You’ve taken the time and gone to the expense of hiring people in order to create leverage in your business—that’s the good news. The question is, “How can you maximize that leverage?”
Well, as you’ve probably already discovered, there are a number of factors that influence how your employees perform. For example, if morale is high, they perform at a much higher level. If morale is low, they perform at a much lower level. Whether we want to admit it or not, if we take the same employee with the same skill set, they have a lot of discretion related to how they use their talent.
So, how can you ensure that you’re going to get the best performance out of your people day in and day out?
Well, the best driver of continual performance is culture. Culture is the 24/7 driver of your workplace, which, by extension, is the driver of your people. If you get the culture right, you can dramatically increase the probability that your people will perform at optimal levels. If you build the wrong culture, you’ll get less than optimal results.
In light of that, what’s the best kind of culture for you to create for your business? Well, here are a few ideas about how you can build the kind of culture that your employees will love.
I. Challenge Them to Be Their Best
While it’s easy to assume that as a business owner/entrepreneur that your employees would want a place where everything is given to them and nothing is required, that’s not actually correct. The A players that you want to build your business with all flourish when being challenged. They know that there’s far more in them than they’re currently experiencing. So, they want a boss who will push them to find that extra gear.
Unfortunately, too many business owners and entrepreneurs are driven by fear (“What if I push them too hard and they choose to leave? Then I’ll be stuck and have to do more work.”). The result is that they tend to lower their standards. They don’t confront. They don’t challenge. They don’t raise expectations. In essence, they become enablers where employees can underperform for years and not get in trouble. In other words, they create the wrong kind of culture where underperformance is accepted as just the way it is.
But that’s not a great culture if you want to maximize leverage. Instead, you want to give your people challenging assignments. You want to hold them accountable. You want to let go of underperformers. You want to push them to find that extra gear. And you want to let your people know you believe in them more than they believe in themselves.
When you create that kind of culture, where everyone is seeking to be their best version of themselves, that’s the kind of high octane culture that A players will be attracted to and where they’ll produce their best work.
So, how are you doing at challenging your people to be their best?
II. Over Communicate. Over Communicate. Over Communicate.
As you’ve heard me say before, “In the absence of information people fill in the blanks, and usually with negative assumptions.” As the leader, you will always have access to far more information than anyone else—and what you’ll probably do, if you’re normal, is you’ll forget that they don’t know what you know.
However, employees hate being left in the dark. They hate it when someone else in your business (or, even worse, when a customer) says, “Do you know about X?” and they have no clue what X is. They hate not knowing how your company is performing, how they’re performing, or what’s coming up next (and so would you).
If you use the basic rule that it’s impossible for a leader to over communicate (or cast vision too much), that’s a good place to live.
Your communication with your team could be a daily or weekly update to the entire staff. It could be a video message. It could be a few minutes during your daily meeting or weekly staff meeting. It could be on your company blog (if you have one). It could be one-on-one communication. Whatever the form, it just needs to be a constant.
And anything new that comes up that you think your people might want (or need) to know, communicate that immediately. Live in the world of over communication (remember, most people miss marketing messages two out of every three times, which is probably a good rule for you to adopt concerning your internal communications).
Employees love a culture where they’re not kept in the dark but feel like they have a good up-to-date read and pulse on the place where they work.
So, how are you doing at making sure everyone who works in your business is up-to-date on what’s going on in your company?
III. Be Generous
As an employee, you know that small businesses are designed so that the business owner/entrepreneur will get a disproportionate amount of the money that comes into that business. After all, it is their business.
But they also know that the owner/CEO has some discretion with how funds are used. And based on how those decisions are made, they know if the company they work for is led by a generous person or a stingy one.
Years ago, I remember reading a line from Rich Schefren that I loved.
“Design your business so that everyone wins.”
I love that. And so will your employees.
In other words, don’t pay the least amount possible. Pay well. As a business owner/leader, you want to provide well for the people who are employed by you so that they don’t have to worry about making their ends meet (especially if something bad were to happen to them). The little bit extra you pay above the norm will generate much better performance and always be a worth the investment.
But don’t limit being generous to pay. Be generous with benefits. Be generous with flex time. Be generous with special bonuses. Be generous with your time. Be generous with little gifts. As a small business owner, you can’t be like a Google and have a cafeteria with free gourmet food, but you can regularly surprise your people with lunch (or an ice cream truck or upgraded coffee or donuts or …). Employees love working for someone who’s generous (not stingy).
