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Economic Indicators for 2020

Economic Indicators That May Impact Your Decisions for 2020

Economic Indicators That May Impact Your Decisions for 2020

Economic Indicators for 2020

Are These Economic Indicators Real?

It seems as if in every meeting these days everyone is talking about a possible recession, market slowdowns, stagnating sales pipelines, etc.

CNN recently published a story saying that America’s CFOs are bracing for a 2020 recession. They cite quotes like this one: “We’re overdue for one of those cleansing recessions,” Duke professor John Graham said in an interview. And Graham said CFOs are growing more certain of a 2020 recession because of the paralyzing consequences of economic and political uncertainty — including trade wars — on business. “Faced with uncertainty, companies may pause by holding off on spending and hiring. That can turn into a self-fulfilling prophecy,” Graham said.

 

5 Key Facts About the Self-Fulfilling Prophecy:

1. There is a shortage of skilled workers

In July 2019, the US economic expansion was the longest on record, surpassing the 1991-2001 boom that was marked by the rise of globalism and the internet. And the unemployment rate is at a 49-year low.

2. We are trying to support the lack of skilled workers by bringing in foreign grad students

For instance, 83% of US CFOs support America offering expedited green cards to allow foreign graduate students in science, technology, engineering, and math (STEM) fields to work in the United States.

3. None of the major institutional forecasters are looking ahead to a recession for the rest of 2019 or 2020

According to the September 11, 2019, Conference Board, while recognizing risks to the economy, they are still forecasting real GDP growth of 2.3 percent for 2019 and 2 percent in 2020. In fact, the International Monetary Fund, forecasts in a July report: “Global growth to expand to 3.5 percent in 2020, with the U.S. economy expected to expand at 1.9 percent. The most recent forecast of the Federal Open Market Committee calls for 2 percent growth in real GDP in 2020, compared with 2.1 percent in 2019.”

4. Employment growth is focused on professional and business services, healthcare, and government

5. According to the Purchasing Managers’ Index, manufacturing weakened in August for the first time since 2016.

But it is important to note that this weakness has not spilled over into the rest of the economy.

Moving Forward

So, knowing the facts should impact your strategic path forward. Consumer spending still drives 70% of our economy, and factors like shortage of workers only give that population more confidence (not less). Keep the pace, monitor what is happening in the segments you serve, and continue to innovate.  Don’t let conjecture determine your future.

Top 5 Things CEO’s Should Know from the “Scaling Up” Book in Order to Grow Their Business

Top 5 Things CEO’s Should Know from the “Scaling Up” Book in Order to Grow Their Business

Top 5 Things CEO’s Should Know from the “Scaling Up” Book in Order to Grow Their Business

Top 5 Things CEO’s Should Know from the “Scaling Up” Book in Order to Grow Their Business

Top 5 Things CEO’s Should Know from the “Scaling Up” Book in Order to Grow Their Business

On a gloomy March morning last year, I was on a plane bound for New York. I was just launching my business coaching & advising practice and had meetings with CEOs and public company investors from my network. One was with a CEO of a $1.5B company, and I was feeling intimidated since I had never run a company that large. Surely the issues he confronted would be of such importance that I would not be able to relate, let alone act as a coach and advisor to him. As I flew that morning, I was deeply engrossed in reading the “Scaling Up” book by Verne Harnish, and I was transformed.

Top 5 reasons why CEO's choose Scaling Up

Later that day, in my meeting in the CEO’s glass-encased corner office with expansive views of the skyline and the Hudson River, I was able to reference back to the book topics that addressed every one of the business issues the CEO was experiencing. Since then, I’ve found in talking with CEOs of companies of all sizes, small to large, so many of their core issues remarkably similar. Culture, accountability, competing in ever-changing markets, and more. Deep issues that the resources and tools in “Scaling Up” can address and overcome on a foundational basis.  

As a CEO of a small-cap public company, and then growing my own company before exiting, I used and loved the Entrepreneurial Operating System (EOS) as featured in the book “Traction.” So much so that I began helping other companies find success in growing using EOS. Until a CEO I met recommended, “Scaling Up” to me. It changed my life and inspired what I do today.

Where “Traction” is the ultimate beginner’s guide to business operating systems, “Scaling Up” is the college-level textbook and reference guide. As another CEO friend says, “It’s Traction on steroids.”

Top 5 reasons why smart CEOs choose “Scaling Up”:

1. They’ve Had Success but are Now Frustrated

They’ve implemented the Entrepreneurial Operating System (EOS) in their business successfully, grew it, but then became stuck on the growth curve and are unable to break through it. Harnish calls these the “Valleys of Death,” and points out they are a natural cycle in a business growth curve. There are many reasons for these valleys, but Harnish points out the top three: leadership, scalable infrastructure, and marketing.  “Scaling Up” helps CEOs to pinpoint the issues and determine a winning strategy.

2. They Struggle with Cash

The faster and higher a plane flies, the more fuel it burns. The faster and higher a company grows, the more cash it requires. A “Scaling Up” cash mantra is “Revenue is vanity, profit is sanity, but cash flow is king.” Why do companies fail and go out of business? While there are many symptoms and issues that contribute, ultimately, they run out of cash, then crash and burn. In “Scaling Up,” cash is one of the “Four Decisions,” including people, strategy, and execution that a CEO and leadership team need to focus on. There are powerful tools in “Scaling Up” that enable CEOs to develop cash strategies to finance growth while in many cases limiting the need for outside capital.

