Tag Archive for: management

Adding Salt: How to Build and Manage Teams That Work

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by Bernie Anderson

My name is Bernie Anderson and I have the honor of taking over the BAM blog for the next several weeks. I am a certified business and nonprofit consultant with Growability® – read more in my bio below. 

This is Part 4 of a series. Read Part 1, Part 2 and Part 3.

Thank you for following along with this month with this series on business basics. My prayer is that this series of articles will be an ongoing resource for your BAM project.

Like baking a great loaf of bread, we build every organization with three simple ingredients: leadership, marketing, and management.

If leadership is the flour and marketing is the water, I consider management the salt.

While prepping the dough for my loaf of sourdough this week, I mulled over the necessity of salt. Why does bread need salt? In theory, it’s possible to create a loaf of bread with just flour and water, give it some time to ferment the natural yeast, and a perfectly serviceable loaf of bread should appear.

But, without salt, nothing about the loaf of bread will be right. It will have the wrong flavor, texture, and consistency. Salt regulates the yeast, strengthens the dough, and brings out the beautiful complex flavors of a great loaf of sourdough. Salt is essential.

Like good management in your business.

Many consider management in basic terms of resources, operations, and finance. And it’s true, all this is involved. But the heart of management is people. Management is the salt of your business because management is the most human element of your business. Continuing with the Growability® Business Operating System as a model, think of management as having two parts:

1. Empowering Teamwork
2. Equipping Managers

 

Empowering Teamwork

The diversity of your team creates a diversity of opportunities. Many BAM teams are cross-cultural by nature. All BAM teams will bring together a variety of strengths and personalities that make your business unique. Community creates and expands creativity. An excellent team is also critical for capacity. Teamwork facilitates both multiplication and stability in your business. Never forget, God delights in and blesses common unity and teamwork (Psalm 131). Joy is an overflow from quality human relationships.

Global business has a reputation of building teams of human beings in some of the most inhuman ways. We hear horror stories of companies who entice employees with the promise of high pay, but to keep the pay coming, workers must sacrifice their humanity. Golden handcuffs, indeed. While paying your team their value is important, it’s not everything. In his book, The Heart of Business, former Best Buy CEO Hubert Joly says:

“The carrot and the stick are pervasive and persuasive motivators. But if you treat people like donkeys, they will perform like donkeys.”

Your BAM project should be different.

Read more

2 Company Leaders Look Back: Financial Planning Highs and Lows

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Read this classic blog from our Archives, first published on The BAM Review blog in November 2016 and republished for the Summer Series 2022.

 

When we have a major decision to make, we often ask those around us for input. Sometimes we follow that advice and other times we don’t. Occasionally we might look back and wish we had followed the advice we received from others. Hindsight is a beautiful thing!

Drawing on the wisdom of others can be helpful and the benefit of hindsight is illuminating. With those two things in mind, we asked a couple of well established BAM leaders for their advice about financial planning. We asked them to share what has been fruitful and has enabled them to grow companies that are doing well. We also asked them to share the lessons they’ve learned the hard way and what they would do differently in hindsight.

Hospitality Company 

Company A is a Hospitality company with 125 employees, it has two owners and was established 12 years ago.

What financial planning have you done to grow your company to the place it is today?

The growth of our company over the past five years has been quite substantial. We have seen our revenue increase 475%, and our earnings grow 540%. Though our financial planning was not the driver of that growth, it was certainly the foundation. Without the steps we have learned and taken over the years, we would not have been able to facilitate the amazing growth we have seen.  Read more

The Postmortem of a Failure: How to Evaluate & Even Avoid Failure

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by Colleene Isaacs

“Why did I fail? I did it by the book. I listened to my advisors. I corrected course based on what others recommended…”

“The business was a good idea, the timing was probably just off…”

“I knew I was in God’s will. He would provide and make it successful. How could I go wrong with Him on my side? I can’t figure out what happened…”

Does any of this sound familiar? Has this, or a variation of this, narrative been your own?

If this has been your own experience, how do you begin to dissect and understand what happened?

The Standard Reasons for Failure?

Most business experts can easily recite the top five to seven reasons for business failure. However, the reality is… the reasons for failure in any particular business cannot be summarily reduced to a quick list.

The manner in which we think about our failures is flawed, because we are flawed. Failure is multi-faceted, and complex, just like the humans who craft the scenarios in which failure thrives.  Read more

Two Company Leaders Look Back: Financial Planning Highs and Lows

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When we have a major decision to make, we often ask those around us for input. Sometimes we follow that advice and other times we don’t. Occasionally we might look back and wish we had followed the advice we received from others. Hindsight is a beautiful thing!

Drawing on the wisdom of others can be helpful and the benefit of hindsight is illuminating. With those two things in mind, we asked a couple of well established BAM leaders for their advice about financial planning. We asked them to share what has been fruitful and has enabled them to grow companies that are doing well. We also asked them to share the lessons they’ve learned the hard way and what they would do differently in hindsight.

Hospitality Company 

Company A is a Hospitality company with 125 employees, it has two owners and was established 12 years ago.

What financial planning have you done to grow your company to the place it is today?

The growth of our company over the past five years has been quite substantial. We have seen our revenue increase 475%, and our earnings grow 540%. Though our financial planning was not the driver of that growth, it was certainly the foundation. Without the steps we have learned and taken over the years, we would not have been able to facilitate the amazing growth we have seen.  Read more

Cash Flow Mishaps: Stories from BAM Practitioners

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We asked BAM practitioners to share their insights about cash flow. Here are 6 mini-stories of BAMer ‘cash flow mishaps’ or near misses!

