As we look to finish the year strong, today I am talking about report cards.
Kids may not enjoy getting them in school, but as a parent, I find them a valuable tool to monitor progress, compare their results to their peers, get feedback when results are not meeting expectation, and to make changes to our process for homework and studying when there is not an “A.”
Yet once our kids graduate and move to the professional world of work, we forget about this useful tool.
Your business has at least one report card – it’s called an income statement [or P&L].
But does every individual in your organization have their own customized report card?
This article from Entrepreneur Magazine explains why every person should have a scorecard/ dashboard/ report card.
Why is a scorecard for every person in your organization so important?
Because the scorecard connects individuals to your company’s vision and strategy, and when all the jobholders in a company have a scorecard, the entire company is aligned.
With a scorecard defined clearly in measurable terms, and with specific roles identified, people will be focused on the most important activities. Accountability is clear.
But how does this type of business scorecard compare to the individual scorecards we are describing here? There are several important differences.
Let’s take a look.
Alignment with vision. The alignment to the mission or vision is usually not clear in business scorecards. They’re very clear in the individual scorecard.
Progress of strategic initiatives. Strategic initiatives are tracked outside of business scorecards within the individual scorecard because the five indicators in the individual scorecard are usually a mix of visual indicators and strategy indicators.
Concept of roles for indicators. The concept of roles for the indicators doesn’t exist in business scorecards. It does in the individual scorecard and is there to encourage cross-functional collaboration.
Related: How to Measure the Effectiveness of Your Company’s Vision
Information on the scorecard. Business scorecards include aggregate consolidated numbers; the individual scorecards show numbers from the source, where performance takes place.
A number of factors. Business scorecards can have a large number of indicators; the individual scorecard focuses on a few.
If you want to “grow” your business 20% or more in the next year… what is your plan to make it happen?
Do you have an achievable sales plan? Great!
What about a People Plan to handle the additional work and keep your customers happy?
Are you planning any changes to your process or technology to be more efficient?
Do you have a plan to handle the increased cash needs that always come with growth?
Most companies focus on the sales side of growth and just let the People and Operations side just figure itself out… this approach causes the “growing pains.”
You might be surprised to know that I speak to business owners every month who want to grow 20% next year, but they don’t have a plan to get the sales and/or handle the extra work.
“More companies die from indigestion than starvation.” – Dave Packard, Hewlett Packard
According to the book “Scaling Up” by Verne Harnish, these are 4 warning signs that you aren’t ready for more sales:
Your profits are at or below the industry average [or you don’t know what that is]
Processes are not running smoothly now
There is drama on the team or from customers from missed deadlines, increasing mistakes, lack of resources, and “communication” issues
People are working overtime to fix problems
At the very time when the focus becomes more important, your key people start being “too busy” putting out fires to work “on” the business.
Maybe you are doing this too…
Getting dragged into daily work instead of setting aside time to evaluate, plan and work on the key projects that will improve the business.
A few real-life examples:
I spoke with three business owners this week who are living this right now.
One almost doubled the revenue but the profits plummeted.
another doesn’t have the hourly staff in place to handle several new clients so she is filling in and training $12 an hour staff.
A third added more customers but one technician team “burned out” and quit… now he is back in the field and everyone is working 50+ hours handling the overload, and revenues are down 20% and profits are zero. Ouch!
What is the solution?
Build the 4 Foundations to Scale Up– Strategy 6 People + Execution + Cash– all TOGETHER.
Changes to one of these four impacts the other 3– so you need to look at the “whole picture” of your business.
[from “Scaling Up” by Verne Harnish- graphic from book summary by Readingraphics]
You, small business manager, want to improve things.
I will bet dollars to Freddy’s Famous Buffalo donuts that you have a “wish list” of projects you want to implement, and you have started some of them.
Yet your office (and mine) is littered with books unread, binders from great workshops, possibly brochures or saved emails with a system or process that sounds great. One you want to investigate that just might make your business operate more smoothly or more profitably.
Hey, we are idea people and we are starters (maybe not finishers).
When you do start something new with anticipation, this most likely happens (image from Todd Herman):
One of the most persistent complaints I hear from employees of small business is that “we don’t finish what we start” and that the owners/ managers are always adopting the latest book advice or stuck in chasing shiny objects syndrome.
Making changes, finishing a project or new process, and getting everyone on board and sticking with it is HARD.