So, how are you doing on creating a culture of generosity?
IV. Make Celebration A Way of Life
Everyone loves winning. And everyone appreciates encouragement.
When an employee feels that their boss notices and takes the time to say, “Thanks!” that means a lot. I remember back in the early days of my former career as a pastor, when our church had no money, I used to give away copper top awards (i.e. a penny on top of a styrofoam cup with a handwritten message on it … I dare you to spend less :-). Yet, I could visit someone’s house years later and I’d see those copper top awards still on their shelves. Most people are starving for appreciation. So break the cycle!
But beyond celebrating individual achievements, make sure you celebrate team wins as well. Bringing in cake and ice cream. Or take everyone out to Dave & Buster’s for two hours to play to celebrate that you landed a big contract or hit a key metric or successfully launched a new product. This is the kind of stuff that makes employees feel like they’re both appreciated and part of a winning team.
At the end of the day, winning teams win. There is an air of invincibility that accompanies a team that feels like they’re winners.
Unfortunately way too many business owners don’t celebrate often enough which then leaves their team performing at sub-optimal levels. Make celebration a way of life and watch their performance soar!
So, how are you doing at creating a culture of continual celebration?
V. Model Your Values
One of the stupidest phrases ever uttered was/is, “Do what I say, not what I do.” Hogwash. People do what people see.
Employees hate duplicity. They hate it when they’re required to do something and you don’t do that thing. Or they hate is when you tell them, “Here at XYZ Corp. one of our core values is … “ and then you go out and break it.
- If one of your core values is speed, make sure you get stuff done fast (and they’re not frequently waiting on you)
- If one of your core values is excellence, make sure your work product is excellent (with no obvious mistakes)
- If one of your core values is resourcefulness, make sure you’re resourceful (and not coming up with excuses for why your stuff isn’t completed)
- If one of your core values is respect, make sure you model respect towards everyone (including the cleaning crew)
- If one of your core values is honesty, make sure you reek of integrity (and no one is questioning your actions or words)
- If one of your core values is continuous improvement, make sure you’re the model for learning in your company.
When it’s all said and done, culture is primarily driven by the stories we tell and the model we set. And of the two, the model we set is the more important of the two. Why? Because it’s easy to say something. It’s harder to live it out. That’s why people do what people see because they know those are the real values.
On the other hand, when employees see a boss who “walks the talk” they’re highly motivated to live that way themselves and to produce at a higher level.
Simply put. Duplicity is a morale killer. Integrity is a morale builder.
So, how are you doing at modeling your values 24/7 for fifty-two weeks per year?
Building a culture your employees love isn’t all that difficult. It’s just rarely tried. So, if you want to turn that around, make sure you follow all five of these culture builders.
- Challenge them to be their best
- Over communicate
- Be generous
- Make celebration a way of life
- Model your values
If you do those five things on a consistent basis, you’ll find that your employees are loving your business more and more. That in turn will translate into higher and higher performance which will lead to greater and greater leverage—which will ultimately result in you building a faster growing, more scalable and successful business.
To your accelerated success!
When you get up in the morning, what do you focus on? When you arrive at work, what do you focus on? As you’re going through your day, what do you focus on? As you look at your week, what do you focus on?
If you’re like most of the business owners and entrepreneurs I’ve met, you don’t intentionally choose what to focus on, you just do. In other words, your focus is primarily reactive, not proactive—and that’s a problem. Why?
Because whatever you focus on determines how you feel, how you use your time, how you order your day, how you perceive what’s happening to you and your company, what you pay attention to etc. Virtually everything in your life (and mine) is driven by focus.
For example, if you choose to focus on finding something wrong that someone is doing, you’ll find it. If you focus on finding something right that they’re doing, you’ll find it. If you focus on last week’s results, you’ll be stuck in the past. If you focus on opportunities that this week presents, you’ll be motivated to make sales calls.
So, if virtually everything is driven by focus, as a business owner/entrepreneur what do you think you should be focusing on in order to get the most optimal results for your business?
Well, if that question sounds interesting, here are four things I believe every business owner and/or entrepreneur ought to be focusing on every week.
