Put an End to the Feast and Famine of Owning Your Own Business

OLYMPUS DIGITAL CAMERAI’ve seen it time and time again, business owners, whether they own an accounting, engineering firm, marketing agency or IT company, are left feeling vulnerable due to the feast and famine of income streams.

When I meet with business owners they share with me their concerns about their struggle for consistent revenues; one month the financials look great, but next month, they are not on target and they begin to stress about making enough income to cover their expenses. Sometimes this cycle is endless and it can take a toll on the many business owners striving for income predictability and growth.

When a business experiences the feast or famine scenario, things like hiring staff for a project today in hopes that there is work for them tomorrow can result in more stress and pressure on the owner to bring in more business.

Owning a business can be one of the most rewarding experiences, but so often business owners are conflicted with decisions about hiring the right staff, committing to paying rent for the appropriate space, investing in office equipment and technology, not to mention marketing. Without consistent and predictable revenue it is hard to make long term plans that will allow owners of professional services businesses to accomplish their goals.

If you are interested in learning about a professional business that will put an end to this feast or famine scenario but still give you the freedom to own a business, check out this website or simply contact me to discuss your situation.


Marketing Your Business: You Can’t Rush The Process

Although I am not a marketer, as a business advisor I am often asked what are the most effective ways to market a company. Business owners tend to ask me what tactics they should use to gain the ‘best’ and ‘fastest’ results. My advice is the same for business management: before you execute on a business initiative, you need a plan. Before you implement a marketing tactic, make sure you invest the time and resources in having a professional strategic marketing plan.

As a business owner, you know what you know, and what you don’t. Marketing, as an aspect of a business, is no different. Hiring a strategic marketing agency to develop your strategic plan is just good business sense.

A big part of any strategy is understanding how your customers value what you do for them. Depending on what data you may already have, a strategic marketing agency will conduct in-depth research on your customers and competitors to understand what brought them to you, and also why they stay.

As a result of the research analysis and the agency’s experience, they will be able to create an area of difference for you – something unique that differentiates your business from others in your industry. This brand identity is rooted in what your customers value.

This strategic marketing plan will now act as your roadmap and provide direction for all aspects of your marketing efforts and determine what tactics will be most effective in targeting specific customers. This is similar to how the strategy in a game of chess is needed to determine the moves made on the board.

Once your strategy is complete and you know what tactics are required, you can make an informed decision as to who will implement them. You’ll need to look at your internal resources and skill sets and compare them to external ones. If you choose to take them on in-house, think about who will manage them from a marketing perspective. You may choose to outsource only a portion of your tactics while taking on the rest internally. When it comes to implementation, you have a few options. Taking the time to plan can save your business thousands of dollars in needless tactics.


What Can You Do About Poor Performers?

performanceAs a business advisor I see the issue of poor performers come up all the time. If you’re a small to medium-sized business owner you want to be out there growing and developing your business, not mired in staffing problems. Without big human resources departments and manuals of policies and procedures to follow, I know you often don’t have a roadmap on how to deal with poor performers. The reality is that regardless of the size of your business or your particular industry, at some point you will have to deal with this issue.

What are the causes of poor performance?

Poor performance can be the result of many things including:

  • Not understanding expectations
  • Lack of ability
  • Lack of motivation
  • Not a team player
  • Chronically late
  • Bad attitude
  • Personality issues
  • Non-work related problems
  • Health issues

Why is employee performance so important to your business?

Employee performance affects organizational performance. A poor performer can create a toxic environment in your workplace, dragging down your entire team.

How can I avoid poor performers in my business?

Here are a few measures that I feel may help you to avoid the problem of poor performers.

  1. The hiring process: Choosing the right employees is crucial to a successful business but it’s not easy. If upon re-evaluation, you’ve discovered that you’ve hired several poor performers, perhaps you should consider outsourcing the hiring process to an external agency. The money you pay to the agency may actually save you money in the long run.
  2. Job expectations: Be clear about exactly what the job entails and what your expectations are.
  3. The onboarding process: Onboarding helps new hires acclimatize and orient to your business so that they can quickly become productive, contributing members of your organization. Have an onboarding plan in place for new hires and make sure that the tools they need to do their jobs are in place on their start date. E.g. workstation, computer, security pass, etc.
  4. Regularly scheduled one-on-one meetings: One-on-one meetings between employee and manager can potentially head off problems. Speaking about issues as they arise or have the potential to arise is always better than leaving them to fester and grow.

