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Second Waste: Right First Time

In any business we should strive to reduce operational expense AND reduce inventories AND increase throughput simultaneously. Lean management is a technique by which we can achieve this goal as at its core is the identification and removal of waste within the business. There are seven typical types of waste that are found and in this article we explore:

Right First Time

Another of the deadly wastes in business is not getting things right first time and this applies equally to all areas of the business. Let’s look at some examples and the effects they may have.

Recruitment

This can be a worrying time for even the best judge of character and ability. We invest a huge amount of time and cost into this process in terms of interviewing hours, advertising, recruitment agencies costs. And that’s just to employ someone! Then when they start there is the induction time / costs.

Often I hear Business Owners say that the employee isn’t really useful to them for a number of weeks until they are trained and get to know our systems. Imagine the shock and horror 3 months in when we finally decide the new recruit isn’t up to scratch! Do we scrap and start again?, Just accept it because we can’t bare having to go through all that again? Cover things they can’t do themselves with someone else? All of this puts a huge strain on the business and the Owner and if measured in terms of cost in hours and money would probably add up to a tidy sum. OK, I understand it’s not that easy. However, we should put systems in place which ensure we have a better chance of getting things right first time.

Misunderstanding of requirements

A client recently relayed a story to me of how they were commissioned to undertake a particular piece of work. Many weeks of effort were invested behind the scenes preparing everything for the big delivery day. Imagine the worry for the two parties on the actual day when the solution didn’t meet the expectation of the client. So where was the problem? There had been a miscommunication at the very start and the project brief had been recorded incorrectly! This happens time and time again in all areas of the business where people are working on the wrong things because there has been a misunderstanding of what is actually required.

I once was asked to take over the lead of a project that had been running for two years and going nowhere fast. My first action was to ask the four team members to bring me up to speed with where they were and what had happened over the previous two years.

After about an hour of sitting to them describing what had happened I have to say I was totally confused as to where they were. I then asked them to go to the four corners of the room and write on a piece of paper what they thought the objective of the project was in less than 20 words. About 10 minutes later I got each of them to read out their statement. At this stage there was a lot of disagreement as they each had written something different down; they were not aligned and were actually each trying to achieve something different, not by much but enough to ensure they made no progress.

Just this simple exercise got them to understand their differences and a quick alignment process ensured they all understood clearly the project brief. The project was completed 6 weeks later!

Lack of system robustness

It’s a fact that all humans are prone to making mistakes. The more human involvement in a process the more chance there is for it to go wrong. I recently visited a business where orders were still received in a manual system. Now, there is nothing inherently wrong with this if it fits with the business requirement. However, in this business the client needed to duplicate the key information into 4 other separate manual systems and this as expected was done by hand by humans. Needless to say there were many occasions when a telephone number had been put down incorrectly, or the address and post code were slightly out. Imagine the cost to the business when product was sent to the wrong place etc. A rule of thumb here is to systemise the routine operations and humanise the exceptions.

Manufacturing

Many business actually make product to sell. Now suppose we have an order for 10 of a certain item and set our manufacturing system up to make them. The product go right through all of the processes and get to the end ready for dispatch. It’s at this point that many businesses will send in the inspector to check that the items all meet the required standard.

What happens if say a couple of the parts are not right! Do we send them back through the system for rework? Start a couple more from scratch? Have to wait to send all 10 parts at the same time so the customer has to wait and experience delays? Or send the 8 good ones and then pay for extra shipping for the last 2 when they’re done? All of these scenarios generally can incur costs, time delays and reputation issues for a business.

Now there hundreds of similar examples that we could discuss here, and I’m sure you could add a few more of your own. The secret is to understand the root cause of the problem and solve it so that it never occurs again. So how do you ensure that mistakes are not repeated in your organisation a second time?

