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What You Should Know About Your Management Development Program

The ultimate success of both large and small companies is determined by how well they recruit and develop managers to train, guide, motivate and hold accountable the employees who are on the front lines with customers. I would not deny that some stellar employees just naturally evolve into good managers. However the vast majority of highly effective managers learned the core competencies of management in the school-of-hard-knocks. Taking two steps forward and one step backwards they became testimonies to my philosophy that “success is based upon the failures we learn from”. But my point is that although these over-comers are proud of their achievement, they readily admit that their failures were very expensive for all concerned. So consider these fundamentals that any company, large or small can use as a foundation to a management development program that will bring big time long term rewards.

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How to Align Incentives with Management Talent

I am a big believer that your business is only as good as the people you have working for you. When it comes to attracting and recruiting high quality, team-minded individuals, some companies do a better job than others.  Over time these individuals distinguish themselves within your organization through their positive attitude, commitment to your core values and performance. You know who these individuals are and at times you wonder how successful your business could be if only you could replicate these impact players. Alternatively, you may be thinking that this individual is so important to your business that you could least afford to lose him or her. So how do you acknowledge, affirm, motivate and retain them?

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Make Sure What You Have Is What You Need - The Importance of Reviewing Your Planning

You may have heard the saying “the only thing that remains the same is change,” and that is especially true when it comes to planning for the future of your business.  My partners and I are constantly reminding clients that change will be a constant in their succession planning environment especially as it relates to their feelings, finances, family and federal tax laws. As these changes occur, reviewing and updating various aspects of your planning is imperative. While at times this can appear to be inconvenient, it will ensure you maintain proper alignment and ultimately increase the probability your succession plan will succeed.

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How to Align Business with Family Goals

A few weeks ago I met a prospective client who happened to be in business with three of their siblings. Two of the family members are in their mid forties and two are in their mid fifties. They have done a fantastic job of giving birth to and developing a successful business over the past twenty years. However, they have reached a point in their business life where they are struggling with what to do next. After spending approximately two hours with this family, it became clear to me that they have been working in opposite directions. Each family member was doing what they thought was important for the business, not necessarily what is in the long term best interest of the company. Thus, one of my conclusions was, “your vision is in need of an alignment.”

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How to Avoid Your Family Business From Becoming a Sinking Ship

Last night was a great night for watching movies about righting sinking ships.  First, I saw a few minutes of Pirates of the Caribbean.  I tuned in just as Captain Jack Sparrow and the rest of the crew were running back and forth from starboard to port in an effort to right the ship and return to the land of the living. 

Then came the Titanic, the ship that couldn’t be sunk.  Unless, of course, it hit an iceberg in the North Atlantic.  As the band played, passengers on that ship also got caught up in running back and forth.  For most of them, the outcome was tragic.

Sometimes, we see similar things happen with families, especially when one or both parents try to run the family like it’s an extension of the business or run the business like it’s an extension of the family.  In either scenario, there’s lots of running around and rearranging of the deck chairs; and it’s almost always damaging and sometimes fatal to relationships.

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How A Missing Toothbrush Can Cost $37,500 - Keys to Avoid This Mistake

Meeting expectations is the key to satisfying friends, family, colleagues, and employees.  Whether we talk about a company or an individual, experience teaches us that there is often a gap between what is promised and what is delivered and the difference can be expensive.

For example, a friend who travels a great deal forgot to pack a toothbrush.  She was pleased to see one of those “Forgot Something?” stickers on the mirror in her room.  The promise was that the hotel had your back if you had forgotten something simple like a toothbrush or toothpaste.  When she went back to the lobby, she stopped by the desk, explained her situation, and asked for a toothbrush. 

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Want Respect? Look at Character and Competence

We all have multiple roles; and there is a brand that accompanies each of those. We have a brand as a parent, a business owner, a spouse, a trusted advisor, a leader. While the responsibilities are certainly different, there is a common element in how well received each of those “brands” are in their respective marketplace.

That element is Trust. And that trust comes from consistent and predictable behavior on our part. It’s broken more easily than it’s built, but here are some ideas that you can put into practice that will help you in the construction process.

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What is the True Meaning of Survival?

How do you define succession? It’s a mouthful – so be prepared. The definition is “The formal definition is the continuation of success through the next generation of owners and managers through proactive reconciliation of predictable, probable and possible contingencies.” Yes, that is an intense definition, so let’s not dwell on the formal definition any more. So what’s the practical definition of succession? SURVIVAL!

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Success - It is a Shared Thing

As a survivor who has passed the foremost trial of succession, it’s a good time to make an assessment of the things you have done right.  There is no future dwelling on the negative. On the bright side, your survival affirms my theory that as a survivor, there is nothing you do wrong that cannot be many fold reconciled by the things you do right. As expressed earlier, success is not always defined in terms of those thin disguises purchased with prior profits. How many examples have you seen of people with mansions, yachts and jets going bankrupt? Success, which comes from the things you are doing right, is a NOW thing. 

