Managers Make Good Choices
Bill Warner Monday, August 31, 2009
We are often told that we just need to say no to a few things so that we don’t get ourselves over committed. After all, we cannot do everything our customers ask us, and we cannot go after every possible market. Some folks will ask if you are going to teach the team how to say no. Because if you don’t say no, you just keep adding more work to an already overloaded plan. Well, we just say no to that question. No, we are not going to teach people how to say no. We don’t think that is the question. Instead, we see the need to learn how to make choices.
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The Need For Seasoned Executives
Bill Warner Thursday, August 20, 2009
If there is one issue that companies deal with frequently it is poorly constituted executive teams. As a result they are suffering from the lack of business and operational know-how. Here are some examples.
Bad marketing and channel choices
The primary way this issue reveals itself is lack of sales; resulting in tremendous cash flow pressure. We recently worked with an emerging commercial hardware tool company that is being run by its founder. The product is unique and patented, and is ready for the market. It has been ready for two years, while the founder tried to sell the product through direct channels to large manufacturing companies. The company has burned over $1M in marketing programs and sales personnel. The problem has been that the founder has no sales experience, has taken the product through the wrong sales channel, and has hired sales people who do not have the knowledge or experience to sell to distributors. If the founder and the company’s board would have insured that the right marketing and sales executives were brought into the company at the time the product was ready, they would be in a very positive position today. In addition, a new CEO with successful business operations experience should have been brought into the company. Unfortunately, the company is nearly out of money, and may fail.
Marketing failure
Without effective marketing programs, there won’t be enough leads to generate the correct number of sales. One of our clients has a very effective software product for managing high inventory turnover situations and reporting quantifiable results. It is sold through direct channels by knowledgeable manufacturing process sales people. The product has been on the market for eighteen months, but only four sales have been made. We discovered that the founder doesn’t really believe in marketing, and has been cold-calling prospects and getting very poor results. Going deeper, we found that the marketing message he was delivering was not effective in convincing a buyer who is solely interested in return on investment. If the founder had brought in a seasoned marketing executive who knows how to put a comprehensive sales lead generation program, there would have been the necessary number of qualified leads to generate sales.
Disfunctional executive team
It is terribly important that the executive team of any company work well together and is on the same business agenda. We recently worked with a financial services firm whose partners were tied in knots by their lack of mutual commitment to the company’s business objectives and private personal goals. Their lack of business maturity and experience to take the company beyond where they were was causing significant sales failures and personnel disruption, as their lack of cohesiveness showed through to the entire firm. Quite frankly, nobody was in charge, and their strong personalities continue to clash and undermine their decisions making. The firm is frozen in place, and won’t progress until the partnership organization is reconstituted.
CEO failure
When a company is launching a new product and is meeting new customer prospects, potential investors, industry analysts and representatives from the media, it is very important that their story is told concisely, completely and with humble excitement. If the company’s leadership cannot do this, accomplishing their goals will be almost impossible. Recent experience with a company that supplies software to associations to manage donations, brings this issue home. The CEO and founder had a major case of arrogance and selective listening. She angered investors, talked down to analysts, overstated to the media, and bored everyone with unnecessary technical detail, never getting their value proposition across to anyone. If the board of directors had hired an experienced CEO, they would have had a chance of survival. Now, the bridges are burned.
Missed commitments
Making well thought out commitments is necessary to maintain credibility with investors and customers. It takes experience to recognize when a commitment is needed, properly establish and manage expectations, and rationally make the commitment. We discussed this with a potential client last month. The software company had a very complex product, with several enhancements to make based on customer needs. The customer demanded rapid delivery. They committed a very aggressive delivery date, and missed it by a month. This was the straw that broke their back. This was the ninth commitment made and missed over the last year, so the customer discontinued the relationship. The development leader and CEO were very junior people, and were working with a Fortune 500 company. If this company had seasoned executives who knew how to handle these tough situations, they would still have the customer.
Having seasoned executives leading your company, who have the wisdom and experience that is needed to accomplish your objectives, will maximize your chances for success.
