The Exit Coach

Maturing the adolescent company

Overcoming the adolescent stage of business is a necessary part of 'lifes journey' for both the enterprise and it's founder.

Maturing the adolescent company is rarely comfortable or easy. As Ichak Adizes has observed, "People organisations like organic systems, express predictable patterns of behaviour as they move through their own lifecycle. At each stage, the behavioural patterns manifest themselves as a certain struggle, where certain transitional problems must be overcome."

For business owners it requires a lot of emotional maturity to accept that he or she has to adopt a different; almost contradictory approach to move forward. Why is this so? Because intuitive control has to give way to delegated and systematised control. And accepting this is never easy for a reactive hand's-on business owner. It's a phase where talented and autonomous  entrepreneurs may find their efforts fall short of the most generous 'emotional intelligence' test.

"And so?"

Simply put; their is a lot of emotional ballast to offload. The act of instituting systems and leveraging technology is a logical decision. But being a owner who can willingly subordinate themselves to such systems rests much more in the emotional than the logical domain. This phase in the business owners life may well require character development of a more personal nature than they are expecting or accustomed to. None-the-less, it is true to say that the growth and maturity of the enterprise, will never exceed the personal growth of the founder. If these hurdles are not managed well the enterprise will beat a retreat. To quote Peter Senge on 'change and learning', "it is critical to dispel the illusion held by many leaders that they can lead organisational change without being ready to change themselves."

Although the linkage could be considered somewhat oblique, two companies which offer technologies, which can be leveraged in support of such maturity in a small to medium sized business are Netsuite and Salesforce. They are very much growing and maturing in their own right, even as they seek to offer their client company's the same 'rites of passage'. The following ZDNET article of Dan Farber attests to this tussle as they 'face-off' in the newly contested SaaS technology domain.

NetSuite launches SuiteFlex to build out verticals by ZDNet's Dan Farber -- It’s been interesting to watch NetSuite and salesforce.com grow up over the last few years. The chief executives at the two companies, Zach Nelson and Marc Benioff, share a common heritage of cutting their teeth at Oracle, but have taken different approaches to spreading the SaaS, multitenancy gospel. Salesforce.com has is roots in CRM [...]

SaaS or 'software as a service' is a model of software delivery where the software company provides maintenance, daily technical operation, and support for the software provided to the client.

Life As A LifeLong Learner

Our changing world of work

Gone are the days of jobs for life. Lamented by many and remembered by increasingly few. The concept now seems outrageously outdated. To our youth it appears ‘quaint’ in an old-fashioned way; sort of back there somewhere with black and white television. It belonged to an era of family certainty and cultural 'givens'. Many baby-boomer children remember their father (mum didn't work) attaching his working identity to the company he worked for. "What do you do?", "Oh, I'm with BHP, what about you?", "Yeah, I'm with Shell!". It was long term tenure, and Dad was the bread winner. That family sameness extended across a full span of childhood memories for many individuals who are in their 40’s and 50’s today. Perhaps in hindsight it was the peak of industrialized culture in terms of the ‘world of work’. 

Trend analysts now describe contemporary life as unchartered waters. Authors such as Salzman & Matathia in their recently updated work titled "Now, Trends for the Future", tell us that today, age-old certainties have crumbled. Known’s such as normal family, where do babies come from, how old is old, what’s a job, have all but disappeared. Changes are coming so fast and on such a broad front people are left bewildered and guessing. This has resulted in a shift in people’s identity and what they feel is their place in the world.

For most, certainty has been replaced with constant uncertainty. The world of work is more dynamic and change is constant. Many permutations and combinations of paid employment now exist. New work opportunities will continue to evolve from new combinations of multi-disciplinary skills, knowledge, understandings and technologies. As a result of these changes individuals now face full responsibility for their own career development. And employers are faced with staff who as individuals, have new needs and expectations. 

In career development language, the era of lifelong learning has been ushered in. In the world of work 'lifelong learning' informs us that it’s now individuals who need to consider themselves managers of their own careers and its necessary and sensible for us all to regard ourselves as self-employed. Old learning theories have been critiqued; new learning theories have been added. Narrow trait and factor tests have been replaced with the need for values and context framed learning environments. 