You have to be patient and persistent to make progress, and to stay positive with all the set backs and challenges you encounter.
Four things you can do to start and finish your projects:
Do ONLY ONE at time (more about this next week)
Enlist the help of your team– don’t do it all yourself
Create an action plan with weekly action items and assign tasks to specific people with a deadline
Meet weekly (same time) to review what is complete, what needs to be discussed/ decided, and what is next
As a bonus– get an “Accountability Buddy” outside of your team/ company (a colleague or a consultant) who will hold you accountable to make progress, keep you motivated, and help you work through the inevitable bumps on the road.
Maybe even decide the reward you will give the team to celebrate– such as a “pizza party” or outing or something nice for the office (plants? Fooze ball table?). This can keep you motivated as you slog through the tough parts and keep you sprinting toward the finish line.
Your employees want and need ongoing direction & feedback & support & recognition, so that they can focus on high priority actions.
Just like a sailboat, if they drift just one degree off course every week they can end up going East instead of North.
You need them to tell you when they are stuck, if they need clarification or resources, and to make more informed decisions.
You also want them to make progress on projects beyond their daily tasks.
All of these employee and manager needs can be met with a 15-minute “weekly coaching conversation”
Weekly Coaching Conversation [Check Ins] Agenda:
Results on individual/ team KPI [key performance indicators]
Status update on ongoing tasks [what my manager needs to know]
Status update on project action items
Challenges- where are you stuck or need more help?
Priorities for this week
….I know you are thinking “how am I going to squeeze in weekly chats with every one of my team?”
I will be honest, the first few weeks are hard for managers to schedule, but then they find something miraculous ….
After a few weeks– people start changing how they interact with their managers:
They hold the “do you have a second” updates and questions for their weekly chat [time saved 5+ minutes per day x per person]
You don’t have to chase people down to get status updates — you know you will hear them on your weekly chats [time saved 10 minutes x per person]
They start completing project action items that you assigned but never went anywhere [1+ hours per week of new “to-dos” completed x per person]
You now have a way to start handing off small action items on the bigger projects to someone else [time saved 1-2 hours week of your time]
You don’t have to put out fires because someone forgot or were stuck or handled something badly [time saved 1+ hour per week]
When you think about all the time you spend on all these reactive activities, it adds up to well over 15 minutes per person.
Would it be better to have a pre-planned time carved out of your schedule to be proactive, to give direction, feedback, support, recognition, and coach for learning and improved decision making and time management?
If you have more than 10 people, over time you can designate and train a “team leader” to have these weekly conversations with the team and just bring you the weekly team updates [time saved 15 minutes x per person]. As an added benefit, this process develops your high potential employees into team leaders.
As with anything that is “good for you” it takes a bit of effort to change your habits and the habits of your team, and diligence to keep consistency and progress.
Managers who master this habit say they would never go back to their old ways.
In my next article, I will share details on Step 3 “Action Plans for Development and Business Improvement” [see all 6].
Are you interested in everyone on your team taking on more responsibility?
I mean real responsibility — when they “own” the work, solve issues, make suggestions and even improve the process, and [the ultimate level] keep you in the loop with status updates or “exception” reports.
You might even have a few people who do this now… but you would like EVERYONE on staff to do this. [Keep reading for the First of the 6 steps…]
This magical state is called the “Accountability Culture” — and blends the benefits of a Results Culture and a Caring Culture, and the top ranked most-effective leadership style that blends concern for People with a focus on Results.
Accountability is not a new concept, but it has become a high priority for the business owner and manager who wants to spend more time on business planning and management and less time on getting the daily work done.
If your team “does what they are supposed to do” then managers are freed up to work on the business- revenue generation, process improvement, cost control and great team and customer experiences. If your pants are on fire you can’t plan and improve your business.
Let me be clear—- Positive Accountability is essential to grow your business.
Last week I spoke to 91 planners and managers in operations, who work for companies with 50-500 employees. Guess what? These organizations are also challenged with building accountability on their teams.
Here is your opportunity to take your smaller more agile company and out-perform you competitors, with 6 Steps to Coach For Accountability & High Performance.
Step 1 is to clarify the Roles, Responsibilities and Results of your key people:
Employees want to have four main questions clarified about their role (although they rarely ask them):
If you cannot answer these questions about your role and those of your key people, you will not be able to effectively hold them accountable for results.
1. What is my role?
2. What does “good” look like?
3. What is my responsibility?
4. What results should I produce?