What can I do if I have a poor performer?

In my experience I’ve found it valuable to try and ascertain the root cause of poor performance before any action is taken. If the reasons are personal or health related and have nothing to do with the job, perhaps a leave of absence is in order. If an employee is lacking in ability, perhaps upgrading their skill set or transferring them to a different department is the answer. If the problem is attitude or motivation perhaps setting performance goals will inspire the necessary change. Try instituting quarterly performance reviews to address any performance issues and monitor improvement. If all else fails, you may have no choice but to let the employee go.

As a first step, I suggest that you review poor performance issues you’ve had in the past or are dealing with now. Evaluate what action to take in order to rectify the present situation and what changes you can make going forward in order to avoid the issues of poor performers.


Everyone Needs to Take Time Off

sea-holiday-vacation-tableAre you suffering from vacation deprivation? If so, you’re not alone. So much has been written about the importance of a work/life balance, but not enough Canadians are living it. According to Dr. David Posen, author of Is Work Killing You?, “Humans were never designed to have stress all the time. Our stress reactions were designed to be turned on and then off. That’s the healthy cycle. But today we operate in a semi-permanent state of stress. Proper vacationing is an antidote to chronic stress. It is absolutely imperative that Canadians are vacationing each year – and not just one time per year.”

I understand from many of the business owners I work with that you worry about leaving your businesses because you feel nobody else can do your work, and although that may be partly true, I can guarantee that if you burn out – you risk not having any business to run.

Make this the year that you take a vacation – consider it preventative medicine – and instead of just thinking about taking a vacation, prepare for actually taking one by following these 4 tips:

  1. Plan your vacation during a slow period. It will definitely reduce your stress levels about going away.
  2. Deal with all time sensitive issues before you go. In theory, anything that arises in your absence should be able to be dealt with by your staff or wait until you return.
  3. Contact your clients well in advance and let them know you’ll be going on vacation. If they have anything that requires your special attention you’ll be able to take care of it before you leave. Delegate a point person for them to contact in your absence.
  4. Empower your employees to step in and step up while you’re on vacation. Delegate specific tasks or duties. Leave detailed instructions about how to deal with situations that may arise. If you’d feel more comfortable with regular status reports, have a staff member email you at a predetermined interval with a report of the company’s activities during your absence. Let your staff know that they can reach out to you under certain circumstances and be clear as to what these circumstances could be.

All work and no play is a recipe for burnout. We all need time to relax, recharge and reconnect with family and friends. What are you waiting for? Start planning your vacation!


Client Favouritism – Is It a Bad Thing?

CustomersLet’s be honest, we all have our favourite clients. I know I do. More often than not, our favourite clients are also some of our best clients. These are typically the clients with whom we have great partnerships and an understanding that together, we’re responsible for success. The question is do we, or should we, treat all clients equally?

 

How we differentiate clients

For some, client favouritism is already built into many of our business models. It’s common practice to tier clients based on the amount of revenue they generate. We routinely see companies offering different levels of service typically called Gold, Silver or Bronze, similar in idea to consumer credit cards. The clients that spend the most have Gold cards, then Silver level, and then Bronze for “basic level”. Does this differentiation set us up to treat our clients differently instead of focussing on delivering great customer service to all of our clients? Is client favouritism itself two-tiered – clients we like and clients who generate the most revenue? How are we treating clients that don’t generate the most revenue but are still solid performers?

 

Can client favouritism be a bad thing?

Client favouritism is not a good or a bad thing. It’s perfectly fine to dedicate more time to the clients you have great working relationships with; the ones that are profitable, appreciate your work and do what they say they’ll do. But if you’re only focussed on your highest revenue generators and let others fall by the wayside, you may be alienating some good clients. Not all of your clients are going to be rock stars in the revenue department. However, I do suggest that you nurture solid, steady, long-term clients that deliver consistent revenue, in addition to the few rock stars. These steady clients speak about your service to others, and can be a good source of referrals, so maintaining a relationship with your clients, where each feels like they are the “only” client, is the ideal.


