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Business Development & Marketing Finance General

Running a small business is a juggling act

businessj juggling actA YouGov study has found that small business owners identified most strongly with the analogy of a juggling act when asked about running their businesses.
The analogy was strongest in the North West, in Yorkshire and Humberside, where 63 percent in each region compared themselves to jugglers.
Bookkeeping was rated the biggest chore by 27% of the 1000 respondents, while 42 percent of respondents believed central government added to the hassle for small businesses.
As an analogy it makes sense where dropping one ball can cause a knock on effect such as the consequences of not having contingency plans or missed payments or failure to file Tax Returns.
Among the issues identified in an article in The Economist on the same subject is knowing the right time to take certain steps in a business.   In that sense, it argues, the juggling act is a permanent exercise in balancing a variety of trade-offs. Such as holding high stock levels can help avoid the consequences of being let down by suppliers but it ties up working capital.
Knowing the right time to expand is a major issue: “by expanding too fast, companies risk losing control of product quality and messing up their management structure”.
Another is the tension between centralisation and delegation. A hierarchical structure can lead to a rigid and inflexible business structure and a loss of agility, while delegation of roles can only work if staff are well trained and the business has a clearly-defined set of goals with which everyone is familiar and on which they act in harmony.
Another juggling act is created by the tension between sticking with the core products or services and how much you can diversify away from the core.
“Choosing the right time to expand and diversify, and the right organisational structure to do it, is a matter of judgment. That judgment, and the flexibility to change plans, is what makes a good manager.” is the Economist writer’s view.

So how can an effective CEO handle the juggling act?

Firstly, they should learn to delegate effectively. They should not be trying to do everything themselves. However, this means that those to whom tasks are delegated must be well-trained and know the company’s goals and be suitably motivated and trustworthy when left to carry them out.
The effective CEO will always be juggling priorities but there are ways of managing them although this involves being well organised.
It helps to see a business as a system of systems by breaking it down into discrete and manageable sub-systems or processes with delegation and clear lines of communication to keep track of all the various activities.
Planning and managing time have been covered in previous blogs and are essential to ensure balls are not dropped. It is easy to put off tasks which can turn out to bite you on the backside if ignored. Examples of activities that are often put off are: the collection in book debts, paying suppliers, VAT and PAYE, boring things like compliance, insurance, allocating time for staff reviews, and even speaking with customers; indeed there is much to oversee the trick is not to do it all but have systems and processes in place to ensure each necessary activity is done.
Check lists and using management systems can make juggling easier. This might mean having KPIs (Key Performance Indicators), check lists such as one listing all the month-end accounting tasks, a monthly management report that consolidates information from departments including management accounts, an order management system to track the fulfilment and invoicing orders, a way of monitoring sales & marketing activities and their results. There are myriad sub-systems and processes that can make the juggling easier but they all need to be optimised and integrated as part of the overall business.
It is possible to make the juggling act manageable and efficient in a way that frees up the time of the CEO so they can focus on the future of the business giving them time to develop strategy. To work on the business, rather than be bogged down in the business.

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Business Development & Marketing General

If you want more effective meetings don’t use PowerPoint or bullet points

effective meetingsEffective meetings depend on discussion that is constructive and to the point, and on wasting as little time as possible.
It has been calculated that the average executive spends around 50 percent of his or her time in meetings of which at least a third are useless.
This was the finding of a 3M study carried out by Annenberg school of communications, University of Southern California, Los Angeles, in 1989.
Studying effective meetings has been ongoing for years and certainly since the 1960s and there has been a growing body of evidence to support the 1989 findings, which suggests that executive productivity could be much improved.
There is an assumption that using lists or PowerPoint presentations can result in more effective meetings, but in fact, this has proven to be incorrect, as Amazon CEO @Jeff Bezos and subsequently others have proved.
A couple of years ago Bezos banned the use of PowerPoint and bullet point slides in executive meetings requiring instead that everyone sits silently for about 30 minutes to read a six-page memo that’s narratively structured with real sentences, topic sentences, verbs, and nouns.
Once everyone has finished reading the meeting memo then the topic is discussed. It has proved to be so effective that is has since been adopted by other CEOs.

Why does a narrative structure produce more effective meetings that use of PowerPoint?

