Lesson #351: Don't Let Your HR Department Steer the Ship

We love our human resources departments.  They do a lot of good inside a business.  They help with recruiting, training and onboarding.  They help with setting benefits plans.   They help with creating a strong company culture, and many other good things.  But, I have been involved with a lot of human resources managers that have crossed the line between supporting the business, and dictating the direction of the business.  You as the CEO need to make sure you know when it is happening, and do your best to ensure it doesn’t happen, which could capsize your business plan.  This post will help you do exactly that.

An HR Case Study—A Single Veto Vote Can Topple the Entire Apple Cart

I was once working with a client where we were setting a new organizational chart structure in the marketing department and recruiting a couple new employees to fill those holes.  In that particular instance, the company also had a little bit of a “power struggle” and culture clash going on between a few of the department heads, which needed fixing.  My role as the interim CMO was to fix that issue and put the company onto the proper course and growth trajectory, as dictated by the company’s business plan, as created by the team. 

When I finalized the organization chart for the marketing department structure that I thought was the ideal solution to hitting the company’s goals and growth objectives, it ruffled a few feathers of the current middle managers in the department, as it would have meant giving up some control over departments they were currently overseeing.  But, that was part of this company’s problem:  the middle managers were inexperienced and doing way too many tasks in one role.  The new structure would lighten their load and make the company more efficient and focused.   The current middle managers proceeded to defend their turf, and ran to the HR department for support.

At the same time, the new organizational structure, would result in a change of reporting assignments, with people potentially getting a new boss in the process.  And, those middle managers, didn’t want to change who they were being managed by.  Again, those staff members went running to the HR department for help.

And, lastly, as we were recruiting new team members, we were trying to recruit really smart team members that could help move the company’s culture in a direction that was more entrepreneurial and nimble, as opposed to some of the entrenched processes that were slowing down the current thinking and operations.  And, when those new candidates were interviewed within the organization, again those same middle managers in the department felt threatened by the new people, as making them look stupid, impeding their ease of promotion, or forcing them to change the way they did their work.   So, what did they do; they again went running to the HR department to help them.

Now comes the guts of this post.  When I presented this organizational and hiring plan to the company’s CEO, he was 100% in alignment and gave me the green light to proceed on implementing it.  But, when I went to the head of the HR department to help me implement the restructuring and hiring, I was met with a lot of pushback.  She had taken all the complaints of the middle managers, layered in her own opinions (as many of those middle managers were her personal friends), and proceeded to try to squash the agreed upon plan with the CEO.  The CEO was not one for conflict, and backed down from the original direction, and let the HR department change the plan.  The restructuring never happened, the new hires were not hired, and the culture of the department was never fixed.  This collectively ruffled the feathers of the strong employees that I did not want to leave the company. 

I just couldn’t believe what had happened:  a couple disgruntled middle managers not happy with the new plan, just toppled the plan with the support of the HR department head that basically was given a “veto vote” on the company’s high level plans and direction.  And, the CEO let it happen??!!

Well you can all guess what happened from there.  The half of the marketing team that I did not want to quit, all left for new jobs.  And, the company’s revenues dropped around 33% in the process, as the smartest talent in the company left and the newest ideas that would propel the company to new heights, intending to grow the revenues, were not implemented.  What a mess!

What this Means for Your Business?

To all you CEOs out there saying this sounds familiar, you have to remember a few important things.  First of all, the strategic plan is the strategic plan, and if you have a smart leadership team implementing that plan, you need to let the plan run its course—you don’t change direction on the whims and opinions of a single “veto voter” midstream.   And, secondly, the HR department needs to know that they are there to support the business in executing its plans agreed upon by senior management, they don’t get to dictate direction . . . ever!!   Yes, their opinions need to be heard, but if they get outvoted by the opinions of the collective management team, they need to back down.  And, if your HR department manager does not subscribe to that model, they need to be replaced by someone that is willing to march to the beat of the company drum, not their own beat.

