Good entrepreneurs tend to be a misunderstood group. They push when others pull. They take chances when others are cautious. They expand while others contract. All the while, their group of friends and family are left scratching their heads trying to figure out if the entrepreneur is crazy or a genius.

This current downturn in the economic cycle is necessary and healthy. It gives great companies the opportunity to be compared more closely to their competitors, allowing them to capture market share. Companies that shed good employees to save money end up losing all of the money invested in the person and as well as the goodwill with the remaining employees.

It is times like these when entrepreneurs have the opportunity to prove their commitment and faith they have in their team and business by working towards strengthening themselves. Upgrade talent where possible. Spend more to improve the infrastructure and sales teams. Protect the investments made in development of great members of the team.

Resicom believes one of its biggest assets is its people. This is the best opportunity for growth that we have ever experienced. Many of our competitors are closing or weakening themselves through layoffs, while our potential clients are re-examining existing relationships, looking for better solutions. We want to be positioned to service them.

During difficult economic times, it is important to drive down costs. Although there are many ways to accomplish this, some cost cutting can cause permanent damage to your business. My approach to cost cutting is to turn it into a contest, which I have named “Blood From a Turnip”. Here is an overview.

Objective

Find creative ways ways to lower our costs without cutting staff. Our strengths as a company are our people, capital, processes, and reputation. With that in mind, come up with ways of improving each.

Rewards

There will be rewards given to everyone that comes up with improvements that are implemented. Value of reward will depend on the impact the initiative has on the company. The grand prize is a trip to Hawaii.

Requirements

The entry must have a name that summarizes the initiative. Give a clear description of how you would like to go about gathering date to analyze and project impact. Send an email to me to review. I also instituted a deadline.

Summary

These economic times are tough. We need to utilize this pressure as a catalyst for creative ways of managing costs and creating new revenue. We need to look at other opportunities to cut costs, not people. Remember our strengths.

Gathering pertinent information to make informed decisions leads to greater likelihood of success. I call this task “Workplace Reconnaissance”.

Lets look a common scenario.

The leader of a business is in the middle of working on something important for the future of their company. They are interrupted by a team member who throws a fire into their lap that requires immediate guidance. The leader gives a quick answer that helps put out the fire. The fire is put out and things resume to normal.

The fire was put out. Things are normal again. Until the next fire…

This situation is scary and frustrating to the leader. What would have happened if they were not available to put out the fire? Who created the fire? How could this fire have been eliminated before it started? These are the standard questions the leader would ask. They are important and should lead to improved processes and training that help lessen the frequency of the fires. But this is not enough.

The other necessary question, which often goes unasked, is “What would I have done if I would have had more facts and a few more minutes to think this through”. The results of these snap decisions often do not get reviewed as thoroughly as other decisions. Management does not hold itself as accountable with these situations. It is these decisions, though, that they should be held most accountable for. Managers have the built-in excuse of the circumstance, but that excuse does not show up in the Balance Sheet.

This is why Workplace Reconnaissance is so important. Getting facts together for your leader so that they can make intelligent decisions despite the conditions. This helps limit downside risk, and lets the leader start at a higher point then ground zero. This builds the habit of making informed decisions.

The important process for gathering Reconnaissance should be part of the training program of all direct reports of company leaders. The impact can be significant. It can include saving time, money, and raising the overall level of the company.

As business owners and managers, we are often put to the test. We face all sorts of situations with which there is handbook on how to deal with the situation.  We need to be able to count on ourselves. Here is the test I give myself before taking action.

I imagine my child is watching me and learning from me and I ask myself “Do I want her act in the way that I am about to act?” This relates to everything. If I am disciplining someone, training them, everything. Do I want my child to learn and mimic my actions. Think about it, this approach makes you break down justifications and leads you to make a deliberate choice of doing the right thing or the wrong thing.

This “Child Test” has helped me work through countless situations. I hope it helps you do the same.

All businesses are indirectly in the insurance business. I am not referring to the traditional types of insurance, rather I am referring to the management of risk. The people we hire, the technology we put in place, the operational procedures we produce are all a form of insurance we invest in to protect and strengthen our businesses. There is the flip side, what is the cost of not having them? What is the risk?