According to a recently published paper on career guidance the term career has taken new meaning. Career has increasingly broadened from a term that is synonymous with occupation or job, to be one that represents the configuration of all facets and roles of an individual’s life. Indeed current thinking is that all individuals have a career, and paid employment is but one element of it. Career development is considered a lifelong process and this process is unique for each individual. Increasing emphasis has been placed on the process of career development, holism and interconnectedness. www.education.edu.au (Career Guidance Paper) 

The Australian Business Foundation has commented that the commercial world is still adjusting to the shift in staff's new career expectations. Business enterprises are digesting the reality that working life is simply not homogeneous and stable, but affected by a complex array of forces for change. They suggest that the challenge for business leaders is to understand that the new nature of work and their ‘contract’ with employees is not standard. There are now whole new cohorts of workers with different perceptions and aspirations for their working life emerging. One size no longer fits all. Workplace design and flexibility are all open to interpretation and must be tailored to distinctive circumstances of individual businesses and their myriad employees.

These expectations are now being framed in policy and new government legislation. For small enterprises this might yet prove an unwelcome reality. While larger corporations in Australia have been wrestling with these issues for some years, now it’s the smaller local employers who may unwittingly be forced into the spotlight. 

For instance your local doctors’ clinic was not traditionally considered a rich learning environment by either Doctors or their staff. Training and development was rarely a budgeted item and staff certainly didn’t expect it. It was a bonus if you happened to work for a more pro-active and professionally oriented clinic. Times have changed. 

New accreditation levels has come into play which include assurance staff have adequate training and development. This will develop new expectations for both Doctors and their staff. New obligations will be nothing more than another layer of burden and irritation for a boss who considers staff as solely a negative on the balance sheet. Their cry will be "Just get the right compliance boxes ticked, and be done with it!" Professionally minded clinics  are not likely to embrace it with open arms either, but for them it will simply formalize what they know and do already. Perhaps most significantly, it will begin to affect the thinking of staff towards their place of employment. 

Just as 2006 ushered in websites where students rate their teachers according to student perceptions, perhaps the future will contain similar web entities where practice staff might rate their Doctors and local clinic in terms of their employment appeal. (a Doctor or Practice Managers very own cyber "Wall of Shame")

"But why would staff bother?" Certainly most won't. But human nature would suggest that some would enjoy firing a cyber dart at their former boss. After all it's anonymous and safe.  But in the bigger picture, there will be a more strategic long term motivation, and that is all employees will understand and accept that they must accrue some certified training and develop a portfolio of demonstrated skills to remain employable and current. It will become a simple survival skill in tomorrows employment environment, as individuals pursue their own distinctive mix of work, life and family.

Staff members are now as big a stakeholder, as suppliers and clients in the quality and reputation of the enterprise. Perhaps more than ever before, training and development of a certified nature will play a role in the new world of work for everyone involved in large and small business.

Living with a clear sense of self

"Have you ever considered that you may have missed your life"

In the post to follow I am going to make two assumptions. 1. that all people are responsible for the choices they make and 2. that these choices are meaningful and significant.

Many individuals experience a crisis of vocation and identity. Not just those Daniel J. Levinson  described in his "Seasons of A Man's Life" as being in their mid-life crisis. The biggest issue is that we can become alienated from ourselves.  We are not sure of our deepest desires and values. One part of us tells us that we have aptitude, promise and a distinctive role to play. But another darker thought lurks. The thought that in some telling way, we might have missed our own life. All of us can identify personal mistakes, unwise decisions and things we wish we had done differently. But can we achieve a stronger sense of personal integrity and authenticity in our day to day lives.

There are many interpretations of integrity in our contemporary world.  One notion I find more compelling than most is the suggestion that at personal level "integrity" exists when our 'internal' and 'external' conversations are aligned. A sense of sameness in our public and private worlds. Not that I endorse 'authenticity' in and of itself. It can be base and demeaning without a moral compass. But rather that the 'speed of life' has increased so much in many of our lives that we find our outer public world, has lost it's connection with our internal world. And more concerning is that our propensity for chronic 'busy-ness' has overtaken us to such an extent, that we do not understand how to hear our inner selves. Despite the dizzy array of labour saving devices and communication technologies we now have at our disposal, few have enabled us to live more principled, considered lives. Rather they seem to have plundered those few welcome opportunities we get to be by ourselves.

Neither is this issue unique to our time or culture. As Gordon MacDonald in his book "Ordering You Private World" wrote. The Irish author and famous playwright Oscar Wilde was an individual who paid scant attention to his private world until he was incarcerated. And for him, contemporary life was lived in the late 19th century. He reflected while in prison that...

