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February 2005 Focus, Focus,
Focus
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It’s been said that managers do things right and leaders do
the right things. The former is about efficiency the latter
is about effectiveness. It is easy to be busy but hard to
work on the right things. Leaders must focus on doing the
right things -- those things that matter most to the success
of the company. In short, effective leaders must drive the
focus of the organization. Leaders must channel the time,
talent, energy, and resources of the organization on
tackling key priorities and goals. Owners must ask
constantly, “What’s Important Now (WIN)?”
In today’s fast-paced, technology connected world, it’s easy
for people to lose track of what is most important to the
enterprise. They get so caught up in the day-to-day minutia
and distractions (email, voicemail, cell phones, PDAs, etc.)
that they must be re-directed, re-focused, re-oriented
continually. Owners need to rein in their employees’ focus.
Do not let your employees waste energy, time, talent, and
resources on trivial matters; keep them focused on the
company’s vision and its mission-critical priorities.
To help you manage the attention and concentration of your
team, consider focusing them on six primary areas:
1. Satisfying your customers/clients
2. Getting results, not excuses
3. Improving continuously (innovation)
4. Maintaining profits
5. Keeping a long-term perspective
6. Having fun
1) Focus on satisfying your customers
Your company’s primary focus should be squarely on exceeding
the expectations of your customers/clients. Begin to
establish a culture whereby your team falls in love with
your customers and their needs/wants and not your own
company’s products or services. You are in business to
attract, delight and retain customers in a profitable manner
– period. The real value of your business is tied directly
to the future, predictable cash flow from your highly
satisfied and loyal customers. Without customers, you do not
have a business.
Again, your focus should be on your customers and solving
their needs and wants. It should not be about your company
or your services and products. Teach your employees to value
your customers, serve them well, and sniff out any customer
problems or complaints. Keep your customers delighted and
coming back for more! As leader, have the courage to create
an environment in which the customer is your enterprise’s
primary focus.
As CEO, set the tone by visiting regularly the top 20% of
your customers and keeping them satisfied. Find out what is
on their minds. Aside from creating clarity of direction for
your business, there is no better use of your time and
talents.
2) Focus on getting results
Next, focus your team on achieving results for your company.
Establish the climate whereby activity is not confused with
accomplishment. Where thinking and planning are admired.
Where actual results are valued more than busyness. Where
effectiveness (doing the right things) is rewarded more than
efficiency (doing things right). Insist on intelligent,
meaningful action and detest procrastination
(paralysis-by-analysis) and excuses. As a leader, one of the
most important jobs you have is to establish a goal-oriented
environment with a solid expectation of performance. Insist
on results; do not tolerate excuses.
The chapter on business planning and implementation will
cover how to set and achieve goals.
3) Focus on continual improvement
After satisfying customers and insisting on results, the
next focus area should be on continuous improvement. If your
company is not improving, it is declining. If you aren’t
getting better, your competitors may well be. Therefore,
establish a climate where continuous improvement and
innovation thrive. Do not let your employees fear failure or
making mistakes. Just eliminate repeated mistakes. Failure
is not fatal, but failing to change might be.
As CEO, you must drive out fear from your organization. If
your company is not failing occasionally, either your goals
are too low or your rate of innovation is too slow. Have
your employees adopt the attitude that failure is not
painful or shameful. Failure is merely valuable feedback on
what not to do next time. Failure is fertilizer for future
success. Failure is an incredible gift if properly viewed
and used. If we are moving closer to our goals, we are
winning. The quicker we fail and modify our approach, the
quicker we get to our desired outcome.
Insist that your employees continually improve what they do
and how they do it. Focus them on thinking about how to
improve their roles, responsibilities, and contribution to
the cause. Have them also improve your systems and
processes. Remind them, “Good enough never is”. Refer back
to the theory of optimization for powerful questions to ask
yourself and your team.
Encourage employees to try new things. Experiment,
experiment, experiment! Insist that “we can always do better
– let’s find the way”! Take small steps to test ideas and
learn more in the process. If something works better, keep
it. If it doesn’t, lose it. Know when to cut your losses.
Admit mistakes and let go of failed ideas fast. Fail fast,
fail cheap. Keep your ego in check.
Once a week, facilitate a one-hour business improvement
workshop. Release the brainpower of your organization. For
every good idea surfaced, assign a champion, due date, and
key action steps to take. Good ideas not fully implemented
are worthless. Reward employees for successfully
implementing ideas that increase revenues, cut costs,
improve operations or morale, or improve customer
satisfaction.
Also, encourage healthy debate amongst your team. Allow
everyone, in a constructive manner, to challenge ideas,
policies and strategies. Even allow for productive and
constructive conflict. When ideas are put to the test, they
improve.
4) Focus on profits
Next, focus on growing your revenues and most importantly,
your profits. Focus on both top line and bottom line growth.
Focusing only on revenue growth is ego-driven and not too
smart. Cash flow and profits are your lifeblood. Keep your
gross margins strong.
Also, while cost containment is important to the health of
your company, do not over-emphasize slashing costs. Stay on
the offensive, not the defensive. Revenue growth is nearly
endless, cost cutting is limited – you can only cut so much
before you do real damage. Some costs are really strategic
investments in the future of your business (new equipment,
advertising, training & development, etc.)
Give yourself a blessing. Hire the best CPA you can afford
and one that not only understands numbers well, but the
issues we are discussing in this book. An
entrepreneurial-oriented CPA that understands the needs of a
growing business and owner is invaluable – worth the
premium!
5) Focus on the long-term
After profits, focus everyone on the fact that you are in
business for the long haul. Do not be short-term oriented.
Business is a marathon, not a sprint. Do what is right,
always. Maintain the highest integrity and ethics. Your
reputation is everything. Business is about sustaining
lifelong relationships with customers, employees, investors,
suppliers, advisers, etc. Repeat business is absolutely
critical to the very life force of your company. Do not take
shortcuts.
To help with this concept, consider the Lifetime Value of
your customers. On average, how much profit does a typical
customer provide you over the average service life (# of
years) of such a customer? For example, if a typical company
buys from you several times a year, yielding you a total
annual profit of $1,000, and you generally retain such a
customer for 5 years, the Lifetime Value for a typical
customer is $5,000. Stated another way, every time you
attract a new customer and serve them well, odds are that
customer will be worth $5,000 to your business over time.
Once you know this number, you and your employees should
think twice about upsetting a customer, losing a customer.
This Lifetime Value also validates that you should spend
money (acquisition cost) to attract new customers. As long
as you break-even on acquiring a customer and know with
certainty that there is considerable back-end/repeat
business, it makes sense to spend money on
marketing/selling. Invest a little to make a lot! That’s
leverage.
6) Focus on having fun
And lastly, focus on making business fun. Celebrate
worthwhile progress toward your goals. Celebrate your
company’s successes often and reward your employees for
superior performance. Come up with excuses to praise your
team and recognize success. Share the joy. Make coming to
work a meaningful and fulfilling event. In fact, appoint a
CFO (Chief Fun Officer). Empower this person to come up with
clever ideas, based on employee feedback, which will put
some excitement and fun into the work environment.
Never forget, often as important as a paycheck, good
employees want to learn and grow, be challenged and
rewarded, and fulfill their cravings to be social beings.
Make your culture an enjoyable place to work.
Interested in gaining more focus? Give us a call at (818) 716-8826 or
email us
today.
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