It seems like some organizations have a rocket strapped to their back. They seem to easily make money and amass a big customer base.
So, how do they do it? What makes them different from their peers – even those with similar products or services. Look inside the organization and you’ll find all or most of these. They work across all industries, across all business sizes, across all stages of business maturity and all of us can do them.
Create and Feed a Healthy Culture – Every organization has a culture. It is the oftentimes unwritten rules and behavioral norms for how we live inside the organization – how we approach work, how we treat others (coworkers, customers, suppliers) and it’s modeled by those who lead – sometimes purposefully and sometimes unconsciously. The best marketing, operations, technical and financial plans in the world are going to fail miserably if they’re released into a toxic culture. Employee infighting, self-serving priorities and departmental turf wars act like anchors that drown even the most brilliant strategies and tactics. Conversely, a healthy culture is like fertile soil. Just like plants thrive in an environment that is rich in nutrients, businesses with healthy cultures effectively execute work that develops employees, delivers value for customers and creates financial rewards for shareholders. Great owners and managers both model and teach how those in the organization should approach their work, treat others and carry out the mission of the organization.
Hire, Retain and Develop the Right People – The struggle for talent is real. Hiring managers kiss lots of frogs on their way to finding a well-hidden prince or princess. And when they find a stellar employee, the organization is challenged quickly to find the best way to engage them in meaningful work and give them opportunities to lead and grow. And, maybe more importantly, those employees must work seamlessly with a new team that must quickly produce results where the whole is greater than the sum of the parts. Great organizations find the right people using a rigorous recruitment and hiring process. They keep them with an employee development program that aligns the interests of the organization with the interests of the individual producing both professional and personal growth. And, they provide an equitable compensation package.
Thoroughly Understanding the Organization’s Value Creation Activity – There are only a handful of business activities that approach “holy grail” status and value creation is one of them. Value creation is the key driver of consumer choice and business profitability. There are two important equations that gauge value –
Price the Consumer Pays for the Good or Service – Cost to the Organization to Produce the Good or Service = Economic Value
Utility and Enjoyment Consumer Derives from Good or Service – Price the Consumer Pays for the Good or Service = Experiential Value
Great organizations understand how to maximize economic value by operating effectively and efficiently and how to maximize experiential value by delivering superior products and an exemplary customer experience.
Exercise Extraordinary Financial Discipline – Great organizations are fiscally disciplined. Sales revenue is carefully forecasted, acquired and collected. Expenses fund employee productivity, development and efficiently create the product or service for the client. Money on hand is carefully managed and deployed in appropriate investment vehicles. Debt is used judiciously.
Measure what Matters – Unfortunately, in many organizations, the only metric for “winning” is the amount of money left in the bank at the end of the month. Great organizations have accurately identified a handful (6-12) of key performance indicators that are truly indicative of organization health. Just like body temperature, pulse rate, respiration rate and blood pressure constitute “vital signs” for health, these metrics (though different for each business) accurately measure and report performance on activities that are essential for the continued viability of the organization.
Governed by a Solid Operations and Implementation Framework – Great organizations have an operational framework – systems for tracking performance, processes for execution, meeting management methodologies, project management methodologies, regular strategic planning and a strong technology platform underlying all of it. They understand that everyone in the organization runs best inside the constraints of operational “guardrails”. Those guardrails provide direction, focus and guarantee that important operational details don’t fall through the cracks.
I think the natural inclination at this point is to use this as a checklist. You’re feeling good if you could check the boxes and feeling discouraged if you couldn’t. Fair enough. If this isn’t your organization, but you want it to be just start with one – culture – figure out what you want your organization to be like, model it and talk about it with your team.
If you have questions, want to talk about how to make the transition to an organization like this or learn more about organization health and business growth, email me at email@example.com, call me at 816-509-9838 or schedule a no-obligation appointment at https://calendly.com/mikechirveno