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"I love what I do."
How often do you hear people say these words? Maybe if you
spend a lot of time with motivational speakers, it’s commonplace. But no matter
how emotionally invested you are in your work, it’s easy to feel like something
is missing. After all, isn't putting "love" and "work" in
the same sentence akin to using "pleasure" and "toil” in the
same breath? Chances are though, if you like what you do, on a good day you
might actually feel some love for it. But is that passion for work life the key
to happiness?
“Choose a job you love, and you will never have to work a
day in your life.”
Surely this maxim will find it's way into many a graduate's
ear this spring. But can it be that are we setting them up for disappointment
by expecting work to feel like… not-work? As Chrissy Scivicque in Forbes
challenges, “It’s dangerous to suggest that work can be anything other than
work."
"That's why they call it work."
It's true that even those who have reached unimaginable
success at their would-be dream job would have to admit that, on some level,
work is still work. But perhaps after redefining our expectations of what work
should be, we can actually appreciate the happiness within. If you have ever
had a day where you wanted to swap positions with a happy-go-lucky sanitation
worker, maybe it’s the happy-go-lucky part you need to focus on.
"Labor of love."
Perhaps the answer lies somewhere in-between attitude and
aptitude. Once you know how much happiness you can reasonably expect from any
work, you see your own work in a different light. Start with the notion that
some component of work will always be, if not tedious, at least routine. A
farmer can still love to farm, even if he doesn't enjoy being at the mercy of
the elements. A doctor can love to heal the sick, but they also have to spend a
good portion of the day filling out paperwork. Remember that difficulty and
unpleasantness are a component of any job worth being passionate about. Being
in a position of authority can make these extremes even more marked.
So, is having a passion for what you do the key to
happiness? The answer lies not in blindly pursuing something you think might
make you happy; it's in deciding to approach everything you do, in and out of
the office, with passion.
 Chances are, as an executive on the go, your business style has evolved along with the latest technology. But for all of the time saving apps and platforms we have at our disposal, some have only clogged our daily to-do list more. Here are a few bad habits to break if you are looking to simplify your schedule.
Bad habit: being trigger happy for meetings
Whether we do it ourselves, or rely on an assistant keeping the daily calendar, sometimes we schedule more meetings than we really need. How many times have you gone to a project status meeting, full of people, only to find that nothing has really changed? Think about who really needs to attend and avoid inviting everyone “just in case.” That’s what a good note-taker is for, so that updates can be shared via email.
Bad habit: being a slave to your inbox
Do you answer your emails one by one as they come in? The constant bleep of a new message can be a huge distraction as you try to accomplish the task at hand, and it can take precious minutes to recover your train of thought. One email can easily send you off on a tangent that suddenly chews up an entire hour. Schedule “mail time” into your day, rather than trying to keep up with your inbox all day long. Utilize your email filters and folders to do some of the work for you. Or better yet, have a trusted assistant monitor and prioritize your inbox.
Bad habit: being vague with your availability
One of the best things you can do as a leader is to make it clear when you are and are not available to chat. A closed or open door is sometimes all you need to send the right signal, but if you work in an open concept office, this can be tricky. Set a precedent by giving people a visual that shows them when you are not to be interrupted: turn on a certain lamp, wear headphones, position your chair towards privacy. You can even have fun with it, setting that teddy bear from your daughter on your desk to ward off those who might break your concentration.
Bad habit: being preoccupied with social media
Whether you have been on board with Facebook since day one, or are a novice tweeter, it’s easy to get caught up in online conversations that might have nothing to do with the business at hand. Set aside time to give yourself a mental break from work, to drop in on conversations that are easily flagged for follow-up later. If you find yourself addicted, most browsers have tools that will place a limit how much time you can spend on a certain site through the course of your day.
We spend a lot of effort measuring the productivity of our teams. Try to spend a set amount of time each day improving your own effectiveness. As you look for bad habits to eliminate, take the last 10 minutes of your day to journal your productivity. Finding out where you lose time during the day can give you a valuable insight into planning your day ahead.
So much of efforts in recruiting and retaining employees focuses on salary, benefits, and other perks, that often one of the most attractive aspects of your company goes unnoticed: it’s your office layout.
With changes in the workplace, many are re-visiting office space design, hoping to provide an increasingly appealing space and collaborative culture in which their teams can conduct daily business. Office walls are literally coming down, foregoing traditional cubicle rows with open community space. The New York Times recently reported that “two-thirds of American office space is now configured in some sort of open arrangement.”
