Be a Leader, Not a Hero

Entrepreneurs sometimes think of themselves as heroes trying to hit a home run or create miracles.

Heroes are created infrequently and for a short time. While you might feel that you have to rescue your company from all situations, it is not always possible and more importantly not the right thing to do.

Successful companies need long-term leadership that builds the organization and the employee team to solve problems and exploit opportunities in the absence of the leader. Dependence on a hero can only work in the short term or in a few instances.

While Entrepreneurs might think of themselves as super-heroes for starting the company and making it grow though its infancy, strong business leadership is necessary to nurture it for long-term growth and success.

Be a Leader NOT a Hero!

Ravi Patel

www.patelCFOservices.com

Published in: on November 28, 2011 at 5:22 am  Leave a Comment  
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Be Thankful

Entrepreneurs have a lot to be thankful for!

First and foremost are our country and the free market system that allow Entrepreneurs the opportunity to create and grow businesses and prosper.

Employees are the backbone of companies and Entrepreneurs should be thankful for the dedication, loyalty and hard work put forth by their people to make businesses successful.

No business can sustain itself without customers and clients. Be thankful to your sources of revenue for putting their trust in you to provide services and products.

Entrepreneurs should also appreciate their suppliers and service providers who continue to supply essential goods and services to sustain their businesses.

Shareholders and financiers who have invested in your abilities to grow the business and provide a return on their capital should be high on the list of people to whom Entrepreneurs are grateful.

Do not forget to appreciate your gratitude to your business advisors who provide a sounding board for you to share ideas and seek advice.

Lastly, the community that you operate your businesses in should be appreciated also.

So on this Thanksgiving, I encourage Entrepreneurs to express their gratitude to the above stakeholders in your companies.

Ravi Patel

www.patelCFOservices.com

Published in: on November 21, 2011 at 5:11 am  Leave a Comment  
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Should you Fire your Customers?

Some might ask what kind of question is that? Why would someone think of firing their customers?

While the old saying “the customer is always right” might be thrown around, it is not necessarily true that all customers are always good for your business.

Entrepreneurs might have to stand up and exercise their leadership by letting some customers go. Which customers are the ones that might be on the firing list?

Customers who are consistently not profitable for your business are not good for the long term. It is acceptable to have lower profits or losses from a customer over a short period for a potential lucrative strategic relationship. However, if the customer over a longer period continues to be a drain on your profitability, it might be time to let them drop off the list.

Chronic complainers, without legitimate reasons, are very difficult to service and cause undue headaches for your employees. Unless the customer has genuine reasons to be dissatisfied, it is not in the best interest of management to service clients that constantly create irrational demands on your staff.

Entrepreneurs need to develop an excellent reputation for service and customer relations, but if need be it is okay to fire certain problem customers.

Ravi Patel

www.patelCFOservices.com

Unmanaged Growth Can Be Painful

Most people would love growth in their business. However, managing growth could be painful especially if it is rapid. In fact, managing growth successfully requires thought and is really hard work.

Adding employees quickly might indicate business growth. Has the infrastructure to support the integration of these new employees in the company increased simultaneously? If not, it creates a painful situation for both management and the new employees. Unaccounted or unforseen indirect costs, such as payroll taxes, benefits and insurance, could adversely impact cash flow. Rapid employment growth might also attract government scrutiny for compliance of labor regulations.

Fast growth in sales orders is a great thing. Do you have the ability to deliver those orders on time and maintain quality. Do you have an adequate customer service function to handle potential issues?

Rapid growth in revenues also means an increase in receivables (unless you are fortunate to have a cash-only business). Do you have sufficient working capital or access to funds to accommodate such an increase or even delays in collections?

While growth is exciting, Entrepreneurs need to manage it carefully to avoid or significantly mitigate the accompanying pains. Leadership requires Doing the Right Things!

Ravi Patel

www.patefCFOservices.com