I. Driving Top Line Revenue Growth
It’s amazing how many things can draw our attention away from driving top line revenue in any business. Ask three business owners what they’re working on this week and you’ll probably get answers like the following
- Redesigning our website
- Figuring out what to do with the new overtime regulations
- Solving a problem with a customer delivery or installation
- Preparing for a staff meeting
- Preparing staff performance reviews
- Working on next year’s budget
- Creating a video for the company’s Facebook page, etc.
You get the idea. Now, it’s not that any of those items are bad items. In fact, they’re all good items. The problem is that they all suck up time. They all divert attention from priority number one—which is getting more dollars walking through the front door.
Years ago, I remember someone saying something along the lines of, “The problem with most Americans is that they’re really good at doing second things first.” And that’s pretty accurate for most business owners.
Priority #1 is a revenue issue. As Mark Cuban says, “Sales solves all problems” (note: obviously an overstatement but you get the idea).
The number one thing that every business owner/entrepreneur ought to be focused on every week is how can we get more dollars walking in through the door? Everything else is secondary. Yet, how often does #1 get pushed down the ladder to the tenth item or even to an item for next week’s to do list? More often that most of us want to admit.
Since what you focus on determines virtually everything about your business, what difference do you think it would make if you chose to deliberately focus on driving top line revenue every week? My guess, a pretty big difference.
II. Increasing Bottom Line Profits
As I wrote about last week, I never cease to be amazed at how many business owners/entrepreneurs get so focused on top line revenue growth that they forget about bottom line profitability.
Yet, at the end of the day, it’s not what you bring in that really matters most, it’s what’s left over when everything else has been paid off, that really matters.
In other words, revenue and profit aren’t an either/or proposition, they’re a both/and. However, the order does matter.
If you don’t have enough dollars flowing through your business, it’s hard to make the profit figures work. However, once you do have the dollars flowing through, then it’s also about focusing on how to make sure you’re generating the right gross and net profit margins in order to make all the work you and your people do worth the effort.
Now, I won’t repeat all of the ideas I shared last week. But suffice it to say, if you want to find more financial freedom in your business, you’ll want to focus more on both driving top line revenue growth AND increasing bottom line profitability every week. It’s really not an either/or. It’s a both/and.
III. Creating Additional Capacity
This is another one of those issues that most business owners/entrepreneurs don’t pay a whole lot of time and attention to which then creates a huge problem for them and their businesses. Why? Because capacity is one of your primary limiters—and it doesn’t matter what size business you’re leading. If you’re leading a $500K/year business, you could be leading a $5M/year business … if you had the capacity to do $5M/year. If you’re a $5M/year business, you could be leading a $50M/year business, if you had the capacity for a $50M/year business (or a $5B business). It really is all about capacity.
- If you don’t have the capacity to lead a $3M/year business with 20 employees, you’ll probably never get there
- If you don’t have your entire business systematized, you’ll probably never be able to scale
- If you don’t have quick access to lots of capital, your business will probably stall out
- If you don’t have easy access to additional qualified employees quickly, you’ll probably find it difficult to handle a rapid influx of new orders.
It really is all about capacity. And when I’m talking about capacity, some it it’s your capacity. Some of it is your top team/direct reports’ capacity. Some of it’s the capacity of your people. Some of it’s the capacity of your technology. Some of it’s the capacity of your systems. Some of it’s the capacity of your finances or your ability to access additional capital, etc.
The reason this matters is because if capacity is your great limiter, what do you think the implications would be on your business if you thought about creating additional capacity before you had to? My guess, huge!
This might mean you need to find a mentor or coach (or even possibly join my coaching club). It might mean scheduling time each day to learn something new so you’re improving your weak areas every week. It might mean spending more time working on staff development or sending more of your people to conferences. it might be investing more time in building your virtual bench. it might mean changing your CRM so it can better grow with you. It might mean building better relationships with capital sources before you need them. Etc.
The options for building additional capacity are virtually limitless. But the key for you if you want to keep growing your business is to work on creating more capacity every week. Why? Because if you keep creating and building more capacity in you and your business every week, you’ll keep breaking through any built in limitations BEFORE they become a major hinderances in the future.
So if you want to build a more scalable business, you’ll want to continually be thinking about creating additional capacity before it’s required.
IV. Improving Team Performance
As a business owner/entrepreneur, one of your goals is (or should be) to create leverage. For example, it’s one of the reasons why you choose to hire people.
