Character and leadership

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There are two things required of someone who seeks leadership:  competence and character.  While both are important the character of a person is often a better predictor of long term success than competence.  Robert Clinton, professor of leadership at Fuller Theological  Seminary believes that approximately 70 percent of leaders do not finish well.  He agrees that leaders can do rather well for themselves through their skills alone, but the leader whose skills are greater than his or her character will eventually falter.

As a small business owner you create the environment in which your company conducts its business.  Every business, like every other organization, has a culture, and the owner of small businesses determine what that culture will be.  We do not have the luxury of hiding behind "company policy."  We created that policy.  We cannot blame some faceless "they" because "they" are us.  We model the type of behavior and character that we expect from others on our team, and that becomes an important part of our brand.

The phone rang one day in our shop, and as I started to answer it one of my employees said, "If it's my wife I'm not here."  The two of them had an argument that morning before he came to work, and he didn't want to talk to her.  It so happened that it was her, and when she asked if he was there I said he was and told him to pick up the line.  When he later hung up he was not very happy with me.  He said, "I told you to tell her I wasn't here."  I looked at him and said, "If I'll lie for you, I'll lie to you.  Is that the type of company you want to work for?"  He looked at me for a moment and walked off.  I wanted him, and everyone else on our team, to know that they could expect the truth from me even when it wasn't pleasant, and I expected the same from them.

As some of you know, during the years I ran our business I was also the pastor of a small church in our community.  We did some work for another pastor who was very slow to pay us.  He was well past 90 days late paying his bill, and some wanted me to take him to small claims court for payment.  I refused to do so on biblical grounds.  The Bible teaches that Christians are not to take other Christians to court.  I know that is a teaching that many Christian business people ignore as not a good business practice, but I felt strongly that it would be wrong for me to sue him for the money he owed.  Probably two or three more months went by before he came in and paid his bill in full.  We received our money, my relationship with my fellow pastor remained intact, and I did not violate a biblical principle.  I realize this would be not a recommended business practice, but I felt that it was part of the climate I wanted for our company.

The Golden Rule is always the safe option when one is confronted with an issue in his or her business.  If you were on the other side, how would you want to be treated?   Then that is how you should treat others.  If you would want grace, you must extend grace.  If you want people to be honest with you, you must be honest in your words and actions.  If you want respect, you must be respectful to others.  This is how one demonstrates character in his or her life and is how a culture of honesty and integrity is created in a business.  Such character will allow you to enjoy genuine success over the long term and make your small business a good place to work and with which to do business.

For an in-depth look at this issue I would highly recommend The Ascent of a Leader: How Ordinary Relationships Develop Extraordinary Character and Influence.  This very uplifting book explains how character enables you to have greater influence in your business, your home, and every other area of your life.

When the dream becomes a nightmare

I begin my book Mistakes by describing the scene as trucks and vans left our business location at the end of an auction with our equipment, parts, tools, office equipment, everything.  It was one of the worst days of my life.  Fifteen years of my life went down the drain that day.  The only good news was that we were able to pay off our debts, barely, with the proceeds of the sale.

Like every small business owner I went into this wanting a better life for myself and my family.  This wasn't a new, unproven start-up but a well established business with a solid customer base and long-time employees.  On the surface there was no reason to believe this would not be a dream come true, and for the first 10 years it was.  The last five years, however, became a nightmare.  The reason I wrote Mistakes was to explain how that happened in the hopes it would spare others from having to go through my experience.

If I had to sum up one overall problem that led to the dream becoming a nightmare I would have to say it was a lack of focus on my part.  I didn't pay attention to the details.  I didn't spend enough time developing a strategy for how our company would continue to move forward into the future.  My competitors did and shot right on past us.  I didn't pay enough attention to the financial numbers, and although I knew they weren't good I assumed they would somehow, automatically (?) improve.  I didn't spend enough time working in our business, and even worse, much worse, didn't spend enough time working on our business.  A business can coast for a period of time, but eventually you run out of downhill, and when the road begins to run uphill you won't go far coasting.

You can purchase Mistakes for your NOOK reading device by clicking on the book cover in the right hand margin.  In this book you can learn about the mistakes I made, many of them not uncommon for small business owners, and how to avoid them so your business can continue prosper and be what you always envisioned.

