Category Archives: Personal Development

Posted on

Planning for a Successful Year

goal setting


What a year! We said that at the end of 2020 and as a business owner or executive, you’ve had your second challenging year in a row. Finding good staff, dealing with supply chain delays, PPP loans, etc. Things have continued to change; I hope you’ve been able to adapt your business to thrive.

Pandemic or not, it’s the time of year to block out some time for next year’s planning and get your forecasts done. For many of my clients, we have scheduled a 1 or 2-day offsite planning meeting with the senior team. I have another one this week.

At these meetings, we review the current year, noting what did we do well, where we failed or came up short, what we learned, how we are progressing toward our 3 and 10-year targets, what condition our culture is in, where we can improve, what our next big initiatives are, and what the team should look like next year. From this, we come away with a synched plan and goals for the new year.

I love this process. It gets teams fired up and ready for the coming year – which is just around the corner.

I use a somewhat similar process for my own business and personal planning. I don’t set New Year resolutions, but I do set solid goals and plans for next year – broken down by quarter. (I’m not saying this is the best or the only way, but it’s what works for me.)

My process starts in December and then is solidified during the week between Christmas and January 1st. I’ve adopted the following approach from several mentors and high performers I follow.

Review, Reflect, Recognize

I start with a full-year review. I reflect on the good and the bad. What went well? What didn’t? I make a list recognizing all my successes and failures. I document 5-10 bullets of the wins and the losses for the year. I process each, then move forward. This allows me to celebrate the wins and no longer dwell on the failures.

15 years ago, one of the businesses I owned had a really lousy year and the company was suffering. We had a couple of large projects go upside down causing a fairly large loss, we had an unexpected workers’ comp audit bill, and we were dealing with an ongoing sales tax audit. The loss and low sales were causing cash flow problems and wondering how to cover payroll was keeping me up at night. Ultimately, we decided to sell the business. Based on all these factors, we got crushed on the valuation. We sold anyway, and the four shareholders took sizable losses.

That year I got stuck in a failure loop, asking myself How could this have happened? Why me? yada yada. This went on for months until I realized these are not failures but life lessons. One of the biggest lessons of this for me was the importance of using the 13-week cash flow forecast. I started perfecting my approach and have used it ever since.

I also started the practice of recognizing and capturing failures and determining what can be learned. Then, I could intentionally put them behind me, leaving the past in the past. It happened. I learned. I’m moving on.

Revisit, Re-affirm and Revise

After spending this time reflecting, and then turn toward revisiting the “why” of my business. My approaches to business have changed slightly over the years to keep up with the times. (That’s the revise part). But the “why” hasn’t. I want to help businesses and business owners be more successful, make more profit, increase cash flow, and increase their business’s value. (In keeping with that purpose, I added an easy-to-use Business Valuation product this year.)

In business, there are plenty of ups and downs. If your purpose or “why” isn’t solid, you’re going to have problems when things get rough (which they will). I love Elon Musk’s answer when asked what words of encouragement would you give an entrepreneur. He said, “If you need words of encouragement, don’t become an entrepreneur.” I am not certain I completely agree as we all need some encouragement to keep going when the going gets tough, but I also understand his premise. I find that revisiting my “why” helps me push through the tough times.

Realign, Ready, and Record

After the reflection and reaffirming comes a new alignment of goals and readiness for the new year. This includes recording my intentions because research shows that written goals reviewed frequently move the needle. I know that really worked for me this year. Written and reviewed often.

I break my goals into four segments with one big goal and 4 ‘subgoals’ for each with targets set for each quarter related to:

Wealth and Financial
Health
Skills development
Personal Enrichment

Some of my goals are achievement-based (I will do “x” by “y” date), some are habit goals. (I will do “x” every day.)

I then consider some really big goals with firm completion dates. I love Grant Cardone’s idea of 10X goal setting. Set your goal, then multiply by 10. 10X everything. Why can’t a 10-year goal be completed in 1 year? Why not try?

I write the goals down, trying to be as clear as possible. This is the deliverable, this is the deadline. I write down the key motivations and why this goal is important to me, the next steps, and a reward I’ll give myself when I accomplish it.

This yearly process helps me celebrate the progress I’ve made and prepare for the next 12 months. I want to be ready for a super-successful 2022. How about you?

