7 Tips for Turnaround Management in Healthcare

The business elements of healthcare have faced significant turmoil this past year. Hospitals, medical practices, groups, insurers and even their service companies have been forced to produce greater results with fewer resources. This has led to strained budgets and strained executives as well as strained staffing. Why have some healthcare businesses survived and done well and others struggled during this past year? Why have some built revenues and profits without sacrificing patient care while others have faced major internal and external issues?

We have worked with a number of healthcare companies and there is a consistent pattern between the best and the rest. This holds true no matter in what segment of the healthcare business the company operates. We aren’t using specifics in this article since they will vary by segment but the basic elements are unchanged. Look at your organization and see how you measure up on these.

Planning
The best create and work from a well thought out written plan. The plan is strategic in nature and includes an annual plan that all departments are responsible for executing. The rest have a semi-thought out or poorly conceived plan somewhere in the CEO’s or Executive Director’s head. This plan is impacted constantly by emotion, ability to communicate, level of trust, delegation skills, follow-up skills, a packed calendar and reliance on the top executive’s memory. You will note that for every article here that deals with the business, we start with a comment about the necessity of having a sound strategic plan. You can’t win without one.

Business Model
The best have strong business models that flow from their longer term strategic plans. They have clearly defined target markets, clients and customers. Their ongoing revenue streams are built on strong relationships with their clients. The relationship could be with the organization, the products and services or the people who work in the business. The rest have the “lets see what comes in” business model and they will continue to do what they have always done to win customers. There is no recognition that the world has changed and that in order to survive, they must change too.

Building The Organization
The best hire the best people. They pay more and reward more for higher performance. The best weed out poor and underperforming people at every level. The best organizations know that allowing people who aren’t working to a high standard lowers the standards for every employee. The best have clear priorities. Every day at the best companies, people focus on the vital few things that matter. These organizations understand the key performance indicators and keep a sharp eye on those measurements. The rest hire those that aren’t hired by the best and tolerate underperformers. At the rest, most of each day is filled with working on the trivial elements and nothing much gets measured.

Building The People
The best take their people responsibilities seriously, recognizing that only through their people can they succeed. Performance reviews in the best organizations are scheduled and held not for judging but for developing. Plans are set out to help employees obtain the skills and hone the talents they need for success. The better organizations see themselves as learning organizations. Continuing education is considered a sustainable competitive advantage. The people in these organizations know what is expected of them and they are motivated and incentivized to perform. When goals are achieved, rewards are given to reinforce performance. The rest don’t believe in performance evaluations because they take too much time, aren’t done well and don’t work. If a person is deemed to not have the skills, they are terminated and a new person is sought. Wasted resources from many standpoints are the result.

Involvement
The best delegate appropriate responsibility down into the organization and with that delegation they share the business plans, objectives and goals so all know what needs to be done. The people then can decide on the best way of doing it. All levels of management are trusted and empowered to get things done within established guidelines. In the rest of the companies, they suffer from underperformance because people lack the authority, responsibility and direction to guide their activities and must wait to be told. Without the written plan communication is spotty and the results are disastrous.

Accomplishments vs. Activity
The best don’t make or accept excuses. The best focus on results. At the end of the day, the best understand that intention, action and activity do not equal results. Trying doesn’t count, either. Nor does working hard, if hard work just means long hours without focus. When something goes wrong, the best take responsibility, learn from what happened and move forward. The rest spend their time focused on everything that keeps people from achieving results. They spend much of the time being caught up in the “blame game,” pointing fingers, resulting in punishment but not always of those responsible.

Operations
The best always try to find a better way. The best companies are never satisfied with how things are because they understand that to improve means they can continue to distinguish themselves for their clients and from their competition. The rest are satisfied with what they have; good enough is good enough. The rest don’t understand that fair, “Okay” and “good” are the enemies of great.

How is your business? How did you measure up? If you are not executing all of these elements very well, contact us. We can help and we have clients that are following these tips and they can help you too.

Thanks

John


John Maver
President
Maver Management Group
(925) 648-7561
Maver Management

Turnaround Management – Focus

CEOs and companies are charged and in fact forced to do more with less. That means greater results using fewer resources. The advent of our technological advances was meant to streamline our work processes and make us more productive. In fact, when the first desktop computers came out, there were predictions that most people would be working less than a one day work week. It hasn’t worked out quite that way. Life and business have become more complex and there are more and more demand on us, our resources and our time.

Focus has become more and more important. How do we target our activities and how do we use our scared resources?

As a simple case in point, the most common complaint in companies at all levels is about e-mail and the inbox. How to handle it is a good example of what successful executives must do to be able to survive in turnaround times. E-mail and the inbox seem to be controlling our lives.

Each day we have entries, sometimes many entries, into our inbox. They come from a wide variety of sources. Some are quite important. Others may be jokes or inspiration notes that are passed from person to person. Some are promotional messages trying to sell us something. Some are spam and get moved without our help to the discard file.

Which ones do you open first? Do you open the “special” ones from friends and family? Do you go for the ones which you know you can get rid of immediately? Do you start with the most important ones and use your best time on them? How do you choose?

Do you read the emails and handle them as you read them or do you read them all and then have to re-read them to decide how to handle them? Do you delete the emails once handled or do you leave them in your inbox to further clutter your life and cause you to make some decisions over and over?

Life is like an inbox. It constantly presents demands of one sort or another. If you have a predetermined way of sorting the demands and activities you can speed the review process. You can make yourself more productive.

The way in which we choose to handle e-mail demands is indicative of our focus. If you take all the fun ones first, you are left at the end of the day with the problem ones and that causes stress, since we generally are not at our best at that time of day. We may even be mentally and physically exhausted. If you take all the easy ones, you can increase the number completed, but that may not mean anything if you didn’t work through the important ones that will really impact the business.

Or alternatively, do you focus on the most important ones and make the tough decisions? Do you send them off to get the advice and council you need along with the facts that will help your decision making process? Do you do this while you and your support staff are fresh and therefore can be at your best for these decisions?

Of course, this is a simplistic example of a very complex job that you have. Running a company is not an easy task. Many executives will answer these questions with their egos in mind and choose “the right answer”. But they will miss the point of the lesson.

Think about it. How are you choosing? What is the impact on your business and your life from the process you use? Whatever your process make sure that it brings you satisfaction and success.

If you need help to identify the really key issues and focus the right resources on them for maximum effect, contact us. We can help.

Thanks

John



John Maver
President
Maver Management Group
(925) 648-7561
Maver Management

Cost Cutting for Companies– Bullet Points

We have written a number of articles about cost cutting for companies. The articles have covered companies in a variety of industries and situations. They have summarized best practices and you can read each one of them here on this blog. Cost cutting has become a major focus for most companies.

I am often asked for some bullet points about cost cutting. I could say:
***Plan
***Do
***Review
***Regroup

These are bullet points but not very helpful.

Cost cutting is not about bullet points. You need a much fuller understanding. Bullet points, like those mentioned, are like giving you some general comments about how to build a house and expecting you could go off and actually build one.

You need a much deeper understanding, along with a mentor, advisor, coach, consultant etc. who really knows what they are doing

What is the most appropriate direction to give to you regarding cost cutting? That will depend upon your company’s objectives, what is needed to achieve those objectives and where you currently are in both the business and the costs you have already cut. It has to start with the plan.

What is your business plan? What are you working to achieve and what are the key elements required to enable you to achieve the goals? What are the interactions, such that costs that are cut in one area do not negatively impact other areas? Often changes can cause unanticipated consequences in other functions and processes that cause even more damage. Without a practiced eye to monitor the changes, many companies end up worse off after the cost cutting than before and they spiral down in revenue and financial measures.

