This month’s leadership quote:
“Almost everything will work again if you unplug it for a few minutes… Including you.”
—Anne Lamott
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Business is good for most companies and has been for quite some time. And yet, the economic signals are there; we are nearing the end (are perhaps at the end?) of this long economic recovery.
Your industry may have more runway, or you may be in an industry that is a leading indicator. Regardless of your industry position, an equal perhaps more important question to ask is, what percentage of your customers fall into each of these categories and those in-between?
In short, are we diversified?
Anyone who has hired an investment advisor knows, all of them advise first and foremost, to build a diversified portfolio. And, despite all the data supporting the long term benefit of diversification, some investors believe they can pick the winner or time the market. There are LOTS of stories in the investment press about the risks and consequences of these choices.
Those of you who are frequent readers know that my background is in financial services and investments and I often compare running a business to managing an investment portfolio. And, as with some stock market investors, when it comes to our companies, we frequently ignore our advisors and the diversification advice they give. We have a great product or service; our biggest client is giving us more and more business; we are making money, we think “if it ain’t broke, why fix it?”.
Over the years, I have worked with a number of businesses and watched this process unfold…
Business is good, there are industry measures that indicate the product, service or economic cycle is maturing, perhaps margins are tightening, but revenue remains strong. Then suddenly (one could argue it wasn’t suddenly), it isn’t strong anymore, in fact, the business has gone from significant profits to losses, seemingly overnight.
The thing about income statements is they are lagging indicators. If we ignore other key indicators, especially the external industry trends, it is easy to be lulled into market timing behavior. And as with market timers, by the time the CEO realizes the market has turned, it is often too late to adjust without incurring significant losses.
As you continue your planning for 2019 strategic actions, I encourage you to pause and ask yourself the following questions:
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As leaders, most of us are action oriented. Something crosses our desk; we deal with it. An issue comes up with a customer, a vendor, an employee; we take action. And, sometimes, if we let things unfold at their own pace, we achieve a better result.
What?? Isn’t that avoidance or procrastination or fear of confrontation or, or, or?
Two quick stories from two CEO’s I know:
First, a long term negotiation on a contract has gone on for several years. As an outsider looking in, one might wonder, why not bring this to closure. And, then we learn, it’s been 20 years of negotiation, minimal dollars spent, many thousands at stake. Even if it eventually settles, the present value of the money saved justifies the long process.
Another CEO negotiating with a former operating partner, still an owner. Sure would be nice to close that loose end, icky to have a former partner, a voting member. And then we learn, the former partner is in bankruptcy; looks like the CEO is going to pick up those shares at a significantly lower cost.
As Kenny Rogers says so well in the Gambler… “You got to know when to hold ’em, know when to fold ’em, know when to walk away.”
For me it’s a reminder to pause before I pick up the phone or write that email about the matter I feel an urgency to resolve.
Are You a CEO or President of a Privately Held Business? If you are also a lifetime learner and want to learn more about my Vistage Group, click here
There are lots of tools available for assessing personality style, and each has its nuance. Stripping away the nuance, with few exceptions, the assessments produce a matrix of 4 primary personality styles.
These styles result from an understanding of extroversion vs. introversion, the relationship of each to detail orientation; and then adding to this, a person’s proclivity to focus on an outcome or to seek harmony.
In my experience, no matter what your leadership role, knowing and understanding your own style and that of each person you work with is the key to achieving the results you want.
I had a conversation recently with a friend that drove this home for me once again. My friend is an advisor to the CEO of a large company. This company is in the midst of a reorganization, and my friend is struggling with one of the leaders of the new organization. As we talked through the situation, it became clear to both of us that the root cause of her challenge is style. She is outcome focused; he is harmony-focused; she is an introvert (goes within to process); he is an extrovert (processes out loud).
The result: he is talking, too much from her perspective; she is trying to move the project moving forward, he has unresolved fears and is resisting.
Once she began to realize it is their style differences that are causing her challenge, she had the answer, I could see it in her face. We then moved into a more extended discussion about the characteristics of each of the primary styles and then a plan of action.
Bottom line. For me, when I am struggling to communicate, and I pause long enough to get some perspective, I’ve come to realize the answer is always, I need to modify my style to adapt to the other person’s style. Easier said than done I know, and like everything else, its a journey.
Are You a CEO or President of a Privately Held Business? If you are also a lifetime learner and want to learn more about my Vistage Group, click here
I had a conversation with a friend the other day that left us both laughing. The two of us have an affiliation with the same organization, and about a year ago, during another conversation, we were sharing our outrage about something. When we talked the other day, we both remembered our outrage, but neither of us could remember why we were angry. Our inability to remember the issue is what left us both laughing.
I tend to be one of those people with a strong sense of justice. I care. And I am willing to speak up. And yet, this conversation was a great reminder that beyond our care for people we love and the things that we can do something about, there are few things in life that matter. Really.
Are You a CEO or President of a Privately Held Business? If you are also a lifetime learner and want to learn more about my Vistage Group, click here
The initial results of my Pivot are excellent. I feel I have much greater clarity regarding the next 3-5 years.. more