Do your clients make unreasonable demands?

TAB-Demand (1)As a business owner, it’s always very difficult to turn away business, especially in challenging economic times. However, the reality is that not every client is a good client. In fact, some clients make unreasonable demands. You know the kind of client I mean; we’ve all had to deal with them.

In my experience providing advice to business owners, I’ve heard hundreds of stories of unreasonable clients, yet many owners are unclear as to how to improve their relationship with these clients.

I’ve outlined below some of the classic unreasonable client requests and some steps you may want to consider trying to better the relationship.

1. They expect you to be available 24/7.

Unless this is the type of service you offer, you should clearly define your boundaries. Let your client know what your working hours and days are.

2. No matter what you charge, it’s always too expensive for them.

An unprofitable client takes time away from your profitable clients. Set your pricing and be prepared to negotiate but only within preset parameters. Be prepared to say no and walk away if necessary.

3. They consistently pay slowly which has a negative impact on your cash flow.

If you’re spending a lot of time and energy chasing a client for money, this may be a client worth letting go – unless you can afford to wait for your money. This type of client will not change their paying habits until you enforce your payment terms. You may have to hold back on your deliverables to make your point.

4. They keep changing their mind about what they want.

If you have a client that keeps changing their mind about what they want after you’ve done the work, start charging them for the changes.

5. They don’t respond to your calls/emails/texts in a timely fashion.

Ask if there is another person who perhaps has more time to be responsive. Let them know that the lack of response may delay timelines and keep a paper trail in case it does.

6. They rarely turn up at meetings or cancel at the last minute.

Your time is valuable. If your client is consistently not turning up at meetings or cancelling at the last minute, start billing them for your time.

I recommend that you try to convert an unreasonable client into a good client, but that’s not always possible. When all of your best efforts fail, it may be time to fire the client.


Did 2015 Measure Up to Your Business Plans for the Year?

measureRemember back in January of this year, when your vision for your business was fresh and clear in your mind, when your business goals and objectives had a well-defined path to achievement? If you are like most business owners, your vision may have remained the same, but the execution and delivery to meet your goals and achievements was not exactly how you had planned. This is typical of most businesses, as our plans cannot possibly allow for unpredicted circumstances, whether positive or negative.

In preparing for the New Year, I encourage you to take the time to reflect on this past year and start preparing your plans for the New Year by considering the following questions:

  • Revisit the tracking of your business plan and any other planning documents including your action plan, and review last year’s goals. Did your business accomplish what you set out to do? Why or why not? Write a list of all the company’s major accomplishments for the year (or lack of them). These will be handy when you do your business planning for the current year.
  • What barriers prevented you from reaching your goals? How can you avoid them or prepare for them in 2016?
  • What is the key area you want to improve on in 2016? What steps do you need to take to accomplish this e.g. hire more staff, expand into new markets, increase marketing/branding, etc.?
  • Are there things you might have done differently e.g. hired too quickly, expanded too quickly, didn’t hire fast enough, etc.?
  • Have you started a business plan for 2016 that includes writing your goals and plans for next year?
  • Have you created a budget for the next year if you work on a calendar year fiscal basis?
  • Have you reviewed your vendors and providers recently? Do you need new ones or replacements for existing ones? Review your list and score them, see where you might need to add or even get rid of any that are not providing you with added value.
  • Have you reviewed and updated your marketing and advertising plans? Make sure you consult with your internal or external marketing professional to ensure you are strategically placing your marketing budget to align with your business goals.

We all know how important business planning is, so before you break for the holidays, take the time to reflect and plan for the New Year. You know the cliché: businesses that fail to plan, plan to fail.

Kick the New Year off with a clear plan with attainable goals and remember to take time off over the holidays and enjoy time with your family and friends. Thank you for following my blog over the past year. Happy Holidays.