Show people you care

One of my secret enjoyments is watching Bar Rescue on television.  Since the script seems to run about the same on every show I don't know how much of it is real and how much of it is staged for television, but it is still interesting to watch.  A bar is in financial trouble, the rescuer is called in who find all kinds of unbelievable problems from dead rats in the kitchen to employees who steal.  There is usually a confrontation between the bar owner and the rescuer that ends up with them shouting at each other.  There is another confrontation between the rescuer and the staff.  Experts are brought in to provide training, the bar gets a make-over, and suddenly everyone is smiling and the bar is making tons of money.  One of the things the rescuer says in nearly every episode is that until the owner cares about the business no one else will, and at least that part of the show is absolutely true.

Most small business owners begin their companies with great enthusiasm and pride, but over time the mundane demands of business, the endless details that must be addressed, the times of disappointing sales, employees that don't work out, and the challenges of trying to run a profitable business can suck the enthusiasm out of nearly everyone.  Little things begin to be ignored.  The floor isn't swept one evening which soon becomes a week.  Past due collections are ignored because too many other things are demanding the owner's time.  Phone calls are not returned promptly.  The owner starts coming in later in the morning or leaving in the middle afternoon to play golf without having resolved a potentially major issue.  Team members are watching and soon determine that the owner really doesn't care any more, and if he or she doesn't care why should they?

It's not long before they begin slacking off, violating company policies, and providing less than quality service to your customers.  You can reprimand them all you want, but this problem is really on you, the owner.  You created a climate in your business that convinced your employees you no longer cared about the company.  They were just following your example.

Small business owners must consistently demonstrate to their employees and customers how much they care about their business.  This is done by addressing even the smallest details in a timely fashion.  It's done by arriving early and leaving after everyone else does.  You show how much you care by demanding that every thing that is done in your company is done with excellence, and that excellence begins with you.  You take pride in the way you dress, the way you go about your job, and the way you relate to both your customers and employees.  You exhibit respect to everyone you meet and you treat others as you would want to be treated.  When you consistently do these things your team members will know how much you care about your company, and they will care too.

I'm afraid this is a lesson I learned the hard way.  You can read more about my own failure to show my employees how much I cared about our company in my newest  book Mistakes which is only available on NOOK.

The personal investment

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Today I had lunch at a new business in our community that recently opened its doors.  It is an art gallery with a lunch area in the back that is owned by some relatives of mine.  I had not been there yet and decided today was a good day to try out their menu.  The food was excellent and the art work was exceptionally nice.  My cousin came from the upstairs where he had been painting, saw me, and took me on a tour of the place.  Upstairs they have a guest room that is really nice for our historic community and a large banquet area.  He is finishing another section upstairs that will be their office.  We went outside where he showed me the old windows high up on the front of the large building that had been covered up years ago with boards.  He said he had spent three days scraping and cleaning those windows so he could paint them and restore the building to more of its original look.  Since buying the building late last year he has spent every waking moment cleaning, painting, and preparing it for its opening.  His pride was evident in his voice and in his eyes, and he should be proud.  The building, the food, and everything about their business was excellent.

This personal investment is what it takes to create a successful small business.  You cannot start a business and manage it half-hearted.  You have to go all-in or stay home.  We didn't talk about their financial investments, but I would assume they have a fairly large financial investment in this business, but he has even more of a personal investment in it.  He and his family have poured everything they have into making this business successful, and I believe it will succeed because of that personal commitment.

Compare that to what I see when I go into some smaller businesses today.  I walked into one shop recently and the person working there was sitting behind the counter talking on her cell phone. She never acknowledged by presence.  While I was there another customer came up to pay for her purchases and the employee rang her up while still talking on her phone.  About that time another customer came up with some items to purchase, so the employee finally said to the person on the phone, "Well, I HAVE to go, I have a customer."  (Emphasis mine)  I don't know what the other customer thought, but my impression was this employee was saying to her friend that she HAD to hang up because she HAD to wait on some customers.  I thought to myself that I didn't want to interfere with her social life so I wouldn't buy anything, and I left. 

There was no owner in sight.  I understand the owner cannot be present every moment, but he or she obviously had not taught this employee anything about customer service.  This was a business that needs the owner there every moment at least until he or she trains the employees about proper customer service.  Unless this owner gets more involved in the business it won't be open for long.  People have too many options and will take their business elsewhere where it will be better appreciated.

How committed to your business are you?  What are you willing to do to make it successful?  If you have a 9-5 commitment to it you may as well close up shop and find a job because that's all this is to you.  At least with a job you won't have the headaches that go along with ownership.  The successful businesses are the ones where the owner is all-in and completely committed to seeing it succeed.  I hope that describes you.

Staffing a start-up

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A common mistake some entrepreneurs make when they start a new company is spending money on things they don't need.  I recently heard a caller to a radio program explain that one of the reasons he was having financial problems was he had bought a new pick-up truck for the carpenter business he was starting.  He had made virtually no money in this new enterprise, and he spent $30,000 for a new pick-up truck.  The radio host told him that was a huge mistake, and the business owner responded that he had to have a truck to do his construction business.  The radio host agreed that he needed a truck, but he didn't need a $30,000 truck he had to finance before he ever got his business off the ground.