Providing training for your team members

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In the late 1980s I decided to begin work on a bachelor's degree.  I was forty years old, had a family, worked full-time in a factory, and was the bivocational pastor of a small church in our community.  You would think that would be enough to keep anyone busy, but I felt that I wanted to earn a college degree.  The company I worked for would pay my tuition for any class that would be applicable to my work there, and that included just about every class I took.  My cost was my time, books, and fuel driving back and forth to the classes.  It was a good deal for me and it's one that many businesses offer their employees.  It took seven years of attending classes to earn my degree, and a year after graduating I took early retirement and left that company after 30 years of service.  Some might think the company wasted their money, but I would disagree.

About three years before retiring a new position came open in our plant.  Being a union factory all shop jobs were assigned by seniority whether the person was qualified or not.  This job was different.  It would not be assigned by seniority, and the union would select the person.  The person who got the job would be a contact person for every customer the plant had.   This was the person who received information about quality issues for all the products our plant produced and had the responsibility to find out what went wrong and what corrections were needed to ensure it didn't happen again.  I became the person selected for the position.

It was quite a change for someone who was used to coming to work every day running machines that manufactured cast iron pulleys.  I had an cubicle in the office area and reported directly to the Quality Manager and the Plant Manager.  When I went out on the floor with a problem every supervisor knew that they had to work with me to resolve it.  I received phone calls from customers all over the world.  One day I had a conference call with customers in Scotland and Brazil.  When I began my new job our plant quality wasn't very good; when I left it three years later our defect rate was one of the lowest in our company.

To this day I am convinced that one of the primary reasons I was selected for the job was because I was working on my college degree.  That didn't make me smarter than anyone else, but it did demonstrate I had the capacity to learn and the ability to relate to others.  Having to write papers made it more likely that I could handle the written communication the job demanded.  The reduction in our quality issues on my watch demonstrated the union rep made a good choice in selecting me, and the investment in my college education was one that paid off quite well for the company.

Some companies seem to understand the importance of training their team members while others still view them merely as production units.  I've heard some argue that they were not going to spend much time training them beyond what they needed to do their job because they would just leave anyway.  That may be true, but as Zig Ziglar says, "The only thing worse than training someone and losing them is not training them and keeping them."  Providing regular training opportunities often brings dividends to a company they never expected.  At the time I began my college education the job I would later get didn't even exist in our company.

Most small businesses would struggle paying for college tuition for their employees, but there are numerous training opportunities for people that are fairly inexpensive.  A local community college might offer a course that would be helpful or interesting to some of your team members.  There may be a seminar you could take people to.  Many offer significant discounts for additional team members to attend making them very affordable.  There are many on-line courses that some of your team members may enjoy.  Investing in their training makes them more valuable to your company and will often make them less likely to want to leave your company.  Many return your commitment to their growth with a greater commitment to you.  Making training available to your employees is the smart thing for every business to do.

If it ain't broke...break it.

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Many of us have heard all our lives  "If it ain't broke, don't fix it."  It was a warning that messing with something that was working well might create more problems than it was worth.  That may have been good advice at one time, but it's lousy advice now.  I encourage people that "If it ain't broke, break it because it will soon be obsolete anyway."

We live in a rapidly changing world that requires people to adapt quickly or be left behind.  Your business plan from 2007 is probably not as effective today as it was just five years ago.  Hopefully, you're not even using that plan any more.  If your equipment is more than five years old it's probably outdated and inefficient.  If the goods and/or services you offer your clients have not been updated in the past 2-3 years they are probably coming across as stale and unappealing compared to what your competitors are offering.  Have you taken a fresh look at your marketing strategy to see what's working and what's not?  Have you checked out new vendors to see how they can add value to your business?  How often do you change out your displays to showcase new items?

One of the mistakes I made when I took over our business was seldom changing anything.  You can read about that, and many other mistakes I made, in my e-book Mistakes: Avoiding the Wrong Decisions that Will Close Your Small Business.  You can order it for your NOOK reading device by clicking on the book cover on the right column on this blog.  I made very few changes in how we operated as a company, and the changes I did make were often too small and certainly too late in coming.  Our competitors ate our lunch because I didn't want to change things that had stopped working.

Several days ago I admitted I liked watching Bar Rescue on television.  One of the things that the rescuer does is change virtually everything about the bar.  He changes the name, the decor, the items on both the food and drink menu, the uniforms the employees wear, and the way they go about their business.  One of the reasons the bars are not profitable is that nothing has been changed for years, and he wants to help create a new brand for the bar.