"the gods had given me almost everything. But I let myself be lured into long spells of senseless and sensual ease...Tired of being on the heights, I deliberately went to the depths in search for new sensation. What the paradox was to me in the sphere of thought, perversity became to me in the sphere of passion. I grew careless of the lives of others. I took pleasure where it pleased  me, and passed on. I forgot that every little action of the common day makes or unmakes character, and that therefore what one has done in the secret chamber, one has some day to cry aloud from the house-top. I ceased to be lord over myself. I was no longer the captain of my soul,  and I did not know it. I allowed pleasure to dominate me. I ended in horrible disgrace. (abridged 'prison writings')

Could it be that one of the great battlegrounds of our age is the private world of the individual. Many individuals shoulder massive responsibilities at home, at work, and within the local community. Are our worthwhile actions simply leaving us very, very tired. And perhaps like Wilde they may have become too public world oriented, ignoring the private side until it is almost too late. The question to pose is "Are you taking time regularly to order your inner life?"

Few people have had to wrestle with the pressures of a public world more than Anne Morrow Lindbergh, wife of the famous aviator. And she jealously guarded her private world and wrote some insightful comments about it in her book "The  Gift From The Sea".

"I want first of all.... to be at peace with myself. I want a singleness of eye, a purity of intention, a central core to my life that will enable me to carry out these obligations and activities as well as I can. I want, in fact - to borrow from the language of the saints - to live "in grace" as much of the time as possible. I am not using this term in a strictly theological sense. By grace I mean an inner harmony, essentially spiritual, which can be translated into outward harmony. I am seeking perhaps what Socrates asked for in the prayer from the Phaedrus when he said, "May the outward and inward man be one." I would like to achieve a state of inner spiritual grace from which I could function and give as I was meant to in the eye of God."

The message is to be aware of the potential collapse that follows when the inner world is ignored. And to have built some relational insurance against it. Many times we need someone to stand with us as we think through the issues of life. 

 

Talent Management

Organisations with effective 'continuity of talent' efforts have many common characteristics. One of those characteristics is the use of a variety of strategies that help build the culture needed for future success.

In 2007 these strategies will pay big dividends. According to the 'ORC Worldwide HR Priorities Survey', which annually polls a group of global HR executives from a cross-section of industries, finding, developing and keeping talent are among the top concerns for human resource (HR) executives this year.

Every six out of ten respondents (61.7 percent) said the most pressing strategic HR issues companies will face in 2007 fall into the realm of "talent management"

Accordingly, talent management, which encompasses acquisition, assessment, development and retention of key talent, is the top category that will consume senior HR executives' time in 2007 (as stated by 33 percent of the respondents).

The ORC Worldwide President Robert Freedman said, "The real driver for this focus on talent management is that companies have not only recognized the value of talent as a competitive advantage, but they are developing the tools and processes that help optimise organisation capacity and performance".

Given record levels of unemployment in Australia at this time, no company irrespective of size can afford to be flippant with the matter of managing their key employees.

Finding good Australian talent and keeping it onshore is a growing issue highlighted in a current  Human Resources magazine article titled Curtailing the skills shortage in accounting.  David Jones, managing director, Robert Half International said “Both SME and large companies within Australia are grappling with a host of issues ranging from a lack of technical skills available on the market to overseas competition, staff loyalty and retention and generational change.”

“I believe staffing issues have been present in Australia for a long time and am unsure as to whether it is a trend or a fundamental shift in the employment market,” added Peter Roberts, CFO, Colonial First State Property. “Therefore I am very interested in looking at what motivates the new generations, and how culture and nationality impact a person’s loyalty to an organisation.”

Similarly, attracting talent is a more prominent issue within small to medium sized organisations which lack both brand recognition and resources. ”We have a small finance function with numerous positions to fill but a shortage of suitable candidates,” said Victor Cuthell, CFO, Burger King. This can be difficult with a limited number of senior positions to progress into, he added.

Following are details on talent management strategies which companies of all sizes can implement in one form or another. These strategies fit into four categories, including:

1. Development and Learning

2. Feedback
3. Retention Strategies
4. Recruitment Strategies

1. Development and Learning: strategies that promote the development of competencies, the exposure to more complex and challenging experiences, and the broadening of horizons outside of the immediate organisation.
Development and learning strategies that promote effective talent management include:      

•   Change in scope of job

•   Job that requires 'a fix it' 
•   Build from scratch assignment 
•   Projects and task forces that require new skill or learning   
•   Placement in 'high stakes' situation 
•   Placement in ambiguous situation 
•   Dealing with significant change event 
•   Action learning with significant change event 
•   Action learning team projects 
•   Rotational, temporary assignments managed by senior leaders 
•   Full-time job rotations managed by senior leaders 
•   Formal leadership training 
•   Formal education courses and programs 
•   Internal training courses

2. Feedback: strategies that facilitate self-examination and assessment and promote continuous growth through ongoing feedback and exposure to role models.
Feedback strategies that promote effective talent management include: 

•   360 degree (multi-rated) assessments 

•   Senior coaches 
•   Mentors outside the persons organisations unit 
•   A performance management system that provides ongoing feedback and appraisal for growth.