New businesses make the same mistake when they purchase or rent office space or equipment.  They overspend on these items before they have any cash coming in thinking they have to have all the latest technologies and a prestigious office.  Actually, unless you are a retail store you may never need to meet a client in your office.  When I think of many of the service people with whom I do business I realize I've never been in their office or even know where that office is located.  You can work out of your garage or your basement when you start out.  For only a few dollars a month you can get a post office box for your business mail and add a second business line that comes into your home which will transfer your calls to your cell phone.  Most people will assume you are working in your office when they call. 

Another unnecessary expense some start-ups encounter involves their staff.  It is doubtful that most new start-ups need to hire a full-time person when the business first begins.  Many entrepreneurs do not realize all the expenses such a hire creates.  This person will need supplies, equipment, and training.  There will be additional taxes due with such a person now on the payroll that will eat into those early sales.  There are better options that hiring a full-time person right off the bat.

1. Get a virtual assistant.  There are now numerous companies providing virtual assistants who will handle the administrative tasks you need to avoid so you can be more productive with your time.  These will cost your new business much less than hiring someone, and if they don't work out you simply end your agreement.  You don't have to worry about unemployment compensation or any of the other issues that goes along with terminating an employee.  There is one thing to make sure of before you get a virtual assistant.  Have a detailed list of what you need this person to do and ensure that is clearly communicated before signing any type of agreement.
2. Get a part-time person.  Maybe you have enough administrative work for someone to do for 10-20 hours a week and you're not comfortable with a virtual assistant.  A part-time person might be the best option for you.  I know a person who did some work for a local professional in her home during the evenings on a part time basis.  The work was such that it could be done at her convenience which made it appealing to her.  
3. Hire a temp.  The benefit of having a temporary employee is you only have to worry about paying a salary to the temp's agency.  They handle all the taxes for the person.  You write out one check each week for the person's services, and you don't have to worry about it after that.  A second benefit is that you can hire the person for a particular project, and when that is completed his or her employment with you is completed as well.
4. Use interns.  If you are located near a college or university there may be some students willing to do intern work for the experience and so they can add it to their resumes.   Interns usually need a lot of supervision but they also bring a lot of energy to the position.  In some cases, you may find a great future team member at little or no financial cost to you.

Starting a new business requires a lot of time, and it may be appealing to hire someone to help.  I agree that it does take a lot of time, but chances are you still have more time than money.  You can't afford to pay someone to answer the phone for you.  Answer your own phone.  Order your own supplies.  Open and close your business yourself.  If your idea for a business is a good one the day will soon come when you will need to add team members.  At that point begin to add part time people or follow the suggestions listed above.  If that is successful it won't be long before you will be adding people, but at that point you should be able financially to do add people who will contribute even more to your business' bottom line.

Growing as a leader

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People sometimes ask if leaders are born or made.  The right answer is yes.  Obviously, leaders are born or they wouldn't be here, and people have the ability to become leaders.  I do believe that some people are born with innate abilities that help them develop into leaders, but I also believe that anyone can learn to become a leader.  I further believe that anyone can learn to become a better leader, and more importantly, have an obligation to their company and to themselves to do so.

During my lifetime I have worked with for many different people.  In the military I served under some very good leaders and a few who somehow managed to advance in rank but who had zero leadership abilities.  In my 30 years working in a factory I worked for some excellent supervisors and some very poor ones.  My biggest disappointment was one person for whom I worked for two years.  For a number of years he had taught quality control classes for the company, and I had attended several of them.  I was excited when I heard he was transferring to our department and would be my supervisor.  Unfortunately, I soon found out he knew a lot of theory and little about real life manufacturing challenges.  More than once I had to ignore his advice to correct a quality problem. 

Each of these share something in common.  The best leaders I worked for were continually growing in their ability to lead.  The worst leaders never did anything intentional to grow as leaders.  They were content to be managers, like the boss I described above, and had no interest in being leaders.

In my book Mistakes (see the right hand column for ordering information) I admit my failures as a leader and how they led to the eventual closure of our company.  I was a fairly successful leader in ministry, but I was much less successful as a business owner.  Although I learned a lot about leading a business it turned out to be too late to save our company.  My purpose for writing Mistakes was to give the readers the benefit of my learning so they could apply that to their own situations.

You may be someone who owns a small business or you may be thinking about starting a business.  For many, that is the American dream, and it is a great dream.  Your company will bring employment to people, offer a quality product or service that people want, and enable you and your family to enjoy a better lifestyle IF you are willing to commit to growing in your leadership abilities.  I am convinced managers cannot grow a successful small business; it takes leaders.  The good news is that no matter where you are in your leadership abilities you can improve.  You can grow as a leader, and there are many resources out there to help you in that process.  One good one is an older book by John Maxwell called Developing the Leader Within You.  I really cannot overemphasize how important this book can be to someone who wants to grow as a leader.  My copy has been read several times and is filled with highlighted sections that I have reviewed even more times.  If you haven't read this book and want to grow as a leader you need to get it this week and begin to read it.

