Ronald Baker, B2B CFO®
Providing CFO services in Mentor, OH and surrounding areas

Your Staff is at Risk

Many of us say our employees are our greatest asset.  Some of us actually believe it and take aggressive action to attract and retain the best.  We rely on key employees to do things we don’t want to do, don’t have time to do, or don’t have the expertise to do.  Regardless of what we do for our employees, most of us will experience the loss of one or more key employees at some point.  We intuitively know this, but most of us don’t want to think about it, knowing it could be damaging to our business.  With the economy and hiring up, this pain could come sooner than you expect.  There are certain things you should do to help manage this risk.

I was recently brought in by a business owner to help recover from the unexpected loss of a key financial executive.  No one in the Company knew what this key employee did to keep the Company running.  How do we make sure payroll “happens”?  How do we close the books?  How do we keep the Company running?  When the key executive left on virtually no notice, it was very painful for the Company.  Very painful and totally preventable.

• As an owner or top executive, you must ensure your key employees have documented their positions.  Job procedure manuals should be in place for all key positions so if someone leaves the organization, the team knows how to pick up the job and get it done.
• Employees should be cross-trained.  When a key person leaves the timing will never be good.  It is much better to have teammates who have seen the tasks before and have some experience to carry on.
• For financial staff, Journal entries should have adequate backup so one can clearly see the data driving the entry, the source of that data, and the purpose behind the entry.  For many companies, a book with all the journal entries and backup in one binder may be convenient.
• Your company should have standard file naming conventions.  All documents should have the file name and file path clearly labeled so others can easily find the file.
• The accounting department should generate and maintain clear audit trails so others can understand the books and records, and journal entries.
• How do you administer systems security?  Are there backup plans in place if your systems security administrator leaves?

I helped the client recover from their painful loss, but it was very stressful and disruptive to the existing staff and business.  The worst part is it was preventable.  Make sure you document your jobs and processes and it may pay big dividends some day.

Passionately Engaged?

Think about the greatest leader you know.  Regardless of whether they’re political, religious, or a business leader, great leaders generally have certain things in common.  One thing a great leader absolutely must be able to do is to rally the troops.  Generally this requires clear vision and superior communication skills.

Facts and reason may initially attract followers to a leader, but emotion completes the bond and builds passion.  Many superior leaders share their vision and appeal to their followers’ emotions by storytelling.  They may talk about how they started the business, explain what they stand for, and detail where they want to take the organization.  They help others rally around an organization’s objectives and strive to develop a common culture.  At a guttural level, they appeal to people’s emotions.

I once worked for a CEO who was not only smart and experienced but also able to easily communicate up and down the organization by not only knowing the facts- but also appealing to emotions.  We absolutely dreaded the annual United Way fund drive.  Not because we didn’t support the cause, but because of his intensity in the campaign.  Generally he would start with sobering facts and within 5 minutes literally be crying about those less fortunate than him (and us).   It was a tremendous motivator for us to see this extremely successful CEO who cared so much about others less fortunate than him.  How could we not follow him? He literally committed every ounce of his being to whatever cause he supported.  When you see a leader that passionate, you generally can’t help but catch the passion and pull beside them.  Most of us would literally do whatever we could to support him and the Company.

Our CEO had a powerful way to sketch a vision.  The entire Company could understand it and most became emotionally involved.  He was able to align our people in a way they felt obligated to bring their “A” game every minute of every day.  We didn’t want to let him down, knowing how much he had committed to the company and to each of us.  He had no patience for anyone not passionate about what they were doing.

Storytelling can take complex ideas and break them down into digestible pieces we can all assimilate and act on.  It takes some practice but try it in your organization.  You’ll likely be impressed with the results.

The national Independent Federation of Independent Businesses (IFIB) is reporting that small businesses plan to increase hiring in the New Year.  In IFIB’s November report, they reported that the number of companies planning to hire was at a 38 month high.  In addition, the number of companies with a net increase in headcount in the last quarter was positive for the first time in nearly 4 years.