An example: A business is a store that only has one person that works in the store. The store owner feels like he cannot afford the $15,000 annually to hire a part time person. To fully understand his predicament, I have him do a little bit of workplace reconnaissance.

1. Confirm that the business is operating in a risky manner.
2. Estimate the potential loss if the employee was to get sick, injured in an accident, or quit?
   
3. The owner estimated this exposure at $8,500.
   
4. The owner took that risk and deducted it from the costs associated with hiring the part time person and he realize the actual increase of costs is $6,500, not the initial $15,000 that the owner assumed.

Armed with the actual costs the business owner was better able to make his decision. He was now informed and could properly manage his risk.

As business owners and managers, we need to manage this risk. The owner determined that the $6,500 additional investment was affordable so he hired the person. In addition, he understood the investment needs to yield a return. He set forth additional tasks for the two person team to complete to help get more value out of the investment.

This approach will help you make decisions that are based on risk adjusted numbers. This outlook has helped me lower my risk and strengthen my company. I hope it can do the same for yours.

All too often people share their two cents when not asked. People tend not to follow advice they receive without solicitation. A more effective method of helping one another is through experience sharing.

It is arrogant to assume that you have the answer to someone’s complex problems after briefly hearing about the story. There are so many nuances to a situation that one could not possibly understand in a short briefing.

Through experiencing sharing, one is able to help see a route taken and use it to help them develop their own solution to their problem that addresses all of the nuances. This type of thought process is found in the major entrepreneur and president organizations, such as Entrepreneurs Organization.

I have learned many things and created many solutions to my challenges through experience shares of people within my professional circle. I encourage all entrepreneurs to join an organization such as EO and establish a trusting inner circle that will openly share experiences and help sharpen your skills.

Finding a mentor is one of the best things entrepreneurs can do for their business. Too often small businesses do not have a board of directors to keep them accountable. Therefore they do not perform to their potential. Its like the old adage, what gets managed gets done.

A mentor relationship can add accountability to the entrepreneur or business manager. Picture your business if someone was checking YOUR work. You probably spend a lot of time checking your team’s work. Even the best qualified members of your team can use the tips you give them and perform better when they are kept accountable. Imagine the most important role in the company being improved.

A good mentor will help you approach situations, deal with the things that you may not want to deal with head on, and keep you to your plan. This accountability is crucial in executing your plan. It makes you answer to someone else. It creates a board of directors type of relationship where one may not exist.

I have mentored many entrepreneurs and helped them strengthen their businesses. My mentor has helped me strengthen mine. I recommend giving it a try.

There is a certain level of anxiety, nervousness, or uneasiness I feel when someone gives me information. I question the information in my mind. I run it through all kinds of internal tests to see if it makes sense.

The first thing I try to do is verify the information. Too often the information is based on inaccurate assumptions, even when the correct information is nearby. The second thing I do is to try and wrap my arms around the information and get a complete understanding of it. Many times I find holes in the information or find it incomplete.Please see Workplace Reconnaissance post for more information on that.

Anyway, I feel much more comfortable when the person providing the information has a quality I call “Completeness”. This is where the person approaches any topic and examines it from many Perspectives before passing the information on to me. These people tend to look at components of something independently then as one. This helps me perform at a higher level because I am able to spend less time questioning whether or not the person ran it through a bunch of internal tests and more time on thinking about how to use this information.

The good news is that Completeness is something that can be trained. It takes time and there needs to be a consistent approach that everyone can get used to following, but in the end, it is well worth it. I created Perspectives to bring more people inResicom to have a higher level of Completeness. By staying firm in my approach and by demanding verification of information, I have been able to successfully raise the level of performance of my team. I hope you can do the same.

