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Total Number of Subscribers: 464 | ||
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Date: 30th August 2009 |
Compiled by: M Sathya Kumar | ||
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" Every morning in
" Every morning in
Verne Harnish calls himself the Growth Guy. He has been
named one of the Top 10 minds in small Business by Fortune small business
in 2002. he has a long influential track record with entrepreneurial and
emerging businesses. He founded the internationally recognized Young
Entrepreneurs Organization (YEO) and Gazelles Inc. He is the creator of
the Master of Businesses Dynamics Program. Verne's mission is to help entrepreneurs of emerging , fast
growth companies increase the value of their firms. He has a gift for
turning complex problems into simple solutions. He is the founder of the
YEO ‘Birthing of Giants' executive program in which Verne works with CEOs
and executive teams where he gives them practical tips and tools to solve
the challenges that come with building a company.
Verne's methods are simple and easy to use. It is also
taught by him in a clear and concise manner with lots of data, everyday
examples and a pinch of humor. Here
are a few good takeaways from the program:
An entrepreneur is an event driven person and is usually not
a good disciplinarian. So every entrepreneur needs a person who has the
same passion but is process driven. This key position has to be someone
the entrepreneur can totally rely on. Traditionally it has usually been a
family member or a close friend. A good example is what Steve Ballamer was
to Bill Gates. As Aristotle says "You are what you repeatedly do.
Excellence is not a event - it is a habit."
Another key person every entrepreneur needs is someone who
has the ability to hold other people accountable for their actions.
Or else it will be a case of everybody doing nothing.
Also there comes a point in every organization as it grows
when the entrepreneur fails to recognize a person who actually works for
him. At this point the dynamics of the organization changes. This is when
the he needs the rest of his core team to be able to pass on his vision to
all the employees. Verne calls this ‘Being on the same page'. This is made
possible by what he calls a daily/weekly huddle that the entrepreneur has
with his core team. They in turn have a huddle with their respective teams
and so the whole organization is on the same page, so to say.
Every entrepreneur needs to know and have a plan of action
for the next 90 days and 10 years hence. But the crunch is that only an
entrepreneur can think that far, the rest of the planet ( those who work
for him ) needs to know what is to be done immediately and so the 90 days
plan. This is an extension of the daily/weekly huddle.
An further benefit to this idea is that the single thing our
brain is best designed to do is pattern recognition. It was Demming who
said "You cannot make patterns without data points."The rhythm of the
daily/weekly huddle gives the entrepreneur and his core team a steady
stream of relevant data to help in their business decisions. It is
during these huddles and receiving of all the data that suddenly some
ideas crystallize. Another method to keep in touch is to take one employee to
lunch every week. Henry Ford did this and he always picked people closer
to the front line and during the 45 min lunch, the first 40 minutes he
spent on small talk. By then the employee is comfortable enough to share
his innermost fears and thoughts. So to "move faster you've got to pause
faster" That is take the time to talk through issues.
If you cannot measure your success it does not count. There
have to be kept promises indicators. You need data to be able to measure
what you are doing. Everybody in the organization needs to know where it is
headed and if the entrepreneur cannot state the strategy in one sentence
then he has a problem. Verne says the single most important thing that one can do
is to make a list of 6 things that need to be done. Then pick the one that
you will most definitely do and this will take care of your priorities for
you. Janie and Victor Tsao of Linksys have a simple answer for
their success. They listened to what their customers had to say and
implemented it within four weeks. When Cisco acquired Linksys John
Chambers said that the reason they were being aquired was that Linksys
always were ahead of Cisco. Another simple advise is to note down the one thing that
will make the company or your service better every week. When you act on
it you are 1% better every week and this has a compounding effect.
For example if you even save just Rs.40 a day, over a period of 30 years
it Rs.4,38,000. This is hugebecause of the compounding effect. It shows
only later because in the initial years the needle does not move as much.
Steve Jobs has said "I am always amazed at how overnight successes take a
hell of a long time." What do you do when your company is in trouble? Verne says
the best thing you can do is to go out and talk to your customers.
Talking to your customer on a regular basis is the key. Also
what you ask determines your growth. One of the common mistakes and
a bad question to start with is ‘Are you satisfied?' . A better way is to
know your customer and focus first on is "how he is doing". What are his
goals, what kind of problems he is facing on the way, what's new in his
industry, etc. Then comes the questions about your competitors because it
is always smart to know what you are up against. The last question can be
about how the customer feels about you, your product/service.
The job of a coach is to ask the right questions and guide
the entrepreneur in the right direction. His role is only to verbalize the
problems and possible areas of improvement. The answer will come to the
entrepreneur. So advisers are ‘influencers of the indusry'.
Cash is King. So here are three ways to shorten the Cash
Conversion Cycle: 1. Shorten the cycle times.
2. Reduce mistakes 3. Improve your businesses model.
Keep asking yourself and your people these questions: What
are the things that you can 1) Start doing, 2) Stop doing and 3)
Keep doing? It is a good strategy for the entrepreneur to ask himself
these two questions every 90 days. 1. If I were competing with us how would I kill us?
2. If we were a brand new start up today what will I do?
What does it take to motivate your people is a million
dollar question? First hire motivated people. But What happens over time
is that the company itself starts demotivating the individual with mundane
tasks or things that he is not interested in doing. So the entrepreneur's
task is to get rid of things that demotivate. But interestingly Bill gates
had a bigger problem ; How do you motivate millionares? The answer is in
the fact that when people quit stretching they get bored. Because life is
like a rubber band; if you do not stretch it, it does not reach its full
potential. Another simple method to motivate is to get all the
employees to write down in two columns what they love doing and what they
loathe doing. These will be different for different individuals. This
Love/Loathe document can be used to juggle tasks around accordingly.
Did you know that ‘The Best Place to Work In' award has been
consistently won by a company called ‘The Container store'. Their 3 simple
rules are: 1. 1 Great employee = 3 good people Hire the Best
instead of making do with many mediocre employees.
2. Pay twice as much Be ready to pay for quality
3. 160 hours of training It is not fair to judge an employee unless you have educated
then at least for a year Whoever controls the ink owns the industry. So own a word
that best describes what you stand for and do. That should be the core
purpose - The WHY of your business. Your whole strategy for growth should
revolve around this core value. According to Jack Welch - "Strategy is not a lengthy action
plan. It is the evolution of a central idea through continually changing
circumstances." One problem with entrepreneurs is they do not like to look
back. Greatest lesson in history is that we do not learn from history.
You have to be able to pick a sand box, make a promise and
Keep it. Also Keep your business simple. This in a nutshell is the formula
for success and growth. n Excepts from Making of Indian Giant - A management program
conducted by Verne Harnish organized by CII
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