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Ken Keller: Six ways business owners can make more money

Brain Food for Business Owners

Posted: July 21, 2010 4:55 a.m.
Updated: July 21, 2010 4:55 a.m.
 

If you own a business and want to make more money, improve your cash flow, keep your current clients and attract more clients, this column is for you.

Results don't just happen by luck or hope in business. When it comes to getting the most out of everyone in an organization, the most critical role is that of a manager.

Owners don't see themselves as managers. Most have a different title (CEO, president, chairman of the board, etc.), but they are first and foremost managers of people.

Businesses rise and fall based on the ability of the managers in the organization to hire, educate, motivate and focus the right employees on key success factors. That responsibility begins and ends with the owner. If an owner wants to make more money, the first thing that must happen is that the amount of time spent coaching the company's managers must increase.

This does not mean "spend more time doing the job of the managers who report to you." Managers are on the payroll to get things done through people. If the current crop of managers are not managing, the company can make more money by terminating the managers not doing what they are paid to do and replacing them with people who have the right skills, abilities and attitude. That is the second way to make more money for the company.

Managers are not overhead, and they are not costs to be cut. Managers are critical to the success of an organization and have key responsibilities including communication, focus, education and training, cost control, analysis, focus and motivation.

Individuals with this title have to make tough decisions that are not always popular. That is the nature of managing people: Management is not a popularity contest.

Not many people are promoted into management with a set of success skills. It is the responsibility of the owner to teach success skills to the managers who report to him or her. That is the third way to make money for the company: Teach the managers how to manage to achieve the desired results of the company.

The role of the owner is educator and coach. Time should be spent discussing with each manager how they can improve.

The owner must put an individual action plan into place for each manager and hold them accountable for meeting deadlines.

The fourth way to make money is to find a way to have every manager use his or her strengths on the job. This not only makes the manager feel better; it engages them and encourages them to be better at what they are being paid to do.

If managers have strengths but there is no effective way to utilize them in the company, it might be time to see if there are other places better suited to take advantage of what they have to offer.

The fifth way to make money is not to be afraid to discipline managers (and those that report to them) who violate standards, policies and procedures. Organizations don't create rules and guidelines in a vacuum. They are created for a reason, and managers have jobs to enforce company policy - That includes the owner as well.

The sixth way to make money is for the owner to overcommunicate everything. There is a disease related to loss of hearing and memory and managers can be those who are afflicted early and often.

Once a manager gets the disease, it quickly spreads to other managers and to employees. The symptoms are numerous, often surfacing through whining, complaining and shock with a dose of indignation.

The disease is NOTMA, which stands for "no one told me anything."

Managers must be given daily doses of communication to limit the spread of this disease. Every important message, deadline and event must be repeated, time and time again, just in case a manager comes down with the symptoms on any given day.

What does it take for the owner to reap the benefits from these six methods? It takes the commitment of time and focus for a prolonged period of time to make a difference. What is the alternative? The answer is the status quo - an underperforming company and a frustrated owner.

Ken Keller is president of Renaissance Executive Forums, helping top executives make better decisions through informed peer perspective, resulting in better top and bottom line results. He can be reached at KKeller@ExecutiveForums.com. His column reflects his own views and not necessarily those of The Signal.

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