Recession Survival - How to Outrun a Tsunami

March 12, 2009 — Facing the most destructive economic climate in decades, America's C-level executives are using a variety of standard-issue business strategies to steer their companies through the recession. Some have immediately turned to layoffs to reduce costs, some are trying to restructure debt, and others are utilizing pay cuts and hiring freezes to keep their businesses afloat.

Many, however, are unable to take decisive action, hampered by panicked shareholders and board members. One CEO was recently heard to say, "We're all looking at this huge tsunami heading straight for us, and it's so big and moving so fast that their attitude is 'There's no point even putting on waders.'"

Yet in the midst of all these actions and reactions, there is one management tool that many CEOs have overlooked during this financial crisis: operational improvement.

In essence, operational improvement (or process reengineering) is an activity that intensively focuses on the processes and systems of a business (production, supply chain, sales, cost control and capital expenditures) to examine opportunities for removing those elements that do not add value, or ones that create unnecessary cost. It isn't about strategy, capital expenditure or IT; it's about the human element of business processes and their improvement.

The benefits of such reengineering efforts are immediately apparent: wasted activity is reduced, productivity is increased, employee performance is enhanced. But, most importantly, the process releases working capital and can drastically improve a company's EBITDA figures.

The Need for Speed

This concept is well established in the Total Quality Movement from the 1990s and in current methodologies such as Lean, Kaizen and Six Sigma. CEOs usually hire firms of management consultants to help them develop such a program. More ambitious chief executives form internal "operational excellence" teams in an attempt to drive operational improvements using their own people.

So why is such a proven business improvement methodology being overlooked now?

According to Doug Wano, U.S. president of Proudfoot Consulting, the conventional forms of process improvement programs all lack one crucial element for being able to help a business survive the recession — speed of installation. "The problem is," says Wano, "CEOs can't afford to wait around for two years until the company's operational excellence program delivers the tangible cost savings it promised. They need operational improvements to deliver P&L results now!"

So how does a CEO add speed to process improvement programs? What's the missing ingredient? Wano continues: "The secret is in the execution. CEOs need to hire consultants who have a proven track record of frontline implementation of the process improvements they recommend. It isn't enough to write a big report recommending a list of business improvements, then walking away. Successful and accelerated process improvement only happens when the consultant sticks around to work side-by-side with the workers to embed the new behaviors. That's a pretty rare skills set. Not many consultancy firms can deliver on that requirement."

Wano adds that companies can release working capital and enhance their EBITDA within three to four months using this intensely focused approach to process improvement.

Utilizing process improvements as a tool to release working capital and improve productivity is a concept echoed by Jerry Jasinowski, former CEO of the National Association of Manufacturers. Jasinowski says: "Protection of the balance sheet by focusing on cash requires firms to reduce working capital and cut back on excess inventories quickly and dramatically. It's kind of a bridge to the process improvement points. Difficult economic times provide an opportunity for accelerating process improvement activities."

Bottom Line for CEOs?

Get back to basics by taking a deep dive through every aspect of your business operations: sales, marketing, customer service, supply chain, manufacturing, transportation and energy usage. Bring in a specialist, either internal or through the services of an operational consulting firm. Listen to what they say and take a long, hard look at the potential financial and productivity benefits they present.

But don't "green-light" the project until the consultants can prove that they are going to put "boots on the ground" and work alongside your frontline supervisors and employees day after day to embed the behavioral change necessary to deliver sustainable process improvement. And they need to show that their implementation will accelerate the delivery of real financial benefits in months, not years.

Concludes Wano: "That accelerated pace of delivery is now more crucial than ever. The recession is here, it's real, and its true scale is only now being realized. CEOs must choose to act, and choose a course of action that brings real cash benefits in the shortest possible time. Accelerated operational improvement offers CEOs a way to fight back and not only survive this recession, but better position their companies for the economic upturn."

(By Farzad Keshvargar)
Farzad Keshvargar is an executive vice president for Proudfoot consulting, an Atlanta provider of operational management consulting.

Overcome obstacles to sales by building customers' trust

In a recent article, corporate trainer Zig Ziglar wrote, “Every sale has five basic obstacles: no need, no money, no hurry, no desire, no trust.”

