Category: Financial Management

In my experience, poor financial management is what causes most underperforming small businesses to fail or not achieve their objectives.  Often it is a lack of understanding of how basic business finance works that inhibits owners and leadership teams.  You need to fully grasp what makes your economic engine work to make the right investments and calculate appropriate risks.

Ten Things Business Leaders Need to Do in 2023

It has certainly been an interesting time to be a in a business leadership position these last few years.  Every time you thought you had something figured out a new challenge arose.  It was hard enough dealing with COVID-19 then we had to deal with a  broken employer-employee model.  In addition, economic conditions have been […]

Daily Leadership Thought #179 – Create Your Own Destiny

Courage still matters in business and in life. Many of us avoid the difficult decisions or talk ourselves out of taking risks. We strive for comfort where only pain and discomfort exists. It’s better to bet on yourself and your business and accept the consequences then to live in someone else’s shadow or become another fish in the pond of mediocrity.

Leadership Thought #400 – 25 Ways Leaders Get Themselves in Trouble

Leadership isn’t easy or everyone could do it. Some talented people make it look easy, but we often don’t see all the hard work that goes on behind the scenes to make it look this way. Most leaders struggle at some point and have to learn some difficult lessons along the way. Experience can be the best teacher if you are open to learning. I’ve observed the following 25 ways (in no particular order) that leaders tend to get themselves in trouble:

Leadership Thought #493 – All Waves Come Crashing to Shore

No matter how far out the tide goes, all waves come crashing back to shore.  The same is true with business cycles. We have experienced a particularly good period in business over the past decade or so.  After experiencing a difficult recession, our economy roared back to life. Many of us have not only regained […]

Leadership Thought #442 – A Few Basic Truths About Business

Here are a few basic truths abut business to help ensure your success: It all starts with simple math.  The formula is pretty straightforward: Revenue – Expenses = Profit.  You need to sell enough of something and price it properly so that it exceeds your costs of doing business.  Knowingly taking work at a loss […]

Leadership Thought #356 – You Need to Have Decision Making Filters

How an organization makes decisions greatly affects whether or not it will have sustained levels of success. Any company can get lucky every once in awhile, but relying on ad hoc judgments is not a good strategy. One of the most important things a leader does is make decisions. He/she must also create a culture that knows how to make sound judgments without relying too much on any one individual. In essence, you want to foster an environment where you, your management team, and other key employees use decision making filters to increase the likelihood of making the right choices.

Leadership Thought #355 – Growth Comes with Its Own Challenges

Business ownership has never been for the faint of heart. On-going change and adaptability is part of the success equation. Even when things go well there are problems you will have to navigate. As you grow, your company and you should be prepared to experience many if not all of the following issues:

Leadership Thought #204 – Your Business GPA

…the ultimate goal of any business should be to have high quality employees who are focused on providing value-added services to a loyal and growing client base in an efficient and profitable manner.

Leadership Thought #198 – Are You Doing Business With The Right Clients?

Targeting the right prospects requires thought and effort. Every business needs to know when to say no. It’s easy to say yes (or at least we think it is). Bad or mediocre clients lead to bad or medicore outcomes – it is that simple. The math doesn’t get better on its own. You need to have the expectation of a reasonable return on investment and manage to certain margin thresholds. There should also be some sense of operational synergy and a belief that you can deliver what’s expected within the expected time frame.

Daily Leadership Thought #173 – Twelve Mistakes Of Well-Intentioned But Flawed Turnaround Leaders

I am worried that many of our leaders have become way too tactical and reactive these days. Instead of seeing the big picture they are getting mired in the details and forging ahead with actions that will have less than optimal impact on the problems/challenges they are trying to address. Actions should never drive strategy. Strategy should drive action. There are also rarely simple solutions to complicated issues. Sometimes you need to step back and actually think through what you are doing before you do it (especially in times of crisis).

Daily Leadership Thought #111 – Diversify Your Product/Service/Market Risk

We’ve all heard the saying that “…you shouldn’t put all your eggs in one basket.” The same thing could be said about betting everything on one major product/service line or depending too much on a small group of clients. Just as diversification is essential to managing financial investment risk, business leaders need to hedge their bets and manage their financial vulnerabilities.

Daily Leadership Thought #63 – Be Transparent

The more people who are knowledgeable about the basic metrics of the business, the more people you have who will be able to make a connection between their work and the actual outcomes of the company. As long as you are a reasonably fair employer, they will take pride in the organization when things are going well and pitch in when you need them to make the extra effort.