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First Waste: Waiting

In any business we should strive to reduce operational expense AND reduce inventories AND increase throughput simultaneously. Lean management is a technique by which we can achieve this goal as at its core is the identification and removal of waste within the business. There are seven typical types of waste that are found and in this article we explore:

WAITING

This is a very common form of waste in most businesses. Our team for whatever reason either:

  • Don’t know what to do and have to wait
  • Know what to do and don’t want to do it, so convince themselves they need help before they start
  • You have given what you believe is a clear instruction, they are afraid to tell you they don’t understand what is required so they keep their head down and hope it all goes away
  • Are unwilling to accept the responsibility of making a decision so they wait for help from someone else
  • Are waiting for resources not yet available

All this waiting affects the productivity of the business as a whole. Let’s look at each one of these in turn.

Don’t know what to do

Imagine you were building a house and the plans and design were not written down but all clearly held in your head. Now all your tradesmen, Carpenter, Bricklayer, Electrician, Ground worker, Roofer etc. all turned up on site along with you ready to work. These are all very highly competent and trained people in their field but how well would they be able to begin the job without instruction from you? You are now the centre of all communication and the blockage to allowing the trades to contribute to thinking for themselves.

This is similar to how many Managers / Leaders / Owners run their business. They have the plan in their head and drip feed little bits of it over time to their team. In terms of the plan for the house, every detail should be planned before even the first spade is put in the ground. There should be a blueprint of what we’re building, how it will look etc. Everyone involved in the job can now have a copy of the plan and engage their brain to have meaningful input and self direction. So here are a few questions for you:-

  • Do you have a plan for your business?
  • What will it look like in 5 years time?
  • Is the plan written down clearly?
  • Has the plan been communicated to the whole team?

If the answer is no to any of the above (and probably a few more) then you are potentially a blockage to the growth of your company and making your team waste some their time by being the only one with the plan.

Know what to do and don’t want to do it so convince themselves they need help before they start

Some of our team may have the plan, or have clearly been told what to do and have a fear about completing the task. Maybe it’s just too far out of their comfort zone so what they do is engage in ‘productive avoidance'; that is, make themselves so busy doing other stuff they convince themselves that they need to check with you again on some minor detail before they start. During this time you are blissfully unaware and believe that they’re getting on with it. You go back some time later to check on progress and find that they haven’t even started yet claiming they were waiting to catch you to check the detail.

You have given what you believe is a clear instruction, but your team are afraid to tell you they don’t understand what is required. So, they keep their head down and hope it all goes away

This is similar to the point above and the outcome is exactly the same. The challenge here is that we need to understand that it is a communication issue and until that is sorted nothing will improve and the person will always be waiting. If you feel that this is prevalent in your business, refer to DiSC® Communication Profiling for hints and tips on how to deal with this.

Are unwilling to accept the responsibility of making a decision so they wait for help from someone else

Some of our team simply will not accept responsibility. If this is the case we need to understand why. Have they been chastised before for getting something wrong? Is the job too big for them? Have they been promoted one level above their competence? Do they believe they are no good at making decisions? Each of these scenarios will require a different remedy and the trick for us as business leaders is to work out the root cause of it- so that we can put a fix in place. Left alone, our team member will once again sit there just waiting and nothing will be done.

Are waiting for resources not yet available

We often have a plan and everyone is set to go but not everything is in place. Take a simple example that we’ve set a meeting with our top team to start at 10.00am. At 10.10am we are still waiting for one of the attendees to turn up. Everyone else is at there waiting; does this happen in your business? Maybe we are expecting a delivery of raw materials from a supplier, or an answer from our Accountant etc. Once again, we are sat waiting and can’t get on with the task in hand.

All in all there are many forms of waiting and certainly more than I’ve listed here, so look at your organisation and look at it with a critical eye and see what forms of waste are going on in your business.

 

The second waste of lean – Getting it right the first time.

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Lean Management – The 5 Wastes of Lean

In any business we should strive to reduce operational expense and reduce inventories and increase throughput simultaneously. ‘Lean’ management is a technique by which we can achieve this goal as at its core is the identification and removal of waste within the business.