Last year FastCompany wrote that digital culture has played an important role in our move away from walled in offices. The article states, “A traditional office layout is designed to communicate power among certain individuals and barriers between departments. This does not support the collaborative ethos which is intrinsic to the web.”
Certainly instantaneous sharing has shifted the way we view the workspace. But additionally, open concept offices boost morale and can be just plain fun, as seen in the notoriously over-the-top design at Google headquarters.
Of course, for most of us, creating an enjoyable environment doesn’t necessitate playground equipment. It can be something as simple as relegating the room with the best view, previously reserved for top brass, as a communal space, as The Kindness Revolution author Ed Horrell suggests in this piece for Custom Service Manager.
At this point you might be thinking, “You mean give up my corner office!?” Actually, it’s not just lower ranking employees who are seeking out open spaces. Many of today's most successful CEOs are finding that a private office keeps them isolated and unaware of the actual daily work, and unable to get the pulse of their team. Instead some are opting for cubicle life or collaborative spaces. As reported in Forbes recently reported, top CEOs like Tony Hsieh of Zappos, Meg Whitman of Hewlett Packard (and formerly eBay), Klaus Kleinfeld of Alcoa Pittsburg, and even New York City Mayor, Michael Bloomberg, prefer working shoulder-to-shoulder with their employees.
Of course all of these scenarios are reliant upon other factors, such as the type business you run, and how your brand needs to be conveyed. But even in the most conservative and professional offices, there are ways you can make your office layout more fun and practical for your employees. And who knows? You might like it so much that you’ll want to join them.
 It’s happened to any of us in a management position. You’ve gone through a few rounds of interviews, and find yourself needing to make a decision between one of two very different candidates.
One candidate has a strong resume demonstrating years of experience in your industry. He has all of the skills and qualifications you could expect, and you know he could hit the ground running.
The other candidate is younger, and hasn’t held positions that would translate directly to this role. But she’s been successful at every turn. Your gut says think that in a few years you might really be kicking yourself for having passed on her.
Which do you pick?
Hire for your objectives, and for theirs
Of course, there’s no one right answer, but the first thing you should do is take a look at your organization’s objectives.
Is there a time-crunch causing you to need immediate help? Are you launching a new product? Is this a highly skilled technical role? Then you’ll probably lean toward hiring based on experience.
However, if your company has a strong mentorship program, is growing steadily and looking long-term, or more interested in innovation, then the candidate with potential might be the way to go.
It’s not all about your needs, either. Take a long look at what the candidate will want to get out of this role, as well.
Make sure your company’s values align with theirs. Consider whether one candidate is a stronger cultural fit for the organization. Be certain that they will have all the tools they’ll need to succeed, whether they have the experience or the potential.
Watch out for red-flags
Experience and potential aren’t always positives. If that first candidate spent fifteen years in a position, was it because he had no motivation to rise above? Did he lack the skills to take his career to the next level? Does he limit his problem-solving abilities by resorting to tried-and-true methods he’s relied upon over the years?
Conversely, potential is always difficult to measure. Her high GPA doesn’t necessarily translate to intelligence. Someone possessing the ability to rise to her potential will already have demonstrated the ability to stand out from the crowd; she’s done more than her peers of a similar age and background. You don’t know that she’ll have the dedication to stay with one organization long enough for your investment to pay off.
Final considerations
Many employers will look at those red-flags and err on the side of experience. Hiring for potential is a risk, but not everyone has it. Experience happens over time, no matter what.
A short-term, safe approach may stagnate your company, as well. Ideally, you’ll have a mix of experience and potential on your team. The attributes complement each other, and both sides of the spectrum will have something to learn from the other.
Most importantly, make sure the candidate wants to do the work that comes along with the position. It sounds obvious, but whether your candidate has the experience or the potential, the most successful hire will be the one who is willing to do whatever the job requires.
 Staying ahead of the curve is tougher than ever. In fact, sometimes it’s all you can do to keep up with changing technology. In an ideal world, you’d hire a person who does one thing really well, and they might do that one thing for their entire career.
The skills you learned in school that got you that first job may have been applicable for several years, but that’s not the case anymore. From advertising to Zamboni repair, technology requires us all to be in a continual state of learning.
