A Leadership Attitude That Can Put Your Business on the Road to RecoveryChia-Li Chien
Outrageously contagious leadership
Chia-Li Chien | May 16, 2011
I recently watched Morning Glory, and the movie reminded me about a mid-sized business I consulted with a couple years ago. The business had a mountain of debt, high employee turnover and was on the verge of closing down. After carefully assessing this company’s financial records and interviewing key management staff, it was not long before I realized they were experiencing the syndrome of great people with poor leadership.
Todd was president of this mid-sized, well-known franchised operation and he quit right before I started working with the owner of this business. For years, due to the high turnover, the employees were never asked their opinion on how to improve the business. The team had always felt threatened by Todd’s superior, careless attitude along with his lack of direction for the business. The result predictably showed up in this business’s financials.
Unfortunately, the financial problems spread like a tumor and affected the entire workforce morale as well as that of their customers. In the end, it took this business about twenty-four months to achieve the first of a three-phase recommendation. Today, this business not only has an outstanding financial performance, but has also become an industry leader in innovation of their products and services.
Similarly, the movie was about an upstart television producer who accepts the challenge of reviving a struggling morning show. Rachel McAdams plays the producer, who has an outrageously contagious leadership attitude.
She is willing to step up to let poor performers go, and leverage great people at the same time. She not only turns around the entire show, but most importantly, the entire team becomes like family in their work environment.
In the TV business, as portrayed in Morning Glory, daily ratings were used to check their show performance. Do you have something similar in your business? I called them KPI’s (Key performance Indicators), a set of small numbers to help you, as the owner, make decisions. Not just any decision, but effective decisions that allow you to continue to thrive in the direction you set out for.
Give your business a checkup:
• Review your business benchmark comparison with your Chief Financial Officer (CFO) – not your accounting staff, not your CPA, not your auditor – but someone who can strategically see how your business should perform overall. Most small to mid-sized business don’t have a CFO in place. Hire a company with the right skillet to act as part-time CFO as well as participate in your annual strategic planning.
• Conduct a competition or survey and ask your employees to come up with ways to improve products, morale, etc. Your people are the human capital you need to grow your business. They are on the ground servicing your customers, and they know what to do. Listen to your team as well as your customers.
• Set a realistic and achievable phased approach to reach certain milestones for your business. Break it down to a set of small numbers to help your team understand what it means to your business.
• Adopt an outrageously contagious leadership attitude at work. If you don’t have it, hire someone who does.
As leader of your business, unless you have outrageously contagious leadership, the road to recovery will be hard and frustrating. Sometimes your business financials look just fine, but there is no indication how you stack up compared to others in your industry. But you, the owner, subconsciously know the business is no longer the same. You can blame it on the economy, or things that you have no control over. The truth of the matter is that with outrageously contagious leadership, your business can build a strong foundation to ride the storm out, still standing tall in your industry afterward.
How do you know if you as the owner or if president of your company lacks outrageously contagious leadership?
- Negative net profit for the past consecutive three years
- Negative cash flow for the past consecutive three years
- Your financial ratio is below industry benchmarks such as:
- Profit before taxes
- Sales / Working Capital
- % Profit before Taxes / Total Assets
- You rely on lines of credit or loans to stay afloat
- Your revenue decreases 50% or more over a few years and you believe it is due to the economy
- Your team has a high turnover rate, with people quitting within twelve months or less after hire on average.
- Your customers stop doing business with you and you are not aware of it.
- Your products (include services) have limited change or innovation in the last three years.
So do you have an outrageously contagious leadership attitude that consistently motivates your people and your customers? We can help you toward outrageously contagious leadership. Contact us today!