How important is communication in the workplace?
Very important. Communication in general is a real concern in the workplace, mainly because many employees perceive that their managers don’t listen to them. We’ve found that when problems arise, only 10% of them are due to an actual issue.
The other 90% are a result of the way things are addressed, and what people hear and feel rather than what’s actually happening.
Managers who learn to communicate well become highly effective leaders with high performing teams because their people know what’s expected of them and feel their needs are addressed.
As a result of these improved relations, they focus more on the work and getting things done, and less on perceived issues.
How does poor communication play out in the work environment?
A daily example is when accusations are made before checking facts, resulting in very reactive behaviour.
Another is the generation gap and how this shows up, particularly in the way Gen X and Y Millennials communicate via email and converse in short ‘text’ language.
This is particularly problematic when we see younger managers interacting with their older colleagues. Other factors impacting good quality communication include stress from fear of job security, tightening legislation and economic and social complexities.
These are just some of the factors that contribute to the disconnect in communication. It’s no wonder workplaces have the potential to become toxic unless proactively managed.
How do managers affect revenue growth?
Managers should be setting goals and ensuring there’s alignment between the company’s strategy and the tasks that teams are engaged in.
Managers who are drawn into task-type work instead of managing people are not effectively managing revenue growth.We refer to this as transformational versus transactional work.
Transactional tasks are all about the details of doing things right. Transformational tasks are about leadership and doing the right things. Like most things in business, this should follow the 80/20 principle: 80% of what a manager does should be transformational, and 20% transactional. Unfortunately, the opposite is often true.
A focus on transformational activities requires a manager who has excellent delegation skills. It also requires staff to do the transactional work, and clarity in terms of what’s expected of them. Murkiness filters from the top down.
Is the manager clear on what their leadership requires? If they aren’t, they can’t prioritise for their own teams.
Is there such a thing as working too hard?
Definitely. No one can be on 24/7, and the trouble today is that with Internet access and smart devices, we’re all reachable anywhere, receiving a constant stream of information we feel compelled to reply to.
Leaders tend to want more and more, but good managers should encourage their teams to take time off to recharge, and to encourage daily down time by making a habit of going offline.
There’s also a multitude of studies proving that being ‘always-on’ negatively impacts your ability to be effective and that downtime leads to higher productivity.
How can teams use their time more effectively?
As a manager, start by understanding that many people have a ‘monkey on their back’ or an issue that is causing them stress.
You’re the manager, so naturally they’ll come to you. It’s not your role to simply solve the problem for them, particularly if you can see the solution.
Instead, take care to train and empower your team so that they don’t need you to make every decision for them. As a manager, you tie a noose around your neck by creating co-dependency.
Managers who have a fear of letting go or difficulty trusting others will also buy into the idea of being ‘on’ 24/7. It’s a poor management style – it doesn’t work, and it generally leads to a high staff turnover.
Dealing with people and creating trust is all about personal boundaries. Start by discussing issues openly. For example, if you think it’s okay to contact your team at 11pm, they’ll think it’s okay with each other too, and before you know it, no one has boundaries, everyone feels burnt out and not in control of their time or lives and productivity plummets, despite 50+ hour work weeks. What example, and ultimately what culture, are you as the manager creating?
Are there any in-office tricks that help with productivity?
One of the best productivity tips is to zone your time. Focus exclusively on specific outcomes and don’t allow yourself to be distracted by tasks that appear urgent, but aren’t a priority.
We advise setting up automated email responses that outline specific times when you answer emails. This way no one thinks you’re ignoring them, and they know when they can expect a reply.
It’s important for this to become a company policy though, as it can create internal conflict if one department is expecting an answer to an urgent email and feels they are being ‘ignored’.
The world won’t end if an email remains unanswered for two hours – it just means everyone has to plan ahead and be proactive about their time, rather than reactive. With this one simple system, productivity should skyrocket.
Should leaders adapt their style to the situation?
We’re strong supporters of Ken Blanchard’s Situational Leadership model (see sidebar), which does advise matching leadership style to the situation at hand. However, while different situations require a different response, such as taking control, or teaching and coaching, ultimately the most successful organisations encourage senior managers, middle managers and all employees to feel empowered.
To achieve this, you need to develop an organisation with a listening culture, and accountability structures.
A place that builds relationships and people with respectful boundaries, where staff are heard and acknowledged. The best thing you can do is make someone feel valuable: Hear them and allow them to exercise what they’ve brought to the table.
