SOPHISTICATED FINANCE

Decision Making and the Smart Man

Back in March I posted on the role of assumptions in developing the business and financial model. The important point was that the assumptions represent the key risks in the business model. Yesterday I read a good post on recruiting in the Private Equity and Venture Capital Recruitment blog. In the post the author suggested that one should trust their intuition and check their assumptions. The key point was that your intuition is frequently a better indicator than a rigid checklist approach.

My definition of intuition is " facts that you cannot articulate". Therefore, when you rely on intuition there are a series of facts and certain assumptions which logically lead to the conclusion--the intuition. I have on many occasions worked with highly intuitive people. Frequently I have been able to put togeher the facts and assumptions that led to the intuition. There are two points here.

1. For most intuitions the facts can be discovered, if you work at it--perhaps with another person
2. The assumptions in the intuition represent the risks in the decision or conclusion

I do not use intuition much and never have, but I have great respect for intuitive people. However, I always take the time to construct the facts and the assumptions in an intuition in order to identify the risks or the errors in logic.

Another technique I always use is the "smart man" hypothesis. Whenever, you are trying to understand something like an intuition, assume the person is very smart. By assuming they are very smart, you force yourself to find the facts and the assumptions that would logically lead to the smart man's conclusion. Dismissing something as "woman's intuition" or "off the wall" usually means that you were not willing to put in the effort to understand how a smart man would have arrived at the conclusion.

Note: I learned about the smart man hypothesis back in the early 1980s. It has served me especially well in better understanding many, many people and their thinking. I am sure it has been renamed to be more gender neutral but I do not know the new term.

Mission

In entrepreneurship and in corporate America much is made of the “mission” of the firm. The mission explains the corporate focus and principal objective of the firm. Unfortunately, the mission statement is frequently written and then ignored. Equally problematic is the executive who puts his personal ambition and recognition ahead of the mission.

An excellent example of people who understand mission are the guards at the Tomb of the Unkown Soldier in Washington, DC. This story was sent to me by several people today, the anniversary of the December 7, 1941 attack on Pearl Harbor.

In 2003 as Hurricane Isabelle was approaching Washington , DC , our 
US Senate/House took 2 days off in anticipation of the storm. On the ABC evening news, it was reported that because of the dangers from the hurricane, the military members assigned the 
duty of guarding the Tomb of the Unknown Soldier were given permission to suspend the assignment.

They respectfully declined the offer, 'No way, Sir!' Soaked to the skin, marching in the pelting rain of a tropical storm, they said that guarding 
the Tomb was not just an assignment, it was the highest honor that can be 
afforded to a service person. The tomb has been patrolled continuously, 24/7, since 1930.

CEO Needs to Consider More than Profit

A new study published by a group of academics in Arizona shows that employees are more highly motivated when the CEO focuses on more than company profitability. A survey of 520 companies shows that employees place a high value on relations with customers, their own welfare, the community and environmental issues. CEOs that ignore these concerns lose respect from employees and demotivate them. Additional detail is available in HBR December 2009.

Not a surprising set of findings but perhaps the survey results will make this type of thinking more mainstream. For those of you who do not think you can afford concerns such as the environment or the community, consider what the cost is of demotivated employees.

Management Insights from the Israeli Army

I have written about the military 11 times on this blog, with these two posts the most popular (here and here). I find the military to be an excellent source of management techniques and lessons. Today I read a terrific post (terrific being my highest level of praise) from the Israeli Consulate in Los Angeles. The post is titled "Soldiers of Fortune-How the Israeli Army became the most prolific innovation engine on earth". Setting aside the hype, this article is worth about three blog posts. You definitely need to read the full article if you have even a passing interest in management. Very valuable also if you are in a resource constrained environment.

The management lessons to be learned from the Israeli Army are:

1. Flat organizations work best when you are resourced constrained
2. Put the most talented person in charge of a mission, not the most senior person
3. Foster open communications that ignore organizational rank

The economic development lessons to be learned are:

1. Universal military conscription fosters a country-wide set of values
2. Everyone serving in the military creates more cohesiveness because people are exposed to all social classes and are forced to work together
3. Mandatory military service creates more mature, experienced and serious students when they later enter university

The human resource lesson to be learned is that participation in elite units, such as military intelligence, is a very good indicator of future performance. Elite organizations, whether it be MIT, the Seals or JP Morgan, all screen for certain qualities that will also benefit your organization. Pick people from elite organizations.

