Last week I talked about the Discovery phase in your approach to developing your second act. We focused on discovering your key strengths and life experiences. This is an exciting time for you to re-engage your strengths and your prior life experiences to have the life you want after you leave your business.For many entrepreneurs, we’ve spent a lifetime building our businesses. Sometimes you’re not sure what’s available next.
There are two key factors that connect you to the future of your dreams. The first, understand your financial goals and the second, understand your personal goals. In this series of blogs, I focus on your personal goals and dreams. If you need more help on your financial goals, how to increase the value of your business, and how to sell your business, we discuss this at our sister blog at the High Growth Business Report
This week, we go further in the 4D Appreciative Inquiry process. The second step is the Dream phase. I challenge you to dream again. For many of my technology clients, this phase is hardest because they make their living dealing with facts and figures and see their analytic skills as a critical component to their success. Continue reading
How do you create the future you want? As your business grows and transforms, you find new challenges to deal with. Many leaders struggle with their futures. For the serving leader, it is critical to get beyond the day to day activities and begin to develop your plans for the future. Many business owners have a difficult time determining what’s next for them beyond their business. Over 80% of entrepreneurs claim they built their businesses to be sold. Then why do so many struggle to disconnect from their business? Having interviewed many founders of high growth businesses, I have discovered how difficult it is for these leaders to create a great second act for their lives beyond their businesses.
I thought it might be helpful to share a process I use when working with these business leaders. I use a four step process that helps them reconnect with the things they enjoyed when they started their businesses while applying the knowledge they gained through growing it. Continue reading
How would you like a process that can help your people deal with changes faster and easier than you ever thought possible? What if the process not only opened you and your team to endless possibilities but also ensured faster buy-in from all the various stakeholders you impact. I’ve been guiding serving leaders through change for over 20 years, from small startup businesses to family businesses over 100 years old continuing to change to keep up with the many challenges businesses face as they grow and prosper. In one client engagement, I was dealing with a large medical practice. I was assigned a psychiatrist to work with to determine how medical professionals deal with change in high stress specialties. I asked several of my better clients to be involved in the pilot program. This allowed me to explore the topic further and it gave me access to a great team of people who deal with high stress on a regular basis.
I can’t imagine a much more stressful job than running a small or mid-market privately-held business today. I share the best process I found and help you apply it to your life starting today. I use this four step process when dealing with my clients to help them see the possibilities in their life and organizations. The process is called Appreciative Inquiry Method and was originally developed by David Cooperrider, PhD. He has continued developing and evolving the process over the years. Continue reading
Why do so few entrepreneurs reach financial independence? I believe it’s because many entrepreneurs are willing to settle for less. They build an organization that will not grow without their involvement. Previously, we talked about the first three reasons why entrepreneurs start their businesses. To build an organization that people want to buy, you must be willing to work outside of your organization. Today’s blog talks about my favorite kind of entrepreneur, the serving leader. Let’s talk about what happens when you do everything right and achieve your goals that take your business from good to great. By thinking about how you’re going to leave the business early and often, you begin to create the future of your dreams. The difference in your results is staggering. The quality of your life changes in ways you can’t even imagine today. So, let me share with you how we can work together to change the world.
The fourth reason entrepreneurs start their businesses is to change the world. I find most of my better known clients have an incredible drive to change the world. They are passionate about what they do and they never tire of working with people and their key ideas. These people are visionaries and serving leaders. During the early stages of their business, they are able to woo people to their ideas and their business. They reach out to many different stakeholders in their communities.You can feel the energy coming off them when you sit down to talk with them or if they are in a room full of people. Continue reading
In the course of daily business activities, I spend time at various meetings, conferences, and other organized functions where I meet a lot of entrepreneurs. Inevitably, the conversation turns to, “So, what do you do?” I explain that I help entrepreneurs plan and get their businesses ready for sale. I’m amazed how often I get the response, “Oh, I’d never sell my business. My business is my life!” Really? Are you one of those entrepreneurs that started a business because you don’t have a life and this was how to get one? I didn’t think so, either. Entrepreneurs start their businesses for a wide variety of reasons, but here are the four most common ones and how planning to sell your business can help you accomplish them. Continue reading
I’ve been involved in succession planning since the late 70’s. It was the first consulting job I did with clients and I still am actively working with organizations on their talent management and succession planning. I’ve worked on over 100 succession plans for key clients and partner organizations.