Going from here to there

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In both my ministry and my business writings I often emphasize the importance of vision.  Without a vision of a preferred future for your business or your life you are merely drifting along hoping that somehow something good will happen.  In workshops I use the illustration of my experiences when I owned a bass boat.  As long as my big engine or trolling motor was running I never had a problem.  The only problems I had in the boat is when I would be drifting along with the current because it seemed that I would always drift into a problem.  More than once my boat got stuck in the fork of a submerged tree when I was drifting while fishing a river bank.  With the engines running I was going somewhere on purpose.  I had a direction in mind, and I was moving in that direction.  The same is true in life and business.  As long as you are moving forward with purpose and with a destination in mind you will encounter fewer problems than you will when you are content to drift.

Notice how I defined vision in the above paragraph.  It is a preferred future for your business or life.  It is a place that you can see in your mind's eye that will be a better place than where you are right now.  The question is do you have such a vision for your life or your business, and the follow-up question is what are you doing intentionally to help you get there?

You begin with a vision of a preferred future, but then you have to connect that to a plan that includes short-terms moves that will take you in that direction.  Without such moves you will never achieve that vision.  You have to know where you are currently and where you want to be in the future, and then you can begin to develop the actions that will help you achieve that.  This is all that strategic planning is.  It is a way to help you get from where you are to where you want to be.

The problem with such strategic planning is that it often gets cloudy the further out you go.  You may know where you are now.  You may know where you would like to be.  You may even have some immediate short-term steps in mind to take.  The problem is we are not sure what happens next, and this unknown factor is often what keeps people from even beginning the journey.

Chip and Dan Heath has addressed this so well in their book Switch: How to Change Things When Change Is Hard.  Their challenge is "When you're at the beginning, don't obsess about the middle, because the middle is going to look different once you get there.  Just look for a strong beginning and a strong ending and get moving."  I cannot tell you how important this statement is.  It is impossible to plan out all the steps on the way to a vision because you can't possibly know all those steps.  You've never travelled that way before.  The key is to start moving.  Identify the vision and the initial steps you need to take and begin the journey.  Along the way you will identify next steps and take those until one day you'll realize that you achieved the vision you had at the beginning.

One way to help take this journey is with the help of a coach who can guide you along the way.  A coach can offer encourgement and challenge you with questions that will help you identify the steps along the way you need to take.  I've been fortunate to have been able to coach a number of people who were on various journeys in their lives, and if you are interested in having me coach you I invite you to respond to this post with your contact information so we can discuss it.  In the meantime I would certainly recommend the Heaths' book to any small business owner and entrepreneur.  It is filled with practical, helpful information you'll use on your own journey towards your vision for a better life and a more effective business.

The danger of growing too quickly

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It seems almost impossible to even think that a small business could grow too quickly.  Isn't growth one of the indicators of a successful business?  Doesn't growth mean that sales and profits are increasing, and what could be wrong with that?  When entrepreneurs begin their business are they not looking forward to the time when that business is growing?  Actually, there isn't anything wrong with growth as long as it can be properly managed.

Growth becomes a problem when the owners/managers find out they can no longer manage the business.  The business has grown faster than they have when that happens.  A growing business demands more of its owners/managers, and sometimes they are not capable of meeting those demands. 

Growth is also a problem when the business does not have the systems in place to manage the growth.  A few years ago a university set a limit for new students for the first time in its history.  They had grown so fast their personnel and computer systems could not keep up.  Their student advisers were overwhelmed by the demands of incoming students.  Much of administration was in shambles so the university president announced a limit on the number of new students the school would accept.  He also announced major changes in personnel, new computer systems, improved dorms and eating facilities, and a general upgrade in much of the admin department.

In the company I owned we had grown the business to the point that we needed to add new team members to install the equipment we were selling.  I hired new people, bought them a vehicle to use, and waited for a big increase in profits.  It never happened.  We were not structured as a company for that rapid of growth.  There were breakdowns in communication.  People were not properly supervised.  In short, we were not prepared to grow, or a more appropriate way of looking at it, I was not prepared for the changes that would be expected of me as our company grew.  My leadership was the lid that held our business captive and eventually forced us to return to our previous levels of sales and manpower.

Sustained growth should be the goal of every small business owner.  You want your business to grow, but that growth must come slowly and include everyone involved in your company.  For this to happen the owners must be committed to on-going growth in their own lives.  You must be continually growing so when the time comes for your company to take it up a notch you'll already be prepared.

Sustained growth also depends upon the systems in place in your company.  Do you have the computer hardware and software that will enable your business to grow?  Do your team members have the training they need to handle new expectations as the business grows?  Do you have the right policies and procedures in place for sustained growth?  These are important questions that must be answered before your company enters into any type of growth.

Failure is an event

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Several years ago I heard Zig Ziglar say at a conference, "Failure is an event, not a person.  Yesterday ended last night and today is a brand new day."  I have used that truth as I've coached people who felt like they were failures because something they tried didn't work out very well.  I've used it in some of my sermons as I was trying to instill hope in people who may have felt they had made too many wrong choices in their lives.  I've also had opportunities to remind myself of this truth when I've been tempted to get down on myself.

