Leadership Quote: I make more mistakes…

This month’s leadership quote:

“I make more mistakes than anyone else I know, and sooner or later, I patent  most of them.”

–Thomas A. Edison

#leadership #Vistage

You can read more of my blogs and leadership quotes here

Are You a CEO or President of a Privately Held Business? If you are also a lifetime learner, and want to learn more about Vistage, click here.

 

 

What Are CEO’s Most Concerned About Today?

Entering the second half of 2018, Vistage Research compiled a report summarizing the key concerns CEO’s face today. This report draws on data from the Vistage Q2 CEO Confidence Index report and a team of expert economists. Here are the five key areas of concern:

  1. Cost pressures broadening and growing stronger
  2. Talent shortage goes critical
  3. Taxes, trade and tariffs translate to trouble
  4. Cyberattacks are the silent killer of SMBs
  5. A recession is inevitable

Beginning in September, this blog will address each of these concerns in turn. Meanwhile here is the complete report for your consideration  Decision factors: H2 2018 – Economic considerations for SMB executives,

Are You a CEO or President of a Privately Held Business? If you are also a lifetime learner, click here to learn more.

Elisa K Spain

#Strategy
#Vistage Confidence Index

Radical Transparency

In publicly held companies, company performance and executive compensation is, just that, public. All shareholders receive both an annual report and a proxy statement and this information is contained within these documents. Additionally, it is a simple matter for a non-shareholder to obtain this information, sometimes with a simple web search, or at least with an inquiry to the company.

Yet in many, perhaps, most, privately held companies, this information is closely guarded and not shared.

Why not? Lots of reasons.

The reasons differ depending on the stakeholder we are discussing. Focusing on employee stakeholders, some of the responses I typically hear are:

  • Why do they need to know?
  • They won’t understand the financials.
  • There will be resentment if they know what the owner(s) are paid.
  • There will be resentment if they know what their colleagues make.

What if instead, you considered radical transparency? What if:

  • you educate your employees so they understand the balance sheet and the income statement?
  • employees learn the investments the owner has made and the risks she has taken, and continues to take, to finance the business?
  • employees understand the expenses the company must incur to operate the business, beyond the COGS?
  • employees begin to understand the relationship between labor utilization/efficiency and profitability?
  • compensation was based on a combination of market data and performance so that employees understand why they are paid, what they are paid?

Transparency without the accompanying education will not work. Thus, radical transparency requires an investment. The good news is, it’s an investment of time, not dollars.

As the war for talent continues, with no apparent end in sight, is radical transparency an investment that may lead to employee loyalty and therefore increased retention?

Why Vistage Works

Elisa K. Spain