My approach to the financial aspect of business is best summed up by the oxymoron “Aggressive Conservatism”. I aggressively approach the financial well being of the company in a conservative manner. Let me better explain:

1. I pay bills faster than terms. This is not what most people would teach because it has the potential to negatively impacts your rate of return on investment, however, it creates a safety valve that you may need to employ. Consider this situation: If I typically pay my bills within 15 days of 30 day terms, my business becomes accustomed to it. If cash becomes tight, I could slow down my payments and pay within 30 days and boost my cashflow without violating my vendor terms. Benefits of the quick pay approach are potential discounts, usually between 1 and 3%. So this conservative approach can actually create more aggressive returns.
2. The company needs protection, not my lifestyle. The company needs to be protected and strengthened. Many people bleed their company of its earnings and to support a consuming lifestyle. If that business faces a downturn, the business becomes exponentially more at risk of closing down. This can become extremely stressful, which only makes failure even more likely. I believe in building the business and keeping it financially strong. I do not think of the company’s money as money for my own personal use.
3. I build a safety net. Many companies take on added risk and use their safety net to do so. This compounds the risk the company takes on. When I add risk, I want to make sure I strengthen my safety net. I am not always able to do so, but I recognize it and try to get to my comfort level as quickly as possible.

These three points may not be glamorous, but they have helped me weather a couple of storms. I almost went out of business because I did not have a safety net in plan in the first few years. I worked hard to position Resicom to be financially stable. We are now in the position of leveraging our financial position to take advantage of this dire economic climate.

It starts with you. When you aim to lead your organization and people to greatness, you need to be accountable to the company. There are things that people in leadership roles do that they believe are of little or no consequence that other people on the team see differently.

Throughout the years, I have had to come to terms with different things. I used to think it was my right to have the company pay for personal cars, meals, etc. When I really understood what it meant to want to lead my people to greatness, I recognized that these things I did hurt my intentions. I needed to change my approach to things. Even though I owned the company, it was not right to have my wife drive a company car nor pay for my personal dinners. As time went on, I was able to identify other little “perks” that negatively impacted the company and the people in it. The Ugly Truth was that I was hurting the company and the team’s morale. I am the driver of the business and while I was pushing the company to be better, I was weakening it. This is not a comforting feeling.

I now view the company and run the company as if I was not the owner. This mindset helps me keep in clear focus the things that are unnecessary. My team now sees firsthand that I do not bleed the company of its money and I do not treat it as if it were my own. I now aim to protect the company from all predators, including myself. It is the best opportunity I have to build a sound financial future and I will not weaken this opportunity by making it bleed to satisfy my lifestyle. Many business owners do not understand this line of thinking, but it is this thinking that helps push businesses to greatness.

The company is on the best track to success that it has ever been on. I hope this pushes everyone to take less liberties in their business and treat it as the best opportunity they ever had for success.

I have been getting requests to write a post about hiring. Why do we hire? Is it to support our desired lifestyle of more time off or is it to make more money? At the core, it is usually to support one or both of these objectives.

Hiring is one of the riskiest things we can do in our business, yet many entrepreneurs spend an hour or less bringing someone into their business. They base it on a “gut” feeling. So much effort is put on driving down exposure within the company, such as safety training, purchasing new equipment, etc. but without someone properly guarding the front door to the business, all of those efforts can become wasted. Why take the chance on a gut feeling when there are so many readily available, low cost background and credit checks. It is incomprehensible.

Here is a blog that I read that has great tips on this topic as well as hiring in general. It was written by Adam Robinson of Illuma, Inc. He is in the business of hiring and has absolute command of his craft. His blog drills down on many topics and provides many best practices and gives a different perspective on hiring.

It is a must read for anyone looking to add to their team.

Company meetings are a great way to get information regarding strategy and goals. Many times they do not happen enough. I like quarterly meetings that are a little bit more formal coupled with regular feedback.

In this environment, there are a lot of questions floating around, job losses are sweeping through the country, and most everyone is nervous. With the economy in the cycle it is in, I have chosen to take more steps to keep everyone in the company current on the state of the company. I circulated a message that ensured my team knows the current status of things so they can properly prepare and know what to focus on.

