In today’s fast-paced business environment, profitable organizations are steering away from the development of old school business plans and more towards assembling exceptional teams centered around an exciting culture, marching towards a shared vision.
Many owners try to create an exciting culture by buying some beanbags and foosball tables. Conversely, “oldschool” owners may perceive the stereotypical modern work environment as chaotic. The truth is that culture comes last, and is a symptom of a company with effective systems and controls. Profitable companies break it down to five steps.
GUEST POST | RYAN FOLEY, MBA, CVA, EA, PARTNER AT CUNNINGHAM & ASSOCIATES
Follow these five steps to leverage your culture and systems, watch your profits grow, and increase your peace of mind. Start with systems and people, and the culture will follow.
1. DEFINE THE STRATEGY
Modern leaders and visionaries understand that a strategic plan needs to be brief, i.e., easily understood and communicated. Companies like Tesla, Airbnb, and HubSpot have all outlined their plan in a way that is transparent and easily digestible. At its core, the most effective strategy hyper-focuses the organization at every level to leverage its competitive advantages through effective systems and empowers its people to push towards the organization’s goals.
A comprehensive strategic plan will look near-term, mid-term, and long-term. Near-term will focus on actionable goals, while longer-term goals are usually much larger and more aggressive. Annual plans should align with an organization’s near-term goals, and they should be transparent across the entire organization. Your company’s mission defines the purpose of the organization and explains why an organization exists, as opposed to what an organization does. Your mission should matter to you; it should be emotional and should motivate. If it doesn’t, it’s time to retire.
2. DEVELOP YOUR PEOPLE
Once an organization has its vision and strategy easily understood and communicated, it’s time to develop a stable of horses that can help win the race. Cutting-edge, profitable companies know that developing a team of A-Players who have the drive and ability to carry a heavy load and take an organization to the next level is crucial. Leaders also need to ensure their people have a clear understanding of their role, responsibility, authority, and be held accountable for performance.
Many business leaders put up false barriers saying they can’t find good help. The truth is great leaders don’t find help; they create great team members. Profitable companies have adopted the phrase “hire for character and train for skill.” This mantra prioritizes good cultural fit and ability before considering qualifications. Developing a robust recruiting, training, and retention program is an essential foundational element to scaling an organization. People are the greatest asset an organization has – invest in them.
3. IMPLEMENT THE PLAN
People and strategy are in place, now, it’s time to implement. Plans often die in this stage, as implementation is hard work and requires consistency. Great leadership and effective managers help companies successfully navigate this phase, but the most profitable companies leverage their systems and controls to manage systems first, which drives performance and bottom-line growth.
Today’s management gurus will tell you that management is a learned skill, however, many doers are very poor managers, and likewise, many managers really stink at doing. Balancing the team to put the right people in the right positions is important. It’s often said business leaders drive the bus, but it’s also their job to make sure their team members are in the right seats.
4. WEALTH MANAGEMENT
You’ve done it! You have a great team and you’ve implemented a great strategy. Now you’ve encountered the next hurdle, wealth preservation. This stage takes many forms including cash management, balancing debt, tax reduction and reinvestment. Today, money is cheap, and recent historic tax reform has rocked the small to mid-sized business world. Modern organizations recognize that their financial plan and tax strategy needs to evolve. You’ll also find it surprising that only one in twenty companies are taking full advantage of the tax, grant, and cost reduction strategies available to them. Make sure to allocate time to strategize how to preserve wealth, reduce taxes, keep costs low, and maximize industry incentives.
5. EXIT PLAN
When done properly, exiting a company can be the realization of many of your personal and professional goals. It can take many different forms, (some owners sell and feel a vacuum or sense of loss, and jump right back into a new venture – others sell and travel the world). A well-planned exit strategy will pay dividends.
Profitable organizations are steering away from the development of old school business plans and more towards assembling exceptional teams centered around an exciting culture, marching towards a shared vision.
Ryan Foley, MBA,CVA, EA
Partner at Cunningham & Associates
Ryan Foley is a Partner at Cunningham & Associates. Ryan has helped clients through every phase of the business life cycle as a small business consultant and trainer for well over a decade. Ryan believes that all challenges can be broken into manageable parts and best addressed in an organized, practical manner. He is able to maintain a unique bond with clients through his experience sitting on both sides of the table. He has actively participated as CEO, CFO, Sales Manager, Operations Manager, Controller and various other business capacities for his clients. He understands the balance between planning, implementation and the occasional, but often necessary, change in direction. Ryan excels in sales strategy and methods, tax planning, operational systems and controls, organizational improvement initiatives and change management.
Ryan Foley, MBA, CVA, EA
E firstname.lastname@example.org | P 508.400.5827
Cunningham & Associates