[Read Part 1: 10 Cash Flow Tips and 10 Red Flags from BAM Practitioners]

6 Cash Flow Stories

One cash flow mishap we’ve experienced is significantly underestimating cash needs to service a period of significant growth. This can happen when long lead time raw materials are needed, with up-front payment. It can also happen when financing growth requires organisational learning and capacity building, it then takes extra time to ramp up production, and the working capital cycle is longer than expected. Another real danger is when a series of smaller mishaps all happen at the same time, for instance low quality raw materials, late delivery of materials, late payment by customers for finished products. Each of these on their own are manageable, but create a serious issue when stacked together. We have been able to develop some cashflow forecasting tools using MS Excel which give us visibility on future cash needs, including graphs, which feed into weekly reporting. This has been invaluable to us. – MH, Manufacturing, Asia

 

A few years ago I led a new initiative at our company to build a software product for retail banking. I was hoping that the recurring revenue from product sales would offset the erratic cash flows that are typical of a project-based software company. A project team of eight members spent 18 months building the product and we spent another year having a sales team sell the product. For a small company like ours the outflow of funds in this experiment resulted in a major blow to our cash flow for a couple of years. What I learned from this costly mistake is that a project oriented service company is not automatically good at being a product sales company. They are two different types of organizations with different team structures and competencies. – Joseph, IT, India/USA

Read more

10 Cash Flow Tips and 10 Red Flags from 10 BAM Practitioners

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In a truly great company, profits and cash flow become like blood and water to a healthy body: They are absolutely essential for life, but they are not the very point of life” – James Collins, Good to Great

As Jim Collins so wisely said, cash may not be the ultimate point of a company, but it is like blood to the body – essential for survival.

We asked 10 BAM practitioners to share their insights about cash flow. Read below the 10 tips they shared and also 10 ‘red flags’ – the tricky situations they have encountered where cash flow can easily trip you up.

In Part 2, we share 7 short stories of ‘Cash Flow Mishaps’ – real-life cash flow challenges that BAM practitioners have encountered

As one BAMer summed up, “Cash flow is an important indicator of how a business is doing, don’t take your eye off it!”

Cash flow tips from BAM Practitioners – Do:

1. Always watch your cash flow very carefully and plan ahead at each stage.

2. When business planning, find a cash flow projection template and someone who will force you to fill it in!

3. Use forecasting tools and technologies to help you watch and manage cash flow on an ongoing basis. Read more

Numberphobic? 3 Key Ideas to Increase Chances of Business Survival

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by Dawn Fotopulos

According to an Intuit survey from 2015, 87% of small business owners do their own books and 47% claim financial illiteracy. It’s not a surprise that more than half of small business start-ups never survive to see year 5 of operations; it’s remarkable that half do. If you follow start-up history out to year eight, the failure rates are in the 80+ percentage. Any thinking person would take their start-up capital and go to Las Vegas. You’d have much better odds of winning there.

What if, by learning just a few key ideas, you could double even triple your probability of small business survival? What if a one day commitment of your time could change the next twenty years of your future and the future of your household? What if what’s in this article prevents your small business from becoming a statistic? It can. Here’s how.

Every business owner needs to answer three key questions:

  • Am I making money? (Showing a profit)
  • Do I have enough money to pay the bills? (Enough cash flow)
  • Am I building wealth or destroying it? (Building net worth)

Read more

Important Issues to Consider in Financial Planning

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by Colleene Isaacs

Let me start by saying, I hate dealing with financials! In a perfect world, I wouldn’t have to think about or plan for the financial aspect of doing good business. Or better yet, I would have some really smart CFO-type deal with it, and be done with it. Unfortunately, as far as I know, we don’t live in that world. So just like everyone else, we have to do the financial “due diligence” (homework), necessary to do business well. There are a lot of great resources to assist as you begin your planning process, particularly when it comes to the financial matters of business. One suggestion I would make is save yourself a lot of grief, and apply a template like the “Business Model Canvas” to your planning process (see the book Business Model Generation.)  This model follows a somewhat lean startup methodology, and is a great way to visually scan and plan for all the aspects of business planning and design. 

Let’s really focus on some things you should be thinking about financially when you start the business start-up journey – a journey that is a very winding road, never a straight path!

Expect the Unexpected

A general principle is start with Plan A, but always have a back-up plan(s). You only have a limited insight into what the future will bring. You may be faced with geo-political situations, product development delays, weather, material sourcing issues, local permitting requirements and delays, transportation issues, broken equipment, etc. that you were not expecting. Any of these external elements, can severely impact planning and business execution schedules, as well as the finances required to support those activities. Just know that wherever there are opportunities for something outside your control to fail, there is a real possibility that it will.  Read more

Business Planning Part 3 Introduction: Financial and People Planning

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We start a new series on The BAM Review blog this month that will focus on developing your business plan: Financial and People Planning.

In previous series we have covered Business Planning Part 1: Introduction to Business Planning and Business Planning Part 2: Product and Market. In Part 3, a new series that will take us up to the middle of December, we will focus on two essential elements in the business planning process: money and people!

Show Me the Money

Crunching the numbers and working out financial projections during the planning stage is a major part of discovering whether your business model is viable or not. Until you start to work out your costs, price points, sales forecasts, cash flow projections, break even point and so on, your business idea will remain just that, an idea. Even if you don’t need to present your plan to outside investors, you will still need to create a financial plan so that you know whether your business model can ever be profitable and how much working capital you will need to sustain it through launch. Read more