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Entrepreneur Gets Overwhelming Support After VC Shark Attack
Bill Warner Wednesday, August 19, 2009
Kevin Flannery has had an interesting time since being bled to death by some not so real VC’s on the TV show Shark Tank. This hyped up TV show that portrays venture investing as a visit to a shark tank has tried to embarrass entrepreneurs and make venture investors look like vicious animals. None of this is real and has been put together by some mindless producers who are trampling on one of America’s most valuable assets, the entrepreneur and the business partners who finance them.
The entrepreneur gets even
Since the show was aired, Kevin has gotten hundreds of responses over his website. The vast majority are encouraging and supportive. Comments like “hang in there,” “prove them wrong,” “way to stand strong,” “keep going, the product is needed,” and many others. More importantly, many of these responses are from potential business partners who want to know more about his business. Unlike the Shark VC’s, many saw the value proposition of the WiSpots product line. Several respondents were sales and distribution companies who showed interest in marketing and selling the product. Lots of people had further product suggestions. They even got contacted by potential investors, even ones that had previously passed on the business.
So, at the end of the day, Kevin has beaten back the sharks in an amazing turnaround of fate. We all thought that Kevin now lies at the bottom of the ocean. Not at all. He is alive and energized.
WiSpots update
Long before the show was aired, Kevin had joined with fellow entrepreneur Jason Angel, and formed a new company called Wi-Ficiency. The company offers a suite of physician and patient-centric software and hardware solutions that maximize profitability by reducing costs, improving productivity and generating additional revenue from the patient waiting room, while simultaneously improving patient satisfaction through education and entertainment. This company has far reaching potential in improving the state of healthcare by providing a broad selection of relevant patient information, a targeted marketing and sales channel for healthcare products, state of the art online medical transcription services, compliant electronic medical records, and many more capabilities as they acquire additional technologies.
The winning entrepreneur
It’s a shame that the VC Sharks couldn’t listen long enough to learn of the true business model of this company and instead chose to go for the ratings and throw WiSpots to the fishes. Kevin and Jason are very much above water and riding in a speed boat to their next funding event.
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Picking The Right Executive Team
Bill Warner Monday, August 17, 2009
Picking the right executive team is critical to a company’s ongoing success, and should be done with regular discipline. To make it even harder, the requirements for the executive team changes as the company matures. The team that started the company may not be the one that raises the first institutional round of funding, or leads the company to its first million in sales, or merges the company with another in an exit event. If you hear any of the following, beware:
- “Products and services are everything, the business and management stuff is easy.”
- “I will be the CEO for the long haul.”
- “I just want people that can do the job. I don’t care about their personality.”
- “I have some close friends and associates that will help me run the company.”
- “Let’s fill out our management team right away so we have the experience we need.”
The mature executive team
What you would rather hear is a mature assessment of the needs of the business, and then determine what executive team is needed in order to accomplish the near term objectives of the company. If you hear people saying the following, you have a supportive and mature team:
- “I need people that have business and management experience.”
- “I probably will not be the CEO after our first round of funding.”
- “Personality and ethics are very important. We have to be a cohesive team.”
- “The best way to end a friendship is to hire them into a risky business.”
- “I will hire the right management when I need it.”
Assessing your management team needs
In order to determine what you need for your executive team, three assessments are needed:
- The current executive team
- The status of the company
- The company’s two year objectives
With this assessment and these needs understood, you can determine if the current management team has the experience and capability to accomplish the objectives that lay ahead. The management organization can be changed to realign roles and responsibilities. When additional management experience is needed, a job description can be easily written for the position that has to be filled. This description is then used to identify candidates through whatever recruiting channels are used.
As companies mature, new challenges are faced that the current management team may or may not be able to handle. As a company grows, so must its management team in order to deal with the demands of the business. The worst thing that can happen is to be led by a management team that is not experienced enough to manage the day to day issues it faces. Investors know that if such a condition continues too long, the company will lose momentum as too many mistakes will waste resources and time performing recovery actions.
The message here is that entrepreneurs must know what kinds of managers they need, and when they need them. Investors are looking for foresight of the upcoming business transitions and whether or not the entrepreneur knows the steps necessary to hire the right managers ahead of time. Unsaid has been that entrepreneurs need to pick people that will fit into the company’s culture and who are “A” players. Particularly in early stage companies, only the best talent should be employed to insure success. If you are rigorous about picking the right management team ahead of the crisis, you will have the right people to manage through the next transition.