Typically there are five types of waste and this series of articles will cover each separately:

  1. Waiting
  2. Right First Time
  3. People Travelling
  4. Parts Travelling
  5. Doing More than Needed

 

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Who is Responsible for Lean Management in Your Organisation?

Do you want to reduce waste in your business? So what’s stopped you so far? Generally this is because we don’t know what to do or how to do it. Now contrary to popular belief, Lean Management doesn’t have to be complicated and full of all ‘management jargon’. All that’s needed to start is a commitment from the top and then get the team engaged and enthused about it.

So who should be responsible for the programme in your organisation? Well many large corporate organisations believe in having a formal structure, meetings, reports etc and in my experience this just tends to bog the whole process down in red tape. The simple answer is that every member of the team can have a healthy impact in removing waste from the organisation if they are ‘fired up’ and pointed in the right direction. The best ideas generally come from the coal face, after all these are the people that are doing the job day in, day out.

To implement, we first need to educate the team about what it is we are trying to achieve. The ‘Goal’ of a business is to reduce operational expense AND reduce inventories AND increase throughput simultaneously. Simply put ‘reduce the waste’. In what form do we see waste?

  1. Transport
  2. Waiting
  3. Over production
  4. Defects
  5. Inventory
  6. Motion
  7. Extra processing

Transport

Items are frequently picked up and put down many times throughout their process. If we truly mapped the route and distance travelled by items within the business we would find out just how much double handling is going on. Every time items are moved there is an increased opportunity for damage to occur.

Waiting

This is where people are held up from getting on with the job because either: they aren’t sure what the next step is and are waiting for instruction; maybe the previous process has not been completed or carried out in time either internally or externally; there are shortages of parts; or unbalanced workloads

Over production

A classic situation in many organisations. To save set up costs, whilst I’m doing one I may as well do a few as this will save time later on. This action has many repercussions like increasing the amount of money we have tied up in inventory, the consumption of raw materials, the cost of the labour to produce the extra and extra storage costs.

Defects

If we do work without the ‘right first time’ approach there are increased costs to the business. We have to rework the process a second time or scrap off the work already done. Maybe we would have to go through a concession type process either internally or externally within the business and along with this if the situation goes outside the business we have to deal with the potential harm to our reputation. All these factors will increase costs within the business.

Inventory

This is similar to over production. Money has been tied up in producing. The extra produced is always at risk of damage. Floor space has to be found to store it all and generally means the work area becomes cluttered and now more difficult to work in. Some of the work done could become obsolescent if customers requirements change and of course there’s always the management information system that needs to be kept up to date to track and control all that’s been made for both logistical and accounting purposes.

Motion

Firstly there is unnecessary movement of people doing the work. Have what they need easily to hand to save them leaving their workstation to go and get essential parts/information/equipment that they need. There is the old chestnut of one piece at a time production over batch production. Most people intuitively believe that batch production is much more effective, however unless there is a very large set up cost involved one piece production can be proven to be the most cost effective.

Extra processing

We should always study what is actually going on in our organisation as often there are many processes that are not adding value to anyone. If asked why it’s being done, the response is often, ‘I’m not sure, it’s how I was taught to do it when I joined’. Sound familiar?

Once our team is educated and knows what to look out for we can then get them to go back into their work space and challenge themselves and others around them as to where the waste is and start to eradicate it. As with all of these types of initiatives they are easily started and early results gained, but like so many they quickly fall by the wayside when things get busy, so putting in a system to ensure that the good work is maintained is the key to success.

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Lean in Sales

As we know the subject of ‘Lean’ is predominantly aimed at manufacturing elements of organisations but should however be applied across all areas. Here we are specifically going to look at how it can be applied to ‘sales’.