Another interesting thing about the article is we could have changed Israel for Singapore and the story would have been identical. The only difference is that in Singapore they encourage the most talented people to stay in the military for 20 years and then to retire into senior positions in the leading quasi-government companies. Singapore is also more hierarchical. Nearly the same model for another successful small country.

So if you are running something small with limited resources--such as a startup--there are many good ideas here from the Israeli Army. Next post we will talk about innovation and the Israeli Army.

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Talent Rarely Matches Ambition

The ambition and passion of young entrepreneurs is rarely matched by their talent and experience. The Netsetter has a good post entitled "Replace Yourself--A Guide to Delegating Your Workload" which encourages founders to trust employees and delegate. This may speak to the point about supplementing talent but it is a less effective solution in filling in for the missing experience.

Venture Hype has a new post that shows that the average high tech founder launched their business at 40. VH stated the following advantages for the older founder:

• They offer a lot of experience

• They are more cautious

• They are likely to have their own funding

• They have nothing better to do

• They have credibility with bankers and customers

Bottom line, experience comes with time, which young entrepreneurs can rarely make up. The good news is that many of you will live to be 100. Maybe taking ten years off to work for a really good company before you start your business is not such a bad idea. As St. Augustine said:"Patience is the companion of wisdom".

The Role of Principles in Management

A Major's Perspective is one of my favorite blogs. I particularly enjoy the quote of the day because he frequently references people that I have not studied in depth. The quotes are particularly poignant when you realize that the Major wrote them from an outpost in Afghanistan or is just back from such places.

Today's quote was from Winston Churchill.

"In critical and baffling situations it is always best to return first to principle, and simple action"

Management also faces critical and baffling situations, rarely as dire as warfare but never the less serious. The question becomes what principles should management return to. What I have found over the years is that the principles that get you through tough business situations such as a government overthrow, a financial crisis or a natural disaster are:

1. A respect for human life and the treatment of all people as equals (as taken from the Bible, the Koran, the Talmud and the teachings of Buddha). Price gauging, massive layoffs, store closings, etc. are usually not in the company's best interest. Staff and customers remember your bad behavior and expect it to be repeated even if things return to normal.
2. Micro-economics, the class everybody sleeps through, provides the best set of basic decision making principles. Concepts such as marginal cost and opportunity cost almost always lead to the correct decision, provided you follow #1.
3. Risk-reward trade off, the most fundamental concept in finance, is a necessity in good decision making. While most people focus on the reward side, the energy and intellect should be focused on thoroughly understanding the risk, especially in times of crisis. Remember the biggest risk is almost always on the liability side of the balance sheet.

Sir Winston's last point--simple action--applies all the time and not just during a crisis. As I have said here before (post), you do not understand something until you can explain it simply. From simple explanation usually comes a simple action plan--particularly important in times of crisis when stress levels soar. And always remember, if life is not at risk, its not really stressful.

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Scientific Thinking as a Management Method

Yesterday I spent the day with one of the most well known academics in the U.S. This man has spent a good portion of his life successfully working with real student geniuses to develop break through technologies. Our day was devoted to working through some complex business issues. What was interesting to observe was how the world renown thinker participated in the discussions. His style is summarized below.

1. He rarely spoke more than a sentence or two at one time
2. He questioned people's logic and not their conclusions
3. He was not afraid to be thinking about the issues and his own positions evolved during the meeting
4. He let people go off on tangents to see if anything meaningful would be discovered
5. He frequently let people discover the conclusions rather than giving his position

This man's style was so in contrast with most CEOs I have seen that it was noteworthy. Perhaps a lifetime devoted to science and research shaped this approach. Two lessons to be noted.

1. If as the leader you begin by stating your position, there is little chance to develop a better solution
2. Letting people discover conclusions gives them a more profound understanding of the material

Jean Piaget said "scientific knowledge is in perpetual evolution; it finds itself changed from one day to the next." Perhaps the other lesson to be learned is that we should be slow to reach conclusions. We can act on the conclusions developed to date but we should constantly be refining them.

How to Make VC Mentoring Work

@philmur posted a good question in response to yesterday's post on VC mentoring. He asked:

"How specifically would you recommend entrepreneurs better experience the mentoring potential of their VC's?"