This post is not intended to bash all human resources departments or managers, as most are very good.  But, this post was simply inspired by the one bad apple manager that was allowed to dictate her personal agenda, which ended up toppling the company’s efforts in fixing and growing their business.  If any of you think your bad apples are going to spoil your bushel (and worse yet impede your business plan), don’t let it happen.  Have conviction in your plan, and make sure all managers are beating to the same drum.

For future posts, please follow me on Twitter at: @georgedeeb.

 

[VIDEO] What's More Important--Strategy or Execution?

I was recently interviewed by ASBN, an online "television network" serving the small business community, about which is more important for your business--your strategy or your execution of that strategy.  As you will learn, you can't have one without the other.  I thought this video turned out great, and I wanted to share it with all of you, to see if it can be helpful to you in making sure you have the right team in place to hit your desired targets.  I hope you like it!!

The embedded video player didn't give me the option to change the size of this video.  But, if you want to see a bigger version, simply click the expand size button in the player above.

Thanks again to Jim Fitzpatrick and the ASBN team for having me on the show.  I look forward to our next interview together.

For future posts, please follow me on Twitter at: @georgedeeb.

[VIDEO] Vertical vs. Horizontal Growth Options For Your Business

I was recently interviewed by ASBN, an online "television network" serving the small business community, about how the various vertical and horizontal growth options to grow your business.  I thought this video turned out great, and I wanted to share it with all of you, to see if it can be helpful to you in setting your own growth strategies.  As you will learn, there any many ways to expand your business, within your industries and markets, and beyond.  I hope you like it!!

The embedded video player didn't give me the option to change the size of this video.  But, if you want to see a bigger version, simply click the expand size button in the player above.

Thanks again to Jim Fitzpatrick and the ASBN team for having me on the show.  I look forward to our next interview together.

For future posts, please follow me on Twitter at: @georgedeeb.

Lesson #350: Top 10 Marketing Strategies for Startups

 

I recently got connected to Alyssa Hitaka at TopTierStartups.com, a new content site rich with startup related news, tips and interviews with startup founders.  I was curious what her startup founders were seeing, in terms of the best marketing strategies they are successfully using today.  Alyssa was kind enough to interview ten of her founders, to get those learnings.  And, we are both pleased to share those learnings with all of you, to help you with your own marketing efforts.  Here is the list:

1. Katja Kaine at The Novel Company: Word of mouth and great customer service

Word of mouth is one of the most important ways a founder can get the word out about their products or services. Katja Kaine, founder of  The Novel Company, has focused on slow and organic growth of her innovative writing technology, gradually building up a strong reputation among customers. Katja also emphasizes the importance of engaging with customers personally—she responds to all emails herself, which indicates to users that the company truly listens and cares, further boosting loyalty.

2. Robert Brüll at FibreCoat: LinkedIn and startup awards

LinkedIn is a must for just about any modern-day professional, and Robert Brüll, founder of high-performance materials startup FibreCoat, encourages fellow entrepreneurs to make the most of the platform to market their brands. His company also regularly participates in startup award contests, and winning awards helps his business build its reputation, secure positive feedback, and gain traction among the target demographic. When paired with FibreCoat’s powerful LinkedIn presence, these awards stretch even further and help drive more traffic at live events, which further boost the company’s reputation among consumers.

3. Vita Valka at Camperguru: Connecting with consumers in real life

These days, a lot of brands rely on digital media to promote their products and services, and Vita Valka’s Camperguru has also leveraged the algorithms at Facebook and Pinterest to evoke interest and familiarity with the target demographic. What gives the innovative camping app its edge, however, is the connections its team of ambassadors make with campers on the ground. Camperguru’s team of passionate campers tour some of Europe’s best campgrounds and, in the perfect locations with highly concentrated groups of avid campers, spread the word about the app in person.