If we accept that the ‘value add’ (VA) aspect of sales is understanding what the customer has a need for and then proposing a solution to fill that need, then everything else that is done in that department is ‘non value adding’ (NVA). Let us consider a salesman who conducts Face to Face, Business to Business sales calls that should take approx 45 minutes and yield say a £500 sale. In a ideal perfect day he will turn up at the first prospect at 9.00am, have the sales meeting, win the order, be away by 9.45am, and arrive ready for the next client to repeat the process at 10.00am. Using this method our salesman would secure £500 of sales per hour, which would give us say £4000 per day / £20,000 per week. I can hear you saying now though, ‘but life’s not like that!’. So let’s list the things that often go wrong?

  1. We get to the appointment and the prospect isn’t there
  2. The sales meeting starts late
  3. The travel between appointments is longer than 15 minutes
  4. The sales meeting overruns the 45 minutes allocated
  5. The prospect decides not to buy the product
  6. The decision maker isn’t there so a second visit becomes necessary
  7. The appointments can’t be made at one hour intervals… etc, etc, etc

With just a few of these factors hitting our salesman every day the results will tumble dramatically and perhaps he secures just two sales a day = £5000 per week

So what has this got to do with ‘Lean’? It’s here that we now need to start working on the systems to ensure we can perform nearer our ideal scenario. Let’s explore the actions we could explore under the ‘Lean’ banner.

  1. Qualify the leads better to ensure they are the right people with the need
  2. Always turn up on time
  3. Pre-frame the prospect that time is tight so they are prepared for you
  4. Phone the prospect when 10 mins away so they are ready
  5. Only book appointments in the same vicinity
  6. Take control of sales meeting and keep to timescales
  7. Make sure decision maker will be there at appointment booking stage
  8. Not book appointments at random times in the day, eg:- 11.15, stick to on the hour

Now I’m not suggesting that it’s that easy, however we shouldn’t ignore looking at what we can do. As you can see, in each scenario our salesman does 40 hours work, but the output from each is vastly different. Have a go and see if you can analyse the VA and NVA activities in your business.

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Are You Ready for the Journey?

Let’s have a look at the importance of and the relationship between financial accounts, management accounts and Key Performance Indicators (KPI’s).

Now this has all the hallmarks of being a dry boring article but don’t despair and dive for the headache pills just yet. I’m going to look at this by the way of a metaphor to bring some clarity and understanding to the subject.

We are going to embark on a little boat trip. We want to motor our boat from England to Holland.

So we need to do some planning. First off we must get the charts out and plot our route. What information do we need?

Well we need to know the weather forecast, the expected wind direction, the state of the tide and the strength of the currents so we can calculate our bearing to reach the destination.

We will also need to know how many passengers we have on board, the average full consumption, the overall distance so that we can calculate how long we will be at sea and therefore how much fuel and other supplies eg. the food and drink we are going to need for the journey. Quite a lot of info and planning. In a business this would be the budgeting or forecasting stage.

But hang on a moment have we forgotten something really basic. Surely, we really need to know exactly where the boat is moored. Not just the area but exactly where a boat is in which marina because that is where we are going to set off from. We may have done all our plans but if we don’t know exactly where we are starting from we are unlikely to reach of destination. In business terms the location is a set of accurate timely financial accounts. No good trying to start from where the boat was a year ago as it could be somewhere totally different.

Now knowing exactly where we are- we can jump on board and plan our course and then safely set off on our journey. We monitor our speed, fuel consumption, distance travelled and keep an eye on the compass, tide, wind speed etc. In business these measurements would be our operational KPI’s. These give us up to date information that we are on course and we are going to reach our destination. We can control the business by the KPI’s.

Now on route we need to check our actual position against where we think we are. Maybe we take a GPS reading and find out we are fifty miles off our planned route and are heading for some nasty sandbanks. In business this GPS reading is equivalent to the management accounts. These need to be accurate and up to date. It’s no good knowing that the boat was off course an hour ago or the management accounts are one, two or three months late. The information was there but no one bothered to tell the captain. Also it’s no good telling the captain he is off course without telling him how he got there. Perhaps the wind has shifted, blowing the boat off course. Knowing that, the captain can recalculate the bearing and bring the boat back on course.

