What Are You Waiting For?

Now is not the time to innovate.

Now is not the time to experiment and take risks.

Now is not the time to do anything rash, just hold the course.

No way.

Those three comments are attributed to CEOs in the last week when asked about their growth strategies. I was disappointed to hear such responses because each of them are the exact opposite of what leadership should be thinking -- that is if they want to grow their businesses and at a minimum maintain market share.

Now is the time to innovate

The ready made excuses for not innovating at this time are budgets, the economy, and we have to cut back. So the economy is challenging? No kidding. Reductions have to be made in certain areas? You should be examining your costs every year regardless of the economy. So that excuse doesn't hold water either. Your budget process is so old style is leaves no room for adjustments? Get with the new fluidity of business if you want to survive because a once a year budget isn't moving fast enough to keep pace with the world of commerce.

Innovations need to be happening every year, every day, and in every meeting. In this economy more than ever innovation needs to be at the forefront of your growth. Fear is causing people to hide and stop necessary business practices that feed the long-term health of the organization. Innovation drives growth, which creates positive activity within an organization, as well as, fuels positive attitudes which are critical to keeping the executives and the workforce focused on making things better. This economy is all the more reason to innovate, to better position your company and to create operational improvements.

Now is the time for experimentation

In talking with a restaurant owner we kicked around ideas to attract customers. We thought of many great ideas to create buzz and establish a unique message without alienating the foundation of the organizations products and services. Unfortunately, the loss of energy stopped the experimentation before it started. There is no doubt this economy is sapping people's energy and drives to try the new and different. To hear one business owner, he is just trying to put one foot in front of the other until we get back to the way it was. It’s never going to be the way it was.

Executives need to find ways to be profitable and grow in the way it is. Trying new things in products, marketing and leadership approach will have great results if you keep at it.

Try something rash and do not hold steady on your current course

Holding steady is one of the contributors to the downfall of the Big Three auto makers in this country. They didn't react fast enough to changing labor trends and customer expectations. Instead, they kept doing the same type of things they always have done. If we can put a man on the moon with the power of a slide rule, don't you think we could've invented a combustion engine that could get 200 miles per gallon?

The 1970's had the first wake up call this industry missed between the oil shortage and arrival of foreign cars. If they had decided then to try a different course of action other than seeking protection, we'd have efficient vehicles who could reach 200 MPG.

This economy is America's big wake up call. If we decide to hold steady on the course we have been in we will end up like the Big Three. I'm not saying panic at all, what I am saying is we need to crank up the innovation machines and the desire to grab hold of the new economy, and do something rash – like fight for the opportunity to be the best in a global market.

Make Your Financial Budget Fluid

After reading that title I know a few readers thought, "My budget is very fluid; it's going right down the drain." That's not exactly the fluidity I am talking about. See if this sounds familiar…

It's November and you are meeting with your board of directors to finalize and approve a budget for the coming year, and some board members want to get in line item discussions, some board members just want to get the meeting over with and some executives pad the budget knowing the board is going to want to trim every budget presented.

It's a game played out in businesses all over the country. And, the time for such games has passed.

Budgeting in the 70's was a relatively new tool for businesses not in the Fortune 500. In the late 80's budget review became a way to cut labor in downsizing efforts. In the 90's prosperity swelled budgets and executive compensation. A once a year budget review was considered often enough since the meetings were often contentious.

The new economy we are currently in moves at a faster pace than ever before and dramatic changes can happen at previously unheard of speed. The best businesses are keeping budgets very fluid. If marketing needs to invest in new technology in July to stay competitive but this was an unforeseen expense the previous November, the company must take the needed action. Seriously, what are you going to do, sit there watching your company lose market share because to spend the needed funds "wasn't in the budget" and just throw up your hands?

You'd be amazed at the hundreds if not thousands of companies that are doing just that right now.

Get in the Game

A budget did not come down from Mt. Sinai carved in stone, yet it gets treated as such. A budget is a guide line for the executives to project expenses based on the business conditions at the time of the budget creation. (Well, it should be.) But, most organization do not do industry projections for the coming year and then determine the budget necessary to be competitive and grow. They just tweak the budget from the year prior.

Do your research on what is coming in the next 12 months, and budget accordingly with the expectation that significant adjustments will be made as the year progresses as the climate dictates. You have to be in the game to know how to be proactive and use your financial resources to win.

Trust in the Decision Maker

If the board of directors can't trust the executives to make the proper financial decisions on the run as the year progresses, one of two things must happen. Either the board needs changed because they don't understand they are not a micro-managing entity, or the executive needs to be changed because he or she can't be trusted to make the right decisions.

The executive needs to have the controls of his organization. He also needs to be focused and willing to make potentially career-risking decisions for the good of the company. Those decisions often deal with financial resources put at risk through investments, research, a new direction or a marketing campaign that has never been tried before. Without a fluid budget, those decisions can't be made on the fly, and at the pace of today's business world, if you don't take action swiftly, the opportunity is gone.