Archive for August, 2012

6 Challenges Fast Growing Companies Face

Tuesday, August 28th, 2012

I’ve mentioned Inc. magazine www.inc.com several times before. It’s a great resource.

There’s a well-researched article in the current issue about 6 challenges fast growing companies face. They’re all about execution – and if the owner doesn’t deal with them well any one of them can be fatal.

1. Your business outgrows its staff. One or more hard working, loyal employees who had the skills required to make a great contribution when they joined the company can no longer deliver. Owners are torn, knowing that the business wouldn’t be where it is without Joe or Mary – but that they just can’t cope and are hurting the company now. The solution needn’t be just to let them go but the owner needs to deal with the situation quickly and honestly.

2. You wait too long to hire.  A classic dilemma. Hire people before you need them and you add to overhead and risk having to lay them off if the orders you thought were coming don’t. The alternative is to risk service and credibility if the business does materialize. One solution – hire all-rounders who you can train and slot into more than one position.

3. Your business lacks the right systems. Two potential causes here. Either you don’t implement processes and systems quickly enough or the system you chose doesn’t work as advertised. I know which one frustrates me most – the latter. There’s nothing worse than dealing with implementation problems and delays – so have a solid contingency plan in case it happens.

4. You run out of money. We’ve said it before, and I’ll say it again, the most important document for a business owner is a cash flow forecast. Keep it up to date, study it often and it will provide the information you need to stay out of trouble. Because growing companies have to invest before invoices are cut, never mind paid, they become less, not more, liquid.

5. You can’t keep up with demand. This is the most dangerous point for fast growing companies according to the article. The owner takes on debt to finance additional capacity – or people – and the demand doesn’t appear. According to the author the best solution is to manage growth so that it happens in small rather than large increments. But that’s not always easy to do.

6. The problem is the owner. If you’ve built a company – i.e. been successful – why would you have to change? That’s a reasonable question. But I notice, after 15 years of working with business owners, that the ones who grow their companies successfully are the most open and willing to change themselves. If the business can outgrow an employee, why can’t it outgrow the owner?

You can read the full article 6 Classic Ways to Crash Your Company here.

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6 Thoughts For Your Planning/Budgeting Process

Tuesday, August 21st, 2012

Can you believe that it’s almost the end of August?

I’ve hardly noticed the summer slipping past – perhaps I dozed more than I intended because of the heat!

It’ll be Labour Day in 2 weeks.

Then kids will be back in school which, for many business owners and executives, will mean that vacations are over for another year and it’s back to work. If your company has a calendar fiscal year, 2012 will be beginning to take shape.

The results from the first two quarters should be firmed up. Orders already in-house and the sales pipeline will provide an indication of whether you will make, or beat, your top line targets or whether there will be a shortfall. Year to date margins and expenses will give you a feel for what, if anything, has to be done to protect bottom line profit.

And, of course, annual planning and budgeting for 2013 will begin soon – if it hasn’t already started.

So here are some thoughts (I’d hesitate to call them pearls of anything, let alone wisdom) from posts I’ve written at around this time of year in the past.

1. To make as accurate a guess as possible about what the future holds you’re going to have to make assumptions. On what information will you base them? Something you read – or are you going to get out and talk to your customers and suppliers about what is happening in their world and what that will mean for you?  (See Don’t Let The Summer Heat Cause A Winter Chill)

2. When so much of what is going on around you seems out of control, it’s easy to stop focusing on the things that are under your control – i.e. whether or not you actually execute your plan. Badly done or completely neglected by many companies, execution is what turns plans into results. (From 6 Tips for Getting Better Results Next Year)

3. In this age of fast, unrelenting change it makes sense to forecast several different scenarios, build assumptions on thorough, comprehensive research (formal and informal) and think through contingency plans. (See It’s THAT Time of Year Again)

4. A sample of responses to a survey sent to our database showed that many companies who said they would miss their targets also said they had completed a structured planning process before the start of the fiscal year. That raises some questions. (See them at Give Yourself A Chance in 2011)

5. The owner must be the champion of the planning process. If, for example, the accounting department are perceived to be driving the process it will be seen as only a number crunching exercise, to be completed as quickly as possible. (See More Heat Less Chill)

6. Think you’re going to miss those top and bottom line targets I mentioned earlier? Then consider changing or modifying your strategy and business planning process. Why? Because if you use the same tools, in the same way, and expect a different outcome you may be in for a surprise. (See Don’t Fool Yourself……… )

Let me know what you think.

And good luck with your planning/budgeting meetings.

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Our Internet Is Not Their Internet

Tuesday, August 14th, 2012

Our guest this week is Paul Chato, CEO at Your Web Department™, the world’s first and only hosted website management system that lets people update and design their websites without programming. It’s hard enough to succeed in one career. Paul has succeeded in four different pursuits. See below…………

 

The Internet we are celebrating and using today is the slimmest approximation of what the Internet will eventually evolve to, assuming there is some kind of end point. Kind of like the reverse of the big bang theory. We have a better idea of where the Universe is heading than how it all began and while we know how the Internet started we have no idea where it’s going.