I have spoken to many, many business owners over the years that have no idea which Ocean their boat is in let alone the direction they are headed or indeed the final destination. Often the captain (owner) is not too worried as they know there is plenty of water under the keel (large cash balance in the bank) and there are no storms brewing. In fact the skies are clear and blue. The boat can just chug along merrily, oblivious to the changes going on around them until it’s too late.

Unfortunately, in nature and in business we have seen over the last few years the climate change. Storms and sudden squally showers are becoming the norm. What served us in the past will not help us in the future.

So perhaps by looking at the importance of the inter relationship between financial accounts, management accounts and KPI’s we can gain, regain or maintain control over our business in these changing times.

To finish, here is a brief relevant extract from my book ‘The Levels- Can Your Business Step Up to the Growth Challenge?’ (Page 143)

You cannot make sound business decisions and grow through the Levels without tackling your financial understanding, forecasting and planning.

I know that, for many business owners, the idea of getting to grips with the finances takes them straight back to a time when it was easier to feign sickness than attempt double math’s, but this is an absolute necessity and with the right resources it doesn’t have to be as painful as it sounds (I promise there are no quadratic equations involved in any of this!).

The language of business is numbers and, just as on an overseas holiday it is helpful to have a basic understanding of the language spoken, a business owner needs to have a good enough grasp on the language of numbers to understand what’s going on within their business. Without the numbers, we are once again relying on opinions rather than the facts and that is something which can result in bad decision making about where the priorities for the business should lie.

I am not saying the owner needs to be fluent in that language. They can always hire an interpreter (an accountant) if the conversation becomes too complex or detailed but having no understanding of the language is like being stuck in the middle of Athens without a map. There are road signs everywhere and plenty of people willing to give you directions but if you can’t read the words or understand any of the lingo, you have no way of knowing which way to go. With good luck, a little judgement and the use of some slightly mad looking sign language you may well eventually get to your destination but the journey could be a very long and winding road!

As any world travel enthusiast will tell you, if you can grasp the fundamentals of a language you will gain a deeper understanding of the complexities and nuances of the country where it is spoken. Basically, your enjoyment of the trip will be much improved.

So, in Setting out the Stall to face the TRANSITION from Level 2 to Level 3, the first thing you have to do is put in place strong financial controls and management information that is capable of allowing you to go to the next Level and beyond. Start by making a review of your current information system and take a look at the information it is providing.

There’s no time like the present so you can do this right now!

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New Year New Start! Is It?

Well it’s the start of another year, actually as I write this it’s the second week of the year and it’s tempting to write a motivational piece around fresh start, new goals and….and….

But, most of us are aware that with all the greatest of intentions our New Year Resolutions often quickly disappear into the mist. In fact, statistically the vast majority of New Year resolutions will have already been broken or will be broken within the next four weeks.

Now before I switch you off totally and you accuse me of just being an old grouch there is a positive spin on the whole New Year thing.

On one side 1st of January is just another day marking the day the earth starts on it’s next 365 day orbit of the sun. On the other hand it also marks the day to take stock. It is time to reflect and consider. It’s out with the old in with the new.

Indeed, I often hear ‘thank heavens that year is over things will now get better!’ putting some mystical relevance to this day. Our fortunes are not going to miraculously change with the change of a year number.

When we think about it, New Year Day highlights the passage of time. It marks the passing of the last 52 weeks and allows us to welcome the next 52 weeks. It is a great time to Stop, Review and Reflect.

Just how quickly did last year go? Like most of us it seemed to fly by. Indeed it seems the older we get the faster the years seem to pass. Can you remember how long school holidays seemed to last?

So, let me ask you a question. What happened in the last 52 weeks? Can you truly remember what you did last year? Take a little time to think about the four weeks of February. What happened, what did you do, what where your thoughts, what were your feelings?