What is the impact on your organization? What skills and talents are required and what do you give up in cost cutting? Most companies start their cost cutting with cuts in employees. They often go for the older employees since they tend to have higher salaries. The problem is that the companies are also cutting experience and knowledge that can drastically impact efficiency and effectiveness throughout the organization. Once the “internal IP” that is in the mind of the seasoned employees walks out the door, much is lost and it is very expensive to regain it.

Cost cutting alone is never the correct way to right size a business. Thought and planning must also go into reigniting the growth of the business. That is why the plan and the organization are so critical. Without them the company will continue to flounder.

If I were to comply with the original request for bullet points on cost cutting, I would offer just one.

*** Contact me and I can help you.

Thanks

John

John Maver
President
Maver Management Group
(925) 648-7561
Maver Management

Veterans Day

Today is designated as Veterans Day in the United States and Remembrance Day in Canada. In other countries it is known as Armistice Day. It was originally set aside to mark the end of the Great War (World War I) on the eleventh minute of the eleventh hour of the eleventh day of the eleventh month. This was to be the last great war. The fact that there is now a I behind the name and there has been a WWII as well as many other major conflicts, says that we are not very effective in learning from our past mistakes.

That isn’t surprising since for most people there is no memory of the war, let alone the reason for the designation of the day. Only a few mark the event or the time. While some have a holiday on this day, they don’t use it in memory but rather as a vacation day. As time has passed, we give less and less attention to the memories. When I was a youth in Canada, school stopped for an hour and all the students gathered around the flag pole, where the flag flew at half mast, for a ceremony to honor those who had fought and those who had died for us. There were hymns, songs, readings and poems and it was meaningful. We wore “poppies” that were sold by the Veterans and the bright red made a sharp contrast to the earth tones of the clothes. Remembrance Day was a time for remembering!

Today, it appears that a few veterans get together and remember. Families of the fallen remember and the rest of us just pass by. We just won’t learn and so we are destined to repeat and we do.

You may very well ask what has this got to do with business? The answer is simple. If businesses don’t stop and reflect on what has happened, learn from it and reformulate their plans, they too will be destined to repeat the failures.

As turnaround experts, we see this far too frequently. Executives continue blindly on, doing the same activities over and over and expecting better results. Insanity, right?

Let me encourage all of you to stop today and reflect. Have a moment of silence for the fallen and those who have fought for you and your freedom.

Have another moment of silence for you. Reflect on your life. Reflect on your business. Reflect on what you could be doing differently to get more success. Reflect on the successes and what can bring you more successes.

To the fallen, thank you!

John

John Maver
President
Maver Management Group
(925) 648-7561
Maver Management

Turnaround Consulting - Turning an Organization from Mediocre to Exceptional

How good is your company, organization or division?

The answer is very important because the companies that will come out of the recession and do well are going to be able to answer this in positive terms. Book stores and office shelves are full of books that chronicle the practices of high performing organizations. This list includes “Built to Last,” “The Breakthrough Company,” and “Good to Great.” The problem is that most companies don’t last, don’t breakthrough and don’t make the leap from “okay to fair” let alone “good to great” because these organizations maintain a focus and culture that insures mediocrity.

A colleague, Sandy McMahon who runs Renaissance Executive Forums of Silicon Valley, recently wrote an article about why organizations stay mediocre and never reach their full potential. What stands in the way is “a culture of status quo.” This is a very important concept and yet so simple. As a result of it, organizations do things that will guarantee they will remain mediocre. That may be happening, at least to some extent, in your company and you will want to turn that around.

However, there are some ways that can help you turn mediocre into exceptional. With proper guidance, most companies are capable of achieving vastly more than their current results. Here is my advice.

1 Create and share a single, simple strategic focus. As we have written often, many companies have no strategic plan and if you don’t know where you are going, no road will lead you there. Too many companies have a strategic focus to improve profits. There is no argument that profit is important - it is! In fact, mediocre companies focus too much on revenue and not enough on profit. But what the mediocre companies fail to do is to energize and rally employees, vendors and clients around a short and focused reason to support the company for the long haul. Work with your team and identify a simple basis that will cause all of your organization and stakeholders to work for a goal that is meaningful to them.

2 Provide the “Big Picture” to the organization and not only to the top. In mediocre companies, there is a belief that the rest of the organization are not capable of thinking independently but need to be told what and when to do something. Leaders practice the “mushroom theory of management”, keeping employees in the dark, under a layer of fertilizer. The slave ship scene from the movie “Ben Hur” says it all: “Row well and live.” Now it has been updated to “when we want you to know something we will tell you.” This undermines the initiative of the rest of the organization and does not take full advantage of their potential contribution. Share the plan with them and turn them loose within guidelines. They will dramatically add to the acceleration potential.

3 Expand from single minded top down management. Mediocre companies believe ideas for improvement come only from the top. Ideas from anyone else are dismissed because they come from people who don’t see the “big picture.” While many people in an organization can say no to initiatives, changes and improvements, there is only one person, the one at the top, who can say yes. With every decision resting on just one or perhaps two at the top, it is clear that no one else really has any authority. Both business and employee participation stagnate. Driving down decision making, once the plan is shared, enables all to participate. Progress and profit driving ideas are accelerated.

4 Hire “A”s not “B” and “C” players. Many hiring managers shun bringing in new people with more education, more experience and impressive backgrounds simply because new employees of this caliber are threatening to them. As a result, the organization misses out on the best people and it is always the people that make the difference in an organization. Go for the best and let them teach you too.

The caliber of the organization is also hindered by ignoring training and education. The mediocre company believes that it knows everything it needs to survive, and sees no need for continuing education for anyone. Our surveys of such companies show a consistent lack of development initiatives for employees. The only way to improve is to start with outstanding employees and feed them education and training so that they get even better. Check out the top companies and see their hiring and training principles.

5 Encourage people to step up to new responsibilities and initiatives. In a culture that fosters the status quo and believes “this is the way we have always done it,” those who step up are agents of change and systematically hindered and eventually forced out. If a company follows the sharing of the plan and the decision making with high quality employees, the result will be a dramatic change from the status quo and top management will be very pleased with the results.

There are two corollaries to the reluctance to step up. They are:
a) Nodding heads. In meetings, only a few say anything of substance. The rest simply nod their heads in compliance. There is fear about risking their job by saying anything that could be construed as being disloyal. There is no serious discussion on how to have a better business. Employees must be encouraged to participate and share their ideas. Effective managers operate as gatekeepers in leading their meetings so that all participate and feel comfortable doing so.

b) Resistance to change. This virus, manifested in meetings filled with people who simply nod their heads, moves to the department level once the meeting ends. Managers will take no risks and make no moves without written direction. This is never possible in any organization that hopes to compete in the current fast paced world. Managers must have clear objectives and guidelines within which they can use their own judgment and decision making for improvement. They must be supported and held accountable to make those changes.

6 Institute for pay-for-performance. Mediocre firms believe that if they offer a nice place to work with a steady paycheck and solid benefits, they are serving all the needs of those who work there. This simply is not true! The best people strive for increased responsibility and company and personal progress. They resent having lower performers reap any rewards from the contribution of the top performers. They will look elsewhere for employment and continue the circle that causes mediocre companies to stay mediocre. Set some targets that stretch your employees. Give them the training they need and the motivation to reach the targets. Then watch the acceleration.

The mediocre organizations are easy to spot as well. You won’t find anyone coming in early or staying late because there is no benefit to doing so - no reward for success or the effort that goes with it. Also most often these days, they have signs that say “Out of Business”.

You can turn your company from mediocre to exceptional with some help. Contact us. We have the experience and have helped turn around many companies. You will like working with us.

Thanks.

John

John Maver
President
Maver Management Group
(925) 648-7561
Maver Management

Chief Operating Officer (COO) Core Competencies

There are many books and articles written about CEOs, their responsibilities and what they need to do to be successful. We have published a number of these articles here based on personal experience as a CEO. However, despite the critical role that the Chief Operating Officer (COO) plays in company operation, there are very few articles written about them. As Director of the East Bay Northern California Chapter of the COO Business Forum, I have become intimately acquainted with COOs who are very effective in what they do. This purpose of this article is share some of the insights that have been gleaned from interactions with COOs and some of the articles that have been found.

