Showing posts with label Corner Office MBA. Show all posts
Showing posts with label Corner Office MBA. Show all posts

Sunday, March 28, 2010

The Corner Office MBA: Lessons In Leadership

By Lewis Collins

Leadership is a term of art. It has been defined and redefined over the centuries. Each leader has his or her unique leadership style and characteristics. The Reverend Martin Luther King once said: “A genuine leader is not a searcher for consensus but a molder of consensus.” This statement is a crystallization of what a leader must do to lead. Rudy Giuliani was once asked whether leaders are born or made. His response was that he believed that leadership is mostly a skill that people can learn. He indicated that the learning process begins when you are a child and sources of the “DNA” that leaders possess come from parents, friends, colleagues, teachers and clergy. Giuliani also believed that leadership can be honed by reading about great leaders. He believed that by reading about these great examples of leadership, one sharpens their understanding of how great leaders think and act. This article is inspired by, and loosely based on, Rudy Giuliani’s book: “Leadership”.

Everyone’s accountable, all the time. As a leader, it is your responsibility to be accountable for your actions. These actions must be based upon your core beliefs. You as the leader set the tone. Leading by example is not only a platitude – it is a platform.

Are you up to the Challenge? For a business leader to remain effective, he or she must continually challenge themselves. For a leader to lead, everything must be questioned. The most dangerous “infection” a business can experience is the virus of success. Success breeds complacency. As pointed out by the authors of Built to Last, the truly successful business is one that has an unchanging core belief yet continually reexamines itself in light of the changing business culture. Long-term success requires a business leader to hold true to his or her core beliefs and, at the same time, continually challenge themselves to change and adapt to the environment within which the business exists. You must remain vigilant by continually examining each component of the business to determine whether or not that component is in line with its core beliefs and goals. Continually challenge yourself and the business to determine the relevance of everything undertaken.

Bright people debunking your logic test the consistency and validity of your ideas. Being a leader does not give you a corner on the market of ideas. Great leaders surround themselves with bright people who are not “yes men or women”. Tom Peters, one of our nation’s most prominent management gurus, advocates at a leader should surround themselves with contrarians. He believes that contrarians help an organization test and shine a bright light on the dark corners of those ideas. A leader needs the insight of bright people who can look at all aspects of ideas and plans from a contrary viewpoint. In this way they will assist you in honing and validating those ideas and plans.

A real leader leads with a true heart and an honest mind and will not deny a belief simply because it makes him or her uncomfortable. Being a leader involves, on occasion, making tough choices. The tough choices must be made if they are consistent with the core beliefs of the leader and, of course, the organization. It is easy to make decisions when those decisions are popular ones – the true leader, however, makes decisions that are tough. Be your own person. A leader is chosen because the business trusts his or her judgment, character and intelligence. Do not put your finger to the wind of opinion and do the popular thing if it runs contrary to the vision you have laid out and your core belief.

Every decision must be made for the benefit of the business. When a decision is made, the business and its interests must be paramount – above those of your own. This must be a template for every decision that is made. Inspire confidence. It is a leader’s job to instill confidence by believing in his or her own judgment. Lead with ideas . . . and ideals.

Prepare relentlessly! Rudy Giuliani, a student of leadership throughout history, made a very striking observation. He crystallized what he observed as a very important key to making a leader. He wrote: “Preparation – thus eliminating the need to make assumptions – was the single most important key to success, no matter what the field.”

The importance of meetings. Meetings are a way to coalesce ideas, a way to brainstorm and refine. Meetings, however, are meaningless unless they are well-organized, focused and short.

Set the tone early on. When you begin to move forward as the leader of an organization, it is vitally important to communicate your vision, organization and plan early and often. The opening tone you set will motivate, inspire and focus others. Start with small successes. Giuliani tells in his book of one of his earliest “small successes”. This success was with a group of people he referred to as the “squeegee men”. These were people in New York City who would jump in front of cars stopped for a traffic light and squeegee their windshield. After the cleaning, the squeegee men would pressure the drivers for payment. One of the first things Giuliani did when taking over as mayor was to crack down on these “squeegee men”. In a short period of time he was able to eliminate their harassment. This small, tangible, success was a building block for the many large successes that he experienced later in his administration.

Surround yourself with great people. Great leaders have great insight. Great insight comes from a variety of sources. The best source for great insight is surrounding oneself with great people. Too many leaders believe that they are “anointed” through their election or appointment to a leadership position. This lack of humility and failure of perspective is one of the single biggest flaws of a true leader.

Servant leadership. A true leader realizes that he or she serves the organization. If a leader believes that they “rule” the organization, they will be an unmitigated failure. To paraphrase Psalm 19, great leaders ask to be free of presumptuousness. The servant attitude will place you in the right frame of mind to lead. It will give you the proper perspective and attitude. You will realize that you brief time at the head of the organization is one of service to the members.