Now you may think that was easy as something major happened to put the period into context for you but for the majority of us it was just another month. Choose another month and review how much you really remember. Days blur into weeks that blur into months and suddenly a year. Life is busy doing stuff and we don’t give ourselves time to reflect.

No we certainly don’t want to live in the past opening up all the sores of yesterday but let’s learn from those experiences to build a better future.

With the passing of each year let’s aim to build on the experience you have gained in the last and previous years. To look forward to taking your understandings from say the last thirty years into your thirty first year. Now that has value.

There is an old adage that goes something like this. ’When we spend our money we can always make some more but when we spend our time it’s gone for ever. So invest your time carefully.’

In my book, The Levels: Can your Business Step Up to the Growth Challenge? I discuss the difference between experience and understanding. Here’s a short abridged extract that gives a little background.

The Levels model will make you more aware of what has happened or is happening in your business right now. Your role is to constantly review your experience to date.

After each of the following chapters, my challenge to you is to Stop, Reflect and Review. Write down your experiences so far, how the topic covered in the chapter relates to your business and what steps you can take to make a change.

So, step 1 is to learn how to review and becoming aware that you may need to change the way you do things if you want to move forward and grow.

When you take a good look at your experience to date you may be in for a surprise. Maybe the CV says 10, 20, 30 or 40 years’ experience in a particular field. Interestingly, what we think of as 40 years’ experience gained in the cut and thrust of business can actually be only 5 years’ experience that has been repeated over and over again. It just gets photocopied in each successive year.

By truly understanding your experience and how you have arrived at where you are now, you will become aware of many more opportunities that you will be able to exploit in the near future.

The next step is then passing on that understanding to your team so that you can really take control and maximise the opportunities.

Let’s make the New Year a time to understand, to leverage our experience to impact the future. Start to review regularly. Make it at the end of each week. Write it down, not just a diary of events but what you were thinking and feeling. Seek to understand what has gone on. Re-read your weekly reviews every quarter, take the learnings and seek to understand. At the Year End you have gained a wealth of understanding to invest into the future.

Enjoy reviewing, it’s a powerful tool.

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The UK SME Market: The Levels

In the UK there are around 4.5 million enterprises that are defined as SME by ONS. Interestingly 75% or 3.3 million of these enterprises do not employ staff. They are sole traders who should be considered more as self-employed jobs and therefore should be excluded from the numbers.

Based on the EU employee definitions of the remaining 1.2 million businesses:

  • 83% (968,000) employ under 10 and are classed as micro enterprises
  • 15% (172,000) employ more than 10 and less than 49 employees and are classed as small enterprises
  • Only 2% (26,000) employ more than 50 and less than 250 employees and are classes as medium sized enterprises.

(Source B.I.S Survey 2010)

The demands of these three segments are completely different and the complexity of transitioning from micro to small and small to medium brings totally different issues.

Let’s have a quick look at how businesses in each of these segments can behave.

Level 1 – The Power Boat Phase

Micro businesses behave like a power boat. They are nippy and manoeuvrable. Flexibility is their advantage beating other boats to the action. They are quick to react to the conditions as they are very close to the sea. They can see things coming but have to constantly focus on the moment.

To ensure the other power boats (competition) don’t steal a march on them the skipper (business owner) is constantly on the lookout for the next job and keeping in front of the game. If the skipper (business owner) takes their hands off the controls for a moment disaster can ensue.

The ride is always very bumpy but exhilarating.

The skipper fixes the engine, maintains the boat, makes sure they have the right crew and gets stuck in when they arrive at the next job.

With never enough time to properly maintain and improve the boat means the boat and the small crew taking such a prolonged pounding the speed may be slowed to make it a more comfortable ride. This results in them being beaten to the jobs by other new boats in the area.

However the main problem is that in choppy or stormy conditions they can easily be sunk- losing everything.

