The Next Major Challenge

The Next Major Challenge

The Next Major Challenge

John R. Daley

June 19, 2009

Seasoned companies either fail during a recession, ownership transition or during growth.
So we have survived the economic collapse.  We are battered and torn, less talent, less capacity, reduced cash reserves and fewer customers buying less… but we are still upright!  Just anemic.  We get to choose how this continues. 

The next potential cliff to beat will be the growth and hyper inflation phase.  In order to compete we will have to reinvent ourselves to make up for lost sales due to customer value changes.  Customer buying patterns are probably changed for the long term.   Markets are consolidating and evolving. We have to reinvent our offering to earn business.  That means market analysis is required which takes time, talent and money. Our cash reserves were used to make up for a loss of 40 to 60 percent of our normal profits so we have to rebuild our reserves.   Inflation will mean that the reduced cash reserves you have will be worth less.  Bank loans are few and far between even if you had predicable sales and assets in demand.  Asset based loans are available at about 8 to 12 percent if you have unencumbered assets and predictable cash flow.  Mezzanine loans are available at about 16 to 18%, Wow! They do have a place.

We are truly back to the basics of lending:  Appropriate Collateral, Target Market, Competitive Advantage, Strong Business Plan and a Strong Management Team that can deliver despite the market challenges.  Money is available for those prepared and that know where to look.

Some of us are about to run a marathon and we are anemic.  We just have difficulty admitting we don’t know what we don’t know.  

During this recovery the strong and financially well off companies will be sourcing contractor and employee top talent, preparing for growth.  Some are planning to grow organically and some are shopping for deals on capacity, customer lists, mergers and acquisitions.   The best are analyzing the markets to see were their capabilities will earn them profitable sales.  Where can they pick off weaker players?  Our freshman year of business school we were taught that was called asset and resource reallocation to more efficient uses. We will truly see who has what it takes and chooses success. 

The bottom line is you will either be a more efficient and stronger competitor or have more efficient stronger competitors.  You will either have cash, talent and capacity to compete or you will be running the marathon anemic.  The next few months will truly tell who will survive and thrive!
My take away from all this besides all of the above, never forget the cycles, they are just like the seasons, plan for them!

How do you attract and keep talent?

How do you attract and keep talent? Talent will seek the place where they are seen as an asset, not an expense. They want 5 years of experience, not 1 year of experience 5 times. So that means they are looking for training and mentoring. The best talent will always find the place where they are happy (positive culture) and they can grow professionally and personally.

Looking for a High Performance Team?

Pubished February 13, 2006

Looking for a High Performance Team?

Coach Daley

As a business coach I watch business organizations as a student.  I'm always looking for the unique characteristics of successful (or unsuccessful) organizations and as you know it usually boils down to leadership.  Nothing new… right?  Look at sports; you can have great players and a manager that struggle to win.  What about the gold medal winning US Hockey team with an outstanding coach but no superstars? One manager can be the biggest hindrance to success and that would be the "tribal manager".  (The Strategic Partnering Handbook) 

Remember, "Leaders" create a vision and are enthusiastically followed:
"Leadership is the art of getting someone else to do something you want done because he wants to do it." Dwight D. Eisenhower"Leaders create an environment where teams thrive and produce beyond even their expectations, managers without leadership skills stress teams out and so production is work, people do only do the minimum not to get fired and struggle to do that much." Coach Daley"The first responsibility of a leader is to define reality.  The last is to say thank you.   In between, the leader is a servant." Max De Pree
"Managers" struggle with a sincere "thank you", because it could go to their subordinates head, make them think they are more important than they are to the manager, after all the subordinate is just completing tasks...their job... right?  "Managers" dictate, intimidate and do things themselves. Why would they do things themselves?  First to show the team they are not needed just tolerated.  And secondly to show their superiors they can do the job themselves, matter a fact, they believe the team is taking the credit they should have.  If they feel the superior is questioning who is the hero the manager will show them by doing the task themselves or moving some else to do it.  It's just a task. This makes perfect sense if you consider they see their job as their career development,  as the organization and implementation of tasks not leadership and development of people.  They are the "alpha male" or female, they are always jockeying for political position and competing with their own team to show they are the superior and the manager.  The scary thing with these managers is that they don't see this behavior. They tend to be very insecure and hence "Alpha males" are dangerous to any up and comers they see as a threat, how many future leaders can your organization afford to lose?  My dad used to say watch what people do, not what they say.  He must have had these managers in mind.  Bottom line, first on their priority list is their status, second is positioning for their career growth, and last is tasks. People are necessary evils they have to put up with.  These managers look at their subordinates from their (the manager) perspective. These managers love the line "Salary Continuation Plan!"  "You should be glad to have your job." "Stay below the radar screen and complete your tasks as I laid them out!"  "I can replace you tomorrow!"