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Does Survival Mean Success?

Hopefully you buy the Right Reconciliation Theory: assuming you have survived, there is nothing you do wrong that cannot many fold be reconciled by the things you do right. I know there are many ways of taking exception to this theory but from a succession planning perspective, it works. There are ten diverse components to the Succession Matrix that give plenty of opportunity to do things right and wrong. We all have our strengths and our weaknesses which from a realistic perspective means that on the norm, we are doing some things right and some things wrong. As an example we could be knocking the market dead with profitability while being totally insensitive to the development of a successor. Or reciprocally we could be so involved in the development of our successor that organizational productivity falls through the basement.

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How to Build Value in Three Forms of Capital Assets

I like to use the words capital and resources interchangeably.  So, from my perspective, there are three kinds of capital and/or resources available to us all the time.  Those three kinds of capital or resources are basically:  People; Time; and Money.

Let’s put people first, so we will begin with building the value of human capital.  There are probably several varieties available, but the more recognizable forms include Leadership Capital, Family Capital, and Culture Capital.

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Let Your Successor Experience It All

Confirming the optimum role for a family member entering the business is an exciting process that takes patience, honesty and proactive aggressive coaching. For the family member to have the opportunity to achieve their ultimate role the most important developmental activity is establishing, monitoring and refining a three to five year on-the-job-training plan that exposes the candidate to most if not all the departments of the business. This development track should offer diversity and challenges that provide sufficient feedback to confirm the optimum job role.

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In-Laws - You Can be a Positive or Negative Force, Your Choice!

The second step to navigating the role of an in-law in the family business environment is to seek to understand the family’s unwritten laws -  if you don’t know them, you will not know whether you are about to break them.  Knowing the laws allows you to discover how to best live within them, and potentially even have a positive influence on those laws over time. However, you must understand as an in-law that no one has asked you to come in and be the rescuer and change all of the dysfunctional dynamics that occur in your spouse’s family.

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Beating the Odds: Four Building Blocks to Create Change

recent survey of 3,199 business owners and executives indicates that only about 30 percent of programs addressing “change” succeed.  Where 30 percent sounds low, that is considerably higher than the success rate of programs addressing generational changes of business ownership or succession.  If both programs involve managing new behaviors, why is the success rate for one so much higher than the other?

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3 Keys to Inspire Change

There are four building blocks that serve as cornerstones for successful change and, by extension, successful business and family transitions.  These four are:  Inspiration; Stake in the Game; Tools; and, Feedback.

A truly rational person, Star Trek’s Mr. Spock, relies on common sense to convince others to move in a certain direction.  This approach, with all its logical merits, often results in misdirected resources of people, time, money, and unintended consequences for one simple reason.

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How and When to Turn Over or Sell the Reins

Today, let’s talk about how you set the stage for a graceful and timely exit.  Depending upon your disposition of the business – sale, family transfer, outside management - some of the steps listed below may take anywhere from a few years to a couple of decades to implement effectively.  So, the sooner you begin this process, the sooner you will be able to begin climbing other mountains. 

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Are You Falling Victim to the "Can't Leave" Syndrome?

In August of 1972, the celebrated childrens’ author Dr. Seuss addressed the issue of succession planning.  His chief character in the book, “Marvin K. Mooney – Will You Please Go Now!” just couldn’t bring himself to get out of the way and let someone else take center stage.  Almost two years later, in July of 1974, Dr. Seuss changed his main character’s name to Richard M. Nixon and sent his revised book to columnist Art Buchwald.  Buchwald received permission to publish the revised lyrics; and nine days later, on August 8, Richard M. Nixon went.

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Goals: Turn Them Into Reality

We probably all know a lot of people and businesses with bold, audacious goals.  Some of them get accomplished.  Some of them don’t.  What happens to those that don’t?

After years of working with individuals, families, and various types of business organizations, I have come to the conclusion that people who realize their goals have a plan for doing so.  They are not content to be “dreamers”; they focus instead on being “doers”.

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I Have No Qualified Family in the Business - What Are My Succession Options?

In previous posts we touched lightly on the staggering statistics that show nearly 75% of all family businesses will have difficulty with perpetuating business success. Continuing business success into another generation is often dependent upon a variety of key managers, especially if you do not have family in the business or your family is unqualified for ownership. In effect, they become the “Succession Bridge” because a committed group of competent, capable, and committed managers can keep the company moving forward.

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What Happens When There Are Multiple Successors and the Eldest is not the Best Qualified?

In many, if not most, family owned businesses, there seems to be at least one member of the next generation who wants to take a crack at being Number One.  What happens when there are multiple successors and the eldest is not the best qualified? 

The wrong choice can, and probably will, have devastating consequences on future family harmony and business success.   Picking a successor simply because (s)he is the eldest or rejecting someone based on gender can be fatal.  Unfortunately, we still see far too many businesses being lead by incompetent sons when highly competent daughters were stereotyped into inferior roles. 

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