Tag Archives: employees

John, The beauty of this article is its simplicity. Rule #3 is of particular interest to me because I recommend another simple tactic that helps in identifying the priority of actions to improve the generation of profit. I am referring to the 80/20 Pareto Principle that approximates to “80% of your profit comes from 20% of your customers” or “80% of your costs come from 20% of your operations.” This is an oversimplification but applying the thought process across a company does reveal where to apply resources. Richard Koch’s book The 80/20 Principle is the reference work on the subject.
Another comment is more controversial. I like to see business owners measure the value that they are creating in their company and track its change year over year. This is preparation for the day when they will depart, but it is also a check on the health of the company and the industry it is in. The measurement includes a standardized process of a three year forward projection and calculation of the Net Present Value of the cash flow, plus a simple terminal valuation at the end of the third year, discounted to the present. If this valuation is growing, the owner has added comfort in his/her commitment to the company and supports making suitable investments. If it is declining, it is time for a serious look at future plans.

Interesting article! We as so many other small business’s are always looking for what we believe will make a great sales manager. We usually do not give enough recognition to our top performers, but will seek out rewards for them.

This viewpoint may work from a 10k ft view, however; each situation needs to be looked at on an individual basis. For example, I have always been in the top 5% of every sales team I was a member. One of my clients enticed me to take over a struggling sales team due to his promoting the #1 salesperson into managment. While having my own growing pains, I soon discovered the key to success in transitioning to management was to alter my “mindset”. All of a sudden my ego needed arrested and I had to get my “kudos” for watching others grow due to my leadership. All of a sudden I was a member of the support function and whether during “ride along” sales calls I may have done the entire process – when I got back to the office I put the salesperson out front and said “look what they just did”. Most successful salespersons cannot stand the hit to their ego. Here is one that successfully made the switch.

Last year our production manager had a verbal blow out as he felt our goals were too difficult to achieve. I gave him three paid days off and he had a vacation after that. He decided to move on (much to my relief and financial relief). I now have two assistant production managers who have easily met our goals. they accomplished their goals because they did not know “it could not be done”. It is amazing what can be accomplished when we do not know what the limits of ingenuity are.