Realize your weaknesses. A good leader realizes that he or she has weaknesses. No one leader has all of the traits and qualities needed for leadership. When a leader realizes this, they can balance their weaknesses with the strengths of others. I am not as good with budgets and financial forecasting. I am more of a big picture, idea man. I realized this shortcoming and, as a result, relied on the sound financial judgment of others to compensate. Leadership, therefore, requires the leader to be honest with themselves. Admit your shortcomings and be a leader by making sure you have a person or persons you can count on to fill the hole in your leadership void.

Motivate and Delegate. A great leader who surrounds themselves with talented people must take the next step by motivating those people to achieve. Allow the people you appoint to encounter challenges on a regular basis. Challenging talented people brings forth their true abilities and allows them to achieve great things. Create a sense of adventure in the job you task them. If highly driven people are not sufficiently challenged, they surrender to self-satisfaction and arrogance. Give them the vision of what you want to accomplish, the leeway to make it happen and the spark to ignite their passion for the project. Empowerment allows businesses to achieve great things. A team can achieve much more than an individual. If you delegate - and then empower the people you delegate - you show your true leadership character. Delegation without empowerment leads to the primary weakness of an organization – micro-management from the top. General George S. Patton once said: “Never tell people how to do things. Tell them what to do and they will surprise you with their ingenuity.” As the Chinese philosopher Lao-Tzu once said: “When the best leader’s work is done, the people say, ‘We did it ourselves’”. This is a great picture of what a leader does through empowerment.

Reflect, then decide. It is often said that the primary difference between intelligence and wisdom is experience. Experience provides you with the underlying facts that allow you to reflect. Experience teaches you what you need to determine the best course of action. It gives you the basis for making a more informed decision. Woodrow Wilson said, “One cool judgment is worth a thousand hasty counsels. The thing to be supplied is light, not heat.” Experience teaches that we should:

1. Be reflective. Consider all your options before making a decision.

2. Be ready to pull the trigger. After considering the options and the counsel of others, the time comes to make a decision.

3. Early analysis. You must begin the process of decision-making by analyzing all of the options at the earliest possible moment.

4. Use creative tension. As pointed out earlier, the contrarians in your organization are very valuable. Use their contrary views, thoughts and ideas as a catalyst to making the right decision. F. Scott Fitzgerald said that the “test of first-rate intelligence is the ability to hold two opposed ideas in the mind at the same time, and still retain the ability to function” – to make a decision.

5. Chart it, outline it, understand it. Most innovative thinkers understand the importance of reflecting before deciding. His “chart it, outline it, understand it” way of thinking helps a leader make the right decisions. This method of thinking allows a leader to: organize the steps to completion; factor in accountability; use creativity to solve problems and, think outside the lines and decide what’s best for the organization.

6. Establish priorities and stick to them. Once a goal is set, the steps to achieving that goal, within a reasonable time frame, must be established to provide a guidepost of achievement, a horizon of accomplishment.

Conclusion. Leadership is the most important ingredient that enables a business to achieve great things. In his book, Good to Great, James Collins underscores the importance of leadership in developing great organizations. A leader must possess many vital character traits. While no leader has all of these characteristics in equal measure, great leaders possess most of these core ingredients. Character, courage, compassion, vision, wisdom, conviction and doggedness are all aspects that a leader must draw upon if they are to lead an organization from “good to great”. Whether that “organization” is your family, or your business – you must be able to tap into these elements to achieve greatness.

I end with the reflections of Alexis de Tocqueville. de Tocqueville, a French writer, poet and historian, came to America to observe, first-hand, what made this country “tick”. He observed:

“I sought for the greatness and genius of America in her commodious harbors and her ample rivers – and it was not there . . . in her fertile fields and boundless forests – and it was not there . . . in her rich minds and her vast world commerce – and it was not there . . . in her democratic congress and her matchless constitution – and it was not there. Not until I went into the churches of America and heard her pulpits flame with righteousness did I understand the secret of her genius and power. America is great because she is good, and if America ever ceases to be good, America will cease to be great.”

About the author: Lewis is a Partner in the Tampa, Florida office of Butler Pappas Weihmuller Katz Craig, LLP. He has served as President of the Federation of Defense & Corporate Counsel (2005-06) and is Past President of the Florida Defense Lawyers Association. Mr. Collins currently holds the position of President of Lawyers for Civil Justice

Friday, February 12, 2010

The Corner Office MBA: Cash Flow is King

By Dave Richardson

Business is tough, the economy is unstable. You need cash flow to make payroll and pay bills. Wait! No, you need profits to make payroll and pay your bills. No, wrong! If you have more cash flow coming in this month than bills then the cash flow has kept you alive a little longer until you can make a profit.

So….if you have $20,000.00 in bills due this month and you can get $20,000.00 worth of cash coming in to pay the bills you survive another month. The problem is in order to get the $20,000.00 in revenue you have had to cut prices to get the business. You then spend $22,000.00 to operate the business for another month, which will be due next month.

Next month you do whatever it takes to get $22,000.00 in cash flow to pay the bills. No matter what, you have to have $22,000.00 in cash flow to pay the bills even if it costs you $25,000.00, which of course will now be due the next month.

Hopefully when times were good you saved up. In the above scenario, if you have $50,000.00 in a line of credit or extra in your operating account maybe your business will survive another 12 months or so. Or maybe you can last 2 months with no cash flow.

