Mentor Added Accountability

Finding a mentor is one of the best things entrepreneurs can do for their business. Too often small businesses do not have a board of directors to keep them accountable. Therefore they do not perform to their potential. Its like the old adage, what gets managed gets done.

A mentor relationship can add accountability to the entrepreneur or business manager. Picture your business if someone was checking YOUR work. You probably spend a lot of time checking your team's work. Even the best qualified members of your team can use the tips you give them and perform better when they are kept accountable. Imagine the most important role in the company being improved.

A good mentor will help you approach situations, deal with the things that you may not want to deal with head on, and keep you to your plan. This accountability is crucial in executing your plan. It makes you answer to someone else. It creates a board of directors type of relationship where one may not exist.

I have mentored many entrepreneurs and helped them strengthen their businesses. My mentor has helped me strengthen mine. I recommend giving it a try.

Risk Management

All businesses are indirectly in the insurance business. I am not referring to the traditional types of insurance, rather I am referring to the management of risk. The people we hire, the technology we put in place, the operational procedures we produce are all a form of insurance we invest in to protect and strengthen our businesses. There is the flip side, what is the cost of not having them? What is the risk?

An example: A business is a store that only has one person that works in the store. The store owner feels like he cannot afford the $15,000 annually to hire a part time person. To fully understand his predicament, I have him do a little bit of workplace reconnaissance.

1. Confirm that the business is operating in a risky manner.
2. Estimate the potential loss if the employee was to get sick, injured in an accident, or quit?
   
3. The owner estimated this exposure at $8,500.
   
4. The owner took that risk and deducted it from the costs associated with hiring the part time person and he realize the actual increase of costs is $6,500, not the initial $15,000 that the owner assumed.

Armed with the actual costs the business owner was better able to make his decision. He was now informed and could properly manage his risk.

As business owners and managers, we need to manage this risk. The owner determined that the $6,500 additional investment was affordable so he hired the person. In addition, he understood the investment needs to yield a return. He set forth additional tasks for the two person team to complete to help get more value out of the investment.

This approach will help you make decisions that are based on risk adjusted numbers. This outlook has helped me lower my risk and strengthen my company. I hope it can do the same for yours.

Directional Clarity - The Child Test

As business owners and managers, we are often put to the test. We face all sorts of situations that there is not a handbook on dealing with. We need to be able to count on ourselves. Here is the test I give myself before taking action.

I imagine my child is watching me and learning from me and I ask myself "Do I want her act in the way that I am about to act?" This relates to everything. If I am disciplining someone, training them, everything. Do I want my child to learn and mimic my actions. Think about it, this approach makes you break down justifications and leads you to make a deliberate choice of doing the right thing or the wrong thing.

This "Child Test" has helped me work through countless situations. I hope it helps you do the same.

Blood From a Turnip

During difficult economic times, it is important to drive down costs. Although there are many ways to accomplish this, some cost cutting can cause permanent damage to your business. My approach to cost cutting is to turn it into a contest, which I have named "Blood From a Turnip". Here is an overview.

Objective
Find creative ways ways to lower our costs without cutting staff. Our strengths as a company are our people, capital, processes, and reputation. With that in mind, come up with ways of improving each.

Rewards

There will be rewards given to everyone that comes up with improvements that are implemented. Value of reward will depend on the impact the initiative has on the company. The grand prize is a trip to Hawaii.

Requirements

The entry must have a name that summarizes the initiative. Give a clear description of how you would like to go about gathering date to analyze and project impact. Send an email to me to review. I also instituted a deadline.

Summary
These economic times are tough. We need to utilize this pressure as a catalyst for creative ways of managing costs and creating new revenue. We need to look at other opportunities to cut costs, not people. Remember our strengths.

We found over 30 items to improve within resicom that translated into tens of thousands of dollars in annual savings.