However, just hiring people never ensures that you’re getting the best from them.
In fact, everyone has more potential in them than they’re currently presenting which is why one of the top four things you should be focusing on every week is increasing your team’s performance. The better they perform, the more leverage you create—both in terms of their capacity to do more and their capacity to perform at a higher level.
With all things being equal, with the same team, you can either get 20 hours of value out a 40 hour work week or 55 hours of value. You can either handle a maximum of 50 clients a month or a maximum of 100 clients a month. You can either get a big project done in three months or in three weeks. It’s all about team performance.
So, what tends to hinder team performance? Believe it or not, from my experience, your willingness to push your people to be their better selves. Way too many business owners/entrepreneurs either leave their people alone hoping that they’ll do their job well (and hope is a bad strategy) or they’re afraid to push their people because they want their employees to like them. Either option is bad.
In my book, you have to care enough about your employees to be willing to be disliked or misunderstood in order to help them move closer to their full potential. I remember several years ago pushing one of my staff when he said, “Bruce enough. There’s no more of me to go around. I can’t do any more.” To which I said, “Well, that’s where you and I disagree. I happen to believe in you more than you believe in you. You have far more in you than you’re willing to unearth on your own.”
This is true of everyone (including you and me). We all have more potential than we’re either willing to or able to unearth on our own—which is why we all need someone outside of us to help push us to unearth that part of us that we’re not willing or able to get out into the world on our own.
And what is true of us as individuals, is also true of us as collections of individuals. Your team has far more potential than they’re currently presenting and they need you to unearth that potential. It will never happen on it’s own. It needs you.
Note: in case you’re curious, being a good coach who’s willing to push his/her people to be their best is not the same thing as being a jerk. This is not a call for jerkiness.
So, if you want to create more leverage through your business, my recommendation is that you have to be willing to push your people to be their best—both on an individual level and on a corporate level, even if they won’t always like you, because they’ll never get there without you.
Bottom line, if you want to build a more scalable and successful business, there are four things you need to focus on every week. They are what I call the 4 Pillars of Business Success.
- Driving top line growth
- Increasing bottom line profits
- Creating additional capacity
- Improving team performance
Or if you prefer the shorthand version, the four pillars are Growth, Profits, Capacity and Performance.
If you choose to focus on all four of these pillars each and every week, you’ll be way ahead of the rest of the crowd and you’ll end up with a business you love.
To your accelerated success!
P.S. If you’d like a visual of the 4 Pillars, click on the image below.
As hard as you work, doesn’t it make sense that you ought to be able to bring home as much money as possible? Absolutely. It’s one of the primary reasons why people like you and me start businesses. Yes, we start them to make a difference, to solve a problem, employ people, support our communities, etc. But we also start them (and work hard in them) in order to provide a good income for ourselves and, if you have a family, your family.
However, far too often, business owners and entrepreneurs spend way too little time managing the bottom line. Driving top line revenue gets a lot of press. Solving team problems gets a lot of time. But, at the end of the day, the metric that matters most often gets the least amount of attention (i.e. net profit).
Over the years, I’ve watched people double, triple, even quadruple their gross revenues and yet not see any significant growth in their profitability. Why? Because they were totally focused on top line growth and not bottom line profitability (despite my warnings).
In my coaching club, two phrases I frequently use, that you may or may not be familiar with are
1. Revenue is vanity, profit is sanity
2. Revenue is for show, profit is for dough
When it’s all said and done, it’s the number at the bottom of the income statement that really matters. That’s the number that builds your net worth and decreases your stress.
So, how can you dramatically increase your profits so you can decrease your stress and have a bigger nest egg?
I. Increase Your Prices
Now, before you think I’m cheating on how to increase your profits, this is probably the biggest lever for increasing profitability. Why? Because most business owners and entrepreneurs tend to think that prices are fixed—and they’re not. Pricing is far more elastic than most of us think.
For example, let’s take a burger. Can you buy a burger for a buck? Absolutely. Can you buy one for $2.99? Yep. How about $4.99? Same. How about $9.99? Yep. How about $14.99? Okay, how about $25? Yep. How about $1,728? Yep. You can buy a seventeen hundred dollar burger with black truffles, Kobe wagyu beef, lobster, beluga caviar, venison, a duck egg and edible gold leaf.