4. Wolfgang Rückerl at Entity: High-quality content and interactivity

Content marketing is a major growth driver for a lot of businesses today, and Wolfgang Rückerl affirms its powerful role in growing his blockchain startup Entity. Focusing on valuable information, crisp graphics, and thorough explanations of the company’s more technical aspects, Robert has built up a solid community of users for his app. An important addition to his marketing strategy is engagement and interactivity on social media, with Entity regularly designing contests, games, and events for users and prospective users to participate in. Robert credits this interactive marketing approach to strengthening trust with followers and driving growth of the platform.

5. Stefanie Palomino at ROOM: Maintaining a holistic approach

There’s a lot involved in promoting your new startup, with many ways to approach marketing and many factors to consider throughout your company’s continued interaction with consumers. Stefanie Palomino, founder of innovative telecommunications application ROOM, stresses the importance of adopting a holistic approach to marketing. She encourages entrepreneurs to consider the full user journey, from their first acquaintance with your brand to their continued use of your service or product. The data you collect from existing customers—both quantitative and qualitative—can help inform your precise marketing strategy, building lasting relationships and trust with loyal users.

6. Deanna Visperas at GoVirtuals: Influential staff as a marketing strategy

The staff of a company define its aura and atmosphere, and how a company feels can have a major impact on prospective customers. Deanna Visperas, who founded virtual assistant company GoVirtuals, firmly believes that her marketing success is rooted in the influential individuals who staff her team. According to Deanna, thought leadership and employee advocacy are key to building a brand’s reputation and cultivating trust among consumers, so fostering your employees’ talents and influence is a great way to grow your business. Happy employees can lead to happy customers.

7. Mark Brouwers at Nocto: Collaboration with similar brands

The startup world is big, and while similar companies are conventionally viewed as competitors, Mark Brouwers reveals why it’s often better to see them as partners. Mark has built up his unique hospitality connector platform, Nocto, through collaboration with similar businesses who share goals and target demographics with his company. Designing win-win strategies help both companies grow, and as an added bonus, collaboration generally means you save time, money, and effort. This marketing strategy will also allow you to forge meaningful relationships with other professionals in the industry, which can open all sorts of new doors for your brand.

8. Siebe van Mensfoort at Simbeyond: Leveraging industry events

Though online marketing makes up a huge portion of modern-day companies’ promotional efforts, offline marketing can be just as powerful, if not more. Siebe van Mensfoort, founder of Simbeyond—a startup that creates software tools for the development of high-tech devices—regularly partakes in industry events to boost his brand. This marketing strategy takes him all over the world, to conference presentations and exhibitions alike, and has allowed all sorts of interested prospective customers to discover Simbeyond. As a bonus, regular participation in industry events gives Siebe a solid grasp of the latest market innovations.

9. Sam Kynman-Cole at topVIEW: Google Ads and direct calls

Sometimes, the simplest marketing approaches are also the most effective. Sam Kynman-Cole from topVIEW, a digital startup that allows businesses to create virtual 3D tours of their indoor spaces, recommends Google Ads as an effective strategy for B2B companies. However, he highlights directly reaching out to potentially interested parties as his number-one marketing approach. Phone calls are the best, Sam advises, but a personalized email is also effective for less urgent situations. He also praises LinkedIn as a great way to make direct connections with specific people, much like personalized emails.

10. Joe Menninger at Startuprad.io: SEO and media exchanges

Search engine optimization (SEO) is a major buzzword in content marketing, and for good reason—it boosts your rank in search engines, helping prospective consumers find your brand. Joe Menninger, founder of Startuprad.io, an English-language podcast covering startup news in the German-speaking world, highlights how crucial it is to create transcripts of podcast episodes. For each episode, he generates a transcript and a detailed blog post, which allows him to deliver high-quality audio content to listeners while still tapping into search engine algorithms. Joe also collaborates with other podcasts, creating a win-win scenario that boosts the followers of both shows.

So, hopefully, there are some useful "nuggets" here for you all to use in your businesses.  Thanks again to Alyssa Hitaka at TopTierStartups.com for her research and helping me create this post.

