newCFO » EXECUTION

RUNNING A BUSINESS

lorenzo — Tue, 17 Oct 2006 20:59:40 +0000

RUNNING A BUSINESS can be distilled to two activities:

planning
execution

The combination of these two activities results in 4 possible combination, but only 2 possible outcomes:

GOOD execution of a BAD plan: leads to failure;
BAD execution of a GOOD plan: leads to failure;
BAD execution of a BAD plan: leads to failure;
GOOD execution of a GOOD plan: leads to success.

Any other way is only running a business from the seat of your pants, not breaking the rules.

What’s your Action Plan?

Memo to the CEO: Fire your CFO! And your COO, CMO and CTO/CIO as well

lorenzo — Sat, 02 Sep 2006 13:07:03 +0000

Is your company valuing activities over results? BOTH is not a valid answer.

If your actions reward activities, you’ve got a problem, too many people spinning too many wheels, while you are going nowhere.

I don’t mean to pick on cab drivers but . . . If you take a cab during a slow day, in a city that you don’t now, and you ask to be taken to the airport, will you be given the tourist ride of the city and surroundings, and will you be driven expressly to the airport? The cab driver’s interest is in having the meter running for as long as possible. What if you change the rules of the game, before getting into the cab you ask: how much will it cost to get to the Airport? Somewhere between 40 and 50 dollars. What if you offer the cab driver 60 dollars to get you to the airport in as little time as possible, safely and respecting all the traffic regulations?
Now the cab driver has a vested interest of earning that $ 60 in as little time as possible.

What if you selected an handful of mini CEOs to delegate to:

CEO of Finance (formerly known as CFO)
CEO of Operations (formerly known as COO)
CEO of Revenue (formerly known as Chief of Sales/Marketing/Advertising/Branding)
CEO of Information (formerly known as CTO/CIO)

Make sure you do NOT assign ONE person the STRATEGY function, it is too Strategic to be left to the CSO or CEO of Strategy, and do NOT have a CTO or a CEO of Technology, Technology is a mean, Information is the end game.

Why call them CEOs? Because within the Vision of the company, each mini-CEO has a mission to accomplish. Make it clear to quantify what the goals of the mission are; make sure to give them resources (time, money, people & infrastructure), and demand a plan in return. Call it the game plan, or action plan, but please, don’t call it business plan, too boring. Measure progress against the game plan on a weekly basis (executive committee is not optional and it’s not a waste of time) and demand to be informed of major issues on a timely basis. Be available to help with your influence and resources, and to shield them if necessary. Then step back, try to NOT overstep their mandate, don’t give in to the temptation to overrule their day-to-day decisions to play “nice CEO”, let it flow. It’s the end results that count, not the individual actions. Of course you always have the option to fire their sorry derriere if there’s no performance! We are talking about mini-CEOs here, there’s no time for corrective measures, training, development, it’s show time, it’s where the rubber meets the road.

Do people change? And should you care?

lorenzo — Thu, 24 Aug 2006 19:52:12 +0000

Do people really change? Or is it that people can be managed?

There’s a difference, a HUGE difference.

If you hire people with your same worldview, who share your visions, and your ethics, it’s no different than multiple people naturally pushing toward the same direction. If instead the majority of people do not share the vision, worldview, and ethics, the pushing toward the envision direction can still happen, but requires:

supervision
management
training
. . . . .
. . . . .
. . . . .

All these initiatives are non-core, have a monetary cost associated with them, and require time. In a business environment extremely transparent, where achieving corporate milestones is to be equated to a race against the competition, can you afford to waste time, money and resources when your more nimble competition does not, or does it to a lesser extent?

The choice of people that you make affects directly your P&L.

Reading: EXECUTION by Larry Bossidy, Ram Charan, Charlies Burck (the part about hiring is a MUST DO for everyone)

Life, Business, and the art of playing guitar

admin — Sat, 19 Aug 2006 16:59:18 +0000

Do you play guitar? You should! Here’s why:

Musicians have more fun: ask around
It’s portable fun: once you start playing guitar, you’ll start collecting gear, somehow it comes with the territory. Buy a cheap guitar and take it with you at the beach, camp, wherever you go.
It’s social: start playing and people will stop talking, turn off cell phones, detach from their iPod, and start humming, some will sing, and the most courageous may eve dance. You’ll make new friends, and get to know amazing people. (Add dog if you are single).

But wait! There’s more: learning to play guitar will embed in you the most valuable business tool there is: Project Management:

Plan: make one (online resources etc..), buy one (Books, methods etc..) or hire someone to make one fore you (teacher)
Perfect Practice make perfect: only by playing constantly and on a regular basis you will progress on the plan. 30 minutes every day will yield greater results that 3.5 hours every Sunday.
Use it or lose it: put practice off long enough and you will find that you have fallen behind where you were the last time you practice.
Learn by doing is the only way to learn: how many books on swimming can you read and never jump into the water?
Push the envelope: practicing every day what you know will get you nowhere. Set the task too high and you will fail without learning. Set the bar every time a bit higher, practice slow, then increase speed, practice until the conscious efforts grows enough neurons to become habit or second nature, a part of your new you; then move on to the next task.
Enjoy the process, the process is the destination.

Can you say the same about your business tools and habits?