The COO position entails running the day-to-day business operations of the company, freeing up the CEO to fulfill responsibilities as specified by the Board of Directors. In functional respects, the COO will be a vital member of the CEOs core staff, working with the CEO to develop and implement Company’s long-term strategy. The COO will also interact extensively with department heads to provide leadership and direction for all business activities and will be responsible for all major operational decisions. In many companies, the COO is responsible for making the numbers via the business units.

CORE COMPETENCIES
1. Vision: With the CEO, the COO leads strategic, long-term planning, vision and goal-setting using the ability to “look around corners” to anticipate future opportunities or problems. They take strategic and pre-emptive action.

2. Develop and Leverage Relationships: Possesses exceptional relationship-building and interpersonal skills, since diverse functions report to them and the smooth interworking is critical. High emotional and social intelligence makes the COO function more effectively.

3. Communication: Communicates passionately, effectively, and persuasively across a diverse set of stakeholders. The COO must also be able to create processes and structures to facilitate effective communication both internally and externally.

4. Building and Managing Teams: Inspires, motivates, coaches, and develops others. Listens well and continuously learns and seeks advice and feedback from others.

5. Results Oriented: Relentlessly pursues improvement and results. Flexible, with a strong work ethic and an entrepreneurial spirit to accommodate high level of responsibility and multiple priorities. Creates a culture of mutual accountability.

6. Analytical Skill: Analyzes and problem solves at highly developed level. Outstanding organizational skills and high attention to detail are critical to success.

7 Management style: Demonstrates an ability to manage conflict, build consensus, and facilitate problem-solving and collaboration among various parties.

ESSENTIAL DUTIES AND RESPONSIBILITIES:
• Advise the CEO on strategic business development and key corporate planning issues and make recommendations on major business decisions.
• General oversight of all operational and business functions, including manufacturing, research and development and regulatory affairs administration and operations.
• Keep the CEO informed about business activities, potential threats, opportunities, and recommended actions.
• Follow-up on decisions made in management meetings and ensure proper execution.
• Take charge in high-priority crises of an operational nature.
• Shape and develop department strategy and organization. Ensure proper staffing and report structure within departments. Help determine resource allocation among departments. Facilitate resolution of issues between departments.
• Encourage managers to evaluate and take actions that are consistent with company’s overall strategy which will lead to high performance. Challenge basic assumptions underlying each department’s operation. Act as a sounding board for department managers.
• Set performance goals which are tailored to each department. Develop operational goals for each department which are aggressive and tied to long-term goals.
• Monitor department performance against performance goals to ensure that progress is being made and collective action, if necessary, is taken. Ensure adherence to annual budgets.
• Lead program to build organizational capabilities. Develop a group of well-rounded, capable managers in each department.
• Institute processes that facilitate effective and efficient work flow.
• Travel, as required, to customer locations, supplier facilities and other executive matters.

The COO's job is quite extensive and good ones make the CEO's life much more pleasant and the company much more profitable.

Thanks

John

John Maver
President
Maver Management Group
(925) 648-7561
Maver Management

Turnaround Cost-Cutting Techniques

While it appears that the economy is starting to show signs of life, we are a long way from health. Many businesses are struggling and we are providing turnaround expertise. Some will take the advice and be saved. Others may not make it. More than ever, cash is king. Businesses don't go bust, they simply run out of cash. We have written before about cash flow and its importance. Cost cutting has to be effectively married with good planning and effective investment in revenue.

Here are turnaround, cost cutting techniques for you to employ as you bring your business back to health.

1 Start with the plan.
Review your business plan and make sure that it is concise and focused. Build on your core competencies and be ruthless in insuring that only the projects and resourcing in the plan are being pursued. Do not allow business plan creep.

2. Cut cost from the top down.
Starting your cost saving strategies with directors and above first is imperative. This is much more than eliminating bonuses or perks. It is eliminating directors. Each senior person brings with them a set of projects and priorities that need to be resourced if the director is going to do their job. Take a judicious look at what actually has to be done and how many senior staffers are required. Each one removed will take with it significant other savings. But make certain that the cuts follow the plan above. These steps are tough but it sends the message loud and clear to the rest of the company.

3. Get staff buy in.
Cost-cutting is unpopular with staff at all levels. By now, they have been faced with it, not only within your company but with family, friends and others that they know in other companies. There can not be a series of continuing cuts. Follow your plan and make this one last cut and tell the employees that it is the last one. Get them to participate knowing that it can mean solid employment for all who remain. Treat those that must leave with respect.

4. Improve your forecasting accuracy.
Being able to accurately forecast sales by unit keeps inventory levels low and cash free. Many companies forget that as business improves it requires inventory increases to satisfy the new demand and that will tie up cash. Accurate forecasting also enables you to be able to budget for revenue generating spending. This is critical in the turnaround period.

5. Reduce Accounts Receivable.
You are not a bank. At least most of you are not banks and therefore having your customers using your money in the form of unpaid invoices for products in their hands is unacceptable. They are in effect using your cash! Do not hesitate to ask for your money. Clearly, this may be awkward at times but persistence and creativity can pay off. You don’t want to lose the customer but you do want to lose the debt. Get your cash.

6. Cut the Cost of Debt.
Your company may have been forced to extend its debt load during this recession. Now is the time to review it and determine how you might reduce the payments and conserve cash. Credit is still very tight but it is available. Go talk to your banker.

7. Capitalize on technology.
Be open with your clients and establish if your attendance in person is really required. Many companies are using video conferencing or webcams for both client meetings and internal work. Not only does this save travel expenses, it increases the productive hours of each employee.

8. Upgrade processes.
Many companies are still doing business in the manner that they did pre the recession. That won’t work any more. Review your basic processes and streamline them. Eliminate ones that no longer bring a high value to the organization. You will be amazed at the “deadwood” that exists. Automate wherever possible. Better business and better cash flow will result.

9. Outsource.
Outsource when it is not a core competency. There are many other companies in various parts of the world that have the core expertise and can do it faster and cheaper than you can internally. Look for these opportunities and make them part of the business plan.

10. Increase use of consultants.
Many articles advise companies to cut or eliminate consultants, believing that they can be a false economy. This is not necessarily true. We recommend bringing in consultants to do a specific job and capitalizing on their expertise. They can get things done faster and less expensively and make a positive impact on your cash flow. Don’t go for the big names with a lot of overhead. Find the smaller, less expensive but well experienced consultants that fit your budget.

This is turnaround time for companies. The wise will survive and will apply these cost cutting techniques effectively.

Let us know how we can help you improve your cash flow and bring your company to health.

Thanks.

John



John Maver
President
Maver Management Group
(925) 648-7561
Maver Management

Cost Cutting - Scalpel or Chainsaw for Turnaround Success?

Is your company still in the cost cutting mode? I don’t mean are you still concerned about controlling costs, since that should be an ongoing mantra in good times as well as bad. I mean, are you focused on cutting costs to continue to survive?

By now you will have cut out the obvious excesses and are down to the hard choices. What will you use for turnaround success, the chainsaw method or the scalpel?

The chainsaw method sees this as a relatively simple solution to a tough problem. Is there a plan? Yes! Generally it is a simple one. Either take a percentage of cost out of all functions or look at the largest expenditures and cut them. Large “chunks” of cost are cut away and the rest stand as it may. In terms of a quick fix, this method works. Costs are very quickly reduced. However, generally there are severe consequences for both the short term and long term.

