Archives for June 2021

Don’t Ignore the Warning Signs

I once drove a car across town for a friend of mine. As I was trying to get used to this vehicle I was not familiar with, I noted the yellow sticky note on the dashboard. It was blocking part of the instrument cluster so I pulled it off.  After doing so, I noticed the check engine light was on. When I told my buddy about the light being hidden by his sticky note, his response was “Yeah, that came on a few months ago and it bothered me. I put the yellow sticky note on there so I couldn’t see it.  It doesn’t bother me any more!”

WAIT,  WHAT!?!

Think back to that last time you were driving down the road and suddenly you hear the chime and the check engine light comes on. How did you feel? What did you think? Odds are, when this happens to you, you either hate it or you ignore it. Which one are you?

As the leader of your company, you have to pay attention to the warning signs in your company. If you’re the person who just ignores them – I hate to tell you but the problems don’t go away if you don’t pay attention to them. As my Grandma Lucy used to say, “ignorance is no excuse. “

Review Your Financials

Watch your financials – every month. That’s right – every month. If you are not looking at your financials every month, it’s the same thing as putting a yellow sticky note over the check engine light. If you ignore them, potential problems don’t go away. 

For some, you don’t really know what you’re looking for when reviewing your financials. If that’s you, I want you to know that’s not a problem but, staying in that position is a problem. If you are the leader of the company, you have to learn.  When you review your financials every month, they will start to tell you a story that you will not see by looking at them every once in a while. They will tell you when things are going well and give you warning signs when things are starting to turn for the worse. 

Establish the KPI’s You Need to Track

Key Performance Indicators are additional dashboard lights that can tell you if everything is going ok or if you are headed for trouble. The KPI’s will give you an early indicator if problems are on the horizon for the company as a whole or better yet, will let you know which team member isn’t meeting your expectations. The nice thing about KPI’s is that you can address the area of greatest bleeding – and there is always an area of greatest bleeding.  Problems in your KPI’s will usually be seen before they show up on the P&L but make no mistake, if you ignore them, they will result in poor performance on your P&L. 

There are several different KPI’s that can be tracked. If you are not tracking anything yet, pick one or two. Start there and when you get them under control, add one more. As you get that one under control, add one more. Don’t try to do it all as once. you will overwhelm yourself as well as your team. 

If you need help getting the tools in place to “watch your dashboard”, give us a call. We can help. And as for my buddy’s car – well, he had to get rid of it when the engine died. 

Setting Goals

By Gary Hazelberg Grandy Associates

Goals are the definition of success.  Without setting goals how do you and those you manage know if they are doing well.   Setting goals can be difficult, if we have steps to go through it makes it much easier.  My goal is to explain why goal setting is so important, explain the SMART goal setting process, what we should add to this process, and how to facilitate a system integrating goals.

I like the SMART goal system:

  • S = Specific,
  • M = Measurable,
  • A = Attainable,
  • R = Relevant and
  • T = Timely

Specific.  A goal should be Specific, if your goal is a sales or profit goal it should be expressed in dollars not percentage.  A goal specified in a percentage can be vague. Let’s take a $1-million-dollar company, if their goal is expressed as an increase in sales of 10%, the owner and top managers may know that the goal is $100,000, but who else would?  A goal expressed as $100,000 increase in sales is more understandable to everyone in the company. 

Goals can and should be process goals as well. Process goals can also be expressed specifically.  How long does it take to complete a process effectively?  Can we set a goal to shorten that process, make it more efficient without giving up quality? 

Measurable.  A goal should be able to be accurately and consistently measured.  If you are doing a calendar year goal, make sure you use the same process every month to calculate your process towards the goal.  Do your homework before you announce the goal and establish how you are going to calculate your results.  Be very careful that the results will be consistent with your original measurement processes or people will notice the difference and get skeptical.

Attainable.  A good goal should be a stretch to attain.  It should make people wonder “can we really do this?”  A good goal cannot be too much of a stretch however because people will automatically ignore it.  How much is too much of a stretch?  Now is time to do the math. If you are figuring a calendar year sales goal, figure out how much your growth has been over the last few years, maybe your company averages an 8% growth rate, over a five-year period.  Can you do a 10% growth?  11% or more?  Translate the percentage growth to dollars with a healthy stretch and that will be your goal to shoot for.

Relevant.  I feel this is the most important of the steps.  Your challenge to make the achievement of this goal relevant, or important, to as many people as possible.  If you achieve your goal without making it relevant it was pure luck or maybe a good year for everyone.  To make a goal relevant for your team, you need to understand what motivates them, what will make them do something different that is out of their comfort zone. Should you provide a SPIFF or bonus if you achieve the goal, an extra day off, a big thank you, a party or food brought in for the team.  Whatever it is, you must decide what the reward is before you set the goal, so everyone knows what they are working for.  A successful goal will depend on the actions of the team, they must be motivated to achieve the goal, and it must be relevant to them.