Posted on

Interested, or Committed?

I was listening to a podcast the other day discussing what is necessary to be a high performer. The host posed a thought-provoking question to the guest:

“Are you interested in high performance, or are you committed to high performance?”

There’s a big difference.

This question prompted me to increase my intensity now in order to get my Q4 projects wrapped up by December 31st.

Here are a few things I’m committed to now that may inspire you:

  • Time Blocking
  • Budget Wrap-Up
  • Process Documentation
  • Business Valuations

Time Blocking
I’ve returned to blocking time on my calendar to devote to projects – essentially making appointments with myself. I’ve done this in the past, but it seems that my day gets eaten up quickly with video calls and meetings, and I don’t schedule time for the other important things I need to get done. The simple act of blocking time on my calendar for projects as well as meetings has helped immensely.

Wrapping up 2022 budgets.
Most of my client’s 2022 budgets are very close to being solid. For smaller organizations this can be a quick and painless process, but as companies grow things become more complex. Why? Because we need to get other departments involved, the sales pipeline is fuzzy, new business segments are soaring/sinking, logistic and product costs are increasing, and there are questions about what is the fed going to do with interest rates. The key is to get the plans started and get the team engaged even with some incomplete information. Targets need to be aggressive, but also realistic (arguably). I just scheduled several working meetings and company presentations to kickoff 2022. Getting these dates on the calendar now helps get the budget solid by the end of the year.

Completing Process Documentation
As I’ve discussed before, I’m a huge advocate for writing procedures with the intent to simplify and improve. Documenting these can be an arduous process, but it helps with staff alignment, training, and process improvement. I’m working with one company now that wanted to focus on developing “best backroom practices.” The notion of best practices can be somewhat deceiving. Once we deem a procedure a “best practice,” we tend to stop looking for improvement or a better way with that particular procedure. Since organizational learning and process improvements need to be continuous, I instead encourage “better” practices. Best practices imply they have reached the endpoint. We should always be looking for better practices. So in this case, I guided them to change their mindset.

Business Valuations
Verbeck Associates has a license agreement with BizEquity to enable us to provide an efficient and accurate business valuation. Last month, we did three business valuations – one for a business sale and the other two to develop a value baseline. For those two, we are developing plans to increase the relevant key performance indicators with the goal to double the business value. These business owners are making better choices by simply understanding the things that increase their company’s overall value.

What are your big projects to wrap up by the end of the year? Set the deadline, block the time on your calendar, and commit to getting these done. If you want to achieve big things, you have to be more than just interested. You have to be committed. I am, and I can help you be, too. Contact me for help with any of the initiatives mentioned above!

Posted on

Fourth and Final – Finish Strong and Be Ready

fourth quarter

The fourth quarter has started – the final quarter of the year.  In this fourth-and-final quarter, there are four things you should do in your business to stay strong and successful.

Get Your Team Energized to Finish the Year Strong and Be Ready for 2022

With most of my clients, I am focusing on helping them have a solid Q3 close and a strong finish to 2021.  In the quarterly review meetings, we are looking at the numbers and ensuring that everyone understands the business’s vision and long-term strategy.  I find that, generally, everyone is 70% aligned. We use the opportunity to increase that percentage by having an in-depth discussion of the historical quarter’s results, and then looking at the rest of the year and going into 2022 to align the teams’ vision and long-term strategies. Knowing where you stand can give you motivation and energy for what needs to happen next.

Ensure a Solid Q3 Close

If you’ve established effective processes and routines, your accounting staff should be keeping up with the necessary tasks to ensure you have accurate numbers and information for future decisions. If not, focus on getting these procedures polished (checklists are a great help to this) and getting your staff on board with doing them well EVERY month.

Get Your Short-term Targets in Focus

What are you hoping to see happen in your business during the fourth quarter? Write these goals down, narrowing them to be realistic, measurable, and fitting for your team.

Start the Budget Process

2022 will be here soon so you’ll need to have your budget in place to ensure an effective transition. It may be a simple matter of copying and tweaking this year’s budget. Or, you may have to revamp if, for example, some areas of income didn’t match your expectations. Get input from your staff. Consider cost-cutting measures or redirection of funds to more effective endeavors such as product development or marketing for next year.