Level 2 – The Fishing Boat Phase

Small businesses behave more like a Fishing Boat, the sort that battle the storms of the North Sea. It’s built to weather the conditions but it relies on the skill and knowledge of the skipper to keep it safe. From his experience the skipper knows where the fish are most likely to be and keeps an eye on the weather.

The skipper doesn’t have to get stuck in hauling the nets or sorting and storing the catch. Oh no! The crew just get on with that.

So what does the skipper do all day?

The skipper works long, hard hours to ensure the boat and crew are safe as well as finding the catch to feed all on the boat.

The boat is built strong enough to face most conditions but will often have to limp back to port to face long and expensive repairs. Past profits are pumped into the boat just to keep it afloat. If its condition is not kept up to scratch then the stormy seas will claim it.

The boat can easily become top heavy (too many overheads) and capsize.

Without the skipper the boat would drift and eventually flounder.

The skipper works from their gut backed by their experience. What they do can’t be easily taught and so it is difficult to hand over to the next skipper. Indeed it needs years and years of hard graft to develop the next skipper.

Level 3 – The Cruise Liner Stage

Medium sized businesses behave more like a Cruise Liner. The captain spends some of his time on the bridge but he doesn’t have to be there all the time. There are competent crew who can man the bridge whilst the captain is spending time with the passengers (customers) and crew (team) ensuring smooth passage for all on board.

How would the crew feel if the captain spent all his time down in the bowels of the ship in the boiler room keeping the engines going? The safety of the ship is the responsibility of the captain so they need to be kept abreast of all the relevant information to make informed decisions.

On board the communications crew (accounts and administration) who are constantly check the depth of water under the ship and that the ship is on course. The wireless section (Marketing) are monitoring what is going on around the ship and getting all the weather updates. Radar (KPIs) is looking out forward to avoid the icebergs so that the captain can be secure in keeping the course and speed. The Purser department (Customer Relationship and Marketing) ensure the passengers are happy and informed with what’s going on. The Entertainment Department (Sales Team) are down in the bar or in the Jacuzzi schmoozing the passengers!

Only joking unless it’s after 3 pm of course!!

The Liner is large enough and built with stabilisers to face large swells with ease and can also survive major storms relatively untouched.

It’s much easier to replace the captain than it is the skipper in small boats. The boat continues on its chartered course with all the crew knowing where they are headed and their role and responsibilities in reaching the planned destination.

The captain does not have to be the business owner. The business owner has the freedom to be onshore if they so desire. The owner knows the condition of the ship, it’s crew and passengers at all times. They know where it is headed and whether it is on course. The owner however has the freedom to be onshore knowing his ship is in good hands.

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All Star Team

Have you ever wondered what differentiates a winning team from a team that has great potential but never quite makes it?

In sport this is often quite clear. Consider the team of all stars, full of talent, who don’t play together as a cohesive team and are beaten by a team of less talented players who pull together and produce a performance above their perceived skill level. Take a moment and I’m sure you will come up with many examples from Rugby, Football, Cricket etc …

It’s the difference between an All Star Team and a Team of All Stars. The members of an All Star Team work for each other to achieve a common goal, subjugating their own egos to achieve the team goal, whereas, a Team of All Stars play as individuals for their own goals and aim to massage their own egos.

As a business develops through the levels (see separate article) from a micro enterprise (up to 10 employees) to a small business (up to 50 employees) the pressure to succeed and grow can create a Team of All Stars. Often a talented individual (the business owner) works hard and excels in many roles. However, as the business starts to transition to a medium sized business (50 employees plus) the pressure on the talented individual becomes too much. To truly unlock the potential of the business, the future must be based on building an All Star Team that work together.

There are many things that differentiate an All Star Team from a Team of All Stars.

In this first of a series on building an All Star Team we will look at two of the main foundations that differentiates an All Star Team from a Team of All Stars

  • A strong leader that enrolls and inspires their team to achieve a common vision.

The leader has a clear vision and attracts talented individuals who want to help them on their journey. Each team member may have a different compelling reason (their why) for wanting to help and they are prepared to emotionally commit to the team success.