He goes on to explain that as business owners, while you can’t control the lack of need, money, urgency or desire, the one thing you can control is trust.

We can all agree that in recent months there has been a loss of trust in business – all you have to do is skim the newspaper headlines to see that.

In fact Edelman, the world’s largest independent public relations firm just released its 10th annual Trust Barometer for 2009. Not surprisingly, trust in U.S. business is the lowest it has ever been in Edelman’s tracking history - at 38 percent compared to 58 percent a year ago. It’s lower now that it was in the wake of Enron and the dot-com bust.

The study, which can be accessed at www.edelman.com/trust/2009, only confirms the wisdom that Ziglar imparts - trust affects consumer spending. Here’s a quick glimpse at some of the findings:

• “In the past year, 91 percent of 25-to-64-year-olds around the world indicated they bought a product or service from a company they trusted, and 77 percent refused to buy a product or service from a company they didn’t trust.

• Trust is one of the most important factors in determining a company’s reputation. It ranks just below quality of products and treatment of employees.

Likewise, in the first ever BBB/Gallup Trust in Business Index survey commissioned recently by Better Business Bureau, nearly one in five respondents said their trust in the businesses they regularly deal with has decreased in the last 12 months. Our national statistics support this trend. For the past five years the number of consumers both inquiring and complaining to BBB has steadily risen.

So if customer trust is something companies can control, why is it declining? And more importantly as a business owner, what can you do about it?

Define trust as it relates to your company. What does trust mean to you and how does it relate to your mission? What does it mean to your customers? Employees? Once you have a definition, live by it. It doesn’t work if you say your business is trustworthy. You have to act on it.

Below are the Standards for Trust that all BBB supporting businesses agree to uphold as a condition of their membership. If you’re not a member, consider pulling from them to develop your own internal standards. If you are accredited by BBB, now would be the time to let the world — or at least your potential customers — know these are the standards you uphold.

BBB Standards for Trust

• Build Trust: Establish and maintain a positive track record in the marketplace.

• Advertise Honestly: Adhere to established standards of advertising and selling.

• Tell the Truth: Honestly represent products and services, including clear and adequate disclosures of all material terms.

• Be Transparent: Openly identify the nature, location, and ownership of the business, and clearly disclose all policies, guarantees and procedures that bear on a customer’s decision to buy.

• Honor Promises: Abide by all written agreements and verbal presentations.

• Be Responsive: Address marketplace disputes quickly, professionally, and in good faith.

• Safeguard Privacy: Protect any data collected against mishandling and fraud, collect personal information only as needed, and respect the preferences of consumers regarding the use of their information.

• Embody Integrity: Approach all business dealings, marketplace transactions and commitments with integrity.

“Trust affects the quality of every relationship, every communication, every effort in which we are engaged … by behaving in ways that build trust with one, you build trust with many.” - Stephen M.R. Covey.

(Better Business Bureau of Southern Arizona)

Speaking Up Your Mind - Without Fear

Venezuela's President Hugo Chavez's speech at the United Nations General Assembly.

Who is the most influential & successful person in history?

Who is the most the world's most influential and successful person?

The Meaning of Positive Thinking - Dr. Alex Pattakos

Ultimately, we all have the freedom to choose our attitude towards all of life's situations, no matter what.

> http://alfalahconsulting.com/

SWOT Analysis: How to perform one for your organization

Erica Olsen from details how and why you should perform a SWOT analysis as part of your organization's strategic plan.

Attitude of Positive Self Esteem

Affirmation - Attitude of Positive Self Esteem

Jalini on Ingredients for Success - part 1/2

Jalini's talk on RTM 2's Morning Glory program, giving tips and pointers on defining and achieving success for yourself.

Jalini on Ingredients for Success - part 2/2

Jalini's talk on RTM 2's Morning Glory program, giving tips and pointers on defining and achieving success for yourself.

The Power Of Belief - Anthony Robbins

Powerful Affirmations

Affirmations are positive sentences that describe a desired situation, and which are repeated many times, in order to impress the subconscious mind and trigger it into positive action. In order to ensure the effectiveness of the affirmations, they have to be repeated with attention, conviction, interest and desire.