As you can see, depending on how deep your pockets are, you can do this for only so long. Some day you will have to start making a profit or lose your business. You could cross your arms, pout and vow that you’re not going to cut prices just to get work, and there goes your cash flow. You will be out of business…soon. Or, you keep your customers happy, lower your prices, and bring in some cash flow.

Businesses that have a large amount of overhead, expensive equipment payments, or grew too fast will not last as long as those who managed their growth and overhead. To survive you may have to restructure your loans to spread out the payments, sell excessive or unused equipment and inventory. Sometime you have to trim your staff.

Cash flow does not equal profit. Not making a profit does not mean you will go out of business, however eventually to stay in business you will eventually need to run your business in a profitable manner.

About the author: Dave is the Founder and President of Crush It Inc. , a custom concrete and asphalt crushing company based in Florida. He and his wife, Lisa, grew the company from scratch into one of the largest and most successful in the state. Check them out at http://www.customcrushers.com/.

Thursday, January 21, 2010

The Corner Office MBA: The Value of Mistakes

By John Collins

All driven, ambitious individuals set goals. I doubt many use the word “failure” in a list of those business or personal goals. That is a mistake. It ignores the value of screwing up, of trying something new, or innovative, or untried, or “crazy” and not immediately succeeding. It does not recognize the value of mistakes.

Few disregard the worth of a formal education. Learning generally has a well deserved reputation for value on its own -- try getting a gig at Goldman Sachs without your name on a diploma. But generally, my experience is that many entrepreneurs and managers (especially young, cocky ones like I was) discount the worth of lessons taught by failure. Because failure was the antonym of my ambition, it took years of experience to teach me the value of mistakes. “Business judgment” is a trait of effective, successful leaders. The only way to learn “judgment” is through experience. The experiences that made the most lasting effect on my success were not always successes.

I am not suggesting that one should plan to fail – that you start your day, week, month or year by looking forward to a disaster. I am suggesting that you not ignore the view from behind – that you finish your day, week, month and year by carefully understanding what did not work as well as accounting for what did. This is especially true when managing others, when developing talent in others to leverage your success. Few individuals get rich working alone. If you make those working for you (or with you) fear mistakes, what you get are monkeys with typewriters. They will eventually spell a word, but will never create value.

So, what is the value of mistakes in business? It is certainly not the effect -- it is the cause. Analyzing why something did not work, or how a mistake occurred, and using that “education” to make changes designed to make it work or prevent re occurrence. That is the value of failure. Encouraging innovation will likely not result in universal success with every attempt – mistakes are unavoidable. If you think you never make errors, you are mistaken. However, you can universally learn from every failure – and improve your chances of future success.

About the author: John Collins is an entrepreneur and business consultant based in Washington D.C. He formerly founded and served as CEO of Portsmouth Financial Group, Inc. and held senior positions at Knightsbridge Management LLC, Feltman & Co, DeStor Corporation, and The Home Depot.

Thursday, January 14, 2010

The Corner Office MBA: Listening

by Evan

God gave us two ears and one mouth.

Nearly 70% of our country’s Gross Domestic Product (GDP) comes from consumer spending. As Americans, we produce and consume goods and services that drive our economy. Someone comes up with an idea - that is then manufactured, packaged, marketed and distributed to an end consumer.

Therein lies the rub.

The end consumer. The purchaser. The individual who has a “need” that must be satisfied through obtaining the “product”.

In school you’re taught the basics. Reading, writing and arithmetic. But they never teach selling. The one thing that you could attribute the majority of our GDP too. And what is selling? Selling is communication. Selling is understanding the various qualities and capabilities of a product and being able to translate that information to a consumer. We must be informed of what they want in order to deliver the proper advice and sell them. What does the consumer want?

Therein lies the rub.

The consumer, your potential client, has a certain set of needs that must be satisfied through the purchase of the product. We must find out what these are through a process called “Discovery”. We ask questions to identify what the client wants and then we – shut up. Stop talking. Remain silent. When a potential client is telling you what they want – listen to them – understand it – and try to mentally match your product(s) with what they had in mind. Ask more questions to refine their criteria.

The conversation should be back and forth, but should mostly be centered around the client. Cause its not about you – its about them.

Therein lies the rub.

When you are in the process of discovery , LISTEN to what the client has to say, and don’t be afraid to repeat it to them. This is probably one of the most effective, yet underrated techniques in selling. After you are done asking a question, listen to the answer and then repeat back to the client what they just said.

Its not easy to listen, in actuality its one of the most difficult things to do. But for those of us who can master the discovery process, and listen to the answers, we will become much more effective in the world of sales.

About the author: Evan is an investment advisor at one of the top firms in Los Angeles. His clients include affluent individuals and private institutions.
 

Entrepreneur Business Innovation | Startup Business Plan | Teen Entrepreneurs | Entrepreneur's Guide To Business | Real World Business Icons | Climb The Corporate Ladder | Business Resource, Technology & Entrepreneurship Ideas | Personal Career Development | Young Business Blog | Thoughts On Business