In the short term, there is chaos since the cuts have been done without a fully developed plan. What is left may not be able to function effectively or at all due to the elements that have been removed. Employees with specific skills have been lost and others with lesser or without those skills are required to take their place. Processes will not function efficiently. In the long term, the company may have cut the resources and programs that are going to be required to turn the company around and enable it to survive in the upturn. Once the people or the initiatives are lost, regaining them will be very difficult. It is also a major challenge to ignite the organization to achieve and repair the damage to the culture. If your company has used the chainsaw method, you will be able to add many other consequences to the list from your personal experience.

The scalpel method starts with the business plan which reflects the current pressures from the economy but also capitalizes on the core competencies and the requirements for longer term success. The total cost reduction target is identified and employees throughout the organization participate in identifying areas that can be cut, postponed or done more cost effectively to reach that target. In doing this, the consequences of how the company will function post the cuts are reviewed and plans made. This much more orderly cost cutting process not only reaches the targets in the short term, it also sets the company up for success longer term.

Both of these methods benefit from expert assistance. The chainsaw method needs analysis and solutions as to how to recover from the damage done in getting to the lower cost level. The scalpel method benefits from help in the planning and implementation process.


As a turnaround expert, I have worked with companies and both methods. In the chainsaw method, I am brought in after the fact to resurrect the company and help breathe life back into it. Additional help is generally required to execute the plans, since key company people have either been laid off or quit. This can be expensive. In the scalpel method, I am brought into analyze the challenges and the opportunities in reaching the cost saving goals and then create and execute the business plan that delivers. This is a much more productive exercise.

If your company has used the chainsaw method, contact me. I can help you pull out of the consequences. If your company still requires additional cost savings, contact me and I can help you use your scalpel.

Thanks,

John


John Maver
President
Maver Management Group
(925) 648-7561
Maver Management

Company Turnaround – Not a Children’s Story

Many of us remember the fairy tale of the Little Red Hen. This story is known not only to our USA readers but many of you around the world, who are reading these articles. Little Red Hen lived on a farm with her five chicks. On this farm, there also lived a dog, a cat and a duck, along with a number of other animals. Red found some seeds and then asked for help in planting, harvesting, grinding and baking but got the response “Not I” from all. However, all were around to eat the bread when it came out of the oven. They didn’t want to do the work but to share in the rewards.

To some extent, that is the way it used to be in business too. Many employees were focused on their own department and responsibilities and built larger and larger organizations. Teamwork and extended productivity were only a subject for meetings and discussion and not actually practiced. However, the employees were there to share in the bonuses and promotions as the business grew.

NO LONGER. Turnaround for companies isn’t a children’s’ story but the basic idea still works.

Here is how the story could go today and why bringing in an expert on turnaround is such a smart idea before it is too late and you are out of business. It is told in the form of a children’s story to make the point without setting up defensiveness in the readers.

The financial pressures on the farm (this could be any business, but for purposes of this story it is a farm) were getting more and more severe. Prices of eggs, the output of the farm, had risen but were now at a level that further increases were not possible. Demand was falling. Profitability plunged. Much of the days’ activities in all departments centered on what the farm was going to do. There were going to be severe budget cutbacks. Some would have to lose their jobs and.

The farmer, who was the CEO of the farm, had pressures from all around him. He had a lot of ideas given by the Board of Directors, the news, the executives and even his wife. All the ideas involved slashing costs in one way or another. In an attempt to meet the profit targets, which hadn’t changed despite the worsening economy, since there were shareholders and the bank and the other creditors and etc, the CEO give direction to his executives to reduce spending by 15% across the board and start laying off employees.

While this quickly cut some costs, the result wasn’t what had been expected as other costs had to increase to compensate for some of the lost activities. It also caused chaos in the company since there was no overall plan. Almost every process was affected in some way and productivity slowed dramatically.

That led to the need for further cuts in order to make the now reduced targets. The analysts on Wall Street had pulled their investments so the farm’s stock price plunged. Not only were bonuses eliminated, pay cuts were initiated. The layoffs continued and many seasoned farm employees were let go. As you would expect, revenue fell again and again. Soon cash flow dried up. Does this sound familiar as a real life story?

Since this is a fairy tale and not real life, there is a happy ending to the story. In real life, most of these companies would be put out of business.

The Little Red Hen convinced the farmer to bring in a turnaround expert. Not one of those expensive large consulting firms but one that had the expertise and a track record of success. The turnaround expert quickly analyzed the situation, pulled the CEO and the executive team together and led them in creating a business plan that was based on their core competencies and focused the remaining resources on the greatest opportunities.

Unlike in the earlier story where no one would help, here everyone had a responsibility and accountability for the results in their section. The plans were greeted with enthusiasm and soon the business had turned around and like in the children’s stories, all lived happily ever after. Well, perhaps not happily ever after since even in children’s stories there is the realism. If you don’t keep executing the right plan, you can fall back into trouble

Please do not think that turnaround work and plan was that simple to define and execute. It never is but with the right guidance and expertise your company can be turned around and you too can deliver a happier ending. The key is to get the right plan and get some help to turn the business around now. If you wait it will be too late.

If you don’t already have a turnaround expert, contact us and let us help. We have saved a number of “farms” and businesses too.

Thanks.

John


John Maver
President
Maver Management Group
(925) 648-7561
Maver Management

Turnaround – Are going to get your share of the recovery?

The economy is beginning to turn upward and while there are still major obstacles to its health, there are positive signs and consumer confidence is starting to return.

The all important question for you is “will you be participating?”

Will your company be participating? Have you positioned yourself and your company to get a share of the upturn or will the potential business pass you by?

Here are some questions to ask yourself to see if you are ready:

1. Have we focused solely on cost cutting in order to survive and if so have we actually undermined the opportunity to recover? Many answer this question quickly with a no and then upon further review find they are incorrect and are in trouble.

2. Have we maintained the strength of our core competencies through this downturn? Do we actually know, outside of the executive team, what our core competencies are?

3. Do we have the cash availability to fund the inventory increases that are going to be needed as we start to ramp up production?

4. Do we have the cash reserves to cover the short term increase in accounts receivable that will happen with the new sales? This recognizes that even though some customers and clients will pay within terms, we still will have increased AR. It also recognizes that some clients are going to be cash strapped themselves until they get their cash flow flowing and will delay payment to us and other suppliers.

5. Do we have relevant business goals that make sense in today’s environment?

6. Have we kept the right talent in our human capital to succeed? What is missing and where and when will we get it?

7. Have we upgraded to take advantage of the large, very qualified talent pool that is available and their willingness to accept more modest compensation?

8. Do we have a business plan that is actionable and known throughout the organization?

9. Are our business goals clear and communicated to all employees so that they can participate in driving the business ahead/

10. Have we identified the key issues facing the company in order to participate in the economic upturn and do we have a specific plan in place to address each issue?

11. Is our business progress starting to trend up and can we see means of accelerating our progress?

12. Do we have a clear customer focus across the organization? Are we committed to customer satisfaction and possibly delight? Customers are far more choosy now.

If you can answer all of these questions in the affirmative and have the facts to back them up then you are ready to take advantage of the prospective upturn and will be in a position of strength. If you have answered some or all of the questions in the negative, you may be in a great deal of trouble and need help.

Contact us and let us help you. We have helped many others be ready to get more than their fair share of the business to come.

Thanks

John


John Maver
President
Maver Management Group
(925) 648-7561
Maver Management

Turnaround Plans - Mission and Vision Statements

Many companies undertake turnaround execution without an in-depth, thought-out plan. They start with the realization that they have to cut costs to survive and they do so either aggressively or worse, tentatively. Tentative cost cutting just prolongs the process and speeds the downhill slide to out of business. But both are detrimental to the company’s health.

We write often about having a plan. We also recommend that in the development of that plan, companies start with a review of their Mission and Vision Statements. This is forgotten by 91% of companies in their turnaround activities according to recent studies. Yet this is the guiding star for direction setting and use in creating the strategic business plan that will successfully direct the turnaround efforts, as well as the rise again, once the economy improves.