Can you give an example of where this goes wrong?
Something we often see in corporate situations is a manager who presents an idea that a team member came up with to the board, and then takes credit for it.
It’s a very short-sighted form of leadership, because while the manager might temporarily look good, the person who had the idea in the first place becomes discouraged and disengaged, which ultimately affects the overall creativity and productivity of the team.
Great ideas shouldn’t be conceived in isolation. They should be nurtured and developed and this can only happen in an environment of collaboration and trust.
A manager who takes credit for ideas that weren’t theirs does the exact opposite. Grow transparency around ideas so that everyone knows where they originated, and also feels comfortable adding to them.
The best cultures are built around ‘we’ thinking. They reward managers whose teams excel, instead of managers who shine independently of their teams. It’s important to get the whole team involved.
Is there a larger cultural issue at hand?
Trust, ego and a sense of autonomy can cause real stumbling blocks in organisations. Do you reward individuals or team success? Remember that what you reward is what you’ll get.
It’s a simple truth that most ideas aren’t highly sophisticated – the greatest strategies tend to centre on simple ideas of motivation and recognition, so encourage idea sharing and idea building within your team. Your people are your most valuable resource and so it’s important to find creative ways to tap into this.
Do all employees contribute to the bottom line?
Absolutely, and this is one of the single biggest mindset shifts an organisation can make. Imagine what would happen if the cleaner never came to work. Rubbish overflowing, dirty restrooms, no services for maintenance and client visits.
Once you understand the value that the cleaner adds to the organisation, you’ll start valuing everyone’s contributions to the overall whole. Encourage your managers to not only understand their own value, but encourage this thinking in their teams as well.
How important is it for teams to connect to corporate goals?
It’s incredibly important, but it’s also a double-sided issue. On the one hand, the organisation and its management are responsible for sharing the company’s goals.
You can’t expect everyone to connect to the company’s vision if they don’t fully understand what it is and how the goals contribute to attaining this.
Properly understanding and then connecting to the organisation’s goals is the difference between reactive and proactive employees, and dependant and co-dependant thinkers.
There’s a certain amount of responsibility for the employee as well. Employees need to know how they are adding value, and what the company is paying them for it. As the manager, encourage the team to find their motivators, their ‘why’ and to take ownership of their role in the organisation.
Too often we see a victim mentality where individuals see situations as happening to them, instead of how they can impact the world around them and their success within it. It’s all about an internal locus of control.
Encourage your team to engage with their own positions – make them a part of the solution. Ask them how they add value to the company, and expect an answer – get them to think about it.
A great way to foster engagement is by asking pertinent questions: What can contribute to this day? What will this day contribute to me?
Should organisations expect everyone to buy into their value systems?
Organisations need to look for value alignment. If an individual’s values are met (the ‘what’s in it for me’ factor), then by default they will buy into the business’s values. However, for this to work, each team member needs to be able to identify their own values, and evaluate how the company is helping them to achieve those values.
We only ever do things that serve us. Don’t expect buy-in on an organisational level if you don’t tap into that.
On the flip side, there will be some individuals whose values do not (and never will) align with those of the organisation. The situation won’t change, so it’s better for all parties involved if those employees move on.
In our courses, we run everything with full teams, and inevitably someone leaves after the course is complete. Invariably, the energy of the whole team and even the office changes for the better.
The organisation wins by rather utilising resources and energy on people who add value to the company as a whole.
4 Common Myths About Leadership That Can Hold You Back
Alignment with your values and belief systems is the foundation of becoming an effective leader.
To be a great leader in today’s world, being a brilliant knowledge expert or technician is no longer enough. Even harder is trying to learn the golden rules of the wrong and right ways to be a great leader. The amount of content spouted in countless books and resources is overwhelming let alone confusing.
To be unstoppable leaders for our businesses and our people, tuning out from the noise and distractions potentially misguiding us is pertinent now more than ever. Pay attention to any presence of these four myths and make guiding your people a more soul-enriching journey that they and you will want to continue well past your leadership term’s end.
Myth 1: Great leaders are highly ranked individuals
Richard Branson proves a classic example of how great leaders can get to the top without having ivy-league school connections and astounding qualifications. Having had enough of struggling at school, Branson dropped out of the highly reputed Stowe boarding school at the age of 16 to start a magazine called Student. The first publication sold $8000 worth of advertising. We all know the Virgin story from there on. Then there are the likes of Rachael Ray, food industry personality whose empire has amassed a $60M fortune without her having any culinary qualifications whatsoever.