Timely. What is the time frame you have chosen to complete the goal that you have calculated?  Is it monthly, quarterly, annually or a calendar year goal? You must spell this out clearly, don’t assume everyone know what you have in mind.

How. Great you have completed the SMART goal process, but I think one thing needs to be added to SMART.  I like to add an “H”, so now we have a SHMART goal process.  The H stands for How.  How do you plan on achieving the defined goal?  Are you adding more people?  Expanding your territory?  Adding a new line of work?  You must spend some time and make a plan defining how you think the team can achieve the goal and tell everyone about it.

Going through the SHMART goal process will force you to define the goal, so you can communicate it clearly to your team.

Get organized, get excited!  Communicate the goal to the team using the SHMART goal system and tell them how it is going to be communicated going forward.

Set a reminder to yourself to communicate progress regularly on the same day of the month.  I put a reminder in my outlook program for regular updates. 

Remember that department and personal goals need to align with the company goals.  Every department and every person must do their part to achieve the goal.

Success.  If you achieve your goal, remember to celebrate, do not just create another goal and move on.  You must say thank you to everyone and show how much you appreciate their hard work.

Falling short of your goal.  If you fall short of your goal, do an honest review of the goal, was it not set right?  Was it not as relevant to everyone as you would have wished?  Maybe life got in the way, and you did not do your part to make the goal happen?  Or was it weather or some other thing that kept the goal from being achieved? 

If you had a healthy stretch in your goal and you came up just short, you probably did better than if you would not have set the goal at all.  This is not a failure!  Make sure your team is aware of the success you have achieved.

Learn from the goal setting process and create new challenging goals for your team regularly.  You will find as you set goals, you will get better at it and everyone will appreciate that you have defined success, so they know whether they have succeeded or not.

Give the Situation a Name that Causes You to Win

By Dave Ramsey, Ramsey Solutions

I once talked to a guy on my radio show who was scared—really scared. He called because he had just gotten laid off from his job of 28 years. He was making $38,000 a year and didn’t see the layoffs coming. He was afraid, and he was hurt.

My response caught him off guard. First, I told him I understood. And I did. I got fired once, and it was devastating. I felt worthless and lost when it happened. Then, I told him I was glad he got fired. Why? If you’ve worked somewhere 28 years, and you’re making less than $40,000 annually, your job stinks. And the thing is, he would have never left on his own. But suddenly, he had the chance to go somewhere better, and be a new, improved version of himself. I explained if he lands a $50,000-a-year job in the next two months, then he can pocket four months of his six-month severance package as a signing bonus to a better life.

In college, I took a class called Motivation and Emotion. One of the things I remember from that class was the idea, or theory, that we name our emotions. For example, your physical reaction in your body is the same for Fear as it is for Anger. In both cases, heart rate goes up, eyes dilate, proteins are released, endorphins are released, perspiration begins, and in extreme cases you begin to shake. And somewhere in all this physical upheaval we name it . . . either Fear or Anger. “I’m so angry” or “I’m really afraid.” Same physical reaction, though.

Depending on what we name it, our actions will change. Name it Fear and you run—Flight. Name it Anger and you confront—FightFight or Flight are such a part of our lives. The idea that when I’m angry I might really be afraid, or when I’m afraid I might really be angry, is confusing. But also gives hope—hope that I can decide. Is the glass half-full or is it half-empty? It’s comforting and empowering to realize I’m not a slave to a predetermined person inside me that made the half-glassed decision for me before I was born.

The late Zig Ziglar used to tell a story about a psychology experiment with a little boy named Pessimist and another named Optimist. Researchers placed each in a room filled with horse manure. An hour later, the researchers returned and opened each of the doors. In one room they discovered Pessimist in the corner crying. “Why are you crying?” they asked. Pessimist answered, “You locked me in a room full of horse manure!” Then, they opened the door of little Optimist, and found him smiling, giggling, and frantically searching about the room. “What are you doing?” the researchers asked. Optimist answered, “With all this manure, there must be a pony in here somewhere!”

I don’t know about you, but self-control is hard for me. Sometimes I’m a pessimist or a glass-half-empty guy. But the quality of my life and my relationships went up dramatically when I decided I can, and must, intentionally give every situation a name that causes me to win. I might need to name this an Opportunity, instead of a Challenge. I might need to fight for what is right, rather than run.

Life is coming at you. Sometimes it’ll bring a room full of manure. It happens to everyone from time to time. But you have the power to decide how to name the situation, and how you’ll react to it!