The Mission Statement is a brief statement of the purpose of an organization or company. It outlines the organization's broad reason for existing; what it does and for whom. It tells you what the company is today. A mission statement should say who you are, what you do, what you stand for and why you do it. It is not a slogan, goal, business plan or public relations piece.

Mission Statement examples:
• "Provide society with superior products and services by developing innovations and solutions that improve the quality of life and satisfy customer needs and to provide employees with meaningful work and advancement opportunities and investors with a superior rate of return." - Merck
• "To enable people and businesses throughout the world to realize their full potential." - Microsoft
• "Organize the world's information and make it universally accessible and useful." - Google

The Vision Statement outlines what a company wants to be, where the organization hopes to go and it provides clear decision-making criteria. It concentrates on the future. It is a source of inspiration; its dream. The best ones are direct and powerful. Try to relay somewhere in your statement that you understand the future of your business depends on delivering increasing value and quality to your customers, accounts and clients. This delivers a clear message of your priorities.

Vision Statement examples:
• “To experience the emotion of competition, winning and crushing competitors.” - Nike
• “To make people happy.” – Walt Disney
• “To give ordinary folk the chance to buy the same things as rich people.” – Wal-Mart
• “To solve unsolved problems innovatively.” – 3M

In today’s world, many ask about time frames for both of these statements particularly in turnaround situations. The answer is that the statements can hold true for many years and continue to provide guidance. Clearly, the plans that will flow from these statements have to be adjusted on a much shorter time frame to reflect current opportunities and challenges.

Why are these important?

First, they set the direction. If you don’t know where you are going, any path will take you there. Turnarounds are about focus, - focus on direction and focus on plan elements and resource utilization. These statements provide the guidance.

Second, despite the well publized loss of employee and company loyalty in the market today, people are not motivated by dollars alone. They want to work in organizations that inspire them and cause them to feel good about what they do at the end of the day. These statements should provide inspiration and motivation.

Third, it keeps the company grounded in values and not every day exigencies. It will make your life simpler and will help keep away the firefighting.

If you do not have Mission and Vision Statements for your company or are not using them in your turnaround efforts, let us know. We can help you.

Thanks

John


John Maver
President
Maver Management Group
(925) 648-7561
Maver Management

Turnaround Management – 11 Tips for Creating the Plan

In all of the articles we have written here, we have insisted that companies start with a plan so that they know where they are going and have a focused means of getting there. Just cutting costs isn’t going to turn a company around. There has to be a comprehensive plan. The plan doesn’t have to be complex. In fact, we recommend that it be relatively simple so that it can be easily understood and followed.

Here are 11 recommendations to make the planning successful:
1. Start with a clear, well-understood direction from the CEO. The process needs a champion and if not the CEO, there has to be another “C” level executive that will be responsible.
2. Do some research before the meetings. Sound information is required to make sound decisions in your meetings. Failures generally come from relying on bad or no information. Your SWOT analysis should provide information about your external environment as well as your internal operations. Do some benchmarking to determine the relevance of your strengths and weaknesses.
3. Don’t assume everyone thinks like you. Some like big picture visioning. Some like more concrete. Make sure that all types are handled and value the diversity. The key is to insure that all are working from the same set of data that you collected in point #2.
4. Get key players involved from the start. Spread the word to others in the organization. The plan affects everyone so let them know what is happening and what they can expect.
5. Use an experienced facilitator. Yes you can lead meetings too but this enables you to be fully engaged in the process and have an expert who can direct and guide you to do all the right things to get to the right plan.
6. DO NOT ignore the elephant in the room. If there is a large issue facing the company or within the group, forging ahead will cause disaster. Make sure that you surface the issue and allow all points of view to be heard before you solve it. Then proceed with the strategic plan.
7. Focus. Identify the top 5 strategic issues. There are generally only 4 or 5 things that are going to make a significant difference to the success of the company. In turnaround time there may be even fewer. Find them and concentrate on them. The rest will take care of themselves or will drop away as unimportant. Delete the fluff – less is more. Too many pages doom the plan to be put up on the shelf and never used.
8. Get out of the office. It doesn’t have to be at a resort. Get off site and shut off phones and e-mails. There is a need for focus in the mind as well as focus in the plan.
9. Use a scorecard or dashboard to monitor progress. Keep it simple and make changes to the plan specifics based on the measures you are tracking. This will keep you on course.
10. Executing the plan. Start implementing immediately because no plan is ever complete. Break it down into realistic chunks. Get some early wins and celebrate them. This will give the plan credence and traction.
11. Assign responsibility for each element of the plan and make that individual accountable. Provide them with the support and resources they need to do the job right.

If you follow these suggestions, you too can have a successful turnaround plan that can get your company profitable and keep it profitable. Let me know how I can help.

Thanks

John

John Maver
President
Maver Management Group
(925) 648-7561
Maver Management

Turnaround Management – Where did all the heroes go?

Many companies, in fact most companies, are struggling in the economic turmoil to find a way to turn the business around. They have cut the costs. Now what is next? They are left with chaos, confusion and cost ineffectiveness in most cases. How to get out of it? Where will they find that hero to save them?

Historically they would look for examples of leadership in other companies, industries or even non business. We had baseball heroes that would pitch brilliantly, shaking off the troubled start. Or hitters that would follow several strike outs with a home run to win the game. Or quarterbacks who would get up from being sacked to throw several touchdown passes. Or music stars who would rise from troubled childhoods to sing platinum album songs. Or movie stars who finally land the breakthrough part. Or even commercial icons like The Pillsbury Doughboy or Mr. Clean who stood for goodness.

In business, there were the business leaders who stood tall among all the rest and took their companies to market leadership and great profitability that was shared with all shareholders. Or politicians who had good values and we followed them despite party lines.

These were the heroes to whom we looked and got inspiration and guidance.

Where are these people now? The news is full of athletes who are breaking the law, musicians and actors who are on drugs or can not sustain a marriage for more than a few months. Some business leaders are taking outrageous bonuses when they are laying off people at the same time. And the politicians are generally despicable. What week goes by without some problem from one of our elected representatives?

Who will lead our companies out of this mess?

The answer is YOU!

You have to step up and lead your company out of the financial problems. Who else is there to do it? If you are the CEO, COO or any C level executive, it is up to you.

You may very well ask “How am I going to do that – lead the company out of this mess. We have already cut all we can cut.”

The answer is look around and find some guidance. The many articles on this site can be a start to help you develop the right plan. Invest in some consulting help. It isn’t an expense because the right consulting will pay for itself. Find those heroes who can provide the motivation and direction. They are still there. You just have to look for them. Let them into your business life and let them help you win.

If you don’t have a “hero” consultant already in mind, contact me. I can help you to turn your business around. I have solutions that stick to get you profitable and keep you profitable.

There are heroes around and you can be one of them.

Thanks

John


John Maver
President
Maver Management Group
(925) 648-7561
Maver Management

Turnaround Issues - Why Marketing Materials Fail

A friend of mine Lewis Green has an excellent blog that covers a wide variety of issues, many having to do with communication in one form or another. Occasionally, we comment and build upon each other’s posts. Recently, Lewis posted a message about “Why Marketing Materials Fail”. It is excellent and I wanted to share it here as one of the issues I see in turning around companies to get them profitable and keep them profitable. Clearly companies want to get all they are able from their investment of scare dollars in revenue building.

This is what Lewis wrote:

When I see a poorly designed marketing piece, usually it fails to do the following, which, to look at another way, are the very things we should avoid.
1. It talks too much about the product or service.
2. It is written from the company's perspective instead of the buyer's.
3. It is too long.
4. It is poorly designed.
5. It identifies functions instead of buyer benefits.
6. It doesn't tell me the two or three reasons why I should purchase the product or service (WIFM).
7. It fails the readability or usability ease of understanding and navigating tests.
8. It screams at me and isn't conversational. (Static (non-social) pieces should also create conversation, except it occurs in the buyer's mind.)
9. It is boring.
10. It is mass marketing that isn't about me. (Marketing pieces should always be targeted, including advertising that fits that description when it has been carefully placed.)
11. It hasn't been and still isn't listening to me, sharing stuff I don't care about.
12. It contains no call to action.
13. And it doesn't aid sales in selling.