Anyone who attempts to do something will fail at times.  We may think we've thought through every possible situation, but suddently something happens that we never anticipated and we find ourselves battling yet another set back.  Sometimes the failure is rather small and except for the embarrassment there is little impact.  Other times the failure comes with a lot of zeros at the end, and some of these can be very harmful to the future success of our business.  But, the road to success is full of potholes marked failure.  Many successful entrepreneurs tell us that until we have experienced enough failures we will never be successful.

Most successful people I know will tell you the secret of their success is experience, and the way to gain experience is to fail and fail often.  The key here though is to learn something from the failure.  I once read a chapter in a book titled "Never waste a good crisis."  The idea behind that chapter was that if we were going to go through a crisis anyway we should learn all we could from it.  I thought it was good advice when I read it and still do.  The best book I've ever read on failure comes from John Maxwell titled Failing Forward: Turning Mistakes into Stepping Stones for Success.  Maxwell also promotes a positive view of failure and challenges his readers to use every failure as one more step to achieving the success they want.

However, to be able to do that requires that we learn from our mistakes.  It's OK to make mistakes; it's not OK to keep making the same mistakes.  When we find we have failed at some endeavor we need to take time to analyze why we failed and determine what we could have done differently that would have led to a better outcome.  Only when we do that will we be able to apply that learning to the next similar situation that comes our way.

You may want to have a coach help you with this analysis.  Sometimes it's hard for us to be objective about our own mistakes.  We may either go too easy on ourselves or too hard.  Having an outside person who can take an objective approach to our failures can be a valuable asset to our personal growth.  I've been privileged to serve as a coach for a number of people and currently have a few open slots for two or three more.  If you believe having a coach could help you work through some of the issues you are facing feel free to contact me.  Just respond to this post with your email address, and I'll be glad to get back to you.

Leaders are readers

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One of my fondest memories growing up was going to our county library.  I grew up on dairy farms that did not provide a lot of extra money for things like books, but every summer my mother would sign up for a summer reading program at our local library.  I was usually at or near the top of the list for the most books read that summer by people my age.  We would go to town on Saturdays to shop and nearly every Saturday that involved going to the library so I could return the books I had read the previous week and pick up new ones.  That early love for reading has served me well ever since.  Most years I will average reading one book a week, and nearly all of them will be related to ministry, business, or leadership.  I seldom read more than one or two fiction books a year, but I will read an occasional biography or history book.

I recently read a stat that claimed that 42 percent of Americans never read another book after college.  I don't know if that is accurate or not, but studies do show that a large percentage of us read very few books, if any, during a year.  According to some studies 25 percent read no books last year and another 25 percent read between 1-3 books.  People age 63 and up reported reading at least 10 books last year while younger people admitted to reading the fewest number.

This makes no sense to me.  Knowledge is increasing at a rate that no one can really keep up with, but if one isn't reading new material on a regular basis they are falling even further behind regardless of their field.  Leaders are readers, and if they don't read they won't remain a leader for long.

I'm well aware of the excuses people give for not reading, but that is all they are... excuses.  The most common one is the lack of time.  We get done what we spend time doing.  If you want to succeed in whatever business you are in you must keep up with the most current information in that field.  If your competition isn't doing that then you are you have just achieved a major competitive advantage, but if you are the one who isn't reading and your competitor is, he or she will eat you lunch and one day own your business.

Electronic devices such as NOOKs can make it easier and cheaper for you to keep up with your reading.  You can save a few dollars over a NOOK book than if you bought it at the local bookstore, and it's easier to travel with an e-reader than to lug around several books.  Right now about 2/3 of the books I read are on my NOOK.  If even those books are too expensive right now, there is the public library.  With most libraries offering lending services you now have access to just about any book you could ever want to read at zero cost to you.

Even if you get your books from the library there is still the opportunity cost for reading.  Yes, you could be doing something else during the time you are reading, but I am convinced that reading good books will help you work smarter and make your efforts more efficient.  Reading is an investment in yourself, your leadership, and your business.  At the very least you should be committed to reading one good book a month.  Even at that rate, you will be far above the average American which will greatly improve the chances of success for your business.

Control what you can

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Small business owners soon learn that there are many things they cannot control.  They cannot control the nation's economy; they can't control the price of fuel; they can't control the changing buying habits of their customers; they can't control decisions their vendors make.  We could easily make a list of things we can't control that would fill sheets of paper, but there is one thing we can control, and yet many small business owners ignore that thing.  They can control the quality of their people, especially those who are in positions of leadership.  Larry Bossidy and Ram Charan, in their excellent book Execution: The Discipline of Getting Things Done, insists this is so important it is the one thing that small business owners should not delegate to anyone else in the company.

In a post last week I discussed the importance of having the right team members in your company, but just as important is making sure they are in the right places, especially if they are leaders in your organization.  For various reasons, small business owners often struggle with people placement.  We fail to recognize changes that may be taking place and how some of our current leaders struggle to adjust to those changes.  Soon the area of their responsibility begins to struggle as well.  Even if we recognize that this is the direct result of a leadership failure in that department we often fail to respond quickly to that failure.  More often than not this is a lack of courage on the part of the owner or a sense of misguided loyalty.  In my book Mistakes I stated that we can become too loyal to our employees, and that can cause us major problems. The question we must keep asking ourselves of our leaders is are they still able to get the job done?  If the answer is no, we have to find out if there is something we can do to help them improve.  They may need additional training.  They may need additional personal to assist them.  For the sake of the company, they may need to be moved to a different position in the company.  As a last result, they may have to leave the company for a position better suited to their skills.  What you cannot do is allow them to continue to create problems for your business.