Imagine that you are swimming with your friends in a swimming pool. They swim fifteen rounds, something you have never done before. As you desire the respect of your friends, you want to show them that you can make it too. You start swimming, and at the same time keep repeating in your mind: "I can do it, I can do it...". You keep thinking and believing that you are going to complete the fifteen rounds. What are you actually doing? You are repeating positive affirmations.

More than often, people repeat in their minds negative sentences and statements concerning the situations and events in their lives, and consequently bring upon themselves undesirable situations. Such sentences and statements work both ways, to build or destroy. It is the way we use them that determines whether they are going to bring good or harmful results.

Affirmations work in the same manner as creative visualization. The repeated words build mental images and scenes in the mind, and help to focus on the aim, object or situation one wants to achieve or create. Frequent repetitions affect the subconscious mind, which in turn reshapes and affects the way one thinks, acts and behaves.

The conscious mind, the mind you think with, starts this process, and then the subconscious mind takes charge. This means that the most frequent thoughts that pass through your mind, ultimately affect your life and your destiny.

Affirmations work like commands that are given to a computer. They influence us, other people, events and circumstances. It might seem strange to you, but they do also influence the people we meet, our circumstances and the events we encounter.

Sometimes they work fast, but more often they need time. Repeating positive affirmations a few minutes, and then thinking negatively, neutralizes the effects of the positive words. You have to refuse negative thoughts, otherwise you will not attain positive results.

We mentally repeat negative statements, without even being aware of the process. We use them when we tell ourselves that we cannot do something, that we are too lazy, or when we believe we are going to fail. The subconscious mind always accepts and follows what we tell it, whether it is good or bad for us, so why not choose only positive statements?

How to Repeat Affirmations
It is advisable to repeat affirmations that are not too long, as they are easier to remember. You can repeat them anytime your mind is not engaged in something in particular, such as while traveling in a bus or a train, waiting in line, walking etc, but do not affirm while driving or crossing a street. You may also repeat them in special sessions of about ten minutes each, several times a day.

There should be no physical, emotional or mental tension while repeating them. The stronger the concentration, the more faith you have in what you are doing, the more feelings you put into the act, the stronger and faster will be the results.

It is very important to choose only positive affirmations. If for example you desire to lose weight, do not say, "I am not fat, I am losing weight." By saying this sentence you are repeating to your subconscious mind that you are fat. The word "losing" also evokes negative images. It is better to say, "My body has an athletic form, and weighs the right and healthy weight". Such words evoke positive images in the mind.

It is important to affirm in the present tense, not the future tense. Saying: "I will be rich", means that you intend to be rich one day, in the indefinite future. You are actually telling yourself that some day you will be rich, never now. It is better and more effective to say, and also feel, "I am rich now", and the subconscious mind will work overtime to make this happen now, in the present.

As to results, sometimes they may come fast, and at other times might take more time to manifest. Getting results depends on how much time, energy, faith and feelings you invest in repeating your affirmations, on the strength of your desire and on how big or small is your goal.

By using the power of affirmations you state what you want to be true in your life. You see reality, as you want it to be. For a while, you ignore your current circumstances and your doubts, and concentrate on a different reality.

Motivation at Work - how to increase workplace motivation

Motivation at work. People don't get passionate about shareholder value or business profits or excel spreadsheets. They get passionate and motivated about challenge, great teams, vision, important goals, having fun, about family and friends, about the community and world they live in. How to make things happen in Business. Connect with passion, keys to motivation, leadership and change management in business. Managing uncertainty with rapid change. Leadership styles. Why people get out of bed in the morning. How to motivate teams at work to do great things. Business management. Secret of leadership and ultimate leadership speech. Business ethics and values in corporations. Secrets of business success and increased productivity. Cutting costs. Increasing output. Adding shareholder value. Sustainable business success. Work life balance and lessons from non profits / volunteering. Why building a better world is such a powerful motivation. Lecture by Dr Patrick Dixon for MTN, author of Building a Better Business.

Future Conferencing - Patrick Dixon