All Star Teams work tirelessly towards achieving the team goals. They truly commit to the outcome and are prepared to be held accountable for achieving results and being responsible for their actions.

All Star Team members continuously develop themselves and others. They attract the best talent that is available at the organisation’s salary levels.

All Star Team members are prepared to give and receive open and honest feedback.

  • An All Star Team must be underpinned by common values that build trust between all the team members.

Interestingly, we assume that our definition of a word, especially a well-used word like Trust is the same for everyone.

But what’s our basis of Trust?

How do we know that we trust someone?

Let me explain, we all have our own rules about how we view our world and we put all our interaction with people through this ‘rule filter’ to get our perception of reality. We assume that when we are talking about trust to others we are all viewing it through the same rule filter. But is the case?

As our rules are built up by a combination of our past experiences, family and societies influences, to name but a few, so is it any wonder that we find it so difficult to define a simple word like trust that everyone can agree with.

We find everyone is coming from a different starting place, a different set of values.

In the business world, this can have massive repercussions.

Imagine being in a situation where the success of a project is dependent on team members doing what their said they we going to do but you just know that some never deliver.

You just don’t trust them.

What’s going to happen to that project?

So an All Star Teams have common values. These are clearly defined and written down, they are not assumed. The values underpin every action and decision. Issues are openly discussed and resolved to strengthen the team.

Team members are recruited on values first and skills second. Skills can be developed but if the values are not aligned then trust will be quickly undermined and an All Star Team will be transformed into a Team of All Stars.

The successful transition from a Team of All Stars to an All Star Team is one of the hardest steps in business. In deed many of the team may be loyal employees who have been with the company from day one.

Unfortunately, it also maybe these individuals that are not aligned to the company future and are holding the company back.

Often loyalty is also a core value of the business and therefore the creation of an All Star Team in these circumstances can lead to a conflict of values.

This in turn stifles open and honest communication. The door is open for the ‘Pink Elephant’ (see article)

I will discuss conflict of values and the results impact on results in a future article.

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Do You Have the Right Team?

A business is only as good as the team members that work within it.

So often, we hear the Business Owner saying…

“Everything would be fine if the team that work for me did as they were supposed to.”

But, the real questions that follow are:

  • Who recruited the team?
  • What process was used to determine the right people to recruit?
  • Who is responsible for getting the Team to do what they’re supposed to?
  • What is the reason that they’re not doing what they’re supposed to?

Unfortunately, as the Business Owner, you have to accept responsibility for the team you have. But what makes a successful team? We often use the phrase – are all our team ‘on the bus?’ So what determines whether they are ‘on the bus?’

There are two aspects to consider; does the team member get results or not and do they have the values or not? Jack Welch, Ex CEO of GE, had a neat way of charting people within his organisation:

andys-team-on-board-article1

Consider your team at present and how they fit into the matrix.

If they have the values and get results, then the course of action is crystal clear. Look after these people. They are great team members and should be developed, promoted, rewarded and generally encouraged within the business.

It is equally easy to understand that if they don’t have the values and don’t get results they should be exited from the business immediately.

The next category, have the values but don’t get results require some attention. Basically they need to be developed, trained, helped to perform where they are. If this doesn’t work then they may be repositioned within the business to an area where they can get results. If this still doesn’t work then they will have to be delicately exited from the business and helped in their pursuit for alternative employment.

The last category is the most difficult to come terms with. These are the people who get results but don’t have the values. Often we find business owners scared to deal with them as they bring in the most business, so feel that the normal business rules don’t apply to them. They feel that they’re above all of that and can get away with murder.

The only way to deal with this group of people is to exit them from the business (at our convenience) as they are like the one rotten apple in the business that will turn the others bad. This is quite frightening for some as they worry how they will replace the income of business. The most important thing here is that it needs to be dealt with sooner rather than later as leaving the situation or failing to deal with it will just result in a much larger problem later down the line.