3. Retention Strategies: strategies that enhance workforce motivation, commitment and performance around mission accomplishment.
Retention strategies that promote effective talent management include: 

•   Quality of work/life programs 

  •   Telecommuting 
  •   Alternative work schedules 
  •   Child and elder care 
  •   Fitness and Wellness Programs 

•   Recruitment bonuses

•   Retention incentives 
•   Recognition systems 
•   Creating 'best place of work' strategies

4. Recruitment Strategies: strategies that strengthen the ability of the organisation to acquire the best-qualified leadership talent.
Recruitment strategies that promote effective talent management include:   

• Recruitment bonuses

• Recruitment incentives
• Relocation bonuses
• Branding
• Special hiring programs like the Management Fellows Program in the USA
  

   

Business angels stay close to home

Raising capital when you have a great business idea is sometimes closer to home than you think

"Brick" was a movie which struggled to get to production. The script was written back in the late 1990's. Accessing funds when you are just out of film school and unknown isn't easy. So says Rian Johnson it's writer and director. "The first draft of Brick, was written on a Mac SE on the poo coloured carpeted floor of a cramped Santa Monica apartment during a summer of post collegiate unemployment in 1996".

This seems a long stretch from winning the Special Jury Prize for Originality of Vision at the 2005 Sundance Film Festival and being nominated at the Independent Spirit Award 2006 for the John Cassavetes Award (best film production with a budget under USD 500,000). 

Johnson says the reason for the length of the journey was a simple matter; a conspicious lack of money. In the end he simply resorted to family and friends to bankroll production of the movie.

Until recent times there were few options for the eager startup, who was hungry for seed capital. It was either family and friends or venture capital (VC) funds.  Only in the 90's did 'business angels' arrive and establish a presence.

Who and what typifies a 'business angel'?

One of the interesting characteristics of business angels, which research has recently hightlighted in the USA, is that they prefer to invest close to home. Not just in terms of their business experience and background, but also in terms of geography.  Professor Jeffrey Sohl's comments on this item, stating that typically it was  "Within half a day's travel time. It's a very regional phenomenon."

Within Australia a similar travel constraint would allow for domestic flights to all our major cities. No impediment at all.   Does that suggest that our local 'business angels' are continually touring our marketplace keeping across their investments? I would say not.  Most angels prefer to invest  just down the road, where their involvement if not physically, is at least mentally and emotionally 'hands-on'. A convenient drive would be nice.

Do angels typically get involved 'hands-on'? Jeffrey Sohl would say, "No!". They aren't involved operationally. They are often successful entrepreneurs, who have cashed out of their own businesses. They actively maintain their informal network of contacts and filter opportunities and piftalls amongst close and trusted associates.  In terms of the investment landscape they operate with less formality and generally fit into the investment spectrum beneath and sometimes alongside the established VC companies in the same market.

Had Rian Johnson been able to hunt down some local Santa Monica 'angels', his start-up capital requirements would have nicely fitted their band of available funds. Jeffrey Sohl's findings have shown that business angels typically invest between the range of US$100,000 - US$1million. Where the average investment is in the order of $300,000-$400,000. It is above this level where the established VC companies get involved and often at a later phase in the life-stage of the business. The larger VC funds being available where more certain and shorter term returns are on offer. Such businesses have typically progressed beyond the adolescent lifestage.

Australia isn't exactly brimming with venture capital, but neither is it bereft.  So what strategies can local entrepreneurs adopt?

1. Assess your need and objective.  Is someone else expected to finance your weakness. Or do you have a well developed and objectively vetted growth strategy.

2. Do you have a proper perspective on the lifestage and growth challenges your business faces. And do you involve third party input to your management and operations. Either formally or informally.

3. Have you established your local credentials? Are you available and involved with your local community? There are numerous ways and means of developing a local profile. But a lack of involvement suggests a naive appreciation of your business's impact on it's local economy and marketplace.

4. Have you taken the initiative to 'connect' with other entrepreneurs and investors within and without your industry, whose association and network you actively cultivate?

5. Do you consider yourself a lifelong learner. Are you a reader? And are you actively pursuing a personal/professional development strategy?