Annual reviews do not happen quick enough to highlight these types of issues.  As a small business owner you need regular times with your leadership to determine if there are problems that have not reached you yet.  Even in the smallest of companies there are often things going on behind the scenes that the owner hasn't been informed about, and these kinds of secrets have the ability to cause you real problems.  A small business owner must meet with his or her top leaders at least weekly to make sure everyone is informed of what is going on in the company.  These leaders should be instructed to inform the owner if they foresee potential problems for the company as well as any current issues.  Along with the problems they highlight, they should know that they are also expected to present at least 2-3 ways to respond to those problems.  No leader in an organization should be allowed to present a problem without having thought through it well enough that he or she has identified some possible ways to respond to it.  People who make a habit of doing that are obviously not the ones you want in leadership positions.

Bossidy and Charan offer some excellent advice around the issue how to best use the people in your organization in the book mentioned above.

Success comes from within

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At some time virtually everyone has dreamed of starting their own business.  There is something about owning a business that appeals to many people for various reasons.  They may believe they have a great idea for a service or product they want to offer people.  It may be that they see starting their own company as the path to a better life for themselves and their families.  For some, they are just tired of working for other people.  But, whatever the reason people want to start their own business, most of them never will.  Their daydreams never turn into reality primarily because they convince themselves they can't do it.  Like the old saying goes, "If you think you can or if you think you can't, you're right!"  People who want to focus on all the reasons they can't succeed or start a new business will find plenty of those kinds of reasons.  Let's look at some of the most common ones.

1. I don't have enough money.  It is certainly true that one of the primary reasons many small businesses fail is a lack of sufficient capital, but are there other ways to get started in your business that do not require a lot of capital upfront?  Do you have to have a brand new van to begin a service business or can you start off with an old beater until you begin to make the money to upgrade?  Do you have to buy a store building to sell your antiques or could you begin by renting a booth in an antique mall?  It may be a slower way to begin, but it at least allows you to begin and this strategy doesn't require a lot of capital and offers much less risk if you don't succeed.
2. I don't have the education.  People with this excuse evidently believe that education is no longer available.  Guess what...I drive past college campuses and community colleges all the time and see their parking lots full of cars both day and night.  These are people who are getting their education, and many of them are second-career people who are learning new skills and gaining knowledge to begin something different in their lives.  I got my bachelor's degree when I was 46.  I didn't get a master's degree until I was 58 and my doctorate when I was 61 years old.  You are not too old to get the education you need to live your dream.  It's entirely possible that the new business you want to begin doesn't require a formal education anyway.  You may be able to apprentice for someone in your off-hours to learn what you need to learn about the business you want to start.
3. I don't have the time.  One of the best lessons I learned was in a class I took my very first semester of college.  "You get done what you spend time doing."  I first heard that in the mid-1980s and it has impacted my life ever since.  If time is a problem you may want to check how you spend your time.  How much of it is in front of the television?  How much of it is spent playing video games?  Spend one month and write down everything you do in half-hour increments and see how you are spending your time.  (If you think that's not possible, I did it every day for four years!)  This is an exercise that will get your attention!  You can spend your time doing things or you can invest your time in ways that will make a positive impact on you and your family.  Your choice.
4. I don't have the experience.  Years ago when I was working in a factory we were being asked if we would work overtime in a different part of our plant.  We were told we had to have experience on that job before we could accept the overtime.  I said yes to the overtime even though I had never even been in that part of the plant.  That next Saturday when I reported to work the supervisor was not happy when he learned I had never done that job before.  I told him, "After today I'll be experienced.  All someone has to do is show me once."  I did the job and it went well.  If you don't have the experience, get it and stop using that as an excuse.  Everyone has done everything they've ever done for the first time at some point in their lives.
5. I just don't think I'm ready.  Maybe not, but when will you get ready?  More important, what are you doing to make yourself ready?  If you're doing nothing intentionally to get ready in five years from now you still won't be ready.

What I really want you to see is that you can find plenty of excuses to keep you from moving forward with your life, but none of these are insurmountable.  What your success as an entrepreneur or small business owner really depends upon is what is inside of you.  How badly do you want this?  What are you willing to do to achieve your dreams?  What sacrifices are you willing to make now that will allow you to enjoy a better life later?   You can read more about this in my latest book Mistakes: Avoiding the Wrong Decisions that Will Close Your Small Business.

You need a great team

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I believe it was John Maxwell I first heard say that if your dream is too small for a team your dream is too small.  Many small businesses began as a one-person show, but eventually the owner of a one-person business will learn that he or she is still an employee...and the boss.  Soon after that recognition comes another awakening - unless you can expand the business to include more people it will never be what you first envisioned it would be.  It will never provide you and your family with the life you wanted when you became a business owner.  It is the failure to develop a team that causes many small business owners to eventually give up and return to the workforce.  It makes no sense to deal with all the headaches that go with owning your own business if you are the only employee and are not making any more money, or often even less, than you were when you were working for someone else.