There’s a common entrepreneurial DNA that runs through the veins of such leaders. An avant-garde vision, tenacity and patience seem to be common underlying themes for many. For others, it’s about making sacrifices and taking risks that could cost their life to serve a cause extending far beyond serving their own needs.
By publicly speaking out against the Pakistan Taliban’s extremist rulings, one of which of was to prevent females from accessing education, Malala Yousafzai became a target. At 15 years of age, a masked gunman boarded her school bus and shot her in the head. She survived and many months of rehabilitation spurred her determination to fight for every girl to have the opportunity to attend school. The work she achieved through establishing the Malala Fund with the undying support of her father, earned her the Nobel Peace Prize in December of 2014.
Whether from desperation or a happy place there is always the genesis of a passion driving a persistence to go against the grain and to continue the fight. Often there’s no formal training, qualification or certification in sight.
Myth 2: Following a certain checklist of behaviours will make you a great leader
The ‘fake it ‘til you make’ adage has become a common throw-away phrase consultants and coaches spout as a means to quickly build confidence. Following advice to merely emulate the behaviour of those you admire and respect can pose grave risks, especially when you become a leader by default as opposed to by your own audition. Smart teams can smell falsehood and copycats a mile away. Your integrity will often be scrutinised and your jury will constantly evaluate the values and principles you lead by. One foot wrong might end your leadership term just as quickly as it began and not necessarily by your team’s choosing.
Imagine being tasked with driving credit card sign-ups yet you yourself struggle to make repayments on your own overdraft. How long can you resist your inner conscience? You’ll feel the tug every time you invite a customer to sign up and at every request to your team to follow suit. At some point, you’ll be struggling to face yourself see in the mirror.
This article was originally posted here on Entrepreneur.com.
9 Ways To Get Employees To Buy Into Your Vision
Your business is your dream come true, now it’s time to include your employees in your vision to drive future success.
Your vision statement is the foundation of your business. It is the baseline against which all strategic planning is assessed and the benchmark against which all results are measured. However, as important as it is to have a vision when it comes to business success, it is equally important to get your employees to buy into this vision to ensure that success.
Here are nine ways to get your employees to buy into your vision by making it their dream, as much as it is yours…
- It must be believable – Your company vision needs to be within the realms of possibility otherwise people just won’t believe in it. It must be steady, achievable and relevant.
- It must be inclusive – Employees need to see how they can play a part in achieving this vision to make it relatable and inclusive. If they don’t understand what the business does, they won’t care how well the business does.
- It must be reinforced – Talk about your vision all the time. Don’t assume everybody has read it or is familiar with it as new people may not have seen it and older people may have forgotten. Constant communication is critical to ensure everyone is, literally, on the same page.
- It must be transparent – Make sure your communication around your vision is open and clear. Talk about it with clients, with all staff members, at all meetings and keep on talking until everyone understands it. When a vision is tangible and accessible it is far more achievable than when it is ethereal and vague.
- It must be practical – Don’t make flamboyant statements that are almost impossible to achieve like, ‘We will be number one in X!’. Be practical. It doesn’t matter if you’re not number one, it does matter that your vision is practical.
- It must be shared – Connect people’s careers to the vision by creating opportunities for them. Show them how the work they do is tied back to the vision and the business. If the business is only about profit and customer, then employees often don’t see how they fit in or why they are important. Create opportunities for them and they will be inspired to achieve your vision.
- It must be people-centric – People make up the core of your business. It is bigger than just one person or one idea. So, give them something to aspire to with a realistic, practical and human company vision.
- It must have purpose – Embed your vision and its values into the way you do business. The way you treat your employees and your customers and the choices you make should all reflect your vision. Take it beyond just ‘We want to make money’ and show how your vision positively affects your community and others.
- It must be visible – Put your vision on doors, in emails, on letterheads, in proposals. Show what you stand for at every opportunity. Employees need to feel that there is a cohesive plan for the future. This will not only drive engagement but it will keep them steadfast when times get tough – they believe in the ship too much for it to sink.
What’s Your Number? How To Unpack Company Valuations
Business is booming. Investors want in. But how do you put a price on the value of the company you have built with your own hands?