When you walk into your business tomorrow take a long look around.  Try to imagine what it would look like to someone who had never been in your business before.  Would they find it vibrant and exciting, a good place in which to do business, with goods and services that appeal to them?  Or, would it appear to be tired and outdated with people who look like they would prefer to be just about anywhere but there?  You may want to ask someone to be a secret shopper so you can get an honest opinion from someone with new eyes who may see things you'll overlook.

Change just for the sake of change is stupid, but making changes that improve your organization makes a lot of sense.  Don't hold on to something just because it used to work or your employees (and you) find it a comfortable way of doing things.  Business is too competitive and customers are now too demanding to hold on to things that no longer make good business sense.

Are you ready for a coach?

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Many large corporations provide an executive coach for their top tier management.  They understand the return-on-investment for coaching is huge.  A study in Michigan a few years ago of sales managers who hired coaches found a 10:1 ROI in less than a year.  That represents a serious return.  Another study of 100 executives, mostly from Fortune 1000 companies, found a ROI of 5.7:1.  That also is an impressive return on the money invested in coaching.  In addition, coaching provided other advantages to the companies that provided coaching to their leadership.  People who were considering leaving the organization remained.  A more positive work environment was created.  Customer satisfaction and revenue increased.

Despite the many positives that surround coaching few small business owners and entrepreneurs use coaches.  Some of that may be due to the cost of an executive coach which can run from $400-800 an hour and even higher.  The entrepreneurial spirit causes many to take a "Lone Ranger" mentality that doesn't lend itself to seeking outside help.  A third reason may be that small business owners are so busy that they don't feel they have the time or energy for coaching.  All of these are quite short-sighted reasons that fails to view coaching as an investment in one's life and career.

A few years ago I was struggling with a career decision and really felt pulled in two directions.  Ironically, our organization was providing coaching training to our executive staff and part of that training included coaching by our trainers.  For several months I had the opportunity to be coached by our primary trainer and used that time to explore the two options I was considering.  By the time our coaching was completed I had made a decision which of the two I would take.  It was such a powerful experience that I began coaching others and have enjoyed a coaching relationship with several people.  The benefits of coaching later became the thesis for my doctoral degree, and next spring I have a book being published that explores those benefits.

How do you know when you need a coach?  Here are some signs that you are ready for a coach.

1. You feel stuck and are uncertain how to begin to move forward again.
2. You have a desire to improve areas of your life and leadership abilities.
3. You need help in troubleshooting issues that are holding your company back.
4. You sense it is time to make major changes in your life or career.
5. You are going through a life transition and need help in processing that.
6. You need someone you can talk to who will maintain confidentiality.
7. You are ready to take your business to the next level.

Do any of these ring true for you?  Maybe it's time you invested in a coach to help you begin to move forward in your life and/or career.  If so, I would be willing to talk to you to see if we would be a good fit for a coaching relationship.  If you would be interested in such a conversation, respond to this post with your contact information and we'll see if coaching makes sense for you.

The secret to business success: Selling

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There are so many things to do when starting a small business.  There are business plans to write, inventory to purchase, supplies and equipment to buy, perhaps hiring team members, and finding a good location.  You have to ensure that the facility is kept clean, that paperwork is kept in order, taxes and vendors are paid in a timely fashion, and you are adequately marketing your company.  This list could go on and on.  But, nothing has really been done until you've sold something.  Everything else may be important, but none of them mean anything if you are not selling goods or services.  You're not in business to keep your shelves full and tidy, you are in business to make a profit, and you can't do that until you sell something.

I've met store owners and employees who didn't seem to understand that.  Clerks have made me wait to check out until they finished filling up the shelf they were working on.  Some were clearly frustrated when I interrupted what they were doing with a question on how to find something in their store.  I want to give them my money, and they want to finish dusting a shelf.  Here's a novel idea for a business:  Take the money.  Make the sale.

The most important thing that happens in any small business is sales.  Without sales you have no income, without income you have no profit, and without profit you soon won't have a business.  Every team member reporting for work should have one clear focus: to sell something.  That should be their focus every day.  They may not be in the sales department, but every person in your company needs to understand that everyone is in sales.  Some may be selling the product or service your company offers while others are in the business of selling your company and its brand. 

