Monthly Archives: June 2013

Minimize Your Mistakes

We all make mistakes. It’s in our human nature to be fallible. My line is that if I were perfect there’d be no reason for me to be here. In business, however, mistakes can be costly and may even be fatal for the company.

If you are familiar with the Tylenol case, there are some who believe the problem was perpetrated by an outside influence and the company made no mistake. There had to be a failure somewhere, however, that enabled the perpetrator to infiltrate the system and contaminate product. In either case, the incident could have proved fatal for Tylenol had they chosen a different way to respond or not responded at all. Yes, it was costly to pull all of their potentially-contaminated products from the shelves and re-tool production to include protective seals, but those costs were made back up with the brand regaining its market share because of making the right decision. The right choices were made … and steps were taken to correct the failure in the system.

You will make mistakes in business. You can minimize those mistakes, though, with some preventative measures such as this limited list:

1. Internal Communication. Your corporate mission and the vision you have for your company must be consistently conveyed to your management and employees frequently. Supervisors should be talking to production people and dealing with issues the line identifies. Sustaining a positive, supportive attitude within your team is far more productive than standing by and waiting for something to break. I’ve always believed a pat on the back goes further than a kick in the pants.

2. Quality Control. The image your company portrays – through employees and your product’s packaging – creates the perception of your business to consumers. By controlling that image you can minimize negative perceptions about your products and/or services. It can be something as innocent as printing direct mail pieces when your printer is running out of ink that conveys the wrong impression. Keep an eye on your image and encourage your entire team to do the same.

3. Strategic Plan. Your corporate mission and the other aspects of having a plan for where you want your business to go serves as the guidebook to avoid mistakes. Take time to think things through. Evaluate where you are in accomplishing your strategies on a frequent basis. Spend time on the tasks that are important to the business for the long term and less time responding to urgent tasks. It’s the proverbial but true statement about spending more time on the business than in it.

4. Crisis Management. An often overlooked element in your business and marketing strategy is a response mechanism for when crises occur. Thinking through what might happen and devising methods for dealing with each of them can minimize risks, alleviate headaches, and keep your company in business when mistakes happen. Keep in mind that in certain situations, your best crisis response may be to let the crisis pass without a direct response. You must still be ready to act, however.

5. Learn. To keep from repeating errors that can prove costly, a great piece of advice is to learn from those mistakes you do make. You are doomed to failure if your company continues to make the same mistakes. Make sure your legal counsel knows the risks you face and does what he/she can to help you minimize them. Trust your non-staff team to help you gain from the lessons mistakes teach us. Stay positive and keep moving forward. Understand that this, too, will pass.

Detach yourself from the desire to make a rush (and often rash) decision. Distinguish the true from the false, the facts from the assumptions. Then choose the right path.

Game Plan

A good friend left one professional football team and ended up playing for a different one for a couple of years before he retired. The one he left had a consistent record of making the playoffs, winning championships, and having a waiting list for season tickets.

When he signed on with his new team, he found a locker room full of players more concerned about their paychecks than winning. The team rarely made the playoffs, usually had a losing record, and had a hard time filling the stands on game days. He had come from a totally different environment; a positive, winning environment he wanted to create with his new team, so he needed a game plan.

His approach involved helping his teammates understand that if they put forth the effort to be the best players they could be and concentrate on winning football games, they would fill the stands and generate the revenue necessary to more than compensate them for their efforts. He worked hard on conditioning, talked about the right fuel for the machine, and studied the playbook to perfection. His teammates started to understand, especially that with the right attitude they might even make the playoffs and win a championship, like he had done with his former team. He showed them his championship ring.

While his impact on the team was a small part of their success, they now contend for the division title every year and have made the playoffs consistently for four or five years. He had helped the players think things through, adjust their attitude, and play with a different winning mindset.

What’s the game plan for your business?

You can easily do the least possible and get by. That’s simple. You will own a business and take an occasional paycheck. Your company may be remembered one day for providing a product or service that people enjoyed while it lasted. You may even have an impact on some people’s lives. Is that your legacy and game strategy? Is that why you are in business? Is it enough for you to accomplish?

Or …

Do you want to create, develop, and sustain a comprehensive strategy that builds your brand to have top-of-mind awareness among consumers and own the market for your product or service? You can work your brand to the point where it has phenomenal impact on whatever plane you wish to dominate, including net profit, market share, employee relations, customer service, and public perception. It can be done.

Your strategy starts with your attitude. Answer the question: Why are you in business? Then build on that response by surrounding yourself with the right coaches (consultants such as Brand Irons) and players (employees and vendors). Understand what you’re selling and who your target audience is so they’re willing to buy tickets (purchase your products or services) and come to the games (become repeat customers).

You choose whether your business is mediocre or exceptional.

I go to a certain grocery store for a reason; it’s my favorite. I could buy food at a store where the prices are cheaper, but I go where I do because the owner/manager will stop and talk to me whenever and wherever I am in the store. He and his staff understand the relationship with the customer is more important than stocking the shelves. It makes a difference.

A game plan is a fun way to look at your company’s business plan and market strategy. Contact Brand Irons to get help putting yours together.

Team Resource – Your Banker Or Investor

Bank Cash Bag When we think of a bank, some business owners think of it as a necessary evil. That sentiment is likely due to the feeling that the bank uses the funds it has on deposit to make more money loaning it to others, that they are stingy on lending money back to business owners, and charge fees for virtually every transaction they make.

While there may be an element of truth to some of those concerns, remember that banks are a business and also need to make money to stay in business. What business owners often overlook are the positive outcomes of having a good business relationship with a banker.