Henry Ford said, "Anyone who stops learning is old, whether at twenty or eighty." What was true then, is even truer now. Creating an environment where your employees continue to learn shouldn’t be thought of as merely a perk. It should be considered a must. And in our ever-changing business climate, it is a win-win. Here’s how to make learning work for you and your team:
Retain
Offering continued education is a great incentive when you’re hiring. It’s also an excellent way to retain the people you already have on board. Your best employees want to stay at the forefront of your industry, and to keep their skills sharp so as to contribute at a high level. If you’re not providing that opportunity or encouraging them to do so, they may go elsewhere. When you consider the cost of hiring and training someone new, you are better off investing that money in members of your existing team. Someone who wants to learn more is someone you want to keep. Facilitating their growth shows that you value your employees, and gives them something to value in return.
Reward
Team chemistry is vitally important to the success of any business. Be sure to reward those employees who express a desire to share what they are learning during their course of education. When you offer tuition reimbursement, you are in a sense, paying to have that knowledge imported and spread throughout your business. One enlightened employee can share their newfound wisdom at internal seminars, workshops, and training sessions, saving you money from having to hire outside contractors and instructors.
Revitalize
Tomorrow’s must-have skills are built upon the innovations of today. A recent article in Fast Company points out that thriving in today’s unpredictable climate requires the ability to embrace change. To quote the article, “Few traditional career tactics train us for an era where the most important skill is the ability to acquire new skills.” Perhaps more than any other offering, educating your employees arms them with the tools to succeed.
Of course, continual learning is not just for your employees. It should be number one on your to-do list, as well. If you don’t have time for formal classes, there are several online courses and tutorials that can be affordable, or even free of charge. Sites like Lynda.com can be an economical learning resource for you and your company, offering many very specialized and personalized courses of study.
Are you doing all you can to foster lifelong learning in your company and in your life? Share your tips and advice.
TEC Breakfast & Speaker Event
Thursday, March 22, 2012
8:00 until 12:00 noon
Wisconsin Club, Milwaukee Room
900 W Wisconsin Avenue
Milwaukee, WI
“Discovering The Leader’s Code Part 1: Ancient Secrets For Executive Performance”
RESOURCE SPECIALIST: Don Schmincke, THE SAGA INSTITUTE
Interested in attending? Contact Michele B. at tec@tecmidwest.com, or (262) 821-3340 for details.
ABOUT THE PRESENTATION Based on his book, The Code of the Executive, Don Schmincke focuses this unique session on an issue personally dear to the CEO's heart - how to lead extraordinary performance in their organization. When the organization functions effectively, the CEO has more fun, strategy executes, and the bottom-line improves. Yet most CEOs are frustrated with the level of results produced by their organization, or the politics, hidden agendas, and other dysfunctional behaviors sapping organizational vitality.
This highly participative session addresses these issues with a special journey into ancient history to rediscover lost wisdom that has propelled organizations to success for thousands of years. Members leave with take-home, valued actions and a set of tools for the future.
ABOUT DON SCHMINCKE A dynamic keynote speaker and provocative author, Don Schmincke, began his career as a scientist and engineer. After graduating from MIT and Johns Hopkins University he became fascinated with how people organize and perform in groups, and even more intrigued by the high failure rate of management consulting and leadership theories. With more than two decades of research using anthropology and evolutionary genetics, he discovered that most management theories fail during implementation due to biological factors.
Schmincke is the author of the bestselling book, The Code Of The Executive, and has been featured in The Wall Street Journal and USA Today, and in over 60 industry publications annually. He has appeared on CNN in addition to hundreds of radio and television programs worldwide. In 1990, he founded The SAGA Leadership Institute (www.sagaleadership.com) to offer corporate training programs and help CEOs accelerate business performance in the areas of strategy, leadership, sales, and cultural alignment.
Today, Schmincke’s revolutionary work has established him as a consultant renegade and a top speaker for the world’s largest CEO member organization. He flies 200,000 miles annually keynote speaking at conferences, training CEOs in his workshops, and working with clients in every industry from the Department of Defense strategy (once being shot off an aircraft carrier – he’s still recovering) to large and small corporations including the healthcare, manufacturing/distribution, information/ communications, and finance/insurance sectors.
His new book, High Altitude Leadership, with Emmy-nominated Chris Warner (his historic K2 summit seen in the NBC Wide World of Sports special) reveals leadership insights from Death-Zone environments. It was released by Josses-Bass in November 2008.
 For every board meeting we’ve attended that was productive, inspiring, and energizing, we’ve all been in another that was stressful, fruitless, or just a plain old waste of time.
How do you make sure your meetings don’t end up falling into those latter categories? A little bit of common sense along with willingness to work through difficult challenges can make sure your board stays connected, and walks out of meetings feeling good about the direction of your organization.
