the organization; the negative effects on any of their key people in the room can have a measurable impact.  It costs nothing to share the credit for success. 

Execution needs to be your focus.  Big and innovative ideas aren’t the issue, putting big and innovative ideas into reality is the issue.  The entrepreneurs, the consultants, the managers, the executive directors, and the people working for them have shared these lessons will me.  They work.  Use them, share them, and build your organization.   

Good luck

Paul.

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