1 minute guide to managing change
If you are running a fast growing company, you will be doing lots of new things and having to change from the old way of doing things to the new way. This is a major headache. There’s a huge amount of inertia that means people tend to do things in the old way because they feel more comfortable with that.
However, there are some simple things you can do that will help the change process
1. Make sure everyone understands why the change is necessary. If you can’t clearly express the benefits to the business, it’s probably not worth doing. How does this affect the team undergoing the change? Why will it make things better for them? It’s very easy after a lot of thought and discussion about something new to assume that everyone will ‘get’ the idea quickly. This is rarely the case. If they can’t articulate the reasons and benefits in their own words they are unlikely to have really understood it. If you can get people to take ownership of the change, they are much more likely to make it happen.
2. Don’t rush out lots of changes at once. It’s very easy to sit in a meeting and come up with a long list of new things that you ought to be doing as a company, then dole out tasks to managers. Often this results in things getting half done or ignored as people can only take so much change. I know it is tempting once you have discussed how amazing your business will be after these changes to rush into them. After you have come up with your list, prioritise first (by whatever metric you prefer: quick wins might be a factor, biggest impact on profit, the need for new product, market share etc – just make sure you decide on the priorities). Then look at which projects overlap (involve the same people). Then you can start on the projects with the top priorities that affect only one group of people. As another note, if you have lots of meetings where you generate ideas, you are likely to run into difficulties unless you are always comparing them to your master list of priorities. If you are not doing this you just aren’t managing your business, you’ll always be working on the hot new idea.
3. Have a project leader/cheerleader. You need someone that is on the front line of the project that really ‘gets’ it, and can make sure everything is being implemented properly.
4. Have clear objectives that are measurable, and check on them. Don’t assume that just because you’ve had a great idea and explained it clearly that it will happen. You need to have regular checks. If people never feel they will be checked on, what’s to stop them taking the path of least resistance and carrying on doing things the same old way. Also, you need to check that the changes have been implemented correctly. Again, if you’re always focussed on the shiny new ideas, old change projects will just run out of steam and noting will happen.
If you follow these steps, you will start far fewer change projects, but get more completed. Remember, there’s a limited amount of time available – you can only get so much done in a given period of time. Starting more will not result in more work getting done. I like the story about the British general who said during WWII that our problem was we planned a battleship for a year and took four years to build it whereas the Japanese planned a battleship for three years and took one year to build it.
Worth bearing in mind!
1 minute guide to running effective meetings
I don’t know how much time ineffective meetings lose annually, but I bet it’s a huge amount (and people complain about Twitter!). There are few things more irritating than having to constantly go to meetings where you are often not needed, decisions are rarely reached, and if they are reached not acted on.
Amazingly running effective meetings is incredibly simple and the little extra effort saves you ten-fold. If I had to pick one thing that would immediately increase a company’s productivity by 10%, it would be effective meetings.
So, how do you do it?
1. Think carefully who you invite - do they really need to be there?
2. Always write an agenda, explain why the meeting is necessary and what the end aims are. Some meeting ideas will die naturally at this point! Circulate the agenda with the meeting request so people that feel they have nothing to add can opt out in advance.
3. At the start of the meeting, reiterate the aims of the meeting, and think about how long you need to dedicate to each agenda item to get through the meeting in the allotted time
4. Make sure only one person speaks at once, and that they do not go on for too long. This generally requires a chair, and it can’t be a chairperson that exploits their power to go on and on about their own points.
5. At the end of each agenda item make sure you record what decisions have been taken, what actions result from those decisions, who is responsible for delivering them and by when. Take this opportunity to think about who else in the company will be affected and make sure they are informed.
6. Schedule reminders to follow up on the actions to make sure they have happened.
It really is that simple.
1 minute guide to boosting initiative and innovation in your team
Everyone wants to have a team working for them that they can trust to get on and do the job, be full of new ideas, and not come to them every five minutes asking for help or approval. Some people naturally develop their teams this way, most of us have to work at it.
Some key things to watch out for
1. Make sure you recruit the right people in the first place. If you do not trust them from the beginning, you’ll watch them too closely, give them too much instruction and stifle their creativity. This is a vicious circle, because you do not trust them, you micro-manage, because they are micro-managed they don’t feel free to be creative.
2. When people come to you with suggestions, be very careful how you react. Maybe you’ve thought about their idea before and decided it wouldn’t work. Maybe you’ve tried it and it didn’t work. If your first reaction is to tell them that, they will just feel that you dismissed it. Listen to their suggestion carefully, ask them questions about it, check there isn’t a new angle you might have missed, then explain why you think it might not work, and listen to their response.
3. When you set out your plans for something new, do you ever get dissenting voices? These people are not necessarily being negative (although they might be), so listen carefully and make sure you understand why they are saying what they are saying. Often it takes great courage to tell the boss he is wrong, so these people may be your best staff, as they are showing they really care. If you never get dissenting voices, it is more likely that you have effectively taught people that there is no point dissenting than it is that you are right all the time.