But, just adding people isn't enough.  You have to be adding the right people.  Dave Anderson, in his excellent book Up Your Business!: 7 Steps to Fix, Build, or Stretch Your Organization, writes, "You can read books on strategy and attend courses on corporate vision but the fact is that without getting the right people on your team, nothing else you do will matter.  Your vision is worthless, strategy impotent, and values corrupt without the right people to execute them."  Later in the book he adds, "A great dream with the wrong team is a nightmare because bold goals pursued by mediocre people still result in mediocre results."  He spends the remainder of his book addressing good hiring procedures, the importance of ongoing training, setting high expectations for the team, and how to survive success by overcoming common temptations that successful companies face.

Adding team members is expensive.  If the owner does it right it takes an enormous amount of time.  The best people do not work for entry level salaries and benefits.  There is the cost of training new people in your culture and in whatever business you may be in.  It is very expensive to hire new people, but the cost escalates much higher when you hire the wrong people.  You have all the expenses the good people have plus you have the additional costs of lost business, a damaged reputation, and your own elevated stress levels while you try to contain the damage they cause.  Unless you begin to feel that you are taking too long to hire a new team member you probably have not taken enough time to do it right.

If you want your business to continue to grow you must be constantly developing team leaders.  You cannot wait until you need a new leader to begin searching for one.  The best companies always have people in the leadership pipeline at various stages of leadership development so when the need arises they can go to that pipeline and immediately bring someone in that is prepared to provide the leadership needed.  Without that pipeline a small business owner will often find that he or she is being held hostage by incompetent, mediocre people that the owner doesn't want to keep but can't afford to lose either.

One of the mistakes I made as a small business owner was not hiring quality people when I had the opportunity.  It seemed like those people always presented themselves during our slow times, and by the time we needed them they had already found positions with other companies.  If I had it to do over again I would hire them and create a position if I needed to so that I could keep them.  I really believe they would have easily paid for themselves and would have put us in a much stronger position for long-term growth.

If you want to read a very helpful book on the importance of having a quality team working for you I encourage you to read Anderson's book.  It is one of the best on the topic I've read.

Do you love your customers?

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A business truth is nothing happens until a sale is made.  You are in business to sell products or services for a profit.  In order to do that you need customers or clients.  These are really important people in your life because without them you cannot sell your products or services.  Small business owners should love their customers, but sometimes I wonder just how much some of them do.  If every small business loved their customers I have to believe we would see much better customer service than we find in some companies.  It almost seems that some small business owners and companies go out of their way to make it hard for their customers to do business with them.

Several years ago I read a self-published book by a business owner in a nearby community titled Our Bathrooms Are Not For Customers.  It was a book about how some businesses treat their customers and potential customers poorly.  The title for the book came from a sign he noticed in a store in which we was doing business.  He wondered why a business would not have a public bathroom their customers could use.  The really only possible reason is that it would require keeping it clean and presentable, but that hardly seems like a burden on a company.  What happens if someone is having "problems" and needs a bathroom quickly?  What about the customer with a small child?  In either circumstance what do these folks do?  I guess in those businesses with "No Public Bathroom" signs the customer heads for the nearest place that has a toilet he or she can use, but does the original business really believe that person will return to complete his or her shopping?  Not likely.

Another way small companies make it hard for people to do business with them is by not offering credit.  As I admitted in my book Mistake for many years our company did not offer credit to our customers.  We didn't even accept credit cards.  If someone wanted a new heating and air conditioning system they had to be able to pay cash or arrange their own financing if they were going to buy it from us.  It's probably best that I never knew how many thousands of dollars in sales went to our competitors simply because they offered financing.  I finally made arrangements with a local company to provide credit to our customers and found out that within 10-15 minutes we could let them know whether or not their application had been approved.  It wasn't long before we found out the studies were right...when people make purchases with credit they usually spend more money than if they are paying with cash.  For us that meant they were more likely to buy the more high end equipment which resulted in greater profit margins.  You wouldn't think in the 21st century we would even need to bring this up, but just today I did business with a small company that still does not accept credit cards.  Last year I ate in two small diners that didn't take credit cards.  I never returned to either of them again, but I did recently drive past one and saw it was out of business.

Small businesses make it hard for their customers to do business with them when they refuse to listen to their needs.  Many times salespeople fail to make a sale because they never stop talking long enough to find out what the customer wants.  The best salespeople ask a lot of questions and build their sales strategy to that customer around what the customer has said in response to the questions.  If you offer a product or service that fits nicely with what the customer has said he or she wants you are much more likely to make the sale.  A few years ago I was buying suits and having to drive an hour each way to purchase the brand I like.  Nothing fancy, just average suits price-wise, but I liked the way they fit and how they hung.  I went into our finest men's clothing store in our community and asked if they sold that brand suit.  The owner said they did not because no one in our community would spend that much money on a suit.  He assured me that the brand he carried was made by the company that made the suits I liked so I tried one of his suits on.  It was a horrible fit and I didn't buy the suit.  I cannot believe that I was the only person in our community that purchased that brand of suit, but the owner had no interest in making that brand available because he knew no one would buy it.  That store closed last year.