It's healthy to accept that investors are buying you as much as they are buying your business opportunity at the evaluation stage. This odes well for the more considered, reflective and passionate business owner and less for the opportunist whose style could be considered perhaps a little too cavalier.

Jeffrey Sohl is the director, Center for Venture Research, Professor of Business Administration Whittemore School of Business and Economics, University of New Hampshire. A leading authority on 'business angel and venture capital' investments. David Forman who is a key contributor to The Australian Business Foundation website, recently met with Jeffrey Sohl to discuss the role of business angels with fast growth business startups. This conversation titled "An audience with Professor Jeffrey Sohl" is featured on the website.

Don't walk out that door...please!

When difficult and necessary conversations get postponed and important issues remain unresolved

In a past life I was employed by an international recruitment agency. My initial role was to develop a consulting service around a battery of psychometric assessments. I found I spent 6 months understanding exactly what the assessments were, then the next two and a half years explaining to corporate clients what they were not. None-the-less the work was fascinating and 10 years on the results for individuals almost prophetic.

At this time in Australia both finding and keeping staff is problematic for SME's. Particular those staff who are valued and skilled members of the enterprise! Commonly clients and colleagues share their concerns and insecurities in this regard. "If I am too honest" they say, "and bring them to account too abruptly, then I risk them simply walking out the door. Something too painful to contemplate." The consequence is that difficult and necessary conversations are postponed and important issues remain unresolved.

One remedy is leveraging the services of a trusted third party individual. Either to gain fresh perspective or gather new ideas to apply to the situation. Or further, to introduce this third party into the process directly.

Business owners always value perspective, and maintaining informal relationships with advisor's, in order to talk sensitive matters over can be of great value.

Such advisers come with their own private set of people processes and tools they have grown to trust and value over time. e.g. personal inventories, team activities and appropriate psychometrics. These aids are typically quick and easy to administer. But should never be used flippantly or as a quick fix. If their hasn't been adequate  thought and sensitivity involved, it can appear to staff as nothing other than intrusive and abrasive.

Before involving advisers directly into the organisation, business owners need to exercise caution. Particularly assessing the advisers orientation and approach. Are they client focused or self focused. Are their methods rigid or flexible. Do they have the motivation to learn your need, culture and background adequately before they propose a solution to adopt.

Collaboration and engagement by staff is vital. Individuals who are active participants in any activity have better ownership in the outcomes of that activity.

These outcomes usually occur in the form of written reports or personal notes. Reports and notes taken often add new words and fresh vocabulary. Which can further assist in negotiating sensitive issues.

When to cut your advisors loose

"Professional demarcation can and often does result in financial planners, accountants and lawyers’ not being aware of what each other is advising"

A family or companies trusted professional advisors are vital for the growth and dispersal of property and business assets in contemporary life. The nature of our rapidly evolving regulatory environment and changing tax laws create this need. This makes it more essential than ever, to enlist the advice of those who make it their livelihood to specialize and remain up to date.

However it is common experience to find that crucial strategic planning decisions are often made inadvertently, as felt needs dictate. Such decisions can have big consequences over time. These decisions include the choice of financial products such as superannuation and insurance as well as the ownership structures chosen for business and investment assets, the protection of assets and the minimization of tax.

Despite this, when might it be helpful to cut your Solicitor, Accountant and Financial Planner loose and delete them from your Christmas card list? Under what circumstances might individuals or company’s consider them counter productive?

Strategic planning is by nature both big picture and proactive. It does not work well where it is limited by professional demarcation, or the strategic initiative in the relationship rests with the client. Unfortunately for clients, coordinated advice is difficult to access, except in the top end of town. Something small to medium sized business owners can rarely entertain. Likewise suburban professionals are limited where they rarely meet clients at the clients premises and are tightly bound to stay within their professional area of advice by industry code of practice. This can and often does result in accountants, financial planners and lawyers’ not being aware of what each other is advising.

Boutique consultancies are now appearing to meet this need. This is partly the result of technologies which allow collaboration between all parties. Individuals with project management experience who are experts in consulting and client services, will often work ‘client side’, and get more involved with ensuring that implementation of the action items does happen on a coordinated and proactive basis. It’s permits a more dynamic liaison where the client and professional advisors all share the same web-based password protected project site. This becomes a common planning and communication centre for the duration of a particular project. e.g. succession planning.

Its main benefit being that group collaboration ensures that all parties know ‘who has the ball’ at any point in time. Operating this way provides high quality outcomes in a much shorter time frame. This in turn leads to significantly greater levels of client and professional satisfaction.