That's my Baker's Dozen of typical marketing collateral mistakes. There are more and each of the above doesn't always apply.

Creating Winning Marketing Pieces
Nevertheless, to end on a positive note, here are a few ways to create winning marketing pieces:
1. Use only the words necessary to tell the right story to the right customers.
2. Include visuals or videos or audio that jump off the page.
3. Create credibility and trustworthiness by using customer's words to explain why they love your product (or inspire them by creating opportunities for them to say those things).
4. Include the two or three messages that persuade me to buy.
5. And show me how to buy, quickly and easily.

If you are not getting the results you need after the cost cutting and are asking “what’s next?” perhaps Lewis Green or I could help.

Thanks

John


John Maver
President
Maver Management Group
(925) 648-7561
Maver Management

Turning Around The Turmoil In Companies

Companies today are so often caught up in turmoil as they struggle to work through the economic downturn and the cost cutting that has happened in all industries. The focus has become just staying alive.

Scott Adams has cartooned the problem perfectly in a recent strip.



We laugh at this idea and yet we see it happening over and over again. The business model has changed and will never be the same again. There are too many influences. The economy just brought the problem to light.

What can you do as CEO, COO, CFO or any C level executive? Stop the broadscale cost cutting. By now you have trimmed the obvious fat. The issue now is to take stock of what is left and then start to move forward.

We have written many times that a solid business plan is required. It has to have the following characteristics:
1. Recognizes the current market place realities. The old and the wished-for future are not relevant here,
2. Identifies and capitalizes on the company’s core competencies.
3. Focuses effort to maximize the impact of scarce resources, both people resources and financial resources.
4. Kills, stops, drops, sells off, or forgets the non priority projects and initiatives, no matter whose idea they were or how much money has been sunk into them.
5. Emphasizes cash flow. Without the operating dollars coming in at this moment there will not be a tomorrow.
6. Communicates down through the ranks so that “the untalented will not be executing the wishes of the powerful until failure is achieved.”

You may need help. Most companies do, but don’t acknowledge it.

Contact us. We can help. We are turnaround experts.

Thanks

John


John Maver
President
Maver Management Group
(925) 648-7561
Maver Management

Turnaround Management - Overcoming Marketing Mistakes

Cost cutting isn’t enough in today’s economy. You have to drive the revenue line as well. Here are 7 common mistakes made in marketing and what you can do about them.

1. No Game Plan.
Strategic planning gets a bad name but you can’t win without it. Doing marketing randomly isn’t a good idea. This will dissipate your energy and resources and make you feel even more desperate if your efforts aren't successful. Develop a game plan. Identify your target customers and be specific about their needs and how your product or service can meet those needs. Then build a step by step plan to deliver your message persuasively.

2. Nothing added. Just the same old, same old.
Everyone is providing value oriented services. Fast food places have “Value meals”. They offer special products but at a lower price. Retail stores have a two for one special or have bundled several products as a special. What can you do to increase the value associated with your offerings and not rely on price cuts which just make meeting the revenue target harder. Think about it and build it into your plan.

3. Having a meaningless marketing message to your customers.
If your message is not clear and full of value, prospects won't pay attention. If it is not persuasive, they won’t take action. Make sure your marketing message includes: a. a clear target market, b. a problem or issue your customer is experiencing, c. the bottom line outcome you produce and d. a compelling and provocative story.

4. Outdated, tired marketing materials.
Your plan is new. Your message is new or revitalized. You must communicate it with new fresh materials that have the look and feel of quality consistent with the image you want to establish. This holds true not only for the materials but also for the medium you are using including Facebook, My Space, twitter, website and blogs.

5. Letting your sales activities undermine the impact of the marketing.
The selling process often ends up as a rambling, unfocused conversation about your services, hidden among many other items. The message gets lost. Another major problem is that many presentations focus on your company and your product and not on the customer and their needs. They are only interested in “What’s in it for me.” There are many formats that can be used but all need to be focused and take the prospect through what is in it for them in regard to a problem they are experiencing now with a call to action and an easy next step.

6. Being your own worst enemy.
The economy is rocky and we are seeing problems in the stock market, housing prices, the automotive industry and troubles with the banks. Often we think stressful thoughts, feel worried and then become paralyzed from taking any creative action. Focus on what you can control and then take action one step at a time. Quickly, you will have progress toward the goals that you set in your plan.

7. Just not doing it.
You have to get out of your office and make it work. The best plan is no good sitting on your desk or on your computer. The more “face” time you can get with your customers the more you will sell. Face time can be defined as anything from an interactive e-mail to an actual face to face sit down sales presentation.

You may have shifted your focus from cost cutting to revenue generation built on your new more efficient business model. That puts you ahead of many other companies and perhaps most of your competitors. However, that only is a competitive advantage and will pay off if you aren’t making these marketing mistakes. How many of these marketing mistakes are you making? What's your plan to correct them?

Get some help and make your resources really work for you.

Turnaround Management.

John

John Maver
President
Maver Management Group
(925) 648-7561
Maver Management

The Need for Turnaround When Smart Companies Do Dumb Things

We see examples of smart companies doing dumb things every day and there are books that have been written about this phenomenon. In fact, business news is full of stories about companies, senior executives, CEOs and Boards of Directors that have done something that from the outside or in hindsight looks to be dumb. In many cases it has required turnaround expertise to bring the company back to profitability and to survive.

Why do we see so much of this in the press?

First, bad news is much more newsworthy than good news so we see a lot of it being reported.

Second, hindsight is 20/20, so those of us who look at the results can see when there have been mistakes.

We need to remember two things

First, if mistakes are not being made by companies, very little learning occurs and the company will ultimately die. No one is right 100% of the time. So companies and senior executives need to be making mistakes (small mistakes) and hopefully learning from them.

Second, in most cases, the people who have led the mistakes didn’t start out to do dumb things. They really thought they had a winning idea.

But what are some of the root causes that turn what was expected to be a winning idea from the outset into a result that gets branded as dumb?

1 Operating without a clear strategic plan. Without the plan, the company is almost guaranteed to have unfocused resources and multi-direction activities. The result will be a number of failures, some that are going to be seen as dumb ideas.

2 Poor communication. Often a plan is devised by the executive group and then not well communicated to the organization. Hence the execution is flawed leading to lack of success.

3 Not heeding changing or changed market conditions. Once a program is underway in development, it generates a momentum all of its own and people/companies are hesitant to make changes, particularly if one has ownership in it. What was a good idea at the start becomes a dumb idea in a changed economy.

4 Insisting on consensus. The old adage is that the camel was designed by committee with a forced consensus. The more people involved, the harder it is to reach a workable solution and once reached, to change it in any way. This is not to recommend that all decisions be made unilaterally, but that a committee decision is viewed carefully.

5 Pride and arrogance getting in the way. It causes decisions to be based on “who is right” not “what is right”.

6 Unrealistic expectations. It is good to dream big dreams. However, realism must come into play and overreaching, overextending resources and over estimating causes disasters.

7 Budgets and budget changes. Often the original proposal has sufficient resources to achieve the result. However often either the resources are cut back for a variety of reasons or there are extensions to the project. Budget shrink and project creep set in and the result is always not good.

How could companies minimize the chances of making dumb mistakes?

1 Develop a clear realistic business strategic plan.

2 Get some expert help from someone who has been there before and has relevant experience

3 Make fact based decisions.

4 Act on what is right not who is right. Just because the CEO says they like it doesn’t necessarily mean it is a great idea. The organization knows their capabilities.