The first reason succession planning is not done is because there is always something more important to do. For most entrepreneurs, they are still actively involved in their business. They can find a hundred other things to do than talk to about who will lead their organization after their gone. Over 50% of my client s don’t put an emphasis on organizational sustainability. They are brilliant at what they do. In many cases, they’ve created visionary organizations. The problem for many is that they cannot see a time when they won’t be involved in their business. So why invest time into something that won’t build a lasting leadership legacy. My challenge is to get them to face their own mortality and still remain a long term client.
The second reason there is no succession plan is the founder doesn’t feel that someone else can do their job. For many in North American men, their lives are so tightly aligned with their careers, take away one and the other begins to falter. I have found than many market leading organizations begin failing when the founder can no longer see the future. Since many of my clients are technology based, the leader is unable to deal with disruptive technologies and capabilities in their markets. As their technologies mature, the type of leadership required also changes. Since many entrepreneurs are controlling by nature, when change begins to occur they may hold on tighter to the leadership of the organization. Leaders who have built significant organizations are not willing to bring in leadership that may add another dimension to their organization. In the worst case, they may begin chasing the out their successors, either because of fear of the unknown or they’re afraid they’ll be thrown out before they’re ready to go. The other part of this is that the leader can misread their own health and drive. They don’t notice health problems until it’s too late. I’ve seen several of my clients die before their successor is chosen. Sometimes it’s not a health issue but a random act the owner suffers. I’ve seen at least several senior leaders die in unexpected plane crashes and, in one case, it took out 3 of his successors. In the military, there are always succession plans to follow. You should have one too.
The final reason succession plans fail is that the leaders and their leadership teams underestimate the impact of a new leader on their organization. When Jack Welch named Jeffrey Immelt as his successor, several key executives left to run other organizations within several months. In the case of GE, they had incredible leadership depth to call on after the executives left. When a new CEO is named in a midmarket organization he or she may lose a critical member of the leadership team. If you’re in a small nonprofit, the moment you promote a new managing director, several of your team members may begin looking for roles outside the organization. You must be prepared to deal with these situations. The better you are prepared for the worst the less harmful it will be to your organization. We will talk more about how to do this in a future blog.
The challenges for a smaller business may also include a financial component to the succession plan. In many privately held organizations, when a team member on the leadership team leaves there is financial burden that the organization takes on. Since the stock is not publically traded many times the cash payout for private stock can cause additional hardship to the organization. I’ve also seen many smaller organizations struggle to pay both the former CEO and their replacement the compensation they feel due to them. This can undue and unnecessary stress during their transition.
Next week after the succession strategy conference, I will bring back the financial piece of the succession strategies process. For many of you CEO and Managing Directors, you will find this next blog incredibly helpful. I’ve got my copy of CFO for Dummies out and I’m not afraid to use it. Next week, we will share the financial secrets of succession strategies. See you next week.
The first lesson George Washington might teach us is that it’s better to dodge a bullet than take one. As a military leader President Washington had several horses shot out from under him in several different battles. He understood that you can’t make things happen from the back of the battlefield. Serving leaders are willing to lead from the front and are willing to do the things they ask others to do. He understood leaders must step up and take responsibility for their results. Entrepreneurs understand that if it’s going to be done right that sometimes means they must do it.
The second lesson to learn from Washington is that he had extensive formal training in the military. He had a formal military training in the British army. He learned the more traditional ways of battle from generations of great military leaders from England. George Washington didn’t let his advanced education and experience limit his ability to recreate the rules of war. He developed strategies that would allow him to use his fledging army to confound the world’s most powerful military. Entrepreneurs must know how to create their own opportunities in the markets they work in. Going straight at your opposition is most likely to end in a loss for your team. As you organization continues to evolve so should your go-to-market strategies. Be agile when you competitors are larger and dominate smaller markets to increase your profits.
The third lesson to learn from Washington is to know when to strategically retreat and regroup. George Washington understood you can’t win every battle. Use what you learned to step back and develop a different strategy. He was the master of using the environment to change the way we fought and won. He was willing to take risks and seize opportunities when others didn’t see them. He crossed the Delaware on Christmas Eve to surprise and defeat his enemies. Successful entrepreneurs must know how to seize new markets when they appear. You must create as many opportunities as you find. Leaving old markets to enter new ones is critical to your organization’s success and growth.
