|
"YOU CAN’T GET THERE FROM HERE!" - A NEW MAP FOR FUTURE SUCCESS
 How to earn the confidence and commitment of your employees, customers, and stakeholders in today’s changing world.
We’ve all heard this joke: A local “hayseed” tries giving directions to a tourist, becomes frustrated, and ends the inquiry by saying simply, “You can’t get there from here.” The humor of this scene lies in its absurdity. Of course, if you know where you are and where you’re going, there’s always a way to get there. The secret is to find the right map.
Consider the danger and frustration that you would feel if you used an old map of Louisiana to go from Shreveport to New Orleans. Since New Orleans, Baton Rouge, and Shreveport are standing where they’ve always been, you’d think that an old map would do-but in fact, a pre-interstate map would expose the driver to unnecessary risks. Two-lane roads, gravel roads, pot holes, speed traps, and “bad parts of town” would be the rule. A map dated after the creation of I-10 and I-49 would lead to a much easier journey.
Every business person is now preparing for a trip into the next century. We’re excited by the opportunities that await us, but anxious about the perils that we’ll face on the road. This trip will take us to a new place, and the pace of our trip will be faster than we’ve ever moved.
Unfortunately, most of us are using no map, an old map or the advice of a local “hayseed” who can’t help us get there. The maps currently available are our plans and our financial statements. Some of us have them, and some don’t. Unfortunately, our maps are out of date.
Our advisers-our CPAs and bankers-are locals who have never been there either. They are the writers and keepers of old maps. They’re invested in (or might actually be) the status quo. They’re not about the future: the new, risky opportunities of tomorrow.
The most valued traditional map, the balance sheet, is out of date. It’s no more a tool for tomorrow than a 1950 map would be for getting from Shreveport to New Orleans. The balance sheet shows your assets, the things you use in business, your liabilities, the interests of those who own the things you use, stockholders’ equity, and the difference between your assets and liabilities.
Your assets-buildings, receivables, inventory, equipment-are stuff that you own or acquire, can insure, and use. But tomorrow’s “virtual corporation” might not include office buildings. Real-time deliveries will eliminate the need for warehousing. Technological changes may result in obsolescence of our equipment and systems before they’re delivered. Tomorrow’s success or failure will not depend on any traditional asset. The balance sheet that starts with these assets is obsolete -- and every other category that follows is therefore based on a flawed premise. Forget it. Get a new map.
Tomorrow’s world will include more small businesses and cottage industries. These will be knowledge driven-not capital intensive. More than 90% of all businesses will have fewer than 50 employees. Probably less than 2% will be “big” (more than 200 employees). What was important yesterday will not be as important tomorrow. Tomorrow’s business will be about innovation, flexibility, and market passion.
The real assets needed for tomorrow include a short, simple list:
Some businesses will need other assets, but these will be the minimum standard. Relationships are about people-employees, customers, and stakeholders. If we have good people working for us as employees and supporting our efforts as vendors and suppliers, we are starting with a strong base. Their qualities must include knowledge, teamwork, commitment, integrity, customer passion, and trust.
We must know and understand our customers intimately. Who are they? What do they want and need? How can we satisfy these needs? We must keep our finger on their pulse. We should not only know them today, but anticipate what they will be and want to be. We must be the answer to their questions. They must value us, or we’ll lose them.
Our stakeholders are people who are invested in who we are and what we do. These include our stockholders, the communities we serve, and any other group or individual we affect significantly. All these are assets: That is, we use our relationships with them in our business. The quality of these assets determines or greatly influences our success.
Knowledge, expertise, and innovation represent the collective energy of your organization. This drive and passion can’t be measured, licensed, or insured-but it can’t be discounted. It must change, evolve and grow.
Profit is an asset and is perceived to be the goal of business. In reality, it’s more important than that. To quote Peter Drucker, profit is our “seed corn”-the chip that allows us to bet on tomorrow. Without it, we can’t stay in the game, much less go for the gold.
Leadership might be our most important asset. If knowledge is the brain of our system and relationships are the heart, leadership is our soul. This is an era of pioneering and exploration into unknown waters. Yesterday’s world was about taking inventory of our abundance-management. Tomorrow’s world will be about the most intense competition in the history of the world-conquest. Each day will call for us to win the relationship, the customer, the result. Leadership is required.
Leadership includes vision, organizational culture and passion, commitment, and integrity.
Leadership defines reality and moves forward from there. Seeing the dream and focusing it in a vision that can be embraced by all in the organization, the leader is an architect. He or she designs the infrastructure and coordinates its construction. Leadership must establish a sound foundation from which the organization can reach for the stars (goals). Leadership brings “fire to the belly” of organizations.
The leader is also an environmental engineer, making certain that the work environment is clean and free of “toxins”-that is, it must include the most healthy elements of integrity and trust. Team members must be able to work free from dangers and distractions as they pursue the dream.
We don’t own our assets. We can only focus them for the good of all. The owners of these assets must be paid for our use of them. This creates our accounts payable-our liabilities.
Our customers must be enthusiastic about our value in their lives. Our employees and stakeholders must feel rewarded for their investment in our future. They must feel part of the team and appreciated for real contributions. Their choices are unlimited: They can take their asset, which we are using, somewhere else. If we don’t pay fair compensation, we lose them.
The operative word in tomorrow’s balance sheet is “balance,” which leads to organizational equity. If we successfully select the right assets and balance our use of them, with fair compensation/rewards to their owners, we will retain them-and prosper. If we don’t have balance, our organizational see-saw will crash. It must work for both sides.
Yesterday’s command-and-control world is over. Your associates (employees), customers, and stakeholders will have unlimited choices. You can’t make them choose you, but must earn their confidence, commitment, and relationship.
Your journey is about to start. You’ve committed the dollars for the venture. The car is loaded. You’ve made all arrangements. Before you leave, make certain your map is current!
|