5 Do not force consensus.

6 Communicate, communicate, communicate.

7 Don’t shoot the messenger of bad news. Reward them for coming forward and avoid the huge dumb mistake.

9 When either the project or the budget changes, make the appropriate modifications.

10 Expect mistakes. Learn from each success and failure so that the small dumb mistakes become learning and never become big dumb mistakes.

If you have already made the dumb mistakes and are in trouble get some turnaround help quickly and get back on track. Squash the pride and arrogance and go for positive bottom line results.

Thanks

John



John Maver
President
Maver Management Group
(925) 648-7561
Maver Management

Staying positive in a negative world

We are seeing glimmers of hope in this economic recession. At least, there seems to be a lot of activity in Washington and much better communication. Our hope is that the activity actually is producing progress.

“In the end you are measured not by how much you undertake but by what you finally accomplish.” Donald Trump

While we love the glimmer, the realism is that we have yet to see the repercussions from the bankruptcies of the auto manufacturers and all of their support industries. We still are feeling the hurt from the credit crunch and unemployment continues to rise. Consumer spending has been greatly curtailed. Not only are purchases for the home down, but all the industries associated with travel, eating out or leisure are also hurting. Look at how many restaurants are closed.

As if the economic issues are not bad enough, our traditional “heroes” are being disgraced and seldom stand for good any more. Athletes have drug and alcohol problems, beating their wives, trashing hotel rooms and more. Actors and actresses seem to have forgotten moral values completely. Many reality shows are based on poor values. The “rap sheets” on our political leaders are shameful in so many cases. Not only do we face this in the news every day, we hear it from the politicians themselves.

“Congress is the only business in the world where your colleagues wake up in the morning and try to figure out how to screw over their colleagues.” Rep. Mike Thompson D – St Helena

So how do we stay positive in this negative world?

1 Look for the good in the people around you. The American spirit is alive and well and ready to burst despite the problems. If the people around you are negative, get rid of them and surround yourself with positive people.

2 Look for the real heroes and celebrate them. Look for the men and women returning from military service abroad, or "Sully" Sullenberger, the pilot of the plane landed on the Hudson River and who lives in my hometown. Or the single mother who works hard to raise her kids despite the hardships. Or the struggling business owner who opens his or her doors every day.

3 Look for the positive role models on TV and in the movies and support them and their products. It used to be that all of the spokespeople and characters for products were positive. Search the ones out that remain.

4 Look for someone to help that can’t help themself. You will feel enormously better.

5 Look for a church service to attend. You may not have the same faith that I have but go worship.

6 Call your parents and tell them you love them. They need that reminder even when it isn’t Mother’s day or Father’s day.

7 Smile at people and enjoy the smiles that come in return. You will be amazed at the reactions you will get from this simple act.

8 There was an old psychology nugget that said “if you want to be positive, act positive”. That is good advice.

9 For your business, read the other articles on this site and take some action. These are best practices and can save your business. That will help you feel positive.

10 Contact me and let me help you. I have helped many others through rocky times both personally and in their business.

A leader’s role is to raise people’s aspirations for what they can become and to release their energies so they will try to get there.” David Gergen

Thanks

John

John Maver
President
Maver Management Group
(925) 648-7561
Maver Management

Turnaround Requirements – More CEO Ousters Underscore the Need for Better Strategizing

The recent ousters at GM, Bank of America and scores of other companies should be a warning to other CEOs that they have to strategize differently. Running a company is like driving at night in unfamiliar terrain on a winding road. You may know your long-range objective, but you can only see up to the range of your headlights. Beyond that is a mystery. So while the company’s objective may remain constant, the plans must be flexible enough to withstand rapid modification to meet market conditions and still be successful.

Many CEOs who don't want to step aside still rely on an antiquated strategic-planning process that often doesn't help them make better decisions faster. Once a year, they require the head of every business unit to compile a strategic report that includes three-to-five year financial forecasts. A fraction of this data is used to decide budgets, but most ends up in forgotten files. In most cases, the data is outdated before it is used.

So that once-a-year strategic plan is next to useless. It slows the decision-making process and is too detailed to be valuable to the units trying to manage the business.

It is difficult to believe that this still exists, assuming the company has a plan in the first place and many don’t. In this economy, no wonder so many companies are in trouble and its not just Chrysler and the auto makers that are filing for bankruptcy.

Clearly a much more flexible plan is required. In order for it to have a chance to work, managers below the executives must be engaged in quicker, more continuous decision making. Monthly full reviews of the plan are required with weekly updates and adjustments.

What is worse in these times is the cost cutting that has been done without an overall game plan. In many cases, this has undercut the company’s ability to execute the programs it does have in place. Many turnaround executives can strip out the costs, but it is important to also identify opportunities, harness resources, and create the plans that can build the business back. Just being a numbers person isn’t enough.

CEOs need turnaround experience these days. If they don’t have it, their tenure as a CEO is going to be short. “It has been my experience that just like in white water rafting, without the right expertise, you will be tossed out and the venture doomed,” says Walter Shill, managing director of the strategy practice at Accenture.

Three questions for you.

1. Do you have a plan that is flexible and works in today’s dynamic economy?
2. Do you have the cost reductions and the plans that identify opportunities to build the business back now and when the economy turns?
3. Do you have the turnaround expertise required to keep your “white water raft” from flipping or do you need to get it?

Contact us. We can help.

Thanks
John


John Maver
President
Maver Management Group
(925) 648-7561
Maver Management

What’s the issue? Business planning or just doing?

The recession continues and more and more businesses are failing - failing and being forced out of business, failing enough to have significant losses despite large layoffs and a desperate focus on cost cutting or failing through having little idea of how to turn the business around and keep a meaningful cash flow.

What’s the issue? Is it too much planning or too much action?

Are they failing because they have spent so much time creating the mission, vision, objective, goals and measurements for their strategic business plan that the opportunities have passed them by? Or are they locked in to outdated plans, programs and spending? Or is it more a case of having leadership that is unable to cope with the realities of today’s dynamic marketplace?

On the other hand, is it because they do not have a basic business plan that they are following and are just winging it? In this case, everyone is going full speed, but not in the same direction, no matter what you may think and certainly not toward a specific goal.

Or worse still, is it because they are faced with analysis paralysis and actually doing nothing? This cause a company to seize up and the organization grinds to a halt.

Actually, the failing may be the result of some or all of these elements. Business plans are a MUST for every company. However, they need to be actionable. And they need to be acted upon, adjusted and acted upon again. They shouldn’t be binder thick. In fact, we recommend that they be kept to one or two pages. Otherwise, they are not read, used properly or followed.

What are you doing in your company? If your company is struggling, is it due to over-planning for the business with concentration on the theoretical plan and not taking the appropriate action? Or is it all action and no known overall plan. Clearly, it can’t be an either/or if you are going to survive in today’s economy. It is a reasoned combination of both planning and action.

Do you have a written business plan? Is it simple and understandable to all? Has it been communicated to others?

Are they taking action on it? Are you adapting the plan based on the ever new market feedback? Do your customers know what you are trying to do and the benefit in it for them? Are they supporting your direction?

What are the results and what needs to be changed?

So many companies are focused on cost cutting that they are not generating revenue that is desperately required for cash flow and support and also undermining all future efforts. Now, and when the economy turns, it is going to be the company with the successful plans put into action and market honed that will prosper.

Managing in today’s turbulent times isn’t easy so don’t think you can do this on your own. Get some help from experts who have been there before and can help lead you through the problems.

This can be a time for you and your company to actually prosper but you have to do it smartly.

Thanks.

John
John Maver
President
Maver Management Group
(925) 648-7561
Maver Management

Don’t Blame the Plan… Blame the Boss! Turn it around!

