People and money... building a good foundation.

There was a an "old school" leader I worked with who played the game of business hard... smoked hard, drank hard, and he played to WIN hard. With a drink in hand, I remember him telling me, "A good manager is determined by how he manages his financial picture". Over the years I have remembered his words and although they do ring true, what he said lacked something so profoundly important.

What he should have said in my humble opinion, is something to this effect, "Good managers are determined by how they manage their people and financial picture"

PEOPLE and MONEY - It is, and always will be, about people and money.

Let's start with MONEY as most of us want it, like to spend it, and will leverage the perceptions of having it. When I say money however, I am actually referring to how you manage it... how you generate it and how you effectively work it; spend it, invest it, and control it - It is the fuel that runs everything. And if money is the fuel, then PEOPLE are the engine... nothing, simply nothing, run's, operates or gets done without people. Full stop.

If you watch successful leaders and managers they always have their Finance and HR partners very close at hand and are ever present (sometimes commercial is included, but that is usually to remind them revenues are not enough... a truism to be sure, as they never are). The effective management of people and money is the foundation for any business success. I had once "acquired" an assignment, and will go out on a limb to say it was a category five "shit storm" - Within the first two days I was asking for my HR and Finance partners. They worked with me understand our bench strength of people, the structure we were working with, and our financial health. In the end, finances were put in order with established controls, people and structure "righted", and as a result, activities in-line with our objectives started to take shape. Success was starting to take hold.   

People and Money, like the engine and fuel, are the fundamentals of a "vehicle" that will take you anywhere and allow you to do anything. It's important to get good at driving - 

• Know your HR and Financial partners; meet with them regularly.
• Involve your HR and Financial partners in your team meetings and activities.
• Ensure you have personal HR and Finance development objectives, as part of your annual goals.
• Ask leaders you respect about their philosophies regarding people and money management.
• Develop a lead and lag indicator dashboard that highlight your people and money goals.
• You want individual contributors to be well versed with people and money as it strengthens the bench, increases engagement, understanding, and optimizes execution.
• Elicit constructive feedback and be open to it.
• Don't underestimate how complex and complicated people and money can get, particularly in times of rapid growth and expansion. 

Remember that time when you ran out of gas, or heard a piston that had ceased up in the engine and the car came a halt? You were so happy to see the friendly tow truck driver... well, with PEOPLE and MONEY, someone analogous to a tow truck driver shows up, but more often than not you aren't happy to see them, and they generally are not very friendly.

It's best to build a good People and Money foundation and stay on the move.

 gpe

Is your vision aligned?

The following is the original and the rewrite can be found by clicking here.

I was at a meeting a while back when a business leader suggested the need to spend some time together to ensure our "visions are aligned" - There was great leadership in this simple request. In it, he would ensure the parties around the table truly had a vision and in turn understood their goals, as well as ensuring that there was a commonality and in that effectively work together. 

A vision, or vision statement is sometimes called a picture of you in the future, but it'’s so much more than that. Your vision is your inspiration, the framework for all your planning and all of your activities. Individuals and organizations should have a vision and it should be in a form that is easy to articulate... it should roll of the tongue effortlessly.

One obvious reason is that "everything you do" should be connected to your "vision for the future", allowing you will achieve whatever you have in mind for yourself. As the conversation between Alice and the Cheshire Cat tells us , "if you don't know where you are going, it doesn't matter what road you take" ( What they didn't mention is that some roads are easier to travel than others ).

Another reason for an articulated vision, and I will suggest even more important than above, is that very few things are ever built alone... success comes when you work with others. Having a vision that is very easy to articulate makes it simple for people to understand, engage, and align - People rallying around a common vision is how momentum to do incredible things gets started, and more importantly sustained. This is where motivational sayings are made. 

But, what happens when you find yourself in a situation where your visions do not aligned?

• Differing agendas and personal conflict.
• Poor and ineffective execution.
• Frustration.
• Lost opportunity and wasted effort.
• Mediocrity. 