Most entrepreneurs are usually good at some of the following:

• product development/tech
• selling
• story telling

Most entrepreneurs have little experience in:

• starting a new business
• business strategy
• managing an organization
• raising capital
• cash flow management

Most VCs are good at:

• evaluating business strategies
• forecasting operating performance 
• forecasting cash flow requirements
• raising follow on capital
• managing an exit

The key to develop the maximum benefit from VC mentoring is to recognize where the VCs have vastly superior knowledge and show respect for that expertise. The ill will that undermines the mentoring relationship usually develops in either the area of business strategy or capital raising. If the VC disagrees with the proposed strategy, they rarely will tell you that you are wrong. However to barge ahead with your plan and not take the time to reach an agreement with the VC is almost always a mistake and can lead eventually to management changes. The same is true with capital raising. If you and the VC disagree it means that you have not convinced the VC and you need to continue the dialog. If after 2-3 board meetings you have not convinced the VC, you are probably wrong!

Like with good marriages, keep talking until you reach an agreement.

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Miami, FL

HBS: A New Model for Innovation

Innovation is a subject that interests me, in part, because of its critical role in entrepreneurship. Christensen may have defined the economics of innovation, but the process of innovation continues to be a subject of much continuing research and study. Today's HBS First Look led me to an interesting article about the research of HBS faculty member Karim R. Lakhani. Lakhani's area of interest is the open-source software community, but this work has lead him into research on "models for innovation".

Lakhani draws two important conclusions about the process of innovation:

1. Introducing problems to those with expertise at the periphery of a problem produces the quickest and most effective solutions
2. "Innovations happen at the intersection of disciplines."

The lessons to be derived from this research include:

1. Experts, such as CEOs, do not necessarily produce innovative solutions
2. Diversity in the workforce probably encourages "expertise at the periphery"
3. To be an innovative thinker one must be multi-disciplined, studying and solving problems in unrelated fields, e.g. mathemeatics, music and education

A SF post from October 2007 about my friend Jeff Stamp made both of Lakhani's points. The credit probably goes to Jeff who also teaches and does research on innovation in entrepreneurship.

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The Discipline of Writing

Will Price is a blogger who I like very much. In a post today he references a quote from William Faulkner, which is below.

"Faulker said, "I don't know what I think until I read what I said." That's not just a joke. You learn what you think by codifying your thinking in some way. Codifying one's thinking is an important step in inventing oneself. The most difficult way to do it is by thinking about thinking  - it helps to speak or write your thoughts. Writing is the most profound way of codifying your thoughts, the best way of learning from yourself who you are and what you believe."

Will goes on to expand upon this quote in the context of blogging, but I think it also directly relates to my post The Discipline of Elegance and Simplicity.

Clear and measured writing requires a discipline to distill the complex into a more understandable form. In fact, I would go so far as to say that people who do not write well usually have not, in part, thought something through completely. If you are not using writing as a means to refine your thinking, you are missing out on a valuable tool.

To improve your writing (so you have fewer excuses not to use the technique), Elements of Style is a classic instructional text. It was written in 1918 and is still widely used in colleges and universities. It is only about 100 pages, so it is an easy read.

The Discipline of Elegance and Simplicity

I have a long held interest in both good design and mathematics. The common thread in both these subjects is that properly done, both achieve an elegance and simplicity in the expression of complex ideas and concepts. To achieve the necessary simplicity and elegance requires considerable discipline. In fact the discipline in some ways becomes the methodology to produce the end result. This type of discipline also applies to how you think about your business and communicate it to customers, prospects, employees and shareholders.

I try to avoid controversial issues in this blog, except for my occasional advice to President Obama on foreign affairs :) I am not violating my own policy, but a bumper sticker I saw yesterday illustrates the power of simplicity and elegance. The bumper sticker said:

"It's a child..not a choice"

I thought that this phrase was the best framing of the anti-abortion position that I have seen. Clear, simple, focused, but with the ability to generate an emotional reaction from the reader. In fairness to the pro-abortion side, perhaps this phrase is equally compelling:

"Do not legislate...in my body"

The point here is not about the abortion debate but to illustrate the power of distilling a complex issue down to its simplest concept. Simple elegance is very compelling. An example from the One Laptop Per Child project illustrates this point yet again. The one liner to explain the project is:

"Give a laptop. Change the world."

Equally strong might be the following:

"One child...One laptop"

Ernest Hemingway, the renown writer, was once challenged to write the shortest story possible. The result was a six word story, which Hemingway later went on to describe as the best story he ever wrote. The story in its entirety follows:

"For sale. Baby shoes. Never used."

