Focus, Focus, Focus!

It’s been said that managers do things right and leaders do the right things.  The former is about efficiency the latter is about effectiveness.  It is easy to be busy but hard to work on the right things.  Leaders must focus on doing the right things -- those things that matter most to the success of the company.  In short, effective leaders must drive the focus of the organization.  Leaders must channel the time, talent, energy, and resources of the organization on tackling key priorities and goals.  Owners must ask constantly, “What’s Important Now (WIN)?”

In today’s fast-paced, technology connected world, it’s easy for people to lose track of what is most important to the enterprise.  They get so caught up in the day-to-day minutia and distractions (email, voice-mail, cell phones, PDAs, etc.) that they must be re-directed, re-focused, re-oriented continually.  Owners need to rein in their employees’ focus.  Do not let your employees waste energy, time, talent, and resources on trivial matters; keep them focused on the company’s vision and its mission-critical priorities. 

To help you manage the attention and concentration of your team, consider focusing them on six primary areas: 

Satisfying your customers/clients

Getting results, not excuses

Improving continuously (innovation)

Maintaining profits

Keeping a long-term perspective

Having fun

1) Focus on satisfying your customers

Your company’s primary focus should be squarely on exceeding the expectations of your customers/clients.  Begin to establish a culture whereby your team falls in love with your customers and their needs/wants and not your own company’s products or services.  You are in business to attract, delight and retain customers in a profitable manner – period.  The real value of your business is tied directly to the future, predictable cash flow from your highly satisfied and loyal customers.  Without customers, you do not have a business.

Again, your focus should be on your customers and solving their needs and wants.  It should not be about your company or your services and products.  Teach your employees to value your customers, serve them well, and sniff out any customer problems or complaints.  Keep your customers delighted and coming back for more!  As leader, have the courage to create an environment in which the customer is your enterprise’s primary focus.

As CEO, set the tone by visiting regularly the top 20% of your customers and keeping them satisfied.  Find out what is on their minds.  Aside from creating clarity of direction for your business, there is no better use of your time and talents.

2) Focus on getting results

Next, focus your team on achieving results for your company.  Establish the climate whereby activity is not confused with accomplishment.  Where thinking and planning are admired.  Where actual results are valued more than busyness.  Where effectiveness (doing the right things) is rewarded more than efficiency (doing things right).  Insist on intelligent, meaningful action and detest procrastination (paralysis-by-analysis) and excuses.  As a leader, one of the most important jobs you have is to establish a goal-oriented environment with a solid expectation of performance.  Insist on results; do not tolerate excuses.

3) Focus on continual improvement

After satisfying customers and insisting on results, the next focus area should be on continuous improvement.  If your company is not improving, it is declining.  If you aren’t getting better, your competitors may well be.  Therefore, establish a climate where continuous improvement and innovation thrive.  Do not let your employees fear failure or making mistakes.  Just eliminate repeated mistakes.  Failure is not fatal, but failing to change might be.

As CEO, you must drive out fear from your organization.  If your company is not failing occasionally, either your goals are too low or your rate of innovation is too slow.  Have your employees adopt the attitude that failure is not painful or shameful.  Failure is merely valuable feedback on what not to do next time.  Failure is fertilizer for future success.  Failure is an incredible gift if properly viewed and used.   If we are moving closer to our goals, we are winning.  The quicker we fail and modify our approach, the quicker we get to our desired outcome.

Insist that your employees continually improve what they do and how they do it.  Focus them on thinking about how to improve their roles, responsibilities, and contribution to the cause.  Have them also improve your systems and processes.  Remind them, “Good enough never is”.  Refer back to the theory of optimization for powerful questions to ask yourself and your team.

Encourage employees to try new things.  Experiment, experiment, experiment!  Insist that “we can always do better – let’s find the way”!  Take small steps to test ideas and learn more in the process.  If something works better, keep it.  If it doesn’t, lose it.  Know when to cut your losses.  Admit mistakes and let go of failed ideas fast.  Fail fast, fail cheap.   Keep your ego in check.

Once a week, facilitate a one-hour business improvement workshop.  Release the brainpower of your organization.  For every good idea surfaced, assign a champion, due date, and key action steps to take.  Good ideas not fully implemented are worthless.  Reward employees for successfully implementing ideas that increase revenues, cut costs, improve operations or morale, or improve customer satisfaction.

Also, encourage healthy debate amongst your team.  Allow everyone, in a constructive manner, to challenge ideas, policies and strategies.  Even allow for productive and constructive conflict.  When ideas are put to the test, they improve.

4) Focus on profits

Next, focus on growing your revenues and most importantly, your profits.  Focus on both top line and bottom line growth.  Focusing only on revenue growth is ego-driven and not too smart.  Cash flow and profits are your lifeblood.  Keep your gross margins strong. 

Also, while cost containment is important to the health of your company, do not over-emphasize slashing costs.  Stay on the offensive, not the defensive.  Revenue growth is nearly endless, cost cutting is limited – you can only cut so much before you do real damage. Some costs are really strategic investments in the future of your business (new equipment, advertising, training & development, etc.)

Give yourself a blessing.  Hire the best CPA you can afford and one that not only understands numbers well, but the issues we are discussing in this book.  An entrepreneurial-oriented CPA that understands the needs of a growing business and owner is invaluable – worth the premium!

5) Focus on the long-term

After profits, focus everyone on the fact that you are in business for the long haul.  Do not be short-term oriented.  Business is a marathon, not a sprint.  Do what is right, always.  Maintain the highest integrity and ethics.  Your reputation is everything.  Business is about sustaining lifelong relationships with customers, employees, investors, suppliers, advisers, etc.  Repeat business is absolutely critical to the very life force of your company.  Do not take shortcuts. 

To help with this concept, consider the Lifetime Value of your customers.  On average, how much profit does a typical customer provide you over the average service life (# of years) of such a customer?  For example, if a typical company buys from you several times a year, yielding you a total annual profit of $1,000, and you generally retain such a customer for 5 years, the Lifetime Value for a typical customer is $5,000.  Stated another way, every time you attract a new customer and serve them well, odds are that customer will be worth $5,000 to your business over time.

Once you know this number, you and your employees should think twice about upsetting and/or losing a customer.  This Lifetime Value also validates that you should spend money (acquisition cost) to attract new customers.  As long as you break-even on acquiring a customer and know with certainty that there is considerable back-end/repeat business, it makes sense to spend money on marketing/selling.  Invest a little to make a lot!  That’s leverage.

6) Focus on having fun

And lastly, focus on making business fun.  Celebrate worthwhile progress toward your goals.  Celebrate your company’s successes often and reward your employees for superior performance.  Come up with excuses to praise your team and recognize success.  Share the joy.  Make coming to work a meaningful and fulfilling event.  In fact, appoint a CFO (Chief Fun Officer).  Empower this person to come up with clever ideas, based on employee feedback, which will put some excitement and fun into the work environment.

Never forget, often as important as a paycheck, good employees want to learn and grow, be challenged and rewarded, and fulfill their cravings to be social beings.  Make your culture an enjoyable place to work.