Bonus Task

I find it interesting the statistic that 98% of business owners don’t know how much their business is worth.  Their business is their most valuable asset, yet most have no idea of its value until they decide it’s time to sell. I know several owners currently looking to transition out and “retire,” but the offers they are receiving are substantially less than they anticipated.   

In addition, not knowing the current value of your business makes it harder to intentionally increase it over time with well-informed decisions.

I suggest all business owners do a business valuation every few years. If you haven’t done this, let’s arrange to do one now. Our valuation process is inexpensive and efficient and you’ll be pleasantly surprised at how the information helps you as you head into 2022.

Posted on

Discretion or Open-Book: Is There a Better Approach to Culture?

The culture of a business emanates directly from its primary leader(s)—the business owner, CEO, or leadership team.

In my work with a variety of companies, I help provide an atmosphere for high performance primarily through improving financial and operating plans, performance driver tracking and accountability. Even though I bring in my own system for making these improvements, my framework needs to fit into the overall culture of the company. I also personally choose to not work for businesses that don’t have a positive, trustworthy and “desire-to-improve” culture.  Beyond those core principles though, I find that companies have cultures that vary.

Two distinct cultures I have noticed are what I call “Trustworthy Open Book” cultures and “Trustworthy Discretion” cultures.

The Trustworthy Discretion Culture

One of my longest-running clients sold her business last year (which turned out to be perfect timing.) She’d been very successful running it, and enjoyed the satisfaction of selling it at a premium.  Her approach to culture was “trustworthy discretion.”

She was very protective of the company’s numbers, even with the top leaders.  The company was primarily blue-collar with a strong family culture.  Everyone trusted her as owner to do what was best for everyone.  When she pulled me in to help (which provided the discretion of a third-party non-employee working with the numbers) we were able to double the size of the company.  It grew to roughtly $80mm with strong EBITDA, thus commanding a premium selling price.

The Trustworthy Open-Book Culture

I have another client who has gone to an open-book format. All numbers are discussed with the teams and we hold a monthly all-hands meeting to discuss monthly results whether they be good, bad, or ugly.  Everyone is seeing everything and all oars are in the water rowing the same direction. Sales and profits are at an all-time high.

Does that mean either culture can work? Yes, provided three things are in play:

  1. The top leader/leaders set the bar of being completely trustworthy.  In both examples above, the leaders were trusted. One for how she ran the company, the other for how open he has been about the state of the company.  Both built trusting relationships with the people who work for them.
  2. The culture remains consistent.  Inconsistencies lead to lack of trust, even if they aren’t intentional. If you have an open-book culture, then shift slowly OR suddenly to hiding more and more information, you are going to break trust with your team. Alternatively, if you suddenly open up, your team may take a while to feel comfortable with the approach or even feel unsettled that there are going to be other major changes to navigate.  Whatever you choose, be consistent.
  3.  The approach is relevant to the type of business.  Some industries lend themselves to open-book more easily than others. If you are manufacturing a proprietary product, your discretion with bookkeeping may be crucial, too.  If you are non-profit needing donations, being transparent about what the money goes for—a more open-book approach— may be appropriate.

Culture is dependent on the CEO and the leadership team. Trust, no matter which type of culture you choose, is the KEY.

 

Posted on

Inspired to Innovate

Don't Believe Everything You Think

I get inspired and motivated by working with smart, driven business owners every day.  They have been forced to be innovative to drive their companies and be successful in constantly changing unpredictable times.  Working with them forces ME to be innovative too, which I love.

I don’t like to get too comfortable. I believe we need to be constantly improving and developing our capacity.  Don’t believe everything you currently think.  Sometimes we need to think differently and not do things the same way they’ve always been done anymore.

Some business owners get stuck in their growth path. Maybe it’s the obstacles in the path to progress. Sometimes it’s stubbornness or a desire to stick with the comfortable.

Take a typical organizational structure for example.  As companies grow, the typical structure adds management layers – some which are necessary and important.  We are all very familiar, and often comfortable, with the idea of an org chart.  Don’t forget though that these hierarchical organization charts were developed back in the 1800s as a way to handle the now growing, larger organizations developing from the industrial revolution.  We needed to create more production in factories.  We needed supervisors to make sure the workers were doing their jobs. We needed managers to make sure the supervisors were doing their job. We needed the directors to watch the managers, the VP’s to watch the directors, etc.