Simplicity and elegance can initiate an emotional response that engages the reader/customer. If you can not distill your business concept down to a single elegant phrase, you probably do not sufficiently well understand the concept. The discipline to achieve a simple and elegant description will help you to really understand your business, greatly improve your message and probably help all the constituencies you need to communicate with to better understand the business concept.

Notes:(a) to encourage simplicity and elegance throughout your organization, stop telling people the length of the document you want. One of the best student papers I ever received answered three questions in only ten sentences about the complex book by Israel Kirzner-- Competition and Entrepreneurship. (b) the best book on simple and elegant PowerPoint design was written by Stephen Kosslyn, who has a new book coming out that I received from Oxford University Press as a pre-release draft. More on that later.

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Miami, FL

Best Posts--Management

This week I am traveling in Asia for a client. Posts may not be as frequent as usual. What follows are the best posts in management.

1. The Stages of a Startup AUG-07
2. Customer-centric Management NOV-07
3. Ideology JUL-08
4. Delegation JUL-08
5. A Competent Team JAN-09
6. What is Sophisticated Finance JAN-09
7. Corporate Culture Understood JUL-09

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Why Entrepreneurs Lack Focus

My Twitter reading this morning of Spanish posts on entrepreneurship highlighted a post on Loogic (SP)-- "The Difficulties of Entrepreneurs to Focus" (Spanish language post is here). Lack of focus or the inability to focus by the founder/CEO is one of the biggest reasons that early stage companies fail. I may not have enough evidence for a journal article in academia, but I see the focus problem almost everyday.

The writer cited three reasons that explain the lack of focus:

1. To focus requires clear goals
2. To focus requires faith in the strategy being pursued
3. To focus requires the ability to say no to offers of deals, partnerships and other "home run" opportunities

My thoughts on the lack of focus of entrepreneurs are very similar to the writer, but what caught my attention was the concept of faith.

By "faith" what we are really talking about is self-confidence. Many entrepreneurs lack confidence in the strategies they thoughtfully prepared for their new business, especially after one or two setbacks. An example may illustrate the point.

The founder of a website that sells a specialized piece of software budgets $20 for customer acquisition on a product selling for less than $50. When I asked why such a high budget, the founder told me "I am not confident about my marketing strategy so I added a cushion".

Rather than having confidence in the original plan or re-thinking the marketing plan, the entrepreneur changes the whole marketing approach by changing the spending levels. A lack of focus is brought about by a lack of confidence.

To improve self-confidence in business decisions, three tips follow:

1. Bounce important plans and decisions off your mentor(s)
2. Research competitors for how they executed similar projects
3. Look for analysis of similar issues on blogs (VC blogs are particularly useful)

How do you know when to use these techniques. As any sailor will tell you, "when in doubt--reef the mainsail". When in doubt about a major decision, use the three techniques above. For those of you who believe that entrepreneurs must use their intuition or gut instinct, always remember that intuition is just "facts that you can not articulate". The facts will come from 1-3 above.

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Miami, FL

Leadership

Drew Faust, President of Harvard University, recently made some remarks to commemorate the 100th anniversary of Harvard Business School. Amongst the topics, he spoke about leadership and the five essential elements that HBS must teach.

1. Developing judgment
2. Having an entrepreneurial perspective
3. Using good communication skills
4. Behaving with integrity
5. Having the courage to act

I find two essential elements missing from the list.

First, there is no concept of commitment to the mission--the over riding principle for which the organization is devoted. Examples of missions might be "defending the U.S.", "improving the lives of our customers", or maybe even "increasing shareholder value".

Second, there is no element of selflessness--putting the good of the team, the company or the country ahead of your personal ambitions.

When it comes to leadership, I prefer the way it is taught at West Point. I think bullets bring a clarity of thinking that the Harvard professors may be missing. For more on the West Point philosophy of leadership, read this post.

I found the story through this post.

Miami, FL

Ohio Entrepreneurship Workshop

I am taking my show on the road. I am joining the folks at Bold Thinking to do a two day advanced workshop on entrepreneurship in Cincinnati on October 24-25. The "advanced" workshop is for company founders who are already in business but are probably struggling with their growth strategy or value creation. Bold Thinking's approach is summarized in this quote:

"The most important tool that today’s entrepreneur must possess is the ability to make value sustaining decisions that directly relate to their enterprise’s ability to remain competitive.  The Bold Thinking methodology provides a proven framework for decision-making designed to enhance the creation of value and strengthen competitive advantage." 