4. Make sure that when people do something new that you recognise it – either directly to them or publicly (or both) – even if it didn’t work that well (provided it didn’t work well because it turned out not to be a good idea, not because it was poorly implemented).
5. When setting strategy, set principles and outcomes, not processes. If you set processes, people will just do what they are told even if it is not achieving the desired outcome. If you make people responsible for outcomes, they will innovate to achieve them.
5 mistakes commonly made by start-ups
1. Recruiting the wrong people. It is amazing how easy it is to do this, and equally amazing how huge the impact on your company is. You know you need to grow, and you know you need people to do it, just make sure you get the right people. How? Well, it’s not easy, but here are some simple rules to start with.
a. Write a detailed spec for the skills and experience you need and make sure that you wait until you find someone that ticks all the boxes. If you are not clear from the start, you’ll find yourself interviewing someone you really like and persuading yourself that they would be great.
b. Always get references. Get two references and do it on the phone so that it is harder for someone to be non-committal. You are not looking for references that say words to the effect of “this was a good person, able to do their job” you want something a bit more enthusiastic than that.
c. Ask them to do some kind of project related to the skills you need. A presentation, a written proposal, some research, what ever is right for you. It’s amazing how this can reveal holes in people’s ability. Remember, anyone can talk a good game.
d. Have clear objectives for the first month and three months and make sure you do a proper review. You really need to be feeling very positive at this stage. If you are thinking that they’ll do, this is not positive enough, and probably means you are hiding the truth from yourself (usually that truth is that you know they are not right, but you really need someone and you think they are better then no one, or you can’t stand going through the recruitment process again (or paying more recruitment fees!)
e. I think it is advisable to get people that are stepping up into the role you are offering - so high on ability, slightly lower on experience. Otherwise you get someone that can get bored quickly and doesn't have such scope to grow with the role.
2. Being focussed on revenue or head count growth rather than profit growth. I don’t know why this is so common, but I suspect it’s because they are easier to measure, and you can show off to people about them more easily. Especially in the early days when you are not making money anyway. Often the same effort put into a relatively small revenue increase from an existing product, market or client can be worth a lot more profit than going after something new.
3. Focussing on what isn’t working rather than what is. You have two markets/products/clients. One is steady, makes a bit of money and not very exciting, the other is full of potential but is tough work. The temptation is to allow the tougher one to take up all the airtime in meetings. Make sure you are looking at what is making you money and focus on how to make the most out of that.
4. Trying to be all things to all people. When you start up, you are full of enthusiasm for your product and you can see all sorts of applications or markets and you feel committing to one could mean losing out in another. Try to remember that it is rare that a company is successful just because it has a great product. More often it is about execution. From a prospective client’s point of view, they need a simple message that is compelling for them. Difficult to do that if you are hedging your bets. If you can not have the position of the biggest/market leader (who can maybe operate in many markets) try to focus on the one or two markets you think are most likely to work for you.
5. Not being clear enough about how you are creating shareholder value, and keeping an eye on the exit strategy. Ultimately you are going to realise the value you have created when you sell the company, at which point the multiple of profit you can command will be critical. There are lots of factors that can affect this multiple, and would require too much space to go it this post, but the key ones are: the size of your margins, are you dependent on a small number of key clients, do you have a strong position in a market place that a competitor would want to acquire, can you get a bidding war going between potential acquirers? Sometimes you need to be thinking that lower profits that get you a higher multiple are a better goal than just doing whatever makes the most money short term.
Why start-ups fail – lies, lies, lies
Why do start ups fail? Lots of reasons obviously, poor concept, poor delivery, and poor management being fairly obvious candidates. I've been trying to boil it all down to one reason or theme, and I think it has to be lies. Why lies?
Well, first of all, I'm not saying that start-ups are lying to their clients or investors (or at least not on purpose), but they are lying to themselves. How does this manifest itself? Numerous ways, but here are some examples:
1) Believing your own hype. Obviously you have to sell yourself to generate new business, funding and to recruit good people, but in the process you may stretch reality (estimates of the size of the market, the weakness of competitors, and so on) not in a deliberate attempt to deceive but because you have a powerful vested interest in believing the better figures. The motto believe the best, prepare for the worst is probably worth bearing in mind.
2) Recruiting the wrong people. You know you need someone to do a key role, and you need them immediately to grow and hit your targets. The temptation is to lie to yourself that the person you have seen that isn't quite what you are looking for is good enough, because you really need them. Again, very tempting, but one of the worst mistakes you can make.
3) Telling yourself you are an approachable CEO. Few people want to bring you problems, and few CEOs really want to hear them. If you are running a business you really want to believe that you are doing everything the best and most efficient way. This is rarely the case and other people won't be telling you - don't lie to yourself too. Seek out things that are going wrong rather than looking for things that are going well.