Today we need different thinking.  Now, we need to trust our employees and help them develop their capacity to act, which helps improve everyone’s capacity. Equipping our employees doesn’t necessarily mean adding more task-work. Now, it’s more about helping them develop their skills so they can make wise productivity choices.  It’s a different way of thinking that also involves helping our employees understand the culture and environment we want for our organizations. What are our core drivers? Who is our real customer? How can each of us be an important part of a synergistic team?*  We want them to be an active part of moving the company forward, not just respond to a list of tasks daily.

Not only is our thinking changing, but our environments are also.  Many of us had to address re-opening our offices – how to layout the office with proper distancing, adapting smaller meeting rooms, spreading out cubes.  Many companies are still questioning the rationale of returning workers to the office full-time.  I know several business leaders who had been very strongly against remote work who were planning to come back to their office as soon as they could.  Now that they see their business working well (some very well) with employees being more productive, collaborative, and happy working remotely, their growth path has shifted and they are intentionally growing their business with remote teams.

As we focus on a strong finish to Q3 in a very strange year, get ready to look at year-to-date results, re-examine your team, and how you’ve adapted in 2020.  The 2HYBP may need to be freshened up for the fourth quarter to finish strong. Be inspired to innovate!

*By the way – here’s a fantastic book on improving your hiring process so you can get the employees that will respond well to growth.  Who, by Geoff Smart and Randy Street.

Posted on

Tips for Communication with Outsourced Pros (including the Human Side)

All CEOs, business owners, and finance execs (CFOs, VP Finance, and controllers) hire and manage outside experts.  Auditors, lawyers, turnaround consultants, IT consultants, HR experts, sales consultants, business consultants, executive coaches and virtual assistants are just some of the roles being filled by independent contractors.  Our current world is opening the door more and more to this type of “gig economy” and the building of virtual teams, some members of which may not be your employees.

In fact, I’m one of those “outside experts” brought in to improve the company’s overall performance. I’ve also worked with hundreds of experts over the years, and I know the importance of working effectively with independent contractors.  For me, it’s all about setting proper expectations and communication – and in today’s world, both are more important than ever.

Having been on all sides, both being hired and doing the hiring for a wide range of projects, I’ve had mostly good experiences, but also a few bumpy ones.

On the good side, an internal control evaluation project I was managing proceeded extremely well.  The project came in on budget, on time and right on scope.  It was a pleasure working with the expert I hired to help with the project.  He was professional, showed up on time, handled the company’s employees well, and delivered a final product that made me look good.

On the bad side, there have been occasions where the professionals I hired didn’t perform anywhere close to where I expected. In one case, they embarrassed me in front of my client’s leadership team.  Then they gave me a bill that blew my socks of, for an incomplete project not even close to what I expected!

I discovered that the most important element for successful projects is clear communication.  I now ensure I have crystal clear objectives with weekly status meetings to ensure everyone is on the same page.  I also continually re-evaluate the situation.  Here are some practical tips to help you navigate your relationship with your outside experts (or manage your relationships with your clients) well:

  1. Start with a clear engagement letter, statement of objectives, or memo of understanding.
  2. Define expectations on all sides so everyone is on the same page.
  3. Conduct a regular review of past, present, future, and future priorities.
  4. Establish a timely invoicing structure. Some outside pros are famous for billing delays which lead to large “lump billings” which can shock a client. (It shouldn’t, but that’s another topic, and even so large billings months later are not best practice.)
  5. Evaluate regularly to make sure the contractor is still adding value, or that you are continuing to add value to the client.  For me, I try to show 10x my fee in better profits for the client. For the virtual executive assistance I contract, we meet almost weekly to discuss objectives and ideas, and she is willing to mention if I’m not making use of a routine service her team is doing for me.  Ensure both sides determine the value and the results and make changes accordingly.

If you’re an outsourced pro, you need to make doing business with you easy and pleasant. You’d want the same from a pro you hire.  Clear expectations and procedures help both sides.

Bonus – since so many of us are working virtually, here are a few additional tips for the human side of communication.