The final issue that makes me wonder how much some small businesses love their customers is the way they ignore them.  How many times have you done business with a small business and was made to feel like an inconvenience?  Nothing makes me more upset when shopping to be standing at the cash register ready to pay for my purchase when the employee has to stop and answer the phone and spend 3-5 minutes answering questions.  I've been tempted to just walk out and leave my items laying there.  I've come to the store, looked for the items I wanted to buy, and I'm there with cash ready to pay for them, and I have to wait while the employee answers questions from someone who's too lazy to come to the store and shop for himself or herself.

That's just three examples, and if we had more space we could describe dozens more.  For more information about how we can provide much better customer service than we find in some small businesses read my book Mistakes.  I devote an entire chapter to this issue.

Learning from the failure of others

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Some of the cheapest lessons small business owners can learn come from the mistakes of other people in leadership positions.  Even CEOs of major corporations can make mistakes despite all the resources at their disposal.  Tim Irwin, in his book Derailed: Five Lessons Learned from Catastrophic Failures of Leadership (NelsonFree), profiles six CEOs of major corporations who derailed in their leadership and ended up being removed from their positions.  These were very sharp people who made some serious misjudgements that cost their companies great sums of money and eventually cost them their jobs.  The one thing their failures had in common is that they came about because of a failure of character.  Irwin points out that it was not a character issue such as dishonesty but of being dismissive of others and hubris.  Their stories make interesting reading of how really sharp people can take the wrong road in their leadership and derail.  The second half of the book warns the reader how easily we can take the same wrong turns and how to avoid them.

One of the lessons Irwin points out is that "Derailment occurs over time - it really happens before the crash.  An ignored warning signal...the inattention to feedback, and one wrong turn leads to another."  I can relate to that because that is exactly what happened to me.  I failed to pay attention to the warning signals that could have helped me avoid having to close our business.  Too often, we think that failure is an event that happens, but failure is really the end result of a long list of issues we ignore over a period of time.

Another lesson we should take from this book is that most derailments are self-inflicted.  As I point out in my book Mistakes we can't blame anyone or anything but ourselves for our failures.  If your business fails you can't blame the economy unless every business failed.  We can't blame government because government never bailed out any small business.  It's not high interest rates, customers who won't pay their bills on time, the price of gasoline, or any other excuse people often give when a business fails.  While that business is failing thousands of others are prospering under the same conditions.  None of these things may have helped our situation, but the problems we are facing are nearly always due to our own decisions and habits.

As the author wraps the book up he points out that "While competence is absolutely essential, our character ultimately makes a greater impact on what we accomplish in our work and in our lives.  Character as expressed in authenticity, wisdom, humility, and courage must ultimately form the substance of who we are if we want to have great impact."  He ends the book by listing five critical habits every small business owner must develop to avoid derailment.

It is fascinating to read how six corporate giants could make such huge mistakes in their leadership, but it is humbling to realize how many of them we make in our own leadership.  This book provides you with an excellent opportunity to learn from the mistakes of other leaders so you might avoid them in your own business, and for the price of the book that is pretty cheap learning.

 

Social media and marketing your business

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This won't be a news flash for young entrepreneurs, but some of my fellow Baby Boomers need to know they are losing some great opportunities to market their business if they are not using social media.  I admit that I am late to this game.  I've only been on Facebook for a couple of years and on Twitter less than that, and there is still a lot I don't know about how to best utilize these tools to market my business, but I'm learning, and it's paying off.  What really caused me to get serious about using social media was when I read a book by Michael Hyatt called Platform: Get Noticed in a Noisy World.  The book claims to be a step-by-step guide for anyone with something to say or sell.  I devoured the book in two evenings and began to implement some of it soon afterwards.  It continues to be a work in progress for me, but I am convinced social media should be one of the primary marketing tools a small business should use.

There are so many competitors out there today for just about any product or service you might be offering.  They all have Yellow Page ads, newspaper ads, and spots on the radio and TV.  How does a business stand out from all that advertising noise?  You have to create a significant platform that makes you visible, gives you a voice, and allows you to connect with people.  None of those things happen in the traditional marketing strategies we have used for years, but they can happen with social media.

But, before that can happen, you must have a product or a message that deserves a platform.  Small businesses are the backbone of our nation, but the failure rate of these businesses is very high.  Having lost a small business myself I know how much emotional and financial pain is involved in such a loss.  I have also been an ordained minister for the past 30+ years which means I have a desire to help people.  Soon after losing our company I began writing a book that described the many mistakes I made as a small business owner that eventually led to the business closing.  I wrote the book wanting to help other small business owners avoid the mistakes I made.  You can purchase the book for your NOOK by clicking on the book cover found on the right side of this page.

I have published a number of books for church leaders and lead workshops for these leaders across the country and Canada, but I am not known in the business community.  My problem was how I would get my book, which I felt was an important contribution to small business owners, known.  It was at that time I came across Hyatt's book and found my answer.  Through this blog, Twitter, and Facebook I have been able to connect with small business owners and make them aware of this resource.  The results have been slow but steady.

If you believe you have a product or service that the public needs and are not satisfied with your current marketing results, I strongly encourage you to get Hyatt's book and learn how easy it is to shift much of your marketing to social media.

