Leadership is simple. First, you’ve got to know exactly what you want, for your company, your department, or your project team. I speak to business owners and ask, “What do you want?” They respond, “I want to make a profit.” I ask, “How much?” – “As much as I can get.” “What if you can’t get very much?” “That’s not enough.” “Then how much do you want?” “More.” “More than what?” “More than I’m getting now.” It becomes obvious they really don’t know what they want or have a clear target to shoot for
Examples of clear targets include: “$500,000 net profit per year.” Specific. “Sales to be $1,000,000 per month.” “The project team to make $50,000 on this job and get at least 2 referrals from the customer.” Leaders know what they want and communicate specific clear targets and deadlines for their people. And only then, can you develop a plan to get what you want. More is never a target. More than what? There are 3 steps to get what you want:
1. Know what you want!
2. Have a plan!
3. Always make progress towards what you want!
Daily you get pulled off track by day-to-day business activities. Things go wrong, customers call with immediate needs, equipment breaks, or people don’t show up. These daily inconveniences pull you off course and take you away from your number one priority, which may be bottom-line profit, sales, or customer service. You need a written plan to keep on track and measure your progress. I recommend written charts and graphs posted for all to see which clearly show progress toward results.
Keep Targets Clear & Simple
According to Fortune magazine, a top quality of America’s most admired companies is laser like focus. They have a clear single business focus of what they’re trying to do. For example: Wal-Mart – low prices, Nordstrom – customer service, GE – be number 1 or 2 in every business they undertake. To me, that’s not a path most small and medium business owners take. They try to do too much and be everything to everyone, instead of staying focused, doing what they do best, and only setting a few simple and attainable goals.
People and companies without clear written targets and goals, are used by those who have them. It’s very interesting. Those who have written goals achieve them. Those who don’t, get the leftovers. I always ask, “Have you got a measurable target? Do you have three clearly defined goals? What do you want to achieve this year?” In my survey of over 2,000 business owners, only 30% had written goals for sales, overhead, and profit. No wonder companies struggle!
Do You Use Scorecards?
Can you imagine playing a golf course without greens? Score doesn’t matter. After four hours, you stop and go to the bar and start drinking. There’d be no excitement. There’s nothing to shoot for. No targets or scorecard. Sound bad? Sounds like most companies to me.
What are you really trying to accomplish? To get the results you want, you have to know exactly what you’re shooting for and have a scorecard to keep track of progress. When you hit a bad golf shot, you can make the necessary adjustments to get back on course. In business, you’ve got different terrain and obstacles along the way to overcome as well. So you need information and feedback to make adjustments as you go, and targets to shoot for and a scorecard to keep track of progress. Get everyone involved by giving them clearly visible targets, written goals, and a scorecard.
Use Challenges & Incentives
As a construction company owner, it’s often amazes me when I go out to a jobsite and ask the field superintendent, “When are you going to get this part of the project completed?” He says, “Well, I think we’ll get it done in a couple of months.” I then ask, “How did you come up with that completion date?” He then says, “Well, I talked to the subcontractor’s job foremen and we sort of agreed we could all get it done by then.” I ask, “Do you think you can finish it a week or two early?” He says, “Well, yeah, we probably could.” “Why don’t you?” “Well, there’s no real need to. We’re OK, we’ll finish it on schedule.” I say, “Wouldn’t it be better to finish early?” “Yeah, but it doesn’t really matter that much, does it?”
As a leader, start challenging basic assumptions. Give people something to shoot for and a scorecard to track the progress. Offer competitive targets, challenges, and encouragements like: “If I give you $100 for every day you finish early, do you think that might make a difference?” Then it’s, “Oh yeah, I know we can finish at least a week early, maybe even more.” Leaders clearly layout what is wanted, draft a blueprint to achieve it, and then watch the progress towards the goal. They also use incentives and challenges to get people focused to achieve the desired end results. When it’s just the same old – same old – same old, people give the minimum instead of their maximum. Everyone wants to be a part of a winning team. Layout a path to victory and watch them hit a hole in one.
George Hedley owns a $75 million construction and development company and Hardhat Presentations. He speaks to companies on building profitable businesses, leadership, and loyal customers. He holds 3-day in-depth “Profit-Builder Circles” open to construction company owners in an interactive roundtable format every 3 months. His “Profit-Builder System” includes proven tools to always make a profit, build equity, create wealth, win profitable jobs, motivate your people, and enjoy the benefits of owning a profitable company.