The Resilient Company
This year’s CEO Retreat is titled “The Resilient Company.” Timely topic, I think!
On a conference call with a couple dozen members yesterday, presenter Keith McFarland had them asking “can we start tomorrow?” Here are some excerpts from the call that offer insight into this Retreat program.
“Greatness is built into companies in the tough times, and not through the good times. If managed correctly, times of difficulty help firms discover hidden strengths, help them define latent capabilities, bring them down to fighting weight. The task of leadership is different during these times. It is important for leaders not to focus solely on getting through the challenges of the day. And that’s what a lot of people do. They hunker down and focus on getting through the challenges of the moment. If you do that, the kind of transformation that is possible during times of challenge will not happen.”
“Instead, CEOs need to guide their organizations to ask the fundamental questions about the business. It is a great time to face facts that you would have overlooked in more prosperous times. It is a great time to integrate new knowledge and insights that adversity always creates.”
“So we have really built this event around some of the themes of The Breakthrough Company, and also bringing in the ideas from my next book – which is called Bounce. It is a parable book. It is a story about a guy who is trying to turn a business around, and he ends up working out at the gym next to a guy who is an army ranger who just came back from
“You’ve got these challenges that come with adversity naturally. You are squeezing to make the financials work, and everybody is working harder. On the other side of the equation we know that when people and groups come under pressure in organizations where there is a strong sense of belonging people rise to the occasion. You can actually get people to consider things they would not consider otherwise.”
“The task of the Virginia Council of CEOs is to get people out of the mode of hunkering down and into the mode that this adversity presents opportunity. Here’s what we are going to be focused on: How do you make sure that when your firm gets under pressure that you have the right kind of approach to make the best out of the situation?”
Family Business CEOs Face Unique Challenges
Two dozen members of the Virginia Council of CEOs met over lunch last week to share what they know about “Thriving in a Family Business.” The 90 minute session at the Robins School of Business was a chance for the CEOs to talk about the challenges of running a family business, and to share what they have learned with others.
Here is a sampling from the experiences of this group.
- Objectivity is difficult if the decision makers are all family. Bring in consultants or set up an outside board to get some perspective on strategic decisions.
- One M&A pro advised that most successions don’t end well. To beat the odds, start a plan ten years ahead.
- Planning elements that were discussed include: buy/sell agreement; a defined conflict resolution process; a management structure with defined decision making powers and check & balances; wealth transfer mechanisms; and regular family meetings to discuss the plan.
- Separating family time from business time is difficult. Some recommended scheduling blocks of time away from the business with a “no shop-talk” rule in place.
- Recommended for reading were: Familybusinessmagazine.com; and Family Wealth, Keeping it in the Family, by James E. Hughes.
CEO Authors
When David Ingram, CEO of Capital TechSearch, told me he was writing a book, I was jealous. How does this guy have time to write a book! I have trouble carving out time to write 150 words a week for this blog!
Maybe that’s why Ingram is so successful. In fact, the book he is writing, “15 Bedtime Stories That Keep Entrepreneurs Up at Night,” shares some of what he has learned along the way. Like all VACEOs members, Dave loves to share his experience with other CEOs.
For more on CEO authors, see this article at Richmond BizSense that highlights David and several other Richmond area CEO authors.
Watch These Companies Grow
Greater Richmond Companies To Watch is Richmond’s annual event to showcase a select group of innovative companies with high growth potential. Companies To Watch is a program of the Venture Forum.
Three of the ten 2009 Companies To Watch are led by Virginia Council of CEOs members. Congratulations to:
Jim Slabaugh of nHealth
Seth Schmidt of Smash Direct
Jim Fitzgerald of Taradel.
Watch them grow!
Cut Costs
Two dozen small company CEOs who belong to the Virginia Council of CEOs gathered last week to share ideas for cutting costs in their businesses. Here is a summary of the ideas they generated.
It Takes A Village
- Give immediate rewards to employees for cost savings or streamlining processes.
- Incent staff on cost savings and profitability.
- Link paychecks to productivity.
- Ask staff to rethink the steps in everything they do.
- Communicate frequently and openly with staff, placing your business challenges in the context of what they read/hear in the news.
- Three questions to open up dialogue with staff, customers, vendors:
- What should we start doing?
- What should we stop doing?
- What should we keep doing?
- Make a list of things your people can do if things are slow and they have time on their hands.
- Reduce / Reuse / Recycle
Look for Savings
- Telework eliminates overhead. Telework VA provides grants for consulting and hardware.
- Use utility and telecom auditors to find savings and overcharges.Their fee is usually paid out of any savings they find.
- Put out new RFPs for everything you think you can get cheaper – e.g. freight, printing, employee benefits.
- Tighten the belt and cut services that are nice to have, but don’t contribute to the bottom line.
- Consider smart investments in equipment that is more efficient, uses less energy or is cheaper to maintain.
Cash is King
- Work your AR – the squeaky wheel gets paid.
- Use (even suggest) early payment terms to save on purchases.
- Ask your landlord for a break(being a good, stable tenant must be worth something), or consider moving to save overhead.
- Consider not accepting credit cards for some or all business.
- Study your company’s credit cards and eliminate those that charge daily interest.Consider lines of credit if cheaper.
- Tighten discount and return policies.
- Tighten credit terms.
- Fire unprofitable customers.
- Incent your sales staff to collect promptly – reduce commission after 30/60/90 days.Don’t pay commissions at all until bill is paid.
- Court your vendors for coop marketing funds./li>
People Cost A Ton o’ Money
- Measure revenue per head and utilization.
- Consider outsourcing where it makes sense.
- Now is a good time to cut the deadwood.
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