  • Invest time to get to know them your outsourced pro. Start meetings with a bit of chit-chat about how things are in their world.
  • Make them feel part of the team. Ask advice. Include them in team meetings if appropriate.
  • Give feedback on performance – positive or negative, on a regular basis.
  • Understand their other projects. Most outsource pros have more than one client they are serving. Don’t be afraid to show interest and respect to them as a business owner.
  • Pay them market or better – don’t skimp on paying what they’re worth.  You get what you pay for.

You can have extremely successful relationships with outsourced professionals (like me!) if you handle communication intentionally and regularly.

Do you need outsourced CFO help? Contact me!

 

Posted on

Halftime Report: the Value of Mentoring

2020 is half over.

For many, it’s a “Don’t let the door hit you on the way out” attitude. Filled with so many unexpected, and primarily negative things happening in our country and world, it’s no wonder many of us would like a do-over.  Technically, we DO get a “do-over” multiple times per year. The halfway point of the year (no matter how good or bad it’s been) is a good time to evaluate and reset ourselves in goals, priorities, and values.  Sometimes, it’s particularly helpful to have a mentor involved in that process (or be one.)

I have felt incredibly inspired lately to be able to be a mentor and coach in some capacity to several of my client controllers and finance team members.  It’s our responsibility as leaders and experts to provide a trusting, enthusiastic and continually developing work environment to the new generation.  I’ve enjoyed passing along my experience and ideas to them, hoping to help them avoid mistakes and make decisions with wisdom and trustworthy information.

But you can’t just immediately jump into a mentor/mentee relationship without developing trust. It’s a process that goes both directions – me with them, them with me. It involves doing what you say, being transparent and honest, delivering results, and confronting some harsh realities.  You have to be willing to establish clear expectations and hold each other accountable. Sometimes that involves having difficult conversations.

I have set weekly meetings with several of my key client controllers to insure I set clear expectations for the immediate,  and quarterly meetings to focus more on the long-term.  The quarterly meetings are where we dive deeper and I provide bi-lateral candid feedback, using a simple checklist to help me help them review both theirs—and MY leadership and management.  The process is remarkably effective to build trust and accountabilty. I’m also working on my listening skills so I can better understand the other person’s perspective.

Mentoring and coaching is about leadership and guidance.  I find sometimes the teacher becomes the student and I’m loving it.

How about you? As you make a halftime report to yourself, can you consider getting involved in a mentor/mentee relationship to help you grow in your leadership skills the second half of 2020?

Posted on

Our Changing World – Strange Days Indeed

The world has changed.  Your world and the economy as you know it has totally changed – and not for the better in the short-term.  We must face facts. The next two quarters will be brutal.  But this is the time to stay focused because we will all get through this.  When you’re in hell, you keep going.

But sometimes, in a crisis, we decide to be honest about our situation (even if it’s not fun), consider the worst-case scenarios (which may not become the case for our business), determine the actual facts of the situation in relation to our unique business (without panic), consider all resources (we may have more than we realize), cut out spending (which isn’t a bad idea even in healthy times) and take appropriate action (that’s what you are in leadership for.)

For many, part of this process will be to take advantage of the Federal Coronavirus Relief Bill.  Work with your CPA, lawyer, and banker now!  See some summary pieces and the simple applications here.

Thoughts On Remote Work

All my clients are now working remotely.  Some companies were progressive and pushed for being ready; others were in denial until the state governors issued stay at home orders.

I’ve been working remotely for the last 15 years as a trusted business advisor and virtual CFO to businesses around the country.  Now everyone is working remotely (or WFH – work from home).  I am lucky to have a great office space above my detached garage.  It’s interesting, with such an increase in video calls, to see how else is using their remote/home space.  Interacting with and leading remote teams is much different for some, where it’s business as usual for those who have been working virtually for years.

Many of my clients are using (and loving) Microsoft Team. I like it too (though I prefer NOZBE Teams.)  Many other tools are now becoming well-known such as Zoom, Asana, Basecamp, and more.