Storytelling has been a part of human culture since we first discovered the use of fire. Anthropologists and historians argue that fire encouraged people to congregate by sitting around the campfire swapping stories as a way of teaching, warning, and inspiring others in pre-literate societies.
But there is more to it than that.
To be persuasive, an argument has to appeal to logic and reason, and also to emotion, which neuroscientists have found is the fastest path to the brain.
Bezos is quoted as saying: “”I’m actually a big fan of anecdotes in business,” arguing that often there is greater insight to be gained from customer emails than from data.
Basically, the scientific evidence is that our brains do not respond well to, or retain, lists. Our brains respond much better to text and even more so when the text is accompanied by pictures.
So, it should be no surprise that effective meetings are more likely to result from getting everyone to read a well-constructed narrative memo at the start, which gives everyone attending the same, essential information before any discussion begins.
The result is a much more informed discussion in which more people feel able to participate, rather than those “usual suspects” with the loudest voices.
Not only this, but the narrative memo provides an essential historical record of background and context for those who are not attending the meeting.
Ultimately using narrative rather than bullet point lists and PowerPoint slides will cut down on the time it takes to reach collective decisions, thus saving executive time and improving efficiency.
We should restrict PowerPoint for use as a tool for making a sales pitch and recognise those who use it in a meeting as trying to sell an outcome rather than seek to discuss the topic.

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Business Development & Marketing General Rescue, Restructuring & Recovery Turnaround

Why do successful people practise time management?

Continuing our series on successful people this time we are looking at the importance of time management.
There are two important reasons for practising time management.
Not only is it important to create a structure to the day that makes it possible to define what needs to be done but also it enables tasks to be prioritised so that the most important are the first to be dealt with.
Time management, using lists and a diary, makes it possible to review the task list, to allocate time and in particular to reschedule the less important from the most urgent along the way.
A second important reason to practise time management is to build in the necessary free space for taking regular breaks from the desk and the phone and for research, personal development and creative thinking.
It is neither mentally nor physically healthy to remain sitting at a desk all day without taking regular breaks to at least stand up and walk around the office for a few minutes.
Pausing to think, visualise what success will look like and to then plot the steps needed to get there is one of the things that distinguishes successful people from those who are competent at their job.
Too many business managers feel obliged to multi-task especially earlier in the day when they feel freshest, but research conducted at Stanford University has found that multi-tasking is less productive than doing one thing at a time and fully concentrating on it.
The danger with multi-tasking and not managing time becomes more apparent when things start to go wrong in a business. Then the failure to prioritise and build in thinking time will show up as stress and an inability to make the right decisions necessary to deal with a crisis.

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Business Development & Marketing General Rescue, Restructuring & Recovery Turnaround

Do you run your business or does it run you?

Owners quite rightly feel passionate about their businesses and feel they know it better than everyone else, which can lead them to believe they have to be an expert in every aspect of the business.
But is this an effective use of their time?
Being an expert at everything can lead to a feeling of being overwhelmed and swamped especially when one person has to make all the decisions.
No matter how the business is doing, whether growing rapidly or facing challenges such as having to constantly juggle cash, the feeling of being overwhelmed can lead to indecision and an inability to focus on important matters rather than demands on a director’s time.
It can also mean that the business leader or owner is unable to prioritise what really needs to be under their direct control and what really should be delegated to managers or even outsourced.
Understandably, most of us find a way of putting off those things we don’t want to deal with. The key for every owner is to know him/herself, to know what they are good at and what they are not good at, as well as what they want to do and what they don’t want to do.
This is more important than time management or being organised, it is about people management and self management – delegation, personal discipline and saying “no”.
The time spent becoming an expert at everything cannot be justified because the owner will end up doing nothing. No one person can prepare the accounts, deal with payroll, develop a marketing strategy, do the selling, build the website, do the search engine optimisation, manage the social media marketing campaign, build a database, be the HR expert, collect in debts, be the IT expert, deal with debt collection, buy the stationery, draft contracts, deal with the landlord, deliver goods, repair machinery, etc, etc. And yet so many business owners do all this and more.
I would argue that an owner’s time is best spent on finding other people who are better than them for each aspect of the business and then supporting them. Over time trust should be established to the point where others are left to get on with their job leaving the owner to focus on what’s important, or at least what they want to do.
To run a business efficiently it necessary for you to ensure that it doesn’t run you by getting others to run it for you.