The point is, if you keep your cost basis the same (or grow it slower than the growth rate of your revenue) you’ll automatically increase your profits and profit margin.
For example, if you’re running a $2M business and your expenses are $1.8M and without changing anything other than the price point of what your customers are already buying so your revenue grows (let’s say 10%), you’re now looking at $400K in profit vs. $200K—and all that was necessary was raising your prices by an average of 10% across the board.
Of course, the only way to know for sure if you’re at the right price point is through testing. Yes, you might lose some customers. But, in general, you’ll make more with fewer people at higher price points.
So, when was the last time you tested a higher price point? And if you got pushback on the pricing, how did you respond?
II. Fire Your Unprofitable Customers
Virtually every business has them (i.e. customers who cost more than they bring in). So, when was the last time you did an assessment of your customer base?
I’ve found very few business owners and entrepreneurs who really know who is and who isn’t profitable.
Just because a client has a big name in your sphere of influence or runs a big business doesn’t mean they’re profitable.
In addition, it’s always worth analyzing the amount of staff time a specific client/customer takes. You know what I’m talking about. Certain clients/customers require a lot more time and energy than your typical client/customer—and rarely do most business owners add that cost back into the cost of that customer.
For example, let’s say your typical client spend $3K per year with you and you have a 33% net profit margin (i.e. you net $1K per customer). Joe, on the other hand, is double that. He spends at least $6K per year, which means you make $2K per year off of him. That sounds good,
However, Joe is far more demanding that your typical customer. He often sends back purchases because they don’t meet his specifications. You end up having to get involved in some of those discussions. He tends to pay 60 days late. He either calls or emails you or someone on your team every week (and his emails are always long). Etc.
When you add up all the time and concessions, you quickly realize that you’re not making $2K on Joe at all. In reality, you’re losing $500. Plus, you’re losing out on opportunity cost (time that could be spent attracting new customers or working on your next innovation or joint venture). When you add all that in, you realize that you’re actually losing more than $2K per year off of Joe. The moment you “fire” him, is the moment your profit line goes up.
So, who do you need to let go of?
III. Move to Value-Based Pricing
The problem for most service-based businesses is that there’s a direct relationship between time and money. However, if you want to bank more money, you have to move your margins up. There are a number of ways to do this but one of the best options is to use value-based pricing. Why? Because it aligns your interests and the interests of your client/customer.
The problem of billing by the hour is that you’re incentivized to take more time. If you bill at $200/hour (and you pay your programmer $100/hr.) and you can get the job done in five hours or seven hours, which is in your best interest? Exactly, seven. But, is that in the best interest for your client? No.
However, if you’re working on a project that will save your client $20,000/year in expenses, is that worth them investing $2,000 in? Absolutely. That’s a 10X return … in year one, let alone in year two or year three, etc. So, is that a fair price for your client? Absolutely. The number of hours is irrelevant. What matters is the result (saving $20k/year for X number of years).
On the other hand, you’ve completely changed your margins. Instead of billing at five or seven hours, you’re now incentivized to get the project done as quickly as possible. At five hours at $200, you end up with a gross profit of $500. However, at $2,000, you end up with a gross profit of $1,500 (and possibly $1,600 if you can get your programmer to work faster).
In other words, by switching to value-based billing, using the example above, you just increased your profits by 200% (an extra $1,000 in gross profits). That sounds pretty sweet!
To read more about why value based billing is better, click on the following link (Why Value Based Fees Are Better For You)
So, how can you move to more value-based billing?
IV. Eliminate Your Unprofitable and/or Low Margin Products
When was the last time you evaluated the profitability of your products/services and what was/is their real marginal contribution to your profits?
Chances are, it’s either been awhile or never. Don’t worry, you’re normal. I’ve even worked with financial services companies that don’t know these numbers.
I remember working with a bank several years ago when I asked this question, “Do you know what the profit is on each of these product lines?” Their answer, “No.”
So, I suggested, “Maybe we ought to figure that out.” Well, it turned out that the product that they were currently running all of their marketing towards actually didn’t make them any money (when all the costs associated with it were added into the profitability question).
Now, it doesn’t take a rocket scientist to figure out that selling more of something that’s costing you money is a losing game if your goal is to grow!