The tool you pick is important, but what’s more important is how you use it.  Try to mirror some of the same standards, schedules, and communication guidelines that would be in place in the on-location office. These virtual tools help you be able to carry on in a similar way … yet do understand that your team is going through a major change that is likely affecting (sometimes deeply) their personal lives, level of distraction, and emotions. Show some grace for a while, while keeping some standards and routines that will provide structure and even, respite, from the onslaught of information and fear.

Let me know if I can be of help to your team during this scary but also potentially beneficial (in some ways) time.  Contact me here.

Posted on

Stop Wearing So Many Hats: Who Can Help You?

I see it all the time as I travel the country talking to business owners. They try to do everything. Sales, HR, Operations, Marketing, Accounting, and oh yeah … leadership.

It’s time to delegate responsibilities and focus on what you’re good at – delegate, double-check and disappear (or go do what you’re good at.)

Generally, business owners develop their skills and expertise through sales, operations, tech, or the finance side of business. Most of the business owners I talk to cut their teeth on sales which makes sense based on their “take action” personality types. This works great – in business, sales start everything.

However, what most business owners are weakest at is their accounting and finance skills.

They understand the P&L. Simple – sales minus cost minus expense equals net income. However, they generally don’t want to understand the balance sheet or cash flow.

I find the biggest need for these businesses I’ve been talking to recently is 1) a complete understanding of their financial statements (the business report card) and 2) clean, basic reporting for visibility and accountability. This includes tracking key business drivers for profit, asset velocity, business efficiency, corporate effectiveness, and cash flow.

I find the biggest need for these businesses I’ve been talking to recently is a complete understanding of the financial statements (your report card) and clean basic reporting for visibility and accountability tracking key business drivers for profit, asset velocity, business efficiency, corporate effectiveness, and cash flow.

Many of these owners don’t trust their numbers and therefore they run things by the seat of their pants. With data analytics tools now, it’s easy to get real-time data to look at customer psychometrics and data, as long as the information is current. That often takes delegation to someone (for lack of a better term) more excited about keeping up with it. You don’t have to be the accountant to understand the basics that will help you make the best decisions you can for your business. Who can you utilize on your team that will help you have the data you need?

So delegate it, double-check by getting regular updates, and spend the bulk of your time doing what YOU do best!

If your business doesn’t have this system in place, let’s talk.

Posted on

The Importance of Checklists and Forms

We all need checklists in our life. It sucks, but for most of us it’s the only way to stay consistent. Yet I know very few people who use them.

I wouldn’t be able to keep up with all the details I have to manage without checklists. I have a morning routine checklist a work start-up and shutdown checklist, a Monday checklist for each client, one for daily workouts, etc.

I might need a checklist for my checklists!

You might laugh, but checklists do two valuable things for me:

  1. Do what I have planned for the week
  2. Push me to stay consistent.

We can randomly travel through life without a plan, but that tends to lead to speculation of “Where did the time go?” or “I thought I’d be in a different place in life/health/etc. at this point.”

Being intentional is critical in every area of life. Your house wasn’t built without a plan. Your car was checked numerous times in production. Hopefully, your medical practitioners have a checklist for procedures – even ones they do daily.

One of my clients is a start-up company and I am helping them develop processes and procedures. We are putting together checklists to make sure we don’t miss anything. It’s really a brilliant thing to do early on in a business. Now we have repeatable steps for training, and the ability to brainstorm and maximize the 80/20 rule for maximum efficiency. Taking the thinking out of basic, recurring tasks reduces mental fatigue. By documenting workflow, it helps any employee who takes on that responsibility to develop consistency. It helps if they go on vacation — their sub can keep the ball rolling. And the work is done in a recognizable way.  As we build these procedures, we are creating screen-cast recordings as a training and reference tool.

How about you? Do you have your everyday/every week/ every month processes written down into checklists? Don’t let the idea of it being too elementary keep you from doing it. It’s actually the opposite–it elevates your business in a way that will make it stand out from those who just “go with the flow.”

Resources:

I recommend the books The E-myth Revisited and The Checklist Manifesto. 

My resource page.

Suggested checklists:

  • A basic meeting checklist for most meetings
  • Month-end financial statement closing checklist
  • New project/idea checklist
  • New hire and onboarding checklist
  • Sales meeting checklist
  • Annual strategy planning checklist
  • New Habit checklist – (I love the app Habit List – although I didn’t make it a habit to use it 🙂