Company valuations is such a hazy part of the scale-up journey of a private company. Putting a price tag on a business is both art and science. At the end of the day, the number that makes the headlines (if ever disclosed) will be where willing buyer and willing seller meet.
But how do you , as business owner, go about setting your asking price? Before approaching investors, it’s a good exercise to determine your own valuation range for the business. Choosing the right valuation method is the first big question. The answer has many parts to it, but the most important driver is the stage of the business.
Let’s look at some of the most commonly accepted valuation methods in our market:
Applicable stage: Established, profitable companies
Listed companies, institutional players and private equity investors normally invest in a company for its cash flow profit that can contribute to their portfolio income. More often than not, companies will be valued based on their current earnings (bottom line profit after tax).
This method can only be used for companies that consistently make a profit. A multiplier will be chosen based on the company’s perceived risk. Younger, more risky businesses will likely have lower multipliers (as low as 3 and 4) and high growth, well established, lower risk companies will get higher multipliers (8-15).
Sometimes small adjustments are made to current year earnings (like non-standard, non-repeating income statement items) after which the valuation is set at Earnings times multiplier equals company valuation.
Discounted Cash Flow (DCF)
Applicable stage: Post-revenue start-ups, growth companies and established businesses
The most commonly used method in practice, the DCF method argues that a company’s value is determined by the future cash flows that it will yield to investors.
The starting point is creating a five to ten year cash flow forecast for the business. This is no small feat. In order to create a full financial model – income statement, balance sheet and cash flow statement – for the next decade requires a lot of work, both from a strategic and technical perspective.
Investors love this model because if forces the owners to put a clear strategy and expansion plan for their business into numbers. It will include dozens if not hundreds of assumptions – all of which can be scrutinised for reasonability. The result of financial model will be five to ten years’ worth of projected cash flows. These amounts are then discounted to present value at a discount rate that reflects the company’s risk and expected cost of capital.
The sum of the discounted future cash flows plus a terminal value (that represents the value after the five or ten year period of the model) then represents the valuation of the company after some final small adjustments for things like existing debt in the business.
A revenue multiple valuation approach is focused on the market for similar businesses and is underpinned by your company’s current turnover. It seeks out the sales price of other similar companies in the country or worldwide, adjusted for size, stage and market differences.
A company that sold for R100 million at a turnover of R50 million would have a two times revenue multiple (valuation/revenue). If the average revenue multiple for similar companies is in a certain range, this multiple is then slightly adjusted and applied to your business.
If the average sale in your industry has been two times revenue but you are growing much faster than the average with a better competitive advantage, you can argue that two and a half times revenue is a more applicable number for your business. Revenue multiples are often used as a reasonability check in the market for the current asking price.
Most established companies are valued using one or a combination of more than one of the above three methods. At start-up stage, there are a number of other methods like Cost to Replicate or the Scorecard Method that early stage investors look to. When a company is simply in too early stage to practically value it, seed stage investors would also consider SAFE Agreements (Simple Agreement for Future Equity) – an instrument that determines that the percentage of the company the investors are buying with their investment. This is only determined when the Series A round is raised at a future date and under certain conditions, generally at a discount to the price the series A investors are paying.
Company valuations are complex. Many of the above technical factors play a role. A lot of it also comes down to the salesmanship of the owners and the negotiating capabilities of the parties. In ‘How Yoco Successfully Secured Capital And The Importance Of A Pitch’, the Yoco team speak about the importance of the right approach in their recent R248 million fundraising
Don’t go into this process without seeking some kind of expert advice. The price of the wrong valuation is simply too high. Make your numbers and your arguments bulletproof and you will be on your way to defending a strong and exciting valuation for your next raise!
Lessons Learnt2 weeks ago
The Daily Schedules Of 10 Famous Business Billionaires
Self Development1 week ago
10 Secrets To Finding A Job You Love
Performance & Growth5 days ago
How Matt Brown Quadrupled His Business By Becoming A Niche Player
Entrepreneur Today4 days ago
Entrepreneurs Organisation Crowns the Winner of the Global Student Entrepreneur Awards
Branding1 week ago
How A Strong Brand Protects Your Business
Marketing Tactics1 week ago
An ‘Outside-the-Box’ Approach to the e-Commerce Unboxing Experience
Entrepreneur Today1 day ago
5 Businesses You Should Start in 2019
Business Landscape1 week ago
4 Tips To Create A Great Conference / Workshop / Event In 2019