Fun in Business

Or why business doesn’t have to be like playing a game of ‘Whack the Mole’

Let me paint a picture for you… See if you recognise any of it:

Running your business is like playing a game of “Whack the Mole” you never know what is about to pop up next and where.

whack-a-mole You run around from crises to crises all day long, extinguishing brushfires along the way. And while you are dealing with the crises, you don’t get to all the business development priorities you know you should get to, marketing, sales, financial management, staff management, planning etc.

A switched-on Business Owner

It’s not that you don’t know what you should be focused on as a responsible, switched-on business owner, but:

1) You don’t have any time left to spend on any of those aspects of business.

2) When you do magically find some spare time, you don’t feel confident to decide which of all those priorities is the most important.

3) And even if you did know what to focus on next and you had the time… you actually feel quite insecure that you know how to do a good job at it anyway… It’s not as if you completed an MBA … nobody ever taught you how to write an operations manual did they?

So you run around from employee crisis, to client crisis, to supplier crisis, to compliance crisis to cash crisis and all the way back to the beginning again.

Your average Week

munch Have I just described your life as a business owner? Of course I have… The responsibilities that come with being a small business owner are daunting, it’s all down to you and you probably feel trapped in a state of Overwhelm a lot of the time in your business…

So let me tell you about Brian, who was one of my clients a couple of years ago and how Brian freed himself from being trapped and took his business from a single store to a healthy growing multi-store business in just 2 years.

The approach Brian and used is one I’ve used with many business owners over the years, because it is so simple and so effective and because the results have been astonishing … every time.

Brian’s Car Accessories

Brian was a client of mine who owned a car accessories business in Sydney.Brian’s business had slowly plateaued over the past couple of years and Brian was frustrated that he couldn’t seem to push the business ahead any further anymore.

Competing priorities

Brian’s head was exploding with all the different competing priorities that were screaming for his attention every day. All the challenges of managing inventories to cashflow, staff, marketing, systems etc etc
Brian simply didn’t know where to look and where to direct his focus.

Scale

Working with me Brian created a “Fun in Business” scale. A scale from 0 to 10, where 10 on the scale meant that he had had as much fun in his business as he could possibly have and 0 meant the opposite.

fun-o-meter Every week in our sessions, Brian would ask himself 3 questions:
1) How much Fun did I have last week on the “Fun in Business” scale

2) On the same scale, how much “Fun in Business” do I want to have next week?

3) What specific things must I do, what specific actions can I take this coming week to ensure I achieve that number on my scale?

Cashflow… staff training

One week, Brian reported that he was at 6 and wanted to get to 6.1 on his Fun in Business Scale and he decided to spend 1 hr in the coming week chasing up outstanding accounts to increase his bank balance and cashflow and hence to have more Fun in Business.

Another week Brian realized that the greatest opportunity to increase the fun number on his Scale would be to deliver some much needed training in the area of customer service to his staff etc etc.

Growth again

After a few months of this approach to managing his business, Brian’s business did start to grow again… slowly, steadily, month by month… quarter after quarter.

Now a few years later, Brian’s has opened a second store and warehouse on the other side of Sydney and when I last spoke to Brian he was looking for a site for his third store.

Lessons from Brian

That is the story of Brian… It may seem odd, that I got Brian to focus on Fun in Business instead of ‘Profit’ or ‘Systems’ or ‘Cash-flow’ or ‘Staff retention’ or ‘Customer satisfaction’ and other business concepts like that, but you see… Fun in Business is actually an incredibly simple yet powerful concept that has the potential to transform your business.

fun-is-good-dr-seuss Because when your business is Fun:
• It means everything is working.
• It means you are making money.
• It means you’ve got cash in the bank.
• It means you are proud of the output of your business.
• It means your customers love you.
• It means that your staff are highly engaged
• It means that you have the balance in your life you want.

A little more fun next week

So asking yourself how you can have a little bit more Fun next week, will help you focus on the most important aspect of your business to focus on next, while using the “Fun in Business Scale” will help you find the next simple steps rather than getting Daunted and Frustrated by the enormity of the tasks before you.

