| Owners and executives must be leaders first and | | | | 4) Management in the Place of Leadership |
| managers second. As leaders our task is first | | | | So why is leadership so important in growing a |
| andforemost to be about doing the right things, and the | | | | business? Because leadership is about doing the |
| "seven deadly sins," should be on the top ofyour list as | | | | rightthings, management is about doing things right . In |
| leadership issues you are dealing with on a regular | | | | many ways, it is leadership that will grow yourbusiness |
| basis. Building a small business isone of the most | | | | from a sales and a stability perspective, and |
| rewarding, but risky ventures one could possibly | | | | management that will make, or keep itprofitable. Also, |
| venture into. Most papers on smallbusiness deal | | | | consider that the best companies focus ninety percent |
| primarily with financing and risk management, which are | | | | of their attention onexternal issues, not internally , |
| only symptoms of the realissues. Your bank account is | | | | leadership is primarily a focus on the external issues. |
| just the scorecard of how well you have developed | | | | 5) Poor or non-existent Systems |
| your leadershipskills relative to accomplishing the "right | | | | Most people think of computer systems when they |
| things." | | | | hear the word "system." But in the since it is usedhere |
| This paper will help you avoid many of the costly | | | | it means all systems, including the system you use for |
| pitfalls of operating a small business, assumingyou | | | | selecting the right employee, fordecision making within |
| heed the advice. Avoiding these pitfalls will in turn help | | | | a department and so on. One of the more telling |
| you to conserve cash, develop marketshare, increase | | | | statistics in this area isthe fact that ninety-four percent |
| sales, improve customer loyalty, increase employee | | | | of all task or project failures are system failures2. |
| retention and build efficienciesinto your operation. | | | | Some of themore common reasons for system failure |
| The "seven deadly sins" include 1) Poor or non-existent | | | | include: |
| business planning; 2) Lack of a strategicobjective; 3) | | | | - Islands of automation verses integrated systems |
| Lack of marketing strategies and tactics; 4) | | | | - Absent or non-existent policies, procedures and user |
| Management in the place of leadership; 5) | | | | manuals |
| Poor or non-existent systems; 6) Failure to utilize an | | | | - Poor training. |
| appropriate leadership style; 7) Care andfeeding of | | | | 6) Lack of Development of Leadership Style |
| sacred cows. Business owners and executives who | | | | Developing leadership ability has a lot to do with |
| do not understand them, do not haveexperience with | | | | understanding the type of leadership required |
| them and therefore do not appreciate their impact and | | | | atdifferent stages of your company's development. |
| significance often ignorethese critical leadership issues. | | | | There are at least six different leadership |
| Thirty-five years of building and operating small | | | | stylesidentified to be effective at different stages of a |
| businesses has taught me that most small | | | | company's development including; Visionary; |
| businessproblems are not money problems at all, and in | | | | Coaching; Affiliative; Democratic; Pacesetting; and |
| fact money is just an indicator that much deeperissues | | | | Commanding . Understanding which leadershipstyle to |
| are at play. Beware; the market is a wicked | | | | employ has been found to significantly increase the |
| taskmaster, these "seven deadly sins" are likesmall | | | | effectiveness, growth and heath of thecompanies in |
| doses of poison injected into your operation by the | | | | which leaders utilized multiple styles. Just as important |
| very marketplace you are trying toconquer, and they | | | | is the understanding of whata leaders personal profile |
| provide a slow painful death to the naive. | | | | is. Armed with these vital bits of information a leader is |
| Here are the "seven deadly sins" in order of priority. | | | | equipped topursue the right leadership style for the |
| 1) Poor Business Planning | | | | task at hand. |
| Most small businesses do not have even a summary | | | | 7) Care and Feeding of Sacred Cows |
| business plan, and of those that do, many arecookie | | | | I do not have a statistic on the amount of money, time |
| cutter business plans built with the help of a piece of | | | | and energy expended on the sacred cowslurking in |
| software. At a minimum a businessplan should have an | | | | American businesses, but it has to be staggering. This |
| executive summary; a company overview with | | | | list details some of the types ofsacred cows you can |
| company history and it's currentstatus; the companies | | | | look for in your business. |
| strategic objective; a description of the companies | | | | - The way we have always done it |