First on the list is reduced risk. Imagine a business where all the cash and payments are kept on site in a vault. Any guarantee against loss or theft is gone. Although it may seem like a viable way to conduct business and keep your cash close by, the scenario also means your business, by definition, relies on being conducted only through cash transactions. That also limits how your customers can pay for your goods or services.

Banks provide a means to process checks and credit card payments, although credit cards can be processed apart from a bank through a company such as Electronic Payments. These options for customers enable your business to accept more than cash. Even businesses (a few restaurants come to mind) that accept only cash have automated teller machines (ATMs) in the lobby or close by where customers can get the cash they need by swiping a debit or credit card.

The most important reason to have a banker or an investor as part of your non-staff management team, however, is to help you manage your business. A strong, professional relationship with a business-oriented banker enables you to control cash flow, keep abreast of banking regulations, and manage your financial assets.

Too often, business owners only approach or talk to their banker when they need money. People I know in the banking industry hate that as much as the business owner. Bankers want to help you but need to know how. If it’s merely depositing your revenue into a checking account and using that account to pay your invoices, just talk to your banker about the best options for that type of account.

To get more value from your relationship, however, you need to get your banker involved in your business. Obviously, the first step is to establish parameters regarding confidentiality and other concerns, especially if it involves sharing your financial statements on a regular basis. Next is to give them insight into your business, which can be done with a business plan, a tour of your facility, and perhaps even a spot on the board of directors. Then stay in touch with your banker on a regular basis. Keep them abreast of your situation so they can be prepared to extend a line of credit or help with a short term loan if finances are getting tight or cash flow becomes an issue.

Talk long-term strategies with your banker as well. Let them know what you have planned, when you anticipate any expansion efforts to take place, and besides what you expect the costs to be, when you plan on being able to pay off the capital improvement loan. The old saying that if you work with them, they’ll work with you is valid when it comes to your banker.

Keep in mind that since the economic crisis around 2007-2008, banks have come under much closer scrutiny from the federal government and all the regulatory agencies. That implies that banks are now required to be more careful in what loans they add to their portfolios, which may mean you need personal guarantees or stronger collateral to get the same kind of loan you used to get before that time … and they may turn you down.

The questions you need to ask your banker should cover interest rates, penalties, loan procedures and requirements, and how best to manage your relationship with them. Getting free business checks is less important than avoiding monthly account service fees, although both may be negotiable.

Your relationship is still what’s most important. You want a relationship with a banker who’s responsive and honest. You shouldn’t have to wait four weeks for an answer about a loan, and you want them to tell you up front what to expect, even if the loan possibilities look bleak. You want answers and want to know where you stand so you can make informed decisions.

Keep in mind, too, that if you face rejection for a loan from one or more banks, there are other options, such as private equity and angel investors. These may be long shots as well and require a higher rate of return, but they are options for your business to continue to flourish and serve your customers.

Ready For A Crisis?

This week shifts to a topic that may be timely for some of you – handling a crisis – and serve as a wake-up call for those who have yet to establish strategies for dealing with the unexpected.

Let’s start with this question: What’s the worst thing that could happen to your business? ship_sailing_off_edge_of_world

Would it be that your “trusted” bookkeeper embezzles a few hundred thousand dollars from your corporate treasury?

Would it be a significant manufacturing defect that causes customers to get hurt or sick because of your product?

Would it be a system malfunction that destroys your electronic customer database and financial records, including the back-up versions?

Those, to most of us, would be major catastrophes. A crisis of any size can catch you unprepared. You have no way of knowing when the unexpected will happen, but you can take the time now to think those eventualities through and develop a strategy for dealing with the unanticipated events that can have an impact on your business.

While there are people who insist you should only focus on the positive and ignore any negative impact on your business, that is a naïve approach. Stuff happens! If you are caught with your proverbial pants down, you are forced to scramble to come up with a way to brush off or embrace the embarrassment and get your pants back up again. If anyone has ever “pants’d” you in gym class, you know the feeling.

Coming up with strategies for dealing with crises in your business can be simple or a complicated process that takes time and, in many situations, suggests that you bring in a professional to help you strategize and then implement the plans should the occasion arise.

Here is an example: When I was going to take over management of a chamber of commerce, I received a call from a member of the board of directors. She wondered what they should do since the chairman had just been indicted on child pornography charges. Holy cow! The potential for a black eye for the chamber was significant. My advice was simple: Distance the organization from the individual and go low profile … immediately but temporarily.

The chairman wisely resigned from the board and by going low profile, the chamber was rarely mentioned in any media coverage about the allegations and subsequent trial. Low profile also meant the chamber had time to get its house in order and be prepared to come out stronger than ever when the wind blew over.

This type of incident may never happen to your business, but some other potentially disastrous event could cripple your business short, or long-term. There are steps you can take to deal with everything from active shooters to negative publicity from a competitor, but going through every scenario is only important if your business may be susceptible to the situation.

There are numerous solutions to the myriad scenarios that can occur – far too many to deal with in this limited space. Seek professional help to come up with the most viable and sensible strategies for addressing the highest potential threats to your operations, whether they seem insignificant or are potentially devastating.

You will rest easier knowing that, in the event disaster strikes, you have a plan to follow and steps to take in managing the crisis or, if nothing else, you know who you can call to help you out. Make sure your strategy is customer and employee friendly because people are what’s most important. Buildings and machines can be replaced.

It all starts by asking the basic question: What is the worst thing that could happen to your business?

If you initially answered fewer sales, there’s an answer for that crisis, too.

Brand Irons can help you create the solutions to sustain and protect your brand and your business.