Business leaders are keenly aware of the need to manage the financial aspects of a business. Your business may have a noble cause, a quality product, and /or a viable service. But if the financial health is weak, none of that can be delivered.
Here are six ways you as a leader can invest in your business in such a way that it yields healthy returns.
Increase Communications – There is an interesting show called Undercover Boss where the leader of a company will go undercover as an employee in his or her business. They inevitably learn more from that experience than from any survey, board meeting, or consultant study could possibly yield. This is because they actually are involved in the work – communicating directly with the customers and employees on their level and experiencing the challenges of the work firsthand. From this vantage point, they are able to see what is working and what is not. They make changes to improve the company and also to reward the dedication of the employees they meet. They get to know the business and the employees on an intimate level. In a world where the CEO is typically seen as the obscure person in the big corner office who only talks with upper management and the board, this type of communication stands out. Wise is the leader who occasionally leaves his or her office and walks to other areas to talk with the “boots on the ground” employees. This leader will gain new perspective on the business and will also gain the respect of those employees.
Notice the Little Things – There is a pattern amongst successful leaders. They notice the little things. You will see them pick up a piece of paper off the floor or save a paper clip. They observe things carefully, not in a micro-manager kind of way, but in a mode of careful protection of the business. A good leader does not let the little things go undone, nor does he or she allow the little things to not be done well. A good leader is principled and focused and does not allow little issues to sidetrack the mission. Carefully watching the little things can make a big difference in a business.
Value – A good leader knows good value. They recognize value in ideas, employees, and quality. And they must. They know that value does not mean “cheap” and are careful to invest wisely. They know that to get a quality employee, they must pay enough to be competitive. They know that to keep a quality employee, they must seek ways to add value to them.
Education – A good leader will invest in continuing education – their own as well as that of their people. Today’s world is one of constant change in technology and business practices – if your business is not actively engaging in development, it will become extinct.
Strategic Planning – Strategic planning is a part of every business. But the danger is that, in many cases, it has become nothing more than an annual excursion to a luxurious resort in order to rubber stamp a warmed-over version of previous plans. If that is the case in your organization, it is time for a major reboot.
Timing – It is common knowledge in the investment world that timing is everything. There was one company – a multi-billion dollar company – whose management decided to manufacture a huge amount of product when the sourcing material costs were high. Why? They wanted to stay ahead of the competition who because of sourcing costs, had cut back on production. They went into full production mode in the month of January. By March, the sourcing costs had fallen to below-normal levels. Their competitors then ramped up production and were able to create the same product for much less. This company was left with inventory it could not sell. The loss was on such a massive scale that the company went bankrupt. A company must invest to grow, but time your investments carefully. Timing can make or break your business.
Does your business have a strong investment plan?