| products and services; alist of the companies | | | | - The product or service you keep pouring money into |
| intellectual properties including patents, copyrights, | | | | because you just know it will take offand be your |
| trademarks, processesand know-how; a market | | | | future, (these are almost never accompanied by |
| analysis; a competitive analysis, which includes | | | | market research or even a promotionalplan) |
| competitors and their marketposition, and their | | | | - Resistance to growth through change |
| strengths and weaknesses; a marketing plan, which | | | | - Idleness within the ranks, some experts believe ten |
| includes your marketingstrategy, product strategy, | | | | percent of the poorest performing peopleshould be let |
| sales strategy, and pricing strategy; your customer | | | | go each year to make room for people with fresh |
| service plan; salesprojections by product, in units, for at | | | | insights and ideas |
| least three years; and finally a set of financials | | | | - The company airplane, automobiles, and other perks, |
| whichinclude projected income and balance sheets | | | | which drain company recourses |
| with a Performa sales forecast. | | | | - The dead weight relatives and friends of the family |
| Here are some other important suggestions and facts | | | | who would be better off elsewhere, actas distractions, |
| related to business planning: | | | | and add nothing to your bottom line |
| - Less than a third of small business startups have a | | | | - The "expert" that no one can live with, who holds a |
| business plan | | | | noose around the companies neck in theform of some |
| - A business plan does not have to be incredibly | | | | expertise or an unwritten code of loyalty. |
| detailed for operational purposes | | | | You could call this business "101," however, most of the |
| - It should be a work in progress updated on a periodic | | | | issues developed in this paper are rarelytaught in |
| basis | | | | schools, much less heeded. These "seven deadly sins" |
| - Particular attention should be paid to the marketing | | | | can impede your company's ability tosuccessfully |
| plan | | | | navigate through the turbulent waters of business |
| - A business plan is part of the first fifteen percent of | | | | development. If you do not understandall the issues |
| the business development processwhich will assure | | | | summarized in this paper, do the research; find a |
| the last eight-five percent will go smoothly | | | | business advisor to help younavigate these storms , |
| - The executive summary should be written last, after | | | | you owe it to yourself, your business and the people |
| the rest of the plan is in view. | | | | who count on you. |
| 2) Lack of Strategic Objectives | | | | Conquering the devil in the details is what management |
| A business strategy is made up of carefully crafted | | | | is about, concurring the "seven deadly sinsof small |
| words making up templates, which in turn act asfilters | | | | business" is what leadership is all about. The beauty of |
| through which all planning, tactics and decisions are | | | | developing top-level leadershipskills is that there is no |
| passed through before implementation. | | | | downside, only opportunity for growth in both your |
| A strategic objective is therefore, a business strategy | | | | business and yourpersonal development. Leadership is |
| developed to guide an organization inmeeting business | | | | what the entrepreneurial spirit is all about. |
| objectives. A strategic objective is developed from the | | | | Develop your business plan, establish strategic |
| owner's vision, passion,core competencies and values | | | | objectives, establish marketing strategies andtactics, |
| for the business. Contact Emerald Business Services | | | | lead, build effective systems, utilize more than one |
| or go to ourwebsite for a worksheet you can use to | | | | leadership style and kill the sacredcows in your |
| develop these critical business development tools. | | | | business, it might be the only thing that keeps you and |
| 3) Lack of Marketing Strategies and Tactics | | | | your company from becominganother dreadful statistic. |
| Marketing strategies govern the development of | | | | 1. article "Most Entrepreneurs Start with . . . No |
| tactics, which in turn provide the actions itemscontained | | | | Business Plan" |
| within your planning process. The most important | | | | 2. Demming |
| aspect of your marketing plan is thedevelopment of | | | | 3. Peter Drucker |
| promotion strategies and tactics, which feed your | | | | 4. Allan Weiss |
| promotion planning and provide youwith sales | | | | 5. Goleman |
| forecasting data. The promotion plan should also detail | | | | 6. Keeping everything the same and expecting things |
| costs and anticipated unit volumeso you can set | | | | to change is at least one definition of insanity |
| priorities and provide sales forecasting data. | | | | 7. |