However, it doesn’t have to just be unprofitable in order to warrant taking a hatchet to it. If you want to grow your profits, killing any products and/or services with low margins and keeping only products and services with high margins is a smart strategy. The moment you kill the low margin products, your profit margin increases.
So, what products and/or services do you have that are either unprofitable or low margin?
Then, what are you going to do about them?
Yes, you might take a revenue hit for a period of time. But isn’t that worth the increase in profit? Remember, it’s not the top line revenue number that really matters. It’s the bottom line profit number that does.
V. Reduce Your Head Count
This is the hardest one of all—but as the person at the top of your business, it’s one of the strategies that you have to keep in your pocket at all times.
One of the reasons why I’m so passionate about working with small business owners and entrepreneurs who want to scale their businesses is because I’m passionate about helping people like you hire more people. I want you to hire people. I want you to provide well for your staff. I want you to put food on the table for lots of people.
However, there are times when a business has over-hired. In fact, I talked with a company this week that’s in that position. Yes, they can grow their revenues, but they’ve also hired too many people for the size of company they are. So, while they might be able to “grow” their way out of the problem, that’s really a way to avoid dealing with a bigger issue (needing to let a few people go).
While there are some industries for which this isn’t true, for most of us in the service-based industry, labor is the largest percentage of our budgets. So, if you want to make a sizable reduction in your cost basis, then you need to be willing to look at your labor cost.
Yes, you can tweak your electric bill. And yes, you can tweak your paper costs. But there are few items in any service-based business which can compete with labor.
So, take a look at your org chart. Do you have too many people for your revenue and profit numbers? Be honest. Most small businesses can usually cut one or two positions (or more) and it won’t significantly impact their performance (usually these are underperforming employees any ways). However, the impact on profitability can be huge.
Note: I’m not saying you should reduce you head count. Remember, I’m pro hiring people to grow your business. But if you’re one of those people who has too many people on the payroll, this simple strategy works.
So, there you go. Five simple strategies to dramatically increase your profits.
- Increase your prices
- Fire your unprofitable customers
- Move to more value-based pricing
- Eliminate your unprofitable and/or low margin products/services
- Reduce your head count
The question for you is, “Which do you need to execute on?”
Whatever the answer, do it! Because if you will, you’ll be the one to dramatically increase your profits—and that will increase your sanity while decreasing your stress.
To your accelerated success!
Whenever you’re confronted with a problem (which should be everyday), what’s the first step you take in trying to solve it?
My guess is that your first thought was, “I’m not sure I have a process.” And if that’s what you were thinking, you’re pretty normal. The vast majority of people, including business owners, entrepreneurs and other kinds of leaders, don’t.
And that’s a very real problem on a number of levels. Why? Because solving problems is what leaders do.
As a leader, you’re trying to take a group of people from where they are now to where you want them to be at some point in the future. Between where you are now and where you want them to be in the future is a whole series of obstacles, which we all affectionately call problems.
Because you’re the leader and your job is to get your people from where they are now to where you want them to be, you have to become an expert in solving problems—period.
In addition, as a leader, you don’t want to have to be the only problem solver on your team (that would be a low leverage option—and a lot of work for you). You want your people to be great at solving problems as well. However, if you don’t have a process, how can you do that?
Well, space and time won’t allow me to lay out a whole problem solving process for you today (though I’m sure you can come up with one on your own if you think about it long enough). Instead I want to give you what I think most people forget about in their process and what I believe ought to be the first step in a strong problem solving process. And, interestingly, it has nothing to do with praxis (meaning, practice). It has everything to do with psychology.
In other words, the first step to developing a solid problem solving process is making sure you (or you and your people) are in the right mental and emotional state to be able to solve that problem.
So, if you want to be in the right state of mind, here are a few thoughts on how you can do that
I. Get Into a Peaceful State of Mind
Have you ever tried to solve a problem when you were angry? As Dr. Phil would say, “How’s that working for you?” Probably not that great.
Or have you ever tried to solve a problem when you were stressed out? Again, probably not your best option.
Stress, anxiety, fear, anger, disappointment, discouragement, disillusionment, frustration, etc. are all negative emotions that have a negative impact on anyone’s ability to think clearly and solve a problem.
So, if you’re experiencing one of them, make sure you eliminate that negative emotion before you start attempting to solve your problem.