Preparation
Most of us understand that a clear meeting agenda and packet should be sent to members a minimum of three days in advance, with the expectation that the recipient will arrive having read through all documents. So what else can you do to be prepared?
- Streamline your presentation: Not everything in the packet needs to be in your deck. Your board members have likely read through it all, and have come with questions. Take slides out and use that time to allow for discussion.
- Use graphs when possible: Some information will be in spreadsheet form, but many of your members are visual learners. Keep them engaged by presenting information accordingly.
- Anticipate conflict: If you have some items that you know will cause some tension with certain members, reach out to them ahead of time. Let them know what they can expect, and ask them to hear out other opinions before shooting down an idea.
During the meeting More often than not, board meetings assemble a group of very talented individuals with a great deal of experience from which you can benefit. Make sure to make the most of this opportunity, maximizing productive discussion time. What it should not be is an “update”, so don’t get too caught up in minutes or financials. Go deep on only one or two topics, and have in mind some desired outcomes to work toward.
- No devices allowed: Enforce a policy of no Blackberries, iPhones, iPads, or other devices that will distract. This might not be popular, so allow for breaks to demonstrate your respect for what they do outside the boardroom.
- Give everyone a chance to speak: It’s not unusual for only a couple voices to dominate conversation, so the Chairperson should make sure to ask everyone in the room to weigh in. You want to make sure all viewpoints and potential solutions are explored.
- Encourage healthy debate: As long as discussion is productive and respectful, there’s nothing wrong with conflict. Make sure the conversation remains focused on the mission of the organization, and doesn’t move into the realm of personal attacks or agendas. Having a passionate board is better than one that’s apathetic.
Follow-ups If the meeting has gone well, you’ll leave with some decisions made and clear direction moving forward. You won’t always have a consensus, but hopefully there was agreement. How do you keep the momentum going?
- Recap immediately: send the members unofficial notes as soon as possible while it’s still fresh in their memories, and they are feeling invigorated, ready to act.
- Make action items clear: Be sure everyone understands their roles and any tasks for individuals or committees. Include a detailed recommended timeline.
- Invite feedback: Once board members have left the room and had a chance to digest things, ask them on an individual basis if they see any room for improvements or efficiencies.
Of course, it all starts with assembling a board of directors that is thoughtful, respectful, and committed to the mission of your organization. But once that’s in place, you want to take advantage of the little time you have together. Do you have any additional considerations from your experience?
The successful growth of any company depends on the ability of team members to grow. While outside training is a great way for employees to build upon their skills, often times it’s the people in the next cube who teach each other the most.
But in a competitive job market, expertise isn’t just going to rub off. After all, your employees were hired based on their particular skill set, and they might be possessive of their knowledge base. But by initiating a mentorship program, you can give all of your employees the incentive to grow together.
Find your mentors Mentorship is an instinctive behavior to some. They enthusiastically share their tips and tricks with others. Even though educating the team is not part of their job description, they are constantly sharing new information and looking for ways to do things better. If several of your team members come to mind when you read this, these are great candidates for your mentorship leaders. A general “call for mentors” email can reveal even more.
Create your program Approach the design your mentorship program as you would any other valuable project. Decide on a budget and how much time your company can afford to spend a week on mentorship efforts. Remember that the cost of outside training can be very expensive, while this is free for the most part. Make mentoring a scheduled “must” with your resource department. In addition, create a communication plan, training meetings, and a program kickoff to fuel interest. A nice gesture might be to offer incentives for the mentors like extra time off or factor it in to their next pay increase.
Measure success Once you have decided on the plan of operation for your mentorship program, put some measurable goals in place. Track the career growth as well as retention rate among program participants. Is there a noticeable change in the cooperation level of your company?
In addition to improving the knowledge-share among your team, implementing a mentorship program is a great way to demonstrate your loyalty to the group. By nurturing their personal success, you can foster company-wide success.
Interested in attending? Please contact Michele Bernstein at tec@tecmidwest.com, or 262/821-3340
ABOUT THE PROGRAM
Join Jim Lindell for an interactive session in which he discusses key pieces in the jigsaw puzzle of profitability. In practical terms he will demonstrate easy to use concepts and tools that are often overlooked and underappreciated. He will discuss:
• The role of Business Culture
• The significance of Business and Strategic Planning and how it creates, identifies and sustains profitability
• How to objectively measure staff when recruiting, training and managing your business
ABOUT JIM LINDELL
James T. Lindell is President of Thorsten Consulting Group, Inc., a Wisconsin based provider of Strategic & Financial Consulting, Professional Speaking, Training, and Executive Coaching.
