The average entrepreneur has
never been to business school. Had he done so he may have realized the
difficulties he was undertaking in starting his own business. Tax
issues abound at the local, state/provincial and federal level, FICA,
FUTA, 1099's W4's, I9's, the list goes on and on. Certainly these
issues are most important but these are not the ones that will decide
if your business will succeed or fail.
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The
average entrepreneur has never been to business school. Had he done so
he may have realized the difficulties he was undertaking in starting
his own business and may have remained working for a boss. In every
jurisdiction in North America there are different regulations, tax
issues abound at the local, state/provincial and federal level, FICA,
FUTA, 1099's W4's, I9's, the list goes on and on. Certainly these
issues are most important and must be addressed in every small business
and with the help of your CPA or local Small Business Development
office there is plenty of advice around. However, as important as these
issues are - keeping the feds off your back - these are not the issues
that will decide if your business will succeed or fail.
So
what are those critical success issues that every CEO must deal with in
his small business. Certainly there are many issues that will trip up
the small business CEO, but in my experience there are three which are
paramount, and I call them the tree P's, Pricing, Productivity and
Planning. Unfortunately in these areas the CPA's and Small Business
Development offices are of limited use. Every small business CEO has to
work this stuff out for himself.
Pricing,
the first of the P's and the one where most small businesses get it
wrong, is dependent on the proper understanding of the accounting
information you get from your bookkeeper. Note the words accounting
information. A small business CEO does not need to know how to do
accounting, (although with some modern accounting programs this is a
lot easier than it sounds) no he needs to understand what the
information is telling him, and he must have asked for the right
information. For this he needs a little training.
Productivity,
or performance, how to get your employees to do their jobs as well and
as productively as they are able. This is a big subject and most CEO's
of small businesses need help in this area. The training you get all
comes down to one simple rule, "Tell your employees what you expect
them to do, monitor their performance and give them feedback".
The
final P is planning, and most specifically, cash planning. More
businesses fail through poor or non-existent cash planning than for any
other reason. And the worst part about it is doing your cash planning
is really not a chore. When I train CEO's in cash planning I make a
point to show them that doing this well gives them a real direction in
what their own work should be that week.
I
believe that if every small business CEO was trained in the basics of
the three P's not only would their success be much greater but they
would also improve their own quality of life.
The
Author
After 25 years consulting to small and medium sized companies,
Mike
Anderson, principal of
Train Me To Be a CEO
realized that the most important part of his work was training the CEO,
and the reason he was such a good consultant was that he did that very
well.
Trained as an engineer,
he became a CEO of
a midsize corporation at the age of 35. After a spell at Harvard
Business School he entered the world of consulting.
3.
Ongoing mentorship. Begins with a minimum two
day one on one, but continues with monthly or quarterly follow up
sessions. (Smart and probably Best!) .
References
A New England Contractor
"Mike Anderson has been
working diligently
with the upper management team at (our firm). Mike is extremely
knowledgeable and has an exceptional way of dealing with many different
personalities. He has worked very closely with the Sales Team to
impress upon them the importance of using a consistent method of
estimating. He was instrumental in restructuring our accounting
procedures."