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Manage Your CEO
Bill Warner Sunday, August 16, 2009
A lot has been written over the years on managing your manager. But, does it all apply to CEOs or business owners and their direct reports? The answer is, “it all depends.” It depends on how much ego is in the executive office and the competency of the CEOs direct staff. It depends on the organization’s view of accountability. It depends on the use of wisdom. It depends on whether or not your CEO is coachable.
How to manage your CEO
The CEO must make decisions that are in the best interest of the company. Members of the organization each play important roles like marketing, sales, development and manufacturing. In these roles, it is important that the CEO hears their best advice. The employee must first provide focused advice from their perspective in the organization. Secondly, the employee should also be able to appreciate and participate in discussions from the CEO’s perspective. The best CEO’s expect solid advice while allowing employees to engage in the CEO decision making process. In carrying out your employee role:
- Be the expert – don’t give in to the guesses of the CEO. The CEO must be decisive and make timely decisions. But, sometimes the CEO gets caught up in the moment and expediency takes control and advice, research, and experts are ignored. Don’t back down when you know you are right, the success of your company depends on your ability to persuade the CEO to listen and act on your expert advice. Support your advice and actions with solid research.
- Do sound research – don’t just go with your past experience. Even experts can learn new things. Times change, the market changes, the products and services change, competition changes, and the financial picture changes. Continually build your experience by doing research. Get the latest information to use to make your decisions and advise the CEO. Especially if you know the answer or the right approach, do the research. Always be talking to your clients, competition, and your sales force. Support your expertise with sound judgment and sound research.
- Use the “experts” who report to you – don’t ignore the experts you hired for their expertise. Just as the CEO should listen to you, you should listen to your staff. The person making judgments and recommendations should always be the person closest to the issue, situation or client. That’s usually your employees. Armed with the best know how and research from your staff, you are better able to help your CEO and your company make better decisions, lead the market, and grow.
- Stand your ground – don’t give in to the CEO when you know you’re right. That’s a tough one! If a CEO is worth anything, they want to hear your ideas and decisions not an affirmation echo back from you on their ideas and decisions. You will be heard if you provide value or better alternatives. You will be heard when you provide the justification and research support for your alternative. You will be heard after you have built a track record of successful advice or decisions. But, be careful, good creativity and research is not sufficient. Your advice and decisions must also be cost justified, feasible in terms of company resources required, and they must be able to show results in the time frame required by the company.
- You can differ with the CEOs direction as long as you are right – don’t get it right and you get fired. Sometimes decisions or objectives have been delegated to you by the CEO. Along with the delegation there is often direction from the CEO on how it should be accomplished. If you have a better, faster or cheaper way to get it done, go for it. You can be the hero and earn yourself some big recognition and maybe even a big bonus. But, don’t forget the consequences. If you’re not successful the CEO will probably let you off the hook once or maybe even twice, but after that you may find yourself on the street because you didn’t follow the CEOs direction. You may hear the career killing statement, “You’re not a team player.”
How CEOs Let Themselves be Guided
In order to be the most effective and make sound decisions, you want to enable and empower your employees to be strong advocates in the roles they play in the organization. At the same time, you need to draw them into conversations with you to help you talk through the pros and cons of decisions you are making. To get the best from your employees:
- Delegate – don’t think you need to do everything yourself. I have seen CEOs of large companies that believe that they need to make all the decisions. So, I see them choosing the colors on the marketing brochures, auditing travel expenses to see who is traveling too much, wanting to go on the sales call where it is planned to close the sale and the worst, wanting to go to every client meeting. These CEOs have not learned to hire good people and get out of their way. Allow yourself to be guided by hiring good people, delegating to them and getting out of their way.
- Trust your employees – don’t forget you hired them to do a job because they were the best you could find for the job. Yes, it’s true that many times the CEO makes a mistake and hires a person not quite suited to the job. Yes, it’s true that many times the CEO does not move quickly enough to correct the mistake. But, when you have the right person, after you delegate, you should trust that they can get the job done. Most times they are closer to the action than the CEO, and better positioned to make the best decision and win the best outcome. If the employee gets it wrong, it’s a great learning experience. Adults learn by making mistakes. Let your employees make little mistakes so they can learn how to make the bigger decision. Trust them to get the job done and they will not let you down.