Jim has an extensive background in senior management including: Chief Financial Officer of Coolidge Glass Company, Inc., Waukesha, Wisconsin, Chief Financial Officer for Lutheran Social Services of Wisconsin and Upper Michigan, Inc., and Corporate Asst. Controller for Wispak Foods, Butler, Wisconsin. Jim has worked with a variety of industries including: manufacturing, health care, not for profit, distribution and food processing. He has been involved in more than 40 M&A projects. In addition, Jim is a TEC Chairman for 2 groups in Wisconsin. TEC is an international organization of CEO’s.
Jim is a Certified Public Accountant with public accounting experience for both local and regional accounting firms. He has a BS in Accounting from the University of Wisconsin - Platteville and an MBA in Finance from the University of Wisconsin - Whitewater. He is a TEC Chairman (The Executive Committee) and member of: Financial Executives Institute (FEI), Association for Corporate Growth (ACG), the American Institute of CPA's and the Wisconsin Institute of CPA's. Mr. Lindell is a Faculty Member of the American Management Association (AMA), the American Institute of CPA’s (AICPA) and the Center for Professional Education (CPE).
Jim has authored the “Survival Kit for Small Business Executives” and was a contributing author on “The Fast Close – Revolutionizing Accounting”.
Your team worked on a big presentation for weeks, putting in long hours and going above and beyond anything you could have hoped. They did the research, made some great insights, and came up with a killer strategy. On the big day, you all left the client presentation barley able to contain some hi-fives. So imagine the disappointment when the project was awarded to someone else. How could this have happened? And more importantly, how can your team recover their confidence without becoming jaded? This is where your leadership skills can really inspire.
 Remind them that failure is part of successIf you can’t celebrate the victory, at least celebrate the opportunity. Sometimes just being in the running is a privilege in itself, which should not be overlooked. Boost morale by celebrating the outstanding effort of your staff. The smaller accomplishments made along the way are each victories in themselves. You cannot highlight these enough. Discouragement and failure are two of the surest stepping-stones to success. ~Dale Carnegie
Point out the lessons learned through failure Whatever type of project you were shooting for, chances are your team has learned a lot through the process. Research what kinds of improvements can be made in the future, and if possible, what your competition may have done differently to win them the job. Be careful not to single out any one person or department, and avoid blame altogether. Document your lessons learned, and arm your team with that intelligence for the next challenge. It's fine to celebrate success but it is more important to heed the lessons of failure. ~Bill Gates
Present them with a new and exciting goal It can be hard to revive a weary team after a major setback. Rather than spending too much time dwelling on the past, steer your team’s vision towards the future. Presenting a new goal will instill them with the confidence to succeed, and is the best way to remind them of your faith in their abilities. Failure is only the opportunity to begin again more intelligently. ~Henry Ford
It’s a cliché, but winning really isn’t everything. We would not recognize our victories without a little defeat – and after all, it’s what we all signed up for. A failure now can be instrumental in winning later.
 Your behavior in a crisis defines your ability to lead. So what messages are you sending your team? Here are a few reminders help you really lead by example.
Keep Calm Remember, you have to take care of yourself before you can take care of anyone else. When you feel like the weight of the world is on your shoulders, it’s very easy to get run down. Keep your health in check, both physically and emotionally, and schedule stress-relieving activities as you would any other appointment. In addition to helping you perform your duties better, a well-rested and positive leader puts everyone at ease.
Maintain balance We all know the importance of keeping the channels of communication open. But during an economic downturn, it can be hard to be honest with your teams without inciting panic. Keep your reporting truthful enough to encourage ownness without placing blame. Worry is a distraction that can spread like wildfire. Do your best to keep it contained and extinguished through mindful communication.
Be a support, find support When your team faces a challenge, you start to get to know everyone’s strengths a little better. Use this as an opportunity to lead. Offer training to those who demonstrate skills in areas your organization could use. Be visible around the office on a daily basis and accessible to anyone who needs help. Just as you show support, remember that your team is a good source of support. Tap into the expertise around you and seek out their suggestions.
Perhaps more than any other time in our lives, the past five years have been a testing ground for CEOs. Setting the tone through confident decision-making and adopting a calm demeanor can keep the whole company functioning at it’s best.
What are you doing to instill calm and confidence around the office?