Send out the information. Make them aware. Give them the opportunity to be a difference maker. If you lead them well, they will follow you wherever you go, so make sure you know where you are going. I sent mine out early Saturday morning and received positive responses from multiple people within 20 minutes. Your team will appreciate your candor and feel more comfortable knowing you have a plan.

I have run a company for years without a mentor, Advisory Board or Board of Directors, and we plugged along just fine. I had been completely comfortable in my role. The company was growing, I was making the company better and challenged myself to continuously improve what we did. I felt great about this. Then along came Mark.

Mark is a successful person and businessman that mentors me. First thing he did was push for greater accountability of me. I had always viewed myself as an accountable learner that worked continuously to improve my skill set and prepare the company to be better, but he recognized that I although I was improving myself and the company in different areas, all of these improvements lived inside my comfort zone. I was refining skills rather than learning new ones. He was right.

Through Mark’s perspective, I was able to clearly see my shortcomings. There were things I was doing that broke down the vision of the company. I created a fragmented company by not saying things that needed to be said and not pushing for things I needed to push for. I was not leading well. I needed to demonstrate a willingness to face difficult situations and lead the company.

Once I started to assert leadership, everything started to fall into place for me. The company unified around an inspiring vision and silos were torn down. I was executing Mark’s statement, “Do the hard things first”.

I am now in the process of building an Advisory Board, thanks to Mark’s suggestion This will create an ongoing process of accountability for me. This will lead to even more scrutiny, but I welcome it. Scrutinize me as much as possible. I want to be great, and by acknowledging my shortcomings, I am better equipped to fix them.

I am grateful to Mark for pushing me to be great. I hope this inspires you to push yourself to be great.

Companies often debate the value in whether to conduct a comprehensive onboarding (orientation) program or initiating new hires as quickly as possible to jump start productivity.  Apart from filling out paperwork, handing over a company handbook/benefits sheet, and perhaps issuing a company I.D., many companies do not invest the resources to properly onboard their greatest assets- their people.  However, this limited approach of sink or swim mentality will only serve to bog down HR function and supervisor’s time as the new hire will undoubtedly have addition questions in regard to not just their general role in the company, but the company’s role in general.

On-boarding programs are a vital component to every organization whether hiring an hourly technician or a top level director. In fact, onboarding timelines and program depth for executive level onboarding should increase exponentially accordingly to responsibility.  Onboarding programs that only encompass one day shortchange the new hire.  At minimum, a full week should be dedicated to onboarding.

The benefits of a full-scale onboarding program are immeasurable, but perhaps the most valid argument for comprehensive onboarding is that it communicates to the new hire that the company is genuinely attuned to promoting the individual’s success and career development within the organization.   An effective onboarding sets the tone to introduce the company’s purpose and core values, and how the new hire’s role will be aligned with these objectives.

Purpose and core values must play an important role each day and need to be incorporated into subsequent Training Modules.  It’s one thing to have your organization’s mission statement and core values on posters scattered throughout the company, it’s much more effective for new hires to learn from day one how these core values are incorporated into daily activities, operations and the KPIs for which they will be measured.

A successful onboarding session has several different components to ensure the employee enjoys a thorough integration into the organization, and often begins prior to the actual first day of work.  A welcome basket or card sent to the employee’s home and touch-base emails from an assigned coach inviting the new hire to view the company’s blog and website help set an inclusive tone.

Once the employee arrives at the organization, set structure and session times are key, while providing the employee a road map of what to expect.   Being the new kid on the block is stressful enough without added anxiety of not knowing where to go or what to do.  The initial day(s) of onboarding should primarily revolve around general transition and “housekeeping” issues – (agenda, handbook, paperwork, benefits, tours, etc.).  Employees need the vitals and want to know to whom they report, who will be their mentor and who is a “Buddy” to whom they can direct initial questions.  New hires given the company history and current corporate structure will understand how the company has developed into the organization it is today.  Key policies and procedures must be addressed to put employees at ease as to what is generally expected.  All these items should be interspersed with engaging, even lighthearted exercises, such as “2 truths, one lie”  or career goal drawings  to introduce employees to one another and veteran employees orchestrating the onboarding.