The fourth lesson to learn from Washington is to know what you are good at. President Washington was a man who was very comfortable with who he was and what he wasn’t. He invested his lifetime knowing what he did best and then delegated to others around him to support his efforts. He spent significant time knowing what he needed to create success both here and overseas. He then found the most capable men and women to support his dreams. Purpose driven entrepreneurs know what they do best. They then find others with complementary skills to do the things they don’t do well.
The final lesson to learn from President George Washington was to know when to leave. Succession is a hot topic today for many business founders. Knowing when and how to bring in the right people is critical to a sustainable organization. If any President was ever given an opportunity to be made King, it was George Washington. He chose to leave office because he understood that our country, and ultimately, our form of government could not be built on the back on an individual, no matter who they might be. In a truly courageous act, he helped create a Constitution and a culture that would far exceed his life and impact. Many great entrepreneurs have failed to create the culture and structure to live beyond their vision of the business. Entrepreneurs must be willing to plan for the unplanned and develop an organization that transcends the individual founding team and develop succession plans for key people within the organization. Then even the best leaders must be willing to step down and create future leaders in the process.
Most of us are very familiar with the stories about Washington; the infamous cherry tree, the silver dollar across the Potomac, the winter in Valley Forge. Looking past the school stories you’ll find we have much more to learn from the Father of our country.
The first thing is you must share expectations for the individual role. Make sure the person understands their individual role in the business. Check to be certain they understand what is expected in the new role they are taking on. Review with them the individual contributions of managing this this new position.
The second thing is to help this individual understand the role on an enterprise level. This includes a discussion on what you expect of leaders within your organization. Communicate how you expect them to work with others and make sure they have the right tools to begin building critical connections with other leaders with your organization. This could also include introducing them to others in your enterprise. Your communication to other leaders on your team is critical to help these people get off to a great start. I’ve seen many promotions fail over the years because people across the organization have not been aware of a recent promotion, the reason why a person is moving into their new role, or why they should change their habits to work with the new person.
The third expectation is to share your expectations with the individual as a member of the senior leadership team. During this conversation you could reveal how you work best with your fellow team members. What are their accountabilities as a member of the senior leadership team? What’s the best way to make sure that they get the support they need from you. I also think it’s critical to establish a communications framework so that the new person understands the best way to communicate with you. Most people have a preferred way of communication, for example, I prefer the phone versus email. Many other executives I work with prefer email. I negotiate with new team members to determine how they prefer to hear from me. I also ask new team members to share this with all their fellow team members during their initial time with the organization.
And finally, during this part of the onboarding process I also start my file on the new team member. This file includes their preferences and also personal information, such as birthdays and family members’ names, and special interests that will help make the transition easier for them. You’re investing significant time and resources in this new person and the personal connection to the individual is the glue to the new organization. Even the most senior people I’ve worked with may struggle with simple things during the initial phases of their new position.
Taking the new person to lunch or just dropping by to see if things are going as expected can help you make a person feel more welcome. I understand that many of these things may have been discussed during the interview process. Having spent many years in an executive search role, I have discovered most great executives have several interview processes going on at the same time. If it’s an internal promotion they may have received many different messages from different members of your leadership team.
If you do this with your new leadership team members, you will be surprised how quickly they begin making a large contribution to your team. It’s your responsibility to provide them with clarity, confidence, and capability in their new role. You’ll both be glad you did.
The first strategy is to become a leader. People in challenging times are looking for leaders. If you hope to create the success you want in your life you must be willing to stand for what you believe. It’s easy to try to become a follower of others in the industry in challenging times. Going along with the crowd will not provide you with the success you desire. You must stand for what you believe and advocate why what you believe is the best course of action for you and your organization. How would you define leadership in your market? Would this position in the market allow you to use your own strengths, gifts, and life experiences?
The second strategy is being willing to see opportunities where others see only challenges. Many great organizations have been founded during tough times because people like you chose to seize new opportunities instead of seeing only difficulties. Moving first can provide you with the needed edge to create a breakthrough organization. Times of change like we see today create trials but also incredible opportunities for the person who is positive about managing change and willing to take risks. You must train yourself to see opportunities and then ask yourself how you might leverage your resources to seize these new opportunities.
There are many additional resources available to you during these trying times. To seize opportunities, you need to develop better judgment and decision making capabilities. I’ve seen many entrepreneurs successfully add great people and businesses to their organizations during economic downturns. These mergers and acquisitions have helped their organizations achieve breakthroughs that their old organizations could only dream of.