If companies are successful due to people and they spend big bucks and time to hire the right people for the right jobs, create an environment for success (for each particular person) and reward them for successful performance (in a manner they see as a reward) than the above managers are not indicative of a successful company are they? 

Consider a couple of facts:
·       Most people leave do to their managers!
·        Bad employees don't quit, where would they go?
·        Leadership starts at the top and the corporate culture helps sustain Leadership (the opposite is also true)

Do you have a leadership problem?Is it costing you a high performance team?
In our workshops we teach to constantly observe, not to judge to quickly.  Things are never black and white.  Having said that ask yourselves the following questions and see if you have a trend that is costing your organization maximum performance and limiting your bottom line.

1. Usually about 20% of your team will be self starters that should excel with minimal leadership so these are the people to watch.  If they are stressed then you might have a leadership problem.
2. If you call a meeting of one of your leaders teams and they can not or will not speak openly you may have a leadership problem?
1. Manager could be jockeying for political position and does not want that impacted by his or her necessary evils!
3. Do you as a manager enjoy reaching visions through people or do you wish you could just do it yourself?
1. You could be a driver?
2. You could be an entrepreneur that just needs to grow to leadership or find a leader.
4. Ask your manager what motivates their team, what are their individual goals? If you have a leadership problem these managers will tell you what "should" motivate their team, not what does! Ask for specifics of each teammate. 
5. Has the manager found a way to align the teammate’s goals with the organizational goals?  
6. How are the teammates coming with their goal attainment? 
7. Would a 360 survey be helpful? Click here
8. Do you want to be a leader but feel you are just a manager?  Would you like to start on the journey to be a leader?  It takes knowledge, experience and then skill: Click here
1. Are your managers coachable? Or do they tell you that you just don't understand?
2. Can they be developed into leaders of teams? 

Do you possibly have a leadership problem?  Is it costing you at the bottom line?  Would you like to learn more?  http://www.daleygroup.com/

As a business Where do we go from here?

Where Do We Go From Here?  (Published in 2009)

By John Daley, The Daley Group, LLCLast year the world changed for most business leaders. Remember how good a president and manager you were and how successful you seemed to be?
Up until several months ago we were all playing a game, “basketball” if you will. We knew the rules and had the skills to win. We were cruising towards a wonderful retirement.
Then the world suddenly changed. As we started to shake off the shock and got our bearings, we realized we were not on a basketball court anymore but rather on a slab of ice.
The new game was called “hockey”.  The playing field was suddenly different and we didn’t quite get the rules.  Now we had to put on helmets and elbow pads and veer into the “corners” of the business world. We started to get banged up and bruised up and things got a whole lot tougher if not nearly impossible.
Many of us had our lines of credit cut or closed, the ones you need to survive the lean times. Plus the bank still wanted you to pay your bills.
Sales decreased by some 40 to 60 per cent. You did your best with retained earnings, savings and loans from family members to keep afloat. You cut expenses to the bone yet wondered if your taxes and costs were still going to rise.
Those of us in the last third of our lives realized we suddenly had to learn a new sport. In this game we found out we no longer had the right players, skills or resources to win. Now it was time to transform the team to compete in a new arena.
Battered and beaten we must now ask ourselves, so what are our options?
Do nothing and adopt a wait and see attitude. You could stay the course, do nothing new, and hope the game changes back to basketball. Risky and unlikely for the foreseeable future, but it could happen.
Re-tool and start over. Are you ready to learn “hockey” and get comfortable on a hockey rink? Can you learn the skills, source and/or retain talent for the new game? It may take up to 5 to 10 years to get back to where you were one to two years ago.  If you are in your fifties or sixties is this how you want to spend the next five to ten years of your life? Perhaps this could make you feel young again.
Sell your company. Sell NOW? You could take the next 12 to 18 months to position your team on the new field, with the new rules and get maximum value for your company. Securing the right help could make it happen.
Hire a professional manager. You could still plan on playing golf, traveling and/or spending more time with your family. Putting the right coach and management team in place that knows how the new game is played, is a real possibility. Once you have the players onboard you might even consider an ESOP and create a long-term sale process where both you and your employees emerge victorious.
Consider these possibilities. Time, money, talent and the marketplace are your empowering variables. I believe the right answer is to pick one and stick to it.
John Daley is CEO of the Daley Group, LLC in Chesterfield, MO. The Daley Group, LLC is a highly valued resource focusing on sourcing capital,  M&A and business growth for middle market companies. They study M&A and growth challenges and then identify, implement and measure solutions for their clients. For additional information call 636-299-0176 or email coachdaley@daleygroup.com.

Business Growth, where does it start?

 Business Growth starts with the management team and once you have buy in at that level everything else starts to fall into place. The long term success of growth and process improvement is determined by the buy in of the people.