Why change often fails

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It's the kind of problem that keeps small business owners up all night.  You know you need to make certain changes in how your business operates, but you also know the opposition that will come if you try to make those changes.  You're not even sure the changes you are contemplating will produce the results you want, but you are certain that your business will suffer if you do not make the changes.  You try to determine which of your team members will be supportive and which will be resistant.  Some of the ones you fear will be most resistant are critical to the success of the change, so how can you get them on board?

One of my favorite books on change was written by John Kotter, a professor of leadership at Harvard Business School.  The title is Leading Change.  In the book he provides an eight step process for implementing successful change in an organization.  They are

1. Establish a sense of urgency
2. Create a guiding coalition
3. Develop a vision and strategy
4. Communicate the change vision
5. Empower employees for broad-based action
6. Generate short-term wins
7. Consolidate gains and produce more change
8. Anchor the new approaches in the culture of the organization.

Let me briefly touch on just the first one: establish a sense of urgency.  Kotter believes the failure to do this is one of the primary reasons most change efforts fail.  That has certainly been true for me.  Most of the changes I've failed to implement could be attributed to my failure to create a sense of urgency around the change.

People do not want to change until they are convinced the pain of not changing is greater than the pain they will feel when the change is implemented.  As long as they are comfortable with the status quo they will be very resistant to change.  One quick illustration.  Everyone knows that obesity and smoking are not good for one's health, but how many people wait until they have a heart attack to begin to lose weight and stop smoking?  That initial heart attack creates a sense of urgency and suddenly they realize that they need to make major changes in their lifestyles if they want to enjoy a long productive life.  The same is true with any change that is needed.

Do not begin your efforts to introduce change with "what" until you have addressed the "why."  Explain why the change is needed and the likely results if the change doesn't happen.  If you can create the sense of urgency you are much more likely to get buy-in for your change efforts.

If you have not read Kotter's book I highly recommend it before your next effort to introduce change to your organization.

Working in vs working on your business

Many small businesses begin as one person operations.  Someone is led to leave their job to begin their own company, and often that company consists of the entrepreneur.  Much of that person's time is spent working in the business.  That is understandable, but as long as the owner is simply working in his or her business that business is not likely to grow.  It is very important that the owner of a small business spends as much time as possible working on the business.  What does working on one's business consist of?

• It involves developing a vision for the future of the company.  Such a vision will give you a preferred picture of what your company will look like 5-10 years from now.
• It involves doing strategic planning that will take your business from where it is today to where you envision it will be in the future.
• It involves keeping a close eye on your financials and responding quickly to any negative changes you find happening.
• It involves developing and improving your relationships with vendors, customers, and the stakeholders in your company.
• It includes you becoming involved in community activities that will provide your company with good exposure and provide you with an opportunity to give back to the community that is supporting your business.
• It involves you getting to know your competitors better than they know themselves so you can differentiate yourself from them.
• It involves you providing leadership to your team.
• It involves just about anything that will help your business go to the next level.

Obviously, if you are the person who stocks the shelves, cleans the restrooms, answers the phone every time it rings, runs the service calls, writes out the checks for the bills, files the invoices, installs the new equipment you are working in your business and unable to spend much time doing the above activities.  You may have to do all these things when you are starting out, and as a small business owner you will still do these things occasionally, but you must move from working in your business to working on your business as quickly as possible or your company will never become what you dreamed it would when you started it.  For more information on how to work on your business I encourage you to read my latest book on your NOOK or NOOK app.

Passion produces profits

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It amazes me how poor customer service is at many places where I do business.  Employees will stop waiting on a customer to talk to someone who has called them on the phone.  When you ask where some item is employees either don't know or point in some general direction instead of taking you to the item.  People arrive late for appointments.  One night I stopped at a fast food restaurant and watched as my food was placed in front of the girl working the drive through window.  She took a drink of her soft drink, opened the window and handed me my change, closed the window and took another drink before opening the window and handing me my drink, and then closed the window and took another drink before finally giving me my food.  At that point I couldn't help myself and told her that had to be the worse customer service I had seen in a long time.  She was offended that I complained.  She was probably even less happy when her manager made her write me an apology letter after I contacted the home office when I returned home.  I used to stop there several times a year.  I haven't been back.

Whose fault is it when employees provide poor service?  Once again I will repeat one of my favorite sayings: Everything rises and falls on leadership.  For whatever reason, employees who provide poor customer service have no passion for what they do.  They are there to earn a paycheck, and beyond that they are going through the motions doing the minimum that will keep that check coming. More often than not, that attitude comes from the top.  When small business owners and managers lose their passion for what they are doing, that loss of passion filters down through the entire system.  And that loss of passion costs the business money.

Passion for what you do must be a core value of the company if it wants to succeed.  Passion will help your business rise to the top in your field.  And believe me, it starts with the owner and managers.  Passion is contagious and so is a lack of it.  Your employees will do what they see you do so if you want them to approach their work with passion you need to as well.  Read the following article to see how passion has helped one well-known hotel chain rise above others, and then spend some time thinking how you can incorporate some of this information in your own business.

http://clomedia.com/articles/view/passion-promotes-profit