For future posts, please follow me on Twitter at @georgedeeb.  

Lesson #349: Consider an Unlimited Vacation Days Policy

 

At every company I have ever worked, from small startup to big corporations, there had always been a capped vacation day policy.  Vacation days would range from 10 to 20 days a year, depending on your role within the organization.  But, we tried something last year at our Restaurant Furniture Plus business--we moved to an unlimited vacation day policy.  And, an interesting thing happened along the way.  Read on.

The Advantages of an Unlimted Vacation Day Policy

The obvious primary advantage of an unlimited vacation day policy is your staff's positive reaction.  When we told our team we were moving from a traditional two weeks of vacation a year to an unlimited plan, their reaction was "WOW!!"  It earned us a lot of goodwill with our staff, as they saw that as a huge perk, having the flexibility to take as many vacation days as they want.

The secondary advantages included things like: (i) you no longer had to worry about tracking all the vacation days by person, which becomes more onerous as your employee base scales; (ii) there is no longer the need for tracking how many vacation days carry over from year to year, or how many untaken vacation days needs to get paid out at the time of an employee's termination; and (iii) it is a huge recruiting advantage for your business when trying to attract new talent.

The Disadvantages of an Unlimited Vacation Day Policy

The obvious primary disadvantage of an unlimited vacation day policy is your staff could take advantage of that perk, and  potentially take many more vacation days than you ever reasonably thought they should be taking with a capped policy.  But, this disadvantage, is largely kept "in check" by the employee's psychology, as described below.

The Psychology of the Employee With an Unlimited Vacation Day Policy

It is interesting the psychology of an employee with an unlimited vacation day policy.  There are three drivers that typically are on their mind: (i) they don't want to be perceived as abusing the system, so they typically take about the same amount of vacation days they would have under a capped policy; (ii) they are all busy people, and don't want to be buried by a sea of work upon returning from their vacation, which typically doesn't have them away from the business for very long or very frequently; and (iii) they are often taking vacations with their friends or family, and those other parties are typically focused on their limited vacation time during the summer or the holiday season. 

The Required Psychology of the Employer with an Unlimited Vacation Day Policy

At the end of the day, there is only one metric that matters on this topic--is the employee satisfactorily getting their job done and hitting their agreed upon goals, or not?  If they are hitting their goals, it doesn't matter if they are taking 2 weeks or 20 weeks of vacation, you should be thrilled with the outcome of their successful results.  So, post making this change, stop thinking about "why your staff member just took a three week vacation".  Instead, think about, "what has their job performance been, and are they hitting their expected goals, or not".  Said another way, manage your staff on their "outcomes", and not their "methods".

Closing Thoughts

What an unlimited vacation day policy really is, is an exercise in trust.  Trusting that your staff are all adults and will naturally do the right thing, by not abusing the system.  And, the reverse of that, your employees feeling empowered and trusted by their managers, which makes them feel good about their relationship with the company.  Which in turn, helps promote their long term loyalty and retention with the business.  We weren't sure this move to an unlimited vacation day policy would work or not, but both our management and our team could not be more thrilled with the results.

For future posts, please follow me on Twitter at: @georgedeeb.

[VIDEO] Best Practices for Splitting Equity Ownership in Startups

 

I was recently interviewed by the Atlanta Small Business Network (ASBN), an online "television network" serving the small business community, about how best to split up equity between startup founders.  I thought this video turned out great, and I wanted to share it with all of you, to see if it can be helpful to you in creating your own fair equity ownership structure.  As you will learn, there is no one right answer here, but you need to know what the variables are, and plan accordingly.  I hope you like it!!

The embedded video player didn't give me the option to change the size of this video.  But, if you want to see a bigger version, simply click the expand size button in the player above.

Thanks again to Jim Fitzpatrick and the ASBN team for having me on the show.  I look forward to our next interview together.

For future posts, please follow me on Twitter at: @georgedeeb.