Confronting Performance Issues

Are you a procrastinator when it comes to dealing with performance issues?

Entrepreneurs, like many other managers, do not like to confront employees regarding poor performance. Entrepreneurs, especially, take a softer view with certain employees that started when the company was established. How can they after all be tough on people who supported them when the times were bad?

Not dealing with performance issues in a timely manner not only hurts the company, but is a disservice to the employee. If the employee is a potential long-term player, it is better to get them on track sooner by making him/her aware of the deficiencies and help the employee develop and work on a plan to correct the shortfalls.

If performance issues are not addressed promptly, it creates in the entrepreneurial company a sense that the Entrepreneur is partial towards certain non-performers. Obviously, a poor performer is readily visible in a small company and not dealing with such issues creates a situation with poor team morale.

Entrepreneurs need to create a culture where performance issues are dealt with promptly, either by implementing a corrective plan to improve performance or managing the consistently poor performer out of the company.

Ravi Patel

http://www.patelCFOservices.com

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Focus on Fundamentals

Recent history showed that during a three-year period, the U.S. economy showed good trends, but the fundamentals were weak. This led to some of the downturns in the stock market and housing meltdowns.

Entrepreneurs can learn from these lessons. What if your business shows good trends, but the fundamentals are poor? You  feel great in the short term, but the future might be bleak.

As an example, your sales may be on the upward trend, but if the fundamentals for your business – quality of product/service, delivery times, customer service, and so on are weak, how long will your sales continue to grow? What if your sales are growing, but your margins are rapidly declining? Is that really a good trend?

Entrepreneurs should not be fooled by short-term trends in their businesses, but focus on ensuring that the fundamentals are sound and going in the right direction. Determine the key drivers of your business and concentrate on fixing and enhancing these fundamentals to grow your company for the long term.

Ravi Patel

http://www.patelCFOservices.com

What Comes After Delegation?

Entrepreneurs cannot do everything themselves in their companies so they have to assign projects, goals, and objectives, or collectively tasks to various individuals.

Do you have a good system of tracking those tasks? If so, that is a step in the right direction. If not, you need to get a system or process that works for you.

But, more importantly, do you follow-up on the assigned tasks? Do you have a system to track the progress on the various items? Do you have a reminder system?

Assigning tasks is not enough. Monitoring the progress on the completion status of these tasks with regular follow-up is crucial. Otherwise you are sending a message to the employees that you are not going to hold them accountable.

While some employees will take the initiative to report on the progress of the assigned tasks, you need to have a system to hold all people accountable.

Follow up is critical when you delegate tasks to others. Otherwise, don’t always expect results.

Ravi Patel

http://www.patelCFOservices.com

Published in: on July 15, 2014 at 3:44 am  Leave a Comment  
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Being Realistic

Entrepreneurs have a very positive outlook regarding new opportunities and ideas. They tend to look at things as a glass half-full as opposed to half-empty. This type of optimistic thinking leads to innovative businesses.

Is this always a good thing? It depends.

If the Entrepreneur has some basis in reality and/or surrounds him or her self with good advisors, there is a good probability that he or she will not venture deep into seeming opportunities that do not make sense or are far-fetched.

On the other hand, if the Entrepreneur is stubborn and relentless in the pursuit of an idea, despite repeated contrary advice, then chances of failure increase.

It is a wonderful quality for Entrepreneurs to have optimism, curiosity and a positive view of new ideas and opportunities, but a reality check is necessary for long-term success.

Ravi Patel

http://www.patelCFOservices.com

Hiring Friends

Entrepreneurs can use all the help they can get when starting businesses. Family members and friends provide assistance when an Entrepreneur bootstraps a start-up. Hiring paid employees at this time is a stretch due to limited funds.

The situation changes after the Entrepreneur becomes fairly well established with steady revenues and cash inflows. Not being able to do everything, an Entrepreneur should then hire paid employees.

Should friends be hired as employees? If friends helped during the start up phase, they might have reasonable expectations of getting employment at the company. Their familiarity with the business could be helpful as opposed to hiring someone new.

However, Entrepreneurs should be very careful when hiring friends as employees. You could lose both!

Setting high performance expectation for employees is necessary for good business. If such standards are consistently not met, an Entrepreneur should hold appropriate employees accountable – from reprimands, counseling, probation all the way to termination as necessary. Friends might have a difficult time accepting such actions from a friend who is also the boss.

Friends who are employees might expect  leniency or latitude due to their friendship, but that might not be good for business and morale of other employees. If an Entrepreneur rightfully holds friends to the same standards as other employees, he or she might not only lose them as a friend but could also lose an employee.

It is a difficult situation to manage and Entrepreneurs might want to be cautious hiring friends as employees.

Ravi Patel

http://www.patelCFOservices.com