My friend Lewis Green wrote an article on this subject in 2007, part of which is included in this article. Since that time, the economy has tanked and many businesses have tossed out their strategic plans. Some have even tossed out their bosses. As companies struggled to stay alive, they have focused on cost cutting. Some bosses have been smart enough to lead the development of a plan that is in tune with their current realities while others have just cut. The “cutters” are and will be in trouble

Lewis asked “Is there anyone in business foolish enough to claim strategic planning always achieves your goals and results in success?” Certainly, having the plan alone will not result in success

Management consulting firm Marakon Associates and the Economist Intelligence Unit surveyed senior executives at 197 companies. Respondents said their firms achieved only 63 percent of the expected results of their strategic plans. And in a white paper entitled Three Reasons Why Good Strategies Fail: Execution, Execution, Execution, which carried the above research, Wharton management professor Lawrence G. Hrebiniak says MBA-trained managers know a lot about how to develop a plan but very little about how to carry it out. “Most of our MBAs receive great training in planning but far less in execution,” explained Hrebiniak.

Based on my experience, these findings are correct. When a plan is developed and that is missing so often, the failure comes from poor execution. Execution with brilliance comes with experience.

Some say that executives can not always be held entirely responsible. As long as shareholders and board members insist upon short-term results, only the most powerful and fearless executives will reap the long-term rewards and margins that strategic planning can deliver. But isn’t that the challenge for CEOs. That is what is causing the lifespan of CEOs to become shorter and shorter and the need for turnaround executives to come in and rescue the company.

So how do we as CEOs, executives and senior managers most effectively use strategic planning and get the desired results from it?

• Do annual strategic planning to provide overall direction but make monthly adjustments to stay current. You will be amazed at how quickly your business plan can be outdated. This applies to all businesses—whether a sole proprietorship or a mega multi-national corporation. While this provides a longer term direction, it takes advantage of flexibility and resilience.
• Be confident. Set high goals, short and long term. Don’t be intimidated by the Street or the Boardroom or your own fears. Those who merely set goals they can easily make never get around to stretching the business to achieve higher margins and outstanding profits.
• Use metrics to measure every goal in every functional area.
• Align every department, function and employee so that every ounce of the business’s energy is directed at achieving the goals set within the business plan
• Tie pay and benefits directly to success or failure.
• Do not focus on cost cutting. Make the focus of the plan marketing and sales. Companies have to operate cost effectively, but without revenue there is no company,
• Communicate, communicate, and communicate! If you want your plan to succeed, every member of your culture must be engaged and informed.

Turnaround management is about identifying the issues and opportunities, creating winning plans and then executing to satisfy both the short and long term objectives. So stop blaming the plan and the boss and start turning the business around.

Let me know how you are doing or how I can help.

Thanks

John



John Maver
President
Maver Management Group
(925) 648-7561
Maver Management

Theme from Mahogany

Diana Ross sang this a number of years ago and its words fit today’s economy better than ever. Most of us do not like what life is showing us.

Do you know where you're going to?
Do you like the things that life is showing you?
Where are you going to? Do you know?
Do you get what you're hoping for,
When you look behind you there's no open door?
What are you hoping for? Do you know?

Now looking back at all we've had,
We let so many dreams just slip through our hands.
Why must we wait so long before we see,
How sad the answers to those questions can be?

Do you know where you're going to?
Do you like the things that life is showing you?
Where are you going to? Do you know?
Do you get what you're hoping for,
When you look behind you there's no open door?
What are you hoping for? Do you know?

Revenues have plunged and profits are non existent. Layoffs are common and so are business closings. Employees are frightened about their job security and almost all are over worked. Businesses and employees do NOT know where they are going to.

Why is that?

Most of these businesses either do not have a workable business plan or have discarded their plan in the confusion caused by trying to remain profitable. They have moved away from the very aspects of their business that made them successful in the first place. The dreams that they had have evaporated and they are left with struggles.

What can you do about this? Here are 7 ideas.

1 Bring your executive team together and analyze your current situation and the opportunities that exist for you.

2 Use the information to develop a business plan that will work.

3 Focus your efforts so that you harness scarce resources.

4 Stay on top of cash flow. Cash is king!

5 Stop just cost cutting and work on driving revenue and profitability. There is a difference.

6 Engage your employees on focused business building within the scope of the business plan that you have developed.

7 Invest in some expert help. You don’t self medicate, so don’t do it to your business.

You may not like the things that life is showing you, change them. Make sure that you and your entire organization know where you’re going to.

Thanks

John
Maver Management Group



John Maver
President
Maver Management Group
(925) 648-7561
Maver Management

Keeping Your Strategy “Live”

Michael Port in his book “Book Yourself Solid” wrote

"One day, there was a blind man sitting on the steps of a building with a hat by his feet and a sign that read: 'I am blind, please help.'
A marketer was walking by and stopped to observe. He saw that the blind man had only a few coins in his hat. He dropped in more coins and, without asking for permission, took the sign and rewrote it.
He returned the sign to the blind man and left. That afternoon the marketer returned to the blind man and noticed that his hat was full of bills and coins
The blind man recognized his footsteps and asked if it was he who had rewritten his sign and wanted to know what he had written on it.
The marketer responded: "Nothing that was not true. I just wrote the message a little differently." He smiled and went on his way.
The new sign read: Today is Spring and I cannot see it.

Sometimes we need to change our strategy and positioning. If we always do what we've always done, we'll always get what we've always gotten. That used to be the case. In today’s economy, we will not get what we have always gotten. We are going to go out of business. Companies must change the way that they do business.

We have written often that many companies either don’t have full written business plans or have ones that are very loosely constructed. Some companies, even well run companies are wedded to the once a year strategic planning process. This is not only cumbersome, but also causes the company to miss out on many opportunities. The same holds true on positioning and the way that companies communicate their message. In trying to save costs, old materials are being used and the positioning in today’s economy just won’t resonate with customers. The example above is a very good illustration.

Is your business plan a “live” document?

How often do you review the basics of it?

How relevant is your company and brand positioning? Is it working? How well and how do you know?

We are now into Spring and you may be able to “see it” better if you check out the business plan and the positioning.

Thanks.

John

John Maver
President
Maver Management Group
(925) 648-7561
Maver Management

Twelve Turnaround Tips for Companies

Most companies have spent the last several quarters cutting and cutting and cutting costs. The focus is on minimalization. Unfortunately the tough economic climate is continuing and is expected to remain for some time. Now what? What focus do the company and the employees have and what are you going to do to actually bring in revenue?

Here are twelve tips to not just survive but thrive in the midst of tough times.

1. Re-examine your business plan and recheck your business fundamentals. You may be surprised at the opportunities that will be presented.

2. Do what it takes to remain profitable. Negative numbers become an excuse for almost anything and you will not only lose focus but you will lose more business. That doesn’t mean just cost cutting. It means being smart about what you are doing.

3. Focus! Cut what's non-core. Invest in what is. Know who and what you are and BE THAT!

4. Simplify something – it will help cut costs. Complexity equals expense. Take a look at all of your procedures and find simpler methods.

5. Look outside for good partners both as alliances and suppliers. Leverage relationships to save money or make money. Others are looking for help too, so work together.

6. Do what you already know is right -- only this time, really do it. Many companies know the right path but continually choose not to take it for a variety of reasons. Stop doing what doesn’t work and reallocate the resources.

7. Go talk to your customers. They are hurting too and want your love and leadership. They will remember you when things turn around.

8. Keep some investment in your R&D. You'll need it. This can give you the competitive advantage when the sales start to flow again.

9. Look for technology-based efficiency. Use the Web to cut costs and boost productivity.

10. Enlist your employees' support. Ask them for ideas. They are closest to the action and will have more good ideas than you could possibly execute

11. Believe in your own business and your future. There will be brighter days ahead and you want to be part of them

12. Hire a good consultant. Their experience and objectivity can show you ways to accelerate your positive business progress. They are not an expense. Good ones are an investment. The ROI can be astounding.

Contact me and let me know how I can help you.

Thanks

John

John Maver
President
Maver Management Group
(925) 648-7561
Maver Management