- Get your staff to do solid research – don’t think you have all the answers. Your employees must be doing solid research to get their jobs done. Sales people need to do research on competition and client needs. Marketing people need to do research on events and now email marketing. Product people need to do research on the latest product advances in the market place. As CEO you don’t have the time nor most likely the skills to do this research. Get your staff to do it. Trust your employees to give you a good summary and the best recommendation possible based on the research. Demand that every decision is supported by sound judgment and sound research.
- Use your wisdom – don’t use your experience; use the experience of your staff. Then use your good judgment, your wisdom, to use the experience of your staff, tempered by their research. Using your wisdom is not using yesterday’s experience in today’s very different and changing business climate. Using your wisdom is first understanding the new environment you are operating in, and then choosing the right actions based on the current situation. Many times this means doing something new, and usually something different from your past actions.
- Hold your employees accountable – ask for the results you expect; don’t just give orders, they may be ignored. If you don’t follow-up after you have given out an assignment, you are telling your employee that it is not important. If you tell your employee he is going to be in a lot of trouble if he does not take a certain action and you don’t follow-up, you are telling him he is not going to get into trouble by not doing it. You hold your employees accountable by following-up on what you asked them to do. You hold your staff accountable by following-up to verify that they have in fact achieved an objective you set.
- Check your ego at the door – don’t let your ego prevent you from hearing the advice of your staff. Make it clear to all employees that you are open to hearing their advice and that it is safe for them to speak their minds, even if they are not in agreement with you. Don’t ever jeopardize their trust in your openness. When your employees tell you what to do or that they are going to take a different approach than you suggest, they are not telling you what to do. They are giving you advice. As above, this assumes you have capable employees in place. As CEO, you don’t have to take the advice, but you sure should listen to it. Some also say you have to hear the advice, which means you need to consider the advice in light of other alternatives. It’s OK if you agree to do what one of your employees says even if it is different than your decision because all that matters is that the company is making the right decision. The CEO will get the credit if the company makes the right decision.
In Summary
The bottom line for employees and the CEO or business owner is the same, communicate ideas, advice and supporting research; listen and hear each other; make the decision or take the action based on the expert in your company, whoever that may be.
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Repelling Shark Attacks
Bill Warner Wednesday, August 12, 2009
The new television show, Shark Tank, portrayed investors as vicious animals and was kind of over the top with respect to how they deal with entrepreneurs. Quite frankly, I was ashamed of the way investors were made out to be the bad guys.
The truth about investors
Although the people who played the investor roles had many of the characteristics of real investors in an initial meeting with an entrepreneur, much of what we say was fiction and just plain overstated.
- Investors are much more curious about the entrepreneur’s business model, starting with an understanding of the market and the buyer they are trying to satisfy. A substantial amount of time is spent on this alone in an initial meeting. Most investors need to establish this base of knowledge before they can evaluate anything about the business idea. We saw very little of this kind of inquiry on the show. Entrepreneurs need to really know their market and business model and be prepared to defend it before they engage with any investors.
- Most investors are actually the biggest friend of the entrepreneur, when it comes down to it. It is rare to see entrepreneurs attacked and ridiculed as we saw on this program. Good investors, when confronted by lack of clarity by the entrepreneur, turn the moment into a coaching session; especially if they are seeing the formation of what appears to be a good idea. Insulting and laughing at entrepreneurs is not a typical way they conduct themselves. If you do run into a bull shark like we saw on the show, I suggest you just move on. You would not want them on your team.
- Investors don’t immediately leap into a deal discussion in the first meeting. The first meeting is all about getting to know the entrepreneur and the business idea. These meetings last anywhere from thirty minutes to a few hours, as the investor performs initial due diligence on the plan for the business. Lots of questions get asked in an effort to determine if it is worth any more of their time to seriously consider making an investment in the company. The successful result of an initial meeting is an agreement to enter formal due diligence that could ultimately lead to a term sheet negotiation. Investors don’t write checks after a five minute discussion. This program leads people to think that investors make snap decisions in just a few minutes of consideration. That is ridiculous.