As I said before, I have used this approach with many clients in the past and I use it myself all the time of course. It is surprisingly simple… all it takes is to put 5 minutes aside for it every week at the same time.

So… get yourself a special little notebook and label it your Fun In Business Book, set the time aside and ask yourself these three questions every week; How much Fun in Business did I have last week? How much Fun in business do I want to have next week? and what simple small action can I commit to taking next week to move me along the scale to where I want to be?

If you do this every week and you commit to taking the small, simple actions that result from the third question…
Your business and your life will never be the same again.
(And the mole can take a break too)
I promise you.

For more information about to how to step out of overwhelm, get unstuck and start having Fun in Business again, click here

 

About the author

Roland Hanekroot is a business coach and the founder of New Perspectives Business Coaching. He is also the author of the acclaimed “The Ten Truths” books for business owners. Roland runs a webinar called “The Small Business Masterminds” every month, on the 10 key aspects of business that all business owners face when developing and growing their businesses. First time is free, normally $99. Book in here.

If you enjoyed this article click here to get a copy of one of “The Ten Truths” books for business owners for free.

Masterminds observations… Love over Hate

Love over Hate

Love over Hate Business Masterminds Observations

 

The illusion of “The Power of One”

I am reading “Love over Hate, finding life by the wayside” link to the book by Graham Long, pastor and CEO of the Wayside Chapel in Sydney .This is a passage that stood out for me particularly:

“The idea that the basic human unit is a solitary individual is the established orthodoxy of the Western World. It’s an illusion and an attractive one at that, often presenting itself as “The power of one”. The power of this illusion is in its promise to an insecure individual that a dream and some willpower is all that is required to overcome life’s obstacles. It promises an individual can triumph over adversity as well as any competitors who get in the way of the prize of justice, fame, wealth or whatever other virtue is implied by the dream.”

It’s all upside down

What this says to me amongst many other things is that we (and I include myself firmly in that “we”) have got it all wrong. The library of work in books, blogs, seminars, videos and everything else by the gurus of the business growth, as well as personal development world repeat the refrain of the Power of the individual and that “The answer is within”… even in the world of religion we hear “The Kindom of God is within”… All of that is nonsense.

To me, that paragraph and the rest of the book and several other books I have been reading in the last year, have convinced me that I have to throw out the rule book, and start again… let me know what you think!

The First Steps to Sound Financial Management of Your Business


the simple steps cogs First Steps to Sound Financial Management of your business

©by Roland Hanekroot, New Perspectives Coaching 2013

success and failure

What does it take to make a success of your small business… how can you avoid adding to those frightening statistics about failure rates of small business.

In this series of articles and associated webinars by the authors of “The Simple Steps for Business Program” you will be introduced to the basic concepts and knowledge that will set you up to become a successful ‘Business-Owner’, as opposed to a struggling ‘Business-Doer’.

Format

The format of each episode in the “First Steps” series is to explain the basics of the topic and then in line with the principles of “The Simple Steps for Business” program, to suggest some “First Steps” you can take straight away to put the knowledge into action.

In the first of these articles we’ll look at Financial Management: What do you need to know and how do you need to apply that knowledge to put your business on a solid financial footing?

3 Principles

There are 3 principles you need to understand to manage the finances of a business well:

1)    Why do we need to make profit?

2)    Profit and cash are not the same thing at all and they don’t even have a direct relationship between each other.

3)    Cash is what you must worry about all the time… not profit

Why Profit?

profitLet’s address the principle about Profit first. The first thing to understand about profit is that it is not the purpose of business. Profit is a vital component of business, but it isn’t the reason the business exists. The Purpose of your business must be something much more important and something your customers actually care about. (More about this idea in the article about Purpose and Vision)

The 3 Functions of Profit

Profit has 3 functions:

1)    To pay investors and stake holders in a business a return on their investment.

2)    To provide the business with funds to invest in itself to grow or develop the business.