* Leadership and small business expert Dave Ramsey is CEO of Ramsey Solutions. He has authored numerous best-selling books, including EntreLeadership. The Ramsey Show is heard by 18 million listeners each week on more than 600 radio stations and multiple digital platforms.

Want a Great Tech? Grow One!

By Tom Grandy, Founder

In case you haven’t noticed, there is a huge shortage of qualified technicians and the situation is getting worse, not better.  On the other hand your business is doing great, it’s growing and you need more techs.  Where are you going to find them after all the good ones are already working for someone else?

The answer is really pretty straight forward.  The successful company of the future is going to have to grow (train) their own techs.  You have heard the principle before:  “Hire for attitude and train for service.”  I understand training new techs is expensive.  That is why it’s important to understand basic labor pricing.  Don’t pressure the new tech to move into the field too quickly.  Initially, consider new techs in training as indirect, or overhead, people.  That means 100% of their cost (hourly rate, matching taxes, benefits, etc.) will be treated as an overhead cost.  How do you cover overhead costs?  Right…they become one piece of the overall hourly rate charged the customer. 

If you build the cost of training into overhead some amazing things will happen:

  • The pressure to perform quickly is gone as 100% of the cost is covered as part of the hourly rate charged by existing technicians
  • The cost off training will always be within the hourly rate charged the customer therefore allowing the company to constantly have techs in training, whether currently needed or not.
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  • As the new tech is able to begin charging some of his or her time to the customer it will increase bottom line profits by providing more billed hours while reducing the cost of non-billable time therefore increasing profit.

Now the investment of training your own techs doesn’t seem nearly as daunting as it did before.  As they used to tell Mickie; “Try it, you’ll like it!”

This month’s Website Special ties into preparing for the future as well.  The special is our Company Policy Manual which comes in Microsoft Word so it can easily be customized for your specific company.  The normal investment is $134.95 but this month it’s only $99.95Order today!   

 

This month’s other offering is our HVAC Onboarding Self-Paced Online Training course.  What a great way to get new employees (office or techs) up to speed.  Normally the investment is $299.95 but this month it’s only $279.95.  Order today!

Like all our products, both Website Specials are 100% satisfaction guaranteed or you will receive a full refund, no questions asked. 

What Would Happen if You Didn’t Come to Work Tomorrow?

By Tom Grandy, Founder

If you are married, and/or have children, it’s highly likely you have purchased life insurance.  Why?  If something were to happen to you, you want to be sure your family is taken care of, right?  Guess what, your business is no different.

Nobody likes to think about it but “what if” you didn’t show up for work Monday morning?  What if you became very sick, were seriously injured in an accident or even worse?  What would happen to your company in the short run, or worse yet, in the long run if it were to be weeks or months before you were able to come back to work?  Do you have a backup plan?

The reality is that all business owners should be in the process of training their replacements no matter their age.  Life is full of uncertainty, and we need to be thinking of a Plan B even when there seems to be no immediate need for it.

Plan B can take several forms.  One form is literally to document every area of responsibility you have.  That’s right, put it in on paper, step-by-step.  This actually applies to ALL employees.  What happens if Jim, Suzy or Joe doesn’t come to work tomorrow?  Does anyone know what they do or how they do it?  They might get sick, have an accident, or simply decide to take another job.  Documenting all areas of direct responsibility will do two things.  First it will allow someone filling in to know what to do, at least in the short run.  Secondly, it will serve as great job description for the new person filling the job.

A second form is a combination of delegation and/or training your replacement.  Let’s face it, some day you are going want to retire and/or sell the company.  Having trained the next owner/general manager while you are still at the company will greatly ease that transition.  This is not a simple or short process.  It will literally take years, so the sooner the process begins the better off you and the company will be.  As the process moves forward, take a vacation for a few days.  When you return, see how things went.  What needs to be tweaked?  Later, take a week off, then a couple of weeks.  Bottom line, train your replacement so that at some point you can either retire fully or at least let go of the reins so you can enjoy what you have invested in most of your working life.

Delegation is literally one of the most difficult things you as the owner will ever have to do.  However, like was stated earlier, life happens so why not try to prepare as best you can while all things are going well.

One last tip.  Be sure to have a life insurance policy on the owner, again, just in case. 

This month’s Website Special ties into preparing for the future as well.  The special is our Company Policy Manual which comes in Microsoft Word so it can easily be customized for your specific company.  The normal investment is $134.95 but this month it’s only $99.95Order today!   

This month’s other offering is our HVAC Onboarding Self-Paced Online Training course.  What a great way to get new employees (office or techs) up to speed.  Normally the investment is $299.95 but this month it’s only $279.95.  Order today!

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