The workshop will combine lectures with case studies to improve business owner decision making. Also, each attendee will be able to work one-on-one with each of the workshop presenters to refine their business model and value creation strategy.

Bold Thinking was founded by Dr. Jeff Stamp and Colleen Post. Jeff is a widely recognized expert on innovation and creativity. He has worked with companies such as Pepsi and American Express on new product development and consulted to large companies around the world. He has also started four or five companies. Colleen and I worked together at the Pino Entrepreneuraship Center at FIU and she was instrumental in encouraging me to develop my workshop series on business model and financial planning. Colleen's area of expertise is in helping companies understand how their customers see them, a valuable but rarely discussed subject.

For more information on the workshop, send an email to post@boldthinking.com or contact me.

Enterprise IT

Jeremiah Owyang is a former star analyst at Forrester Research and writes a well regarded blog called Web Strategy. In a post today he writes about collaboration and says:

"...IT must develop a collaboration strategy or run the risk of being blind-sided by business units developing it without them." (My emphasis)

At first this comment struck me as uncharacteristically not profound. Then I realized the real error--it begs the question of what is the mission of enterprise IT today. Web 2.0 and social media has turned all of us (with a heart beat) into "guerrilla" content providers, videographers, entertainers and diarists. The related technologies have unleashed a worldwide creative potential probably not seen since Gutenberg. To think that these technologies and methods will not be brought into the workplace is naive, but to think that the "company" should control these technologies is to miss the really big opportunity. These technologies liberate the workforce, foster unparalleled creativity and unencumbered by corporate IT departments will lead to a pace of change in business process and business model that is unheard of in corporate America.

What I think enterprise IT should become in the face of this dramatic change is:

1. The operators of the network (somebody has to maintain and upgrade connectivity and maybe maintain security)
2. Special forces type operators who possess certain special skills (e.g. Oracle, AWS, etc.) and are parachuted in to do quick prototyping for a project, if needed

Everything else is handled by individual employees. Productivity software selection becomes a personal decision (perhaps within a budget constraint), collaboration products are selected largely on the basis of who on a team will take the responsibility to maintain the collaboration platform, enterprise software is in the cloud and all that is really needed is domain expertise (accounting, finance, etc.) and whatever does not fall into these categories is probably outsourced to SAAS providers.

Some will argue that today's workforce requires training on software and therefore my model is tragically flawed. In another 5-10 years a whole generation of workers will have grown up with computers. There is no training or training manual for Facebook and workers will have developed the skills to learn software without help, especially if they get to pick the software they use. This new generation is also learning to use their "communities" for help on all kinds of questions and will naturally reach out to these informal sources for help.

The new technologies are breaking down the centralized control model of business in favor of greater individual initiative. Enterprise IT people better buy paratrooper boots (for dropping in) or go to work for cloud computing and SAAS companies.

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Miami, FL

Standards Affect Outcomes

 

Yesterday I heard Nicholas Negroponte speak at a conference. Dr. Negroponte was the founder of the world famous MIT Media Lab and now devotes considerable time to the One Laptop Per Child project (OLPC) which he also founded. Through OLPC, Dr. Negroponte is credited with inventing the netbook computers that are becoming so popular.

Dr. Negroponte told a story about how he founded the MIT Media Lab and decided that he would not solicit government grant money as the means to finance the organization. His concern was that the reporting and review process related to government grants would limit the risks that the researchers would be prepared to take in exploring new applications of computer technology.

The management lesson here is that how you set the standards for performance has an effect on the outcomes derived. Dr. Negroponte was willing to accept some failures in order to achieve significant breakthroughs and therefore eliminated standards (government grant review) that conflicted with this approach.

An example from my days in retailing may illustrate the point more simply. We started a new merchandise department in the stores. The merchandise we selected sold out in one day. All the buyers were ecstatic because they had achieved their sales goal so quickly. I asked "how much more of that same merchandise can we sell". By asking this simple question, I was able to change the standard to the riskier but more profitable goal of maximizing sales rather than selling out the inventory. The department went on to achieve $40 million in annual sales.

My experience is that people are incredibly resourceful and effective in achieving goals, given the proper resources, training, standards and goals. If results are sub-par but you have given the proper resources and training, the problem could be that you have established the wrong standards and you may not be encouraging people to take enough risk.