The third strategy is not to do what others do. Look at how your peers do business and decide if they are doing it the best way. It’s easy to go along with the crowd on big trends. The question is, do these new trends serve your ultimate purpose? Will they resonate with the people in your markets? If you do what everyone else does, you get average results. You’re one of the crowd. Many of my best clients have made a good living by being contrarians. When their market leaders go one way, they go the other. If low price is the key strategy for their industry they charge more, significantly more. They have discovered that in a price war ultimately nobody wins. So for their small businesses, they choose to spend more time creating an incredible experience for their clients than trying to uncover the ways to produce a cheaper service. Most of my best clients have decided to create many of the more expensive products and services for their markets. They believe it’s a more sustainable business model. Judging by their results today and the recessions they grown through in the past they are on the right path.
Over the next several blogs we will discuss each of these strategies in more detail. I will share with you different ways of succeeding in challenging times.
I was recently paging through the new Forbes magazine. This year the Forbes 400 list of the wealthiest Americans has dedicated a large part of the magazine to how the wealthy invest their money in nonprofits and charities. This issue not only lays out the facts but shares an insider’s look at how the wealthy are getting more involved in giving. They share how many of these billionaires are investing in our society and help provide insights into how the big donors make their decisions. It’s really a great resource and for less than $8.00 you can see how these individuals think and what they want in the organizations with whom they work. A thought came to me as I read the article. That is, the world of philanthropy and giving is changing. Whenever there’s change, some people see the opportunities and others see only loss. The people that see opportunities also find success in the new reality. It seems to work the same in both the business and nonprofit worlds.
Bill Gates starts the discussion with laying out what he sees happening and even begins defining this new discipline as Catalytic Philanthropy. I worked with Microsoft leadership back in their heyday and I can tell you once Bill creates a vision in his mind many people follow. He is a relentless person in advocating his world view. He has a secret weapon in his philanthropic work that he didn’t have at Microsoft, his wife Melinda. She provides an emotional charge that moves people in ways that Bill might be awkward doing. To be clear, I’m not saying Bill isn’t passionate about what he wants to accomplish but he’s always more about getting things started, innovating, and then implementing for early success. Melinda, on the other hand is very capable of moving people when sharing the vision of the collective future they both see. She talks about responsibility and the role philanthropy has for people who have the ability to make such a huge difference in the world. Talk about a dynamic duo, WOW. And I’m not talking about his bridge partner.
Now if that’s not enough, you can see how Warren Buffet looks at making a difference and why. If you’re a regular reader you know that I started my career in the Berkshire Hathaway family and have spent the past 30 years working with Warren’s many different businesses leaders, including Ralph Schey here in Northeast Ohio. Ralph served on the leadership team at The Cleveland Clinic Foundation. His work helped take a strong medical organization to a world class medical institution while building a team of trailblazers to help shape medical leadership moving into the future.
Warren’s quote should be a challenge to all serving leaders everywhere. He said “You should be doing things that can change lots of lives. And you should be doing things that have some real chance of failing.” Doesn’t that remind us why we do what we do for our clients? A great quote may inspire but Warren’s financial contributions continue to change the face of modern philanthropy. They also talked about the person that inspired Warren to be so giving and I don’t mean Bill and Melinda. A little known fact about Warren is that he was inspired by another lesser known person who helped change the world with his philosophy of giving similar to how Benjamin Graham shaped his investment philosophies. His name was Abraham Flexner and he changed the way Warren looked at giving. When you have time check out his biography I think you will see several interesting similarities. All great givers and business leaders have strong philosophies behind what they do. Uncover the philosophy and the rest is easy.
Let’s see how this might apply to another great giver, Oprah Winfrey. Here a quote from this same issue, “When you go to Nelson Mandela’s house, what do you take? You can’t bring a candle.” How do you think you work with someone who sees the world this way? Would you go and ask for something small and insignificant? This world changer is looking to be involved in projects with world changing implications but of a highly personal nature. Look at the school she launched and you can see a project that gives you another clue to her personal philosophies. You knew she couldn’t fail and she would stick to it until it was successful.
The final thought I would share with you is that the innovators see change as a great thing. Change leads to new opportunities that no one could imagine in the past. The coming years will challenge you to be more than you ever thought possible. We are entering a golden age of business and those who can’t see the possibilities doom their organizations to failure. It will not be a matter of money that you lack but a vision for your organization that others will embrace with all their hearts, minds, and energy.