- If you need to have a crucial conversation with someone, do it
- If you’re letting others control your emotional state, take back control
- If you’re disappointed, work through your expectations and change them
- If you need to forgive someone, forgive them
Whatever it takes to get your emotional state into a peaceful state, do it.
You don’t have to be a Buddhist monk or Spock to solve problems effectively, but you will be infinitely more effective at problem solving if you’re in a peaceful state of mind as opposed to an angry or stressed out or discouraged state of mind.
II. Get Into a Positive State of Mind
The difference between peaceful and positive is that peacefulness is about eliminating negative emotions, positivity is about being hopeful.
Have you ever tried to solve a problem when you thought that problem was impossible to solve? It’s rather debilitating, isn’t it?
For example, let’s say you have a cash flow problem. And let’s say you’ve tried ten different things to solve your cash flow problem and yet not one of them has worked. What makes you think the eleventh is going to work? If you’re thinking like that, it’s going to be extremely difficult to solve your problem. It’s understandable that you’re defeated. But that sense of hopelessness will make it difficult for you to see any new options/solutions that might actually solve the problem in a positive light.
Positivity isn’t about being a Polly Anna. It’s about being hopeful. It’s about believing that there is a solution out there and that you and your team can find it. It’s not about putting your head in the sand and saying, “Everything is all right.” It’s about honestly evaluating the situation and trusting that you can find a way no matter how hopeless it might seem or how many failures you’ve experienced.
So, surround yourself with positive people. Read positive books. Listen to uplifting music. Find encouragers. Talk with other people who’ve overcome similar situations. Remember your previous successes. In fact, you might want to create a success journal so you can read it from time to time when you’re discouraged.
Again, you want to do whatever you can to make sure you have a positive state of mind because when you do, you have hope. And when you have hope, you have the power to solve any problem.
III. Get Into a Process State of Mind
What I mean by this is that problem solving is simply a process—nothing more, nothing less. When you think that you have to be an Einstein to be good at solving problems, that’s a problem. Likewise, if you think that you have to have some blinding shot of brilliance to solve a problem, that’s a problem. If you think you have to be a Sherlock Holmes or an Elon Musk or a Leonardo Da Vinci to be effective at solving problems, that’s a problem
Whenever I’m working with clients and they tend to get worked up about something I’ll remind them. “Listen, this is just a problem. Nothing more. All you have to do is work the problem.” Why? Because problem solving is just a process.
Problems aren’t meant to be personal. They’re just problems—nothing more. Once you have a process in place, all you have to do is just work the process.
If you can remove the emotion from the process and just work the process, you’ll discover that finding a solution is infinitely easier than you thought.
IV. Get Into A Systems State of Mind
I know, I broke the rhythm of the P’s (peaceful, positive, process) but this is the fourth leg of a strong problem solving mindset.
One of the mistakes I see a lot of business owners and entrepreneurs make is that they tend to look at the surface or presenting problem and forget to realize that there’s always a system problem behind that.
For example, it’s easy to think that the problem is Mary in accounting. After all, she’s a Negative Nancy, she’s a slow worker and she she doesn’t always process invoices fast enough so AR is even worse than it should be.
The presenting problem seems to be Mary but is she the real problem? A systems mindset would suggest she’s only part of the problem. The problem probably started with the hiring process. Was the job description correct? How about the selection process? Did Mary get tested beforehand? Did you check her references? Did you ask the right questions? How about Mary’s on boarding? What about her oversight? Could the problem be with training? Could the problem be lack of clear expectations? Etc.
In other words, just assuming that there’s one problem and it’s the presenting problem is rarely a great mindset to start from. Instead, you want to start by assuming that this problem exists because there’s a flaw in the system (not the person). Note: this doesn’t mean that Mary shouldn’t be fired. It simply means that a systems mindset doesn’t let you start and end there. It forces you to think bigger and broader before you settle in on a solution.
So, there you go. Four ideas for how you can help prepare yourself to have the right mental and emotional state BEFORE you start to actually solve a problem.
- Get into a peaceful state of mind
- Get into a positive state of mind
- Get into a process state of mind
- Get into a systems state of mind
If you do those four things before you actually start to solve any problem that your business faces, you’ll be giving yourself (or you and your team) the best chance you can to discover an optimal solution for whatever problem your business is currently facing.
To your accelerated success!