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Miami, FL

Entrepreneurship Class 1

Yesterday was the start of a new semester at FIU. I have about 65 entrepreneurship students including 15 students participating remotely by video from another school. All the video will be archived, so I am thinking I may be able to do a video series of my entrepreneurship lectures.

I begin the semester by trying to dispel the illusions the students have about entrepreneurship. First, I explain the difference between self-employment and entrepreneurship. Entrepreneurship is about company building and ideally large companies.

Then I explain that entrepreneurship is not about epiphany moments but rather based on a rigorous analytical process, which is the five step process I teach and that forms the core of the course. I quote Peter Drucker, as follows:

“Entrepreneurial management is not natural, creative, or spontaneous but instead is based on a systematic, thoughtful approach….”

I then develop the theme that financial reward is a bi-product of entrepreneurship and executing one's passion should be the focus. Consistent with this theme is the idea that entrepreneurs should be building companies that are socially responsible and not just focused on profitability. The quote to illustrate this point comes from Eric Ries, a Venture Advisor at Kleiner Perkins (a world renown venture capital firm).

"Every startup has a chance to change the world, by bringing not just a new product, but an entirely new institution into existence. That institution will touch many people in its life: customers, investors, employees, and everyone they touch as well. I believe we have an obligation to ensure the resulting impact is worthy of the energies we invest in bringing it to life."

To conclude the first lecture, I show the TED video of Richard St. John on the "8 Secrets of Success". Richard's eight factors are recurring themes through out the semester. Just watch this very entertaining video to discover the 8 key factors.

Corporate Culture Understood

I will admit that I have never understood all the academic and professional interest in corporate culture. In my naive view of the world I always believed in five simple concepts:

1. Always be ethical
2. Always act in the best interest of the company
3. Work really hard
4. Hire the smartest people
5. Promote from within and develop your people

I always knew that many companies just paid lip service to culture and values. Until yesterday maybe I had seen one believable description of a culture or value system (Chase Manhattan Bank circa 1977). Yesterday on the NetSetter I read a presentation on the corporate culture at Netflix, a successful, publicly traded company. The thought that went into this presentation makes the culture believable. The clarity of thought actually makes it an incredible tool to understand what is meant by "corporate culture". The value system espoused is spot on correct. I would probably not change a word in this presentation. This presentation will become a classic in the teaching of corporate culture. Read all 128 slides, then study it.

The presentation is also an excellent introduction to human resource management. Reading it from that perspective should also be beneficial to any start up.

Miami, FL

Guest Post: Who is Managing The Business of Your Business?

With so much success from the Rickert Warnelid guest posts (here and here) on project finance and financial modeling, I have been actively seeking out new guest bloggers for here at SF. I met Deborah Koch, Senior Vice President of Gibraltar Bank in Miami, at a breakfast networking event. Gibraltar Bank focuses on serving small and middle market private companies and entrepreneurs. Deborah's understanding of entrepreneurs impressed me so I asked her to do a guest post, which follows.

Remember your first and probably second years in business?  You wore many hats --- CEO, Sales Manager, HR Director, Operations Coordinator, Purchasing Associate, and Receptionist, just to name a few.  You took on these diverse roles to efficiently launch your dream; either you couldn’t afford to hire professionals for these jobs, or just wanted to do it your way.

 

In short, you ran the business of your business.  Somehow, you carried this off in addition to delivering the special skill that drove you to start your company, whether it be as an inventor, consultant, writer, plumber, or chef.  

 

This is a common entrepreneurial dilemma…how do you maintain and grow your business and deliver your unique value proposition?  Can you be adept at both?  

 

We all know success stories that make the answer to this question a resounding YES; however, these people are not successful by accident.  A close friend who runs a CPA firm told me it was years before he trusted anyone else to make business decisions, but eventually he was so busy being a CPA that he had to hire a professional manager for the firm. In those early years, he spent many late hours tending to routine responsibilities necessary to keep the firm on the right path --- everything from ordering office supplies to paying the bills and hiring staff. 

 

When you are ready to share your dream, here are a few tips to help you grow into your role.

Trust.  Hire smart people whom you trust.  Letting go is much easier when your staff is empowered to perform.

 

Delegate.   If you trust your team, let them do what you hired them to do.  They may do it a little differently than you would have, but you never know, it just may turn out better.

 

Plan.   At least once annually, take time away from the office to plan for the next year, next five years, next ten years.  Include your management team however large or small the group.

I like the clarity and elegance of Deborah's advice. Maybe we can have her back for more guest posts.