This is a result of not being able to clearly articulate visions and determine if there is commonality, synergy and alignment to make things happen. Understanding this, is where leadership is made. 

Having different visions is just fine, but trying to build something with misaligned visions is precarious to say the least. It is important that all of us bring a clear vision to "the table", so we all know what we will rally behind ... or not.

gpe 

A business lunch and insights into dealing with a business truism.

I was at a business lunch recently, and inevitably someone began to discuss the challenges that come with business; I was instantly reminded of a core business truism... something fundamental to all that is defined as business and very complex. It goes like this - 

 Profit = Revenue - Cost*

• Revenue: money generating from the products or services you sell.
• Cost: the money needed to run your business (tangible and intangible)
• Success is defined as profit moves towards, and ultimately above zero.

Reflecting back on my salad and our conversations around the table, this is what I walked away with. 

Business is a people activity

No single person can run a business alone... it's simply too complex to have all the skills and knowledge needed, let alone the time. This is where building strong business relationships are important with trusted, smart and reliable people. As the old saying goes, "If you want to go fast go alone, but if you want to go far go together". 

Asking the right question is more important than having the right answer

Asking the right question that uncovers the answer to a better "line of sight" or understanding of a situation is key. It is much better to say, "I don't have the answer, but will find it", than not know what question to ask and in turn not get the answer you need. The old adage of "You don't know, what you don't know" rings true here, and remembering that business is a people activity, will help. The more good people involved in the discussion, the better chance you will ask the "right questions".

Listening is much more important than talking

Sharing thoughts, perspectives, knowledge and insight are important for you when tackling this truism. Let someone else have a turn sharing their thoughts. It will serve you well.

The Customer

If your business lunch doesn't include talking about the customer, then what you are having is just a lunch. Customers are - 

• The people who will buy your product and/or service contributing to revenue generation.
• The employee who will implement activities that either generate revenue, or help pull cost out of your business activities.
• The community where your business operates and is involved... this indirectly generates revenue and reduces costs, as well as supports sustainability.
• The shareholder who looks for profit and good governance.

Revenue is not easy to generate

Great ideas lead to great products... however, contrary to that popular saying, "great products sell themselves", they in fact don't. Generating revenue involves a large amount of work to develop customer relationships, communicate the value of your product, overcome aggressive competitors, and offer a service proposition that will have the customer purchase from you again. It is hard work.

Patience

Just because you want it really, really badly, doesn't mean others do; it takes time to communicate ideas, change perspectives and influence behavior. Endurance, persistence, risk tolerance and dedication are also other characteristics that will serve you well when dealing with this truism. 

In the end, it is your decision

Depending on your position in an organization, your decisions may or may not have direct ramifications on revenue or costs (or both). But we all have a part to play and responsible for the decisions we make; stand by them, and make them work. 

Revenue versus Cost

There is an attractive "bunny hole of a discussion" with regard to whether revenue generation is more important than effective cost management and governance. This is a pointless debate and is analogous to arguing that the heart is more important than the lungs in terms of keeping the body alive. It's best to focus on what you need to do and be as effective as you can be. 

One of the stories around the table involved someone working through a complex situation and they metaphorically said, " It just seems like every time we turn over a new stone we find a 'squiggly'"**. I laughed and laughed... not because of the problem they were dealing with, but because a very accomplished individual used a word like "squiggly". And this is why I like business.

Business is not easy and the truism of "Profit = revenue - cost" can take a lifetime to solve. But as you work through it, you are challenged, rewarded, learn something new everyday, meet amazing people who use the word "squiggly" - When you look back on it all, you will more often than not be proud of what you have accomplished, had fun and laughed. 

gpe

* If you believe this truism doesn't apply to you, then you are either not in business or you have "some" work ahead of you.

** Saying squiggly instead of worm as a metaphor for a "problem" just struck me very funny and also illustrates that they weren't necessarily nice looking problems (with all due respect to worms).