- The entrepreneurs were not prepared very well to give a thoughtful business presentation, and even more unprepared to negotiate a deal. A real negotiation is much more thoughtful and reasoned. Entrepreneurs should explain the basis for the value they place on their company by describing its recent accomplishments and reflecting what the market is right now. They need to be prepared with a reasonable ownership offer, and know what their walk-away point is. Investors normally explain the reasoning behind their offer or counter-offer in order to convince the entrepreneur to accept it. It rarely gets into the shouting matches and insult slinging we saw on the program. Before any negotiation starts, investors carefully think through the numbers and determine the potential future returns, based on what they think the revenue, cost and expense requirements are going to be and how much money is going to have to be raised. We saw none of this.
Meet a real investor
I have no idea why it is good entertainment to publically humiliate an entrepreneur in front of millions of people. If you want to really understand what this process is all about, take the time to meet a real investor. I guarantee you will not find the kind of arrogance and be humiliated and berated like you saw on the Shark Tank. Most will take the time to give you some pointers and guide you to what your next step should be.
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Find the Right Investor
Bill Warner Tuesday, August 11, 2009
So you have completed your business plan, determined how much money you need, practiced your presentation, and are now ready to approach angel investors to raise the capital needed to launch your business. But, you don’t know any. You have heard about the angel organizations in the area. You have read about the venture capital firms as well. Where do you start looking? Here are some tips to finding angel investors:
- First decide what you want from an investor with respect to industry experience, management experience and scope of influence. Your first investors are going to be your business partners and are people who can help you get your company started with their contacts and advice. When you have a good understanding of the kind of help you need from your investors, you will be able to easily qualify them. Not every investor you meet is one that you need on your team. Don’t make the mistake of engaging an investor who is going to ultimately be a bad partner. It could kill your company.
- Right now you probably know more investors than you think you do. Establish a list of people that you know that you think could be an investor in your company. They should be accredited investors if at all possible. Think through all your business associates, friendships and family members, identifying those that could be investors, or those who might be able to introduce you to investors. This approach is often described as a “friends and family” round of investors. The reason it make sense is that you are dealing with people who know you and trust you, and therefore are more likely to agree to become an investor in your company. Of course, the downside of this approach is that you your friends and family may lose their money if your business is not successful.
- The sophisticated angels are territorial and many of them roam in packs. Go to the Angel Capital Association website to find the names and contact information for the angel investor organizations in your area. Many also roam alone or in small private groups. They are hard to find. You need to make a habit of doing a lot of business networking. The more business people that you meet at networking events the better are your chances of finding angel investors. Let people know you are raising angel money to maximize your chances of getting a referral to them.
There is no silver bullet approach to this. Finding angel investors takes a lot of hard work and months to accomplish. You will need to attend a lot of events, meet a lot of people, shake a lot of hands and give your elevator pitch hundreds of times to find just a handful of people that are willing to invest in your company.
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A Glimmer of Hope in VC Financing
Bill Warner Tuesday, August 11, 2009
In its second quarter Venture Capital Survey of venture financed companies in Silicon Valley, Fenwick & West reported some brightening of venture deals.
Financing summary
The number of down rounds in the second quarter exceeded up rounds 46 percent to 32 percent. It looks like bad news, but this is an improvement over the first quarter which was 46 percent to 25 percent. The difference is that flat rounds decreased from 29 percent to 22 percent. Although this is the second time that down rounds have exceeded up rounds since 2003, it does signal that the bleeding has started to subside.
However prices continued to fall, with a 6 percent decline in the second quarter, which compares to 3 percent in the first quarter. This two represents the second time that there was a price decline since 2004.
Other indicators
Dow Jones VentureSource reported that the amount invested by VC’s in the U.S. in 2Q09 was approximately $5.3 billion in 595 deals, an increase from the $4.0 billion invested in 680 deals in 1Q09, but a significant decline from the $8.3 billion invested in 726 deals in 2Q08.
The health care industry received 42% of 2Q09 investment, and information technology attracted 37%, the first time on record that quarterly investment in health care exceeded investment in information technology.
Fundraising by U.S. venture capitalists was $1.7 billion in 2Q09, which was the lowest amount raised in a quarter since the first quarter of 2003.
There were 67 acquisitions of venture-backed companies in the U.S. in 2Q09, for a total of $2.6 billion, a decline from 70 transactions totaling $3.4 billion in 1Q09 and a significant decline from the 89 transactions totaling $6.5 billion in 2Q08. This was the lowest dollar volume of acquisition transactions since 1999. There were three IPOs of venture-backed companies in the U.S. in 2Q09.