3)    As the thing by which we measure how well we are doing in running the business.

The first function is straight forward, if someone invests $100 or an hour’s work into a venture, that person wants to see a return for that investment. That return can only be payed out of the profits of the business.

The second function is also straight forward, in that, if you want to buy a new machine or tool or vehicle for your business you need to have the money to pay for that. Profit is what provides that money. (You can borrow for that purchase of course, but then the purchase is effectively made out of future profits)

The third function is about this: How do we know if our business is going well or not so well? The only clear method to answer that question is to keep track at the financial numbers and profit is the most important of those.

The Simple Steps for Business … First steps:

As mentioned in the opening paragraphs of this article, we will suggest some “First Steps” actions you can take right away, that will get you started on implementing the topics and principles we discuss:

1)    Have a look at a great blog post on the Times of London about the importance of profit in business follow this link to the resources page for this topic

2)    If you are not already doing so, start by paying yourself a regular “wage”. A weekly or monthly amount you can live on as a minimum, and record this wage in your books as an expense to the business. You may decide to invest this money back into the business if you don’t need it to live on, but by paying yourself such a wage you will gain a more accurate insight into the profitability of the business and you will start to see how much money you are actually investing into the business and therefore should get a “return” on in the future.

3)    Start a proper bookkeeping program (Xero, MYOB, Quickbooks, Saasu, Freshbooks) and ensure it gets kept up to date at least monthly.

Profit and Cash

The second principle about profit and cash is what brings a lot of small businesses unstuck. A large proportion of the businesses that make up the horrendous statistics on failures in small business do so because of a lack of understanding of this principle.

Profit is a simple sum (on paper) of sales minus costs. So if you sell stuff in a week for a $100 and it costs you $50 in raw materials that week and $25 in office costs, it means that you have made $25 profit that week.

Cash (your bank balance) bears little relation to those numbers in most cases. The $100 of stuff you have sold might not be paid for that week or even that month. You also might have had to pay for the raw materials some time previously and your office costs (staff and rent etc) may have to be paid every Friday. So that at the end of the week your bank account will actually be significantly in the red even though you’ve made a profit.

Cash Flow

river So cash needs to be calculated in a different and slightly more complicated manner than the simple profit and loss equation.

When thinking about cash it is useful to think in terms of flow… money flowing in and out of your account, like a river flowing into the sea. If it rains upstream in Queensland for example, it may take a month for the Darling River to start swelling downstream in South Australia. So when talking about cash we usually talk about cash flow…. Money flowing in and money flowing out. If more money flows into your bank account in a given period than flows out in that period, your bank account swells and vice versa.

The Simple Steps for Business … First steps:

1)    Read this article: “Profit is a liability”, about the difference between profit and cash-flow by Roland Hanekroot follow this link

2)    Here is an article in Inc. Magazine: “5 Ways to improve your cash-flow”. The article explains the long term strategies for improving your cash-flow dramatically. Read the article and ask yourself what steps you can apply in your business:follow this link

Cash is the main thing

cat And that brings us to the third principle that you need to understand about financial management of the business.

I said that the thing to worry about in your business is Cash and not Profit. For most people this is a counterintuitive statement.

The truth of this principle is actually much more straight-forward than you might think, because:

Only cash can be used to pay for stuff

Theoretically, your business may never make a profit and yet survive, as long as you continue to have enough cash to pay the bills, your staff, your raw materials, the rent etc. Obviously without making a profit, the business will ultimately run out of cash, but that can take years in some circumstances. So as a business owner who is committed to put his business on a solid financial footing, Cash-flow must always be your first concern.

The Simple Steps for Business … First steps:

1)    Article by Roland Hanekroot: “Cash-flow, the Basics”: follow this link

2) The 7 Big Questions: How to make more money and generate more cash

 3) Ask your accountant or bookkeeper for a simple cashflow spreadsheet and either start to use it yourself monthly or ask your bookkeeper to do so for you, you’ll be surprised how easy it is to start to get a handle on the cash flowing in and out of your bank account.