I have come to the conclusion that all we have done so far is digitally recreate a semblance of our present and near past, and stamped it “The Future.” Sort of like those Disney Epcot displays in the 80’s. We try to find old friends on Facebook. We look up ways to fix the washing machine pump. We had home delivery of newspapers, now we have newspaper apps. I could go on, but you get the idea. We have created an Internet us oldsters find familiar and comfortable, but the problem is that people 30 years old and younger have no idea why we are fascinated by this stuff. We have deluded ourselves into thinking we have built the future. We have not. Shockingly large swaths of what we have built will be disposed of in less than 5 years after my generation’s influence wanes.

For instance, few of this cohort read the New York Times in any of its forms. Ditto for local papers. They don’t listen to Talk Radio. They have a tight group of trusted friends. They find what they like. YouTube is still cool, I think. Entertainment in many forms is hot (I include sports and eating out here). They text amongst themselves. They search for specific answers. There is less serendipity in their lives – not including the 5 Korean Kimchi restaurants Siri has found for you. There is no looking through an encyclopedia for Schweitzer only to get distracted by the history of schnitzel. Heck, there is little interest in Schweitzer. Never in our history has the past been so disposable. And let’s not even get onto the topic of politics which we’ve managed to make uninteresting, bitchy and irrelevant.

We are not creating stupid people but a different people. The impact of their influence is only now being felt and understood. One thing’s for sure, we are entering into an era of hyper-consumerism and hyper-entertainment. Buying stuff in quicker, cooler ways will intensify. The Passbook feature in Apple’s iOS 6 points to this as does NFC (being able to buy stuff with your smartphone). But don’t be shocked at the speed with which our cherished Internet institutions will be ditched.

Physical structures provide an anchor to the present and a connection to the past. The Internet provides none of that. A website can be gone in an instance. Ironically, the predictions of the death of bricks and mortar stores at the start of the Internet big bang had it completely wrong. We know that now. Physical stores are hugely important in this age of hyper-consumerism. They are Brand Anchors. They are movie stars.

Retailers are ‘stars’

Anyone can buy stuff from Home Depot online but when you choose to go to the actual store people get that, “OMG, I’m actually at the store!” buzz. Buying something from a Lululemon outlet is like getting an autograph. Retailers must view their stores as their ‘stars on tour’. Come visit Canadian Tire. Get the t-shirt.

So, hyper-consumerism/hyper-entertainment I can see. The Internet will be unrecognizable in 10 years, but my crystal ball is cloudy as to how that will transpire. Are you ready to embrace this new Internet? If you’re a business, you’d better start thinking about it. Me? Just wake me up in 10 years.

More About Paul:
At first pursuing a potential career in nuclear physics, Paul chose, instead, to develop his creative skills. After graduating from Ryerson’s Radio Television Arts program he started Chato Art Ink, one of Toronto’s more successful independent design firms. He stopped designing to take up comedy, helping to form the now legendary Frantics Comedy Troupe, and will be forever remembered as Mr. Canoehead, “Canada’s aluminum-headed crime fighter.” Paul then joined the Canadian Broadcasting Corporation rising to the position of Head of TV Comedy. After considering a move to Los Angeles to take up a position as VP of Development at a major Hollywood studio, Paul instead chose to exercise his interest in computers. He started Electramedia and in the intervening years produced the hugely successful CD-ROM game Jewels of the Oracle, hundreds of corporate presentations, videos and Internet sites. In 1997 Electramedia switched its focus 100% to the Internet and most recently has become Your Web Department™.


If you would like to contact Paul email him at
paul@yourwebdepartment.com

Hurray For Entrepreneurs

Tuesday, August 7th, 2012

This week’s guest, Startup Expert, Roger Pierce, produces articles, videos and blogs to help companies engage business owners. He’s worked with Scotiabank, Visa, Staples, Bell, HP, FedEx, Cisco and Microsoft. Roger is the co-author of the book, Thriving Solo: How to Grow a Successful Business, and writes startup columns for The Toronto Sun, 24Hrs and Profit Magazine. www.NewcomerStartup.com

Any year is a great year to be a business owner, but last year the Government of Canada and most of the provinces officially declared 2011 as “The Year of the Entrepreneur.” In fact, throughout October, entrepreneurs were celebrated across the country as part of Small Business Month.

If you’re running a small business, or plan to start one, you deserve the applause: Here’s why:

Employ the most people 

According to Industry Canada, 48.3 percent of Canada’s workers are employed by small businesses. That’s over 5 Million people. We collectively employ more Canadians than any one company or government. 

Take big risks 

It’s not easy being an entrepreneur. We work long hours. We don’t get a steady paycheque. It takes several years for a new business to stabilize. Our personal relationships suffer, because our attention (and our money!) is held by the business. We risk our finances, our reputations and our energies without any guarantee of success; in fact, half of all Canadian startups fail within five years.

Sell to the world

It’s not big companies that open international markets, but small ones. Industry Canada says 86 percent of Canadian exporters were small businesses in 2009, accounting for $68 Billion in exports. In that same year, 28 percent of Canada’s GDP was generated by businesses with less than 50 employees.
 

Change the world

It’s entrepreneurs who make our lives better. From Gutenburg’s printing press to Steve Jobs’s revolutionary electronic devices, entrepreneurs challenge the status quo and dare to be different. We all win when an entrepreneur succeeds.

If you’re one of Canada’s 2.7 Million entrepreneurs, please know you hold the respect of a nation. Stop for a moment, take your bow…and then get back to work.

You can contact Roger at 416-302-5251 or pierce@newcomerstartup.com.

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