Of course, one point of change doesn’t yet indicate a trend, but these numbers do signal a curbing of the decline of venture capital financing. Let’s look forward to the next quarter being even better.
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Lessons From The Shark Tank
Bill Warner Monday, August 10, 2009
The new television show, Shark Tank, is more than a little hyped up and not terribly realistic about the process of raising angel or venture capital. A lot more preparation goes into getting a company ready to present to investors than is portrayed in the show. The investors looked much more arrogant and cut throat than they really are, and most of the entrepreneurs were substantially unprepared to make the presentations at this level of investing.
Lessons learned
However, there were a lot of lessons that should be learned by entrepreneurs. Some good things were done and some terrible mistakes were illustrated.
- You must present a business story, not a story about an idea. Emmy the Elephant and Ionic Ear were the cases in point. Both were explaining what their product is and how it works. They never explained why they had attractive businesses. When you are presenting to any group of investors, you need to explain what the business model is, describing how you are going to make money. Then, in turn, explain how the investors will make money as well.
- A start-up business has to have a laser like focus and not try to approach too many markets at once. The Pie Factory had a great business going in wholesaling sweet potato pies. His major selling point to investors, a deal with McDonalds, almost had to be dragged out of him. He wanted money to expand his business, and was making thirty other varieties of pies, taking attention away from his core business in sweet potato pies. They got their investment, but at a valuation that was substantially less than their revenue. If he had been more focused on wholesaling and had a confirmed deal with McDonalds, he could have gotten a much higher valuation.
- Unrealistic valuations are common place, but are usually worked out prior to a major presentation like we saw. However, the lesson learned here is that entrepreneurs really have to spend the time to understand what their business is worth right now and offer the investor an appropriate share for the money they will be putting into the company. The Pie Factory was valuing an $850K business at $4 million plus. Poor Kevin Flannery was valuing his business at $10 million plus, with no revenue. Iconic Ear’s valuation was over $6 million at the prototype phase of development. These are not even close to being reasonable and show that these entrepreneurs did little research into the investor market.
- The heart breaker was WiSpot. Kevin Flannery showed a failing business in which he has personally invested his family’s life savings. The investors did him a big favor by telling him that his business model was not attractive and never would be. Their advice was all about knowing when to quit. Entrepreneurs should be listening for good advice from seasoned entrepreneurs and investors. When a lot of people are telling you that the dog is not going to hunt, then you need to move on to something else. It’s a shame that Kevin had to get that news in front of millions of people.
- Entrepreneurs really need to be prepared to negotiate. Emmy the Elephant was raising $50 thousand and was selling 15% of her company. The company is at the prototype phase. She was offered the money, but at 55% of her company. She took the deal, probably not knowing that she just dropped her pre-money value to about $40 thousand and gave up control of her company. Not a great deal, but maybe it was right for her. Nevertheless, entrepreneurs need to know their numbers and come into such a negotiation with clear reasons for their valuation and knowing what they are willing to give on as well as their walk-away point.
- Arrogance and a bad attitude is not a good thing to display in front of investors. The College Foxes Packing Company got hammered because they were not willing to share their current company with investors. Instead, they insisted on trying to sell a spin-out services company that has no revenue for $250 thousand and a 25% share. The negotiation got heated and the entrepreneurs insulted the investors and ultimately turned down a sweet heart deal because they were unwilling to share any piece at all of their current business. In reality, these entrepreneurs should have known that the negotiation would go the way it did and been prepared with a clear position and counter offer.
Once you peel away all the dramatic showmanship, this program has some valuable lessons for entrepreneurs. These mistakes are made every day, and can be avoided by good research, preparation and getting solid advice from experienced entrepreneurs.
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The Job of Management
Bill Warner Thursday, August 06, 2009
One of the very important roles in a company is that of the manager. Management includes group leaders, who sometimes play the role of both manager and individual contributor, to section manager, director, vice president, senior vice president, executive vice president and chief executive officer. Each of these positions has a different scope of responsibility, but they all have several things that they do in common.