It's funny that even some salespeople do not understand how critical sales are for a business.  Such salespeople may be great at doing a sales presentation, but they forget to ask for the sale.  They work hard at developing a relationship with a possible client, but never get around asking for the sale.  Or, if they do ask for the sale, many times they make it easy for the client to say no.

Here are some things your salespeople needs to consider when talking to your clients.

1. Know your product, your client's needs, and how your product or service can better meet that need than your competitors.
2. Ask questions.  This is how you learn your client's needs.  After asking your questions, shut up and listen.  Your client will tell you what he or she wants.
3. Use their comments in your close.  Few people will reject their own ideas.
4. Sell the sizzle, not just the steak.  People are much less interested in your product or service as they are in how well your product or service will meet their needs.
5. Make it easy for your clients to do business with you.  Offer financing.  Meet with them at a time that is convenient for them, not you.  Develop policies that are client friendly.
6. Be prepared with several possible closes and use them at various times in your presentation.  If they agree to purchase your product or service, stop your presentation, take their check and get a signature.  You've already sold them.  There are no extra points for completing your presentation.
7. Accept that call backs are a part of sales.  It may take 7-8 call backs before you make the sale.  Sometimes this is the result of poor presentations or the salesperson's failure to clearly ask for the sale in an earlier presentation.  Work to lower this number.

Obviously, there is more to know about selling than what's listed here.  For a fresh approach to selling I recommend you read Dan Kennedy's book No B.S. Sales Success.  Kennedy doesn't mince words and doesn't provide his readers with a lot of fluff and theory.  His books are filled with practical advice that he has learned as an entrepreneur and business owner.  You can order the book simply by clicking on the image below.

Avoiding the mistakes

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Few things in my life have been more painful to me than when we closed our small business.  For 15 years I had managed our family owned heating and air conditioning business until we were forced to close it.  I had resisted making that decision for several years but just wasn't able to turn it around to its former profitability.  We closed it down and sold everything at auction.  Inventory and equipment went for pennies on the dollar.  

The day of the auction was one of the worst days of my life because I knew that I was the primary cause of it.  Our dream of owning a business had turned into a nightmare because of numerous mistakes I made.  Within days of the auction I began writing a book on the experience called Mistakes: Avoiding the Wrong Decisions That Will Close Your Small Business.  I had learned a lot about how to manage a small business, but I learned it too late to save ours.  I felt like if I honestly told of the mistakes I had made and what I had learned from them it might help other small business owners avoid making the same mistakes.  It is far better to learn from the mistakes of others than from making them yourself.

Although I have published several books I could not interest a publisher in this one.  I think I know why.  Walk into any bookstore and check out the books in the business section and see how many of them address mistakes.  You would think from reading the titles of the books you find on most of those shelves that all you have to do is open for business and you can start making plans for your next Mediterranean vacation.  Publishers like happy, positive books.  They don't like books that explain how the author messed up and lost a business due to his stupidity.

Actually, I think my book is a positive book.  It gives positive advice on how to lead and manage a small business well.  It points out possible issues that can create problems, but after doing so give the reader good advice on how to avoid those issues.  That's positive.  It's also more realistic than what some of the business books I've read.  No small business owner will avoid all mistakes, but he or she can miss several of them if they know to expect them and if they have some idea of what to do when they do happen.  I think this book provides that which is why I decided I would release this book as an e-book on NOOK.

For over three decades I have been a minister.  Twenty of those years I served as a pastor and for the past 12 years I've been a denominational leader.  At heart I am a teacher, and this book will teach you about potential problem areas you may encounter in your business and how to address them in a constructive way.  My interest in teaching is also why I created this website and why I publish so many articles on small business leadership, entrepreneurship, and sound decision making.  I would encourage you to follow my blog as well as the articles I copy each day on Twitter and Facebook.  Every article I share may not interest you, but I bet some of them will.  If you get even a nugget from reading one of the posts it can prove to be a major contributor to your well-being.

By making the book available on NOOK devices I've been able to make it immediately available to you and to sell it for much less than what a publisher would charge for it.  I encourage you to purchase it.  I also invite you to be my friend on Facebook and follow me on Twitter to see the numerous articles I post nearly every day.  If you have questions you would like me to address please let me know, and I'll try to incorporate the answers in future posts.