How to Measure Fun in Business

TTTMBF Fun-O-Meter

Roland Hanekroot In part 1 of this series of articles, I wrote about how 3 letters – FUN – are the most important thing to focus on in your business.

In part 2 of this series, I wrote about the 4 steps to take to create REAL FUN in your business.

So in this part – part 3 – I want to talk to you about how to keep track of how much fun we are having… how to measure the fun we are having in other words.

All of us business owners know that to be able to improve on something a process or a behaviour in a business (or anywhere for that matter) you need to start with measuring the outcome of the process, otherwise you are sailing blind.

There is an old saying in business: “If you can’t measure it, you can’t manage it”.

The problem with a concept such as fun is that most people believe you can’t measure fun… it is intangible, like happiness and sadness and all those emotion concepts.

But You Can Measure Fun

Quite accurately as a matter of fact.

Let me explain:

As human beings we are actually able to put measurements to all kinds of fuzzy notions. For example if I were to ask you to think of a scale between 0 and 10, where the number 10 on the scale means that you are the happiest you have ever been and can even imagine being and 0 means that you are the opposite… depressed.

fun-o-meter You would be able to give me an answer and depending on your mood and where you were and what kind of day you’ve been having and whether the hot girl you met the other day returned your text message you might say 6.

If I came back tomorrow and asked you the same question you might say 8.

Obviously these scores are not scientific numbers in the sense that being a 6 on a personal happiness scale is something a scientist can do much with, but we can be absolutely clear that when you gave an 8 on the scale after giving a 6 on the scale the day before that the 8 means you are feeling happier than you did the day before.

This is called relative scaling. Volumes are written about the process and concepts in several streams of psychology and it turns out that we can apply the concepts of relative scaling very effectively to business management.

Richard’s Weekly FUN Rating Scale

A client of mine with a graphic design business with 6 staff, let’s call him Richard, and I designed a simple a relative scaling system based on the concept of FUN in his business.

Every Friday afternoon, Richard asks his staff to give him an anonymous rating on a scale from 0 to 100 about how much FUN the week in business has been, with 100 being that the person feels the week in business has been as much FUN as it could be and 0 is that the week has been a disaster.

Richard adds his own FUN score to the weekly rating as well. And then he averages the ratings across all the numbers and comes up with a single FUN number.

Monday Morning Staff Meeting

On Monday mornings Richard has his company wide staff meeting and the team spends 15 to 20 minutes discussing why the FUN number has turned out the way it has last week and what they can do to get the number up some increments in the coming week.

I sat in on this staff meeting recently and the question was asked: “What can we do to move the “Fun number” up this coming week. A number of people suggested that what would be really good is if a big push could be made with one particular big project that was running over time. There was simply was too much stress in the office around that project at the moment.

So Richard decided to assign a couple of extra people to that project for the week, in order to get it to completion as quickly as possible.

Richard’s business is flourishing like never before and Richard credits this consistent, disciplined weekly focus on FUN as a business measurement tool as the basis for his team’s current success.

So that is how we can measure Fun and how we apply the whole idea of Fun as our primary KPI to our business.

In the fourth part of this series (June) I am going to run through a couple of examples and pull the whole thing together and get you on your way to start having some REAL FUN yourself.

Have a go…

In the mean time, I’d love you to start thinking about how to start measuring how much Fun you are having in your business… why don’t you call a staff meeting and discuss it… brainstorm it… see what people think?

You might be surprised how even a few conversations on these topics might start to introduce a little bit more fun in your business.

For more information about to how to step out of overwhelm, get unstuck and start having Fun in Business again, click here

5 Minutes of Fun in Business with Tom Poland

Interview of myself by Tom Poland from the B.O.M.B. The Business Owners Marketing Brief.

A quick 5 minute take on why focusing on having Fun in business is the most effective way to ensure that your business does everything it is meant to do, while actually having as much fun as you can have with your clothes on.

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More from Tom Poland at the Business Owners Marketing Brief here: www.8020Center.com/BOMB/