 The first session of the 2012 TEC Senior Managers' Program on Feb. 7th in Milwaukee, and on Feb. 8th in Appleton, features Boaz Rauchwerger presenting, "How to Have Confidence and Power in Front of Any Group".
Boaz Rauchwerger will teach attendees how to become confident and highly effective in front of any group - from small group meetings to presentations before large audiences. He will share the techniques he has successfully used for many years to turn business leaders into powerful presenters.
Participants will leave with specific steps and outlines they will be able to easily use to organize and deliver great presentations with confidence. Not only will they be able to present with confidence, but they will have a list of specific ideas that will add power and effectiveness to any of their messages - delivered before any audience.
For more information about the Resource Specialist, his topic, the fee, or to register, please contact:
Rita Rehlinger at:
rita@tecmidwest.com
262-821-3340
By TEC President Harry S. Dennis, III, originally published in BizTimes.
My thanks this month to well known Vistage (TEC) speakers Ron Fleisher and John Zaepfel for their useful insights on the subject of cash flow.
It’s probably fair to say that monthly or weekly cash flow statements don’t exactly make for the most exciting nighttime reading for the typical small company CEO. But after the income statement and balance sheet, this report is perhaps the most important of all.
We’ve all heard that “cash is king.” Running out of cash with nowhere to go spells the end to a business, regardless of how small or large.
A cash flow report should very simply tell you how much cash you have coming in and how much you have going out. It covers three distinct areas:
1. Operating cash flow. This statement indicates the amount of cash being disbursed to vendors, employees, debt payments (including rent) and taxes, offset by the inflow of cash from customers and short- or long-term investments.
2. Investment cash flow. Business owners or managers make short- and long-term investments from time to time.
3. Financing cash flow. This is cash used to finance the business, including the cost of leases for equipment.
These three statements in aggregate determine a firm’s overall cash flow.
The benefits of tracking
The experts recommend tracking cash flow over time because it’s a key indicator of the health of your business. A chart comparing this year’s cash flow with last year’s, month by month, will quickly expose negative trends.
Tracking does something else for you. It automatically adjusts for seasonal and industry trends. If you spot any other unfavorable trends, that’s a signal to start tracking cash flow much more frequently, such as daily. Specifically:
As an anchor point, always review cash flow monthly.
- Look at your checkbook daily. Note the receipts and note the disbursements.
- Document the cash you have on hand and calculate how long it will last if receipts stop coming in, for any reason.
- Determine your working capital needs (current assets minus current liabilities) for the balance of the year, at minimum.
Undercapitalized businesses are always struggling to support a healthy cash flow business operating environment.
The problems exacerbate when the company experiences a spurt in growth or an unexpected slowdown. A mandate for every CEO is to constantly search for ways to improve the capital strength of the business. Not doing this may be the kiss of death.
Ways to improve cash flow
Let’s review some of the things you can do to improve cash flow. In TEC, these ideas have produced good results over the years:
1. Ask your bank to set up a “sweep” account for you. This is a bank account that automatically transfers amounts that exceed (or fall short of) a certain level into a higher interest earning investment option at the close of each business day. Commonly, the excess cash is swept into money market funds. The “sweep,” per se, varies from one bank to the next, but it’s a good way to get your hands on your cash sooner than later. 2. Go nuts over your receivables. Give your best customers discounts for quick payment of 10 days or less. Consider credit card payments, but only if the total cost to the credit card company justifies it. 3. If you carry inventories, do a physical inventory on them at least twice a year--quarterly if you know you have high inventory carrying costs. There’s nothing worse for your cash flow than low inventory turns, especially in-process inventories. With today’s technology, there’s no excuse for outmoded products sitting on the shelf. GPS has ushered in a whole new dimension of control. 4. When cash flow is tight, negotiate with your vendors for discounts or extended terms. That’s a must. This isn’t an issue of nickel or diming them. It’s asking them to do for you what you do for your better customers. 5. Renegotiate. Long-term agreements, especially leases, are always subject to re-negotiation. Again, the objective is to increase your cash flow. 6. Use pay-for-performance. This is probably the most popular alternative that our TEC members have instituted in the last seven years. Perform first, get paid second. But set the bar so that the pay reward is worth shooting for. It can be tied to bonus incentives, profit sharing plans and even deferred compensation plans for senior execs.
Conserving cash seems like such a mundane chore, doesn’t it? Pure growth is so much more fun.
Spending with absolutely no concern for the consequences seems to be the providence of the U.S. government. The rest of us out here, who play by the rules, need to heed the rules of cash.
Until next month, please remember: cash remains king!
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