The role of management
First and foremost, they are all managers, even if some of them perform individual contributor work. I define a manager as having three fundamental roles. First, a manager is a leader. As a leader, the manager establishes and directs the vision and mission of the team. In this capacity, the manager is the source of visionary strength of the department and keeps the staff on a consistent track to achieving the vision. Second, a manager is a project manager. In this role, the manager is responsible for directing the operational activities of the team by scheduling the utilization of the department’s resources, including people and capital equipment. In this way, the manager gets things done through the efforts of the people on the team. The manager is responsible for establishing and executing the project plan that is necessary to achieve the team’s mission. Third, a manager is a coach, and as such picks the people for the team and improves the performance of people through ongoing counseling. As a coach, the manager works with people to help them become greater contributors by helping them improve their efficiency and effectiveness.
The tasks of management
In these roles, a manager performs several duties that are very important to the successful functioning of any team.
- Strategy – The manager puts the strategy in place to achieve the department’s vision and mission. In this capacity, the manager works with team members to develop a strategy and plan. Then a process is put in place that will be used to execute the strategy. In most cases, this process is an element of the company’s overall development process for purposes of developing and delivering its products.
- Organization – The manager gets the department organized to implement the process and guides all the project activities using the process. All the schedules are established, laying out the tasks that have to be performed to deliver the department’s product or service and assigning the necessary resources to the people on the team.
- Priorities – The manager establishes priorities for projects and tasks and makes decisions required when they have to change.
- People – Making sure that the right people are placed in the right job assignments, and that people get further training to do their jobs.
- Solutions – The manager facilitates problem solving, as needed, by directing the process of problem solving with team members, lending expertise to the process.
- Delegate – A very important duty is to delegate responsibility and accountability. In doing this, the manager gives people a clear role and a set of responsibilities, empowers them to act, and holds them accountable for results. This is the art of management. In getting the best out of people, a manager gives people the responsibility they deserve, then coaches them in their work in order to make them the best they can be, and finally holds them accountable for producing the results that are expected.
- Enable – A manager takes care of peoples’ needs. The manager is an enabler for and ensures that people get what they need in order to do their jobs. This includes equipment, training, assistance, coordination, and time.
- Communicator – One of the most important duties is that of a communicator. The manager not only communicates important information needed for people to do their jobs, but also information that is necessary for people to understand the context of their jobs. People generally want to know what the company vision and strategy is. They want to know about markets, customers and competitors. They want to know about key company initiatives and how it effects them. The manager’s job is to make sure that people know what is going on and how they are effected.
- Policy – The manager represents the company and its policies. To the people in the department, their manager is the company. Managers are familiar with company policy, communicate policy to employees, and represent the management of the company.
- Relationships – Building relationships is a key aspect of the manager’s job. The manager’s job is to establish positive and effective working relationships both inside and outside the company. One of the value-added aspects of a manager’s role is that the manager knows people and can call upon their assistance to help the department get its job done.
- Environment – The manager establishes and supports working relationship principles by creating an environment where people can count on each other. It is important to know what one can expect from another. The manager’s job is to coach people to help them understand how the team operates and to give them the understanding of each other’s role on the team.
- Objectives – Establishing goals and objectives for people is a key part of being a coach. As part of the performance management process, the manager establishes performance goals and objectives for people. This is a very formal part of the manager’s job. Establishing the objectives for people and then letting them know how they are performing in meeting the objectives is management’s bread and butter. To get their best performance, people have to understand how they are performing and be given the coaching necessary to improve. Ultimately, the manager has to formally appraise the performance of their people. This formal review becomes the determining factor for compensation changes and promotions.
- Recognition – People need to be recognized for a job well done. A manager makes sure that people are recognized for their contributions and extraordinary efforts on the job. The recognition should be timely. Recognition can take the form of anything from a sincere thank you to a substantial monetary award. The important thing is that people feel that they are appreciated for their extra effort.
- Mentor – A manager is a mentor. In this capacity, the manager advises people on their career goals and helps them get the job assignments needed to move their careers forward. Although people are responsible for their own careers, the manager can be a valued advisor in career planning.
- Manages his/her manager – Finally, a manager manages upward. That is, the manager keeps higher levels of management informed of their department’s progress that effect their commitments. In addition, the manager advises upper management on key issues and helps in the decision making process.
This is not an exhaustive list of management duties, but it represents some of the most important ones. These are the kinds of things that one should regularly expect from management as they play out their three roles of leader, project manager and coach.