3. Smart CEOs Understand that Strategy is the Key to Market Domination

Using Jim Collins’ bus metaphor for business, you can have the right bus, with the rights seats, and the right people in the seats, and be executing with perfection – but if the bus driver (the CEO), is continually making the right-hand turns circling the same block, it will never really get anywhere. A killer strategy is the key differentiator that sets apart the true growth companies from the rest. It’s a messy, non-linear process that required a lot of information gathering, thinking, and discussion. “Scaling Up” introduces the 7 Strata of Strategy tool as “the page behind the page.” This is the business’s secret weapon to define their unique space and positioning in the market, and developing it should be one of the CEO’s top job responsibilities.

4. They Are Insatiable Learners

Many of the world’s top business minds are readers. Bill Gates, Mark Cuban, and Warren Buffet all constantly read to find new ideas and get ahead of trends that are ever-changing. Harnish wrote “Scaling Up” to be an open framework for growth and learning, citing and recommending many business thought leaders, books and resources. This contrasts with “Traction,” where the EOS principle of being “pure EOS” keeps reliance on a simpler toolset repeated over and over. As a thought leader and author, Simon Sinek believes business is an infinite game where the rules and participants are constantly changing. The only winning is staying in the game, keeping your business going and not quitting. The way to stay in the game is to be aware and ahead of the changes. This requires continual learning and strategic thinking – not just excellence in execution.

5. Smart CEOs Understand the Key to Success is Decisiveness

The role of a CEO is not to have all the answers, it’s to inspire and lead a team toward a shared purpose, building a strong and transparent foundation that enables everyone in the organization to build upon.  Having a clear and communicated strategy and culture empowers the people in your organization to make their own decisions that are aligned with the vision and goals of the company. In “Scaling Up,” Harnish challenges CEOs with a key question, “Can you state your firm’s strategy simply – and is it driving sustainable growth in revenue and gross margin?” I meet far too many CEOs that are unable to clearly articulate their company’s strategy, let alone communicate it to their organization. Many are preoccupied with running their business, putting out fires and dealing with day-to-day issues rather than having the courage to put aside the time and diligence to work ON their business versus IN the business.

 

If you’re a CEO that is truly committed to creating or sustaining a beginner’s growth company, and you’re confident and decisive enough to do what needs to be done, then “Scaling Up” is a must-read. It’s challenged me to reframe my thinking about growth, both personally and organizationally. If you’re ready to get your real-world business degree, start reading it today!

5 Key Attributes of a Good Leader

5 Key Attributes of a Good Leader

5 Key Attributes of a Good Leader

5 Key Attributes of a Good Leader

5 Key Attributes of a Good Leader

One of our favorite business owner’s quotes: “You find out what kind of leader you are when you are going through the tough times, not the good ones.”  It is one thing to be an entrepreneur, or a leadership executive and entirely another thing to be able to effectively lead a team. Do you have what it takes?

Here are five character traits that all good leaders possess:

1. Empathy

Identifying with and caring about others. Empathetic leaders are able to experience a situation the way another person experiences it. Demonstrating empathy is a key tenant of leading others because empathy builds trust and leads to a deeper mutual understanding. This character trait will lead to deeper relationships with your team. You need to give support to get support.  That support ultimately translates to respect.

2. Decisiveness & Courage

One of the biggest complaints we hear from people who work with companies big and small is their leadership’s inability to make a decision. We hear statements like “too much red tape, too many decision-makers, interoffice politics, favoritism,” etc. We get it, change is tough – and sometimes the decision is in the indecision. But, no one thrives in limbo. Have courage and make those decisions – and support this decisiveness by surrounding yourself with the data you need to make critical changes. Don’t become scared stagnant.

3. Optimism

When the going gets tough and conversely crazy busy in the good times, it’s not always easy to keep up your energy. A couple of questions to ask yourself are, “What am I doing to maintain equilibrium and my positive energy as a leader?” “Do I give myself white space so I can be introspective about my role?” “Do I make time to pull up the morale with my team and recognize when and how to do this?” Good leaders are always the ones who can reenergize the team. They know when to provide encouraging words for boosting team spirit, and for making sure that people feel good enough about what they’re doing to keep forging on.

4. Clarity

OK, you are a visionary. How do you help your team understand what needs to be accomplished to achieve your vision? A good leader is clear and concise at all times. They validate that their teams understand their goals and provide the opportunity for people to digest them. They ask for consensus and are open to pushback to perfect their goals. People gravitate to leaders who have a clear picture in mind–good clarity leads to great achievement.

5. Integrity

There is a great quote passed on from a business owner that I know titled, “The Roots of Character” and it reads: “Those who preserve their integrity remain unshaken by the storms of daily life. They do not stir like leaves on a tree or follow the herd where it runs. In their mind remains the ideal attitude and conduct of living. This is not something given to them by others….it is in their roots; it is a strength that exists deep within them.” Great leaders always maintain a level of transparency, regardless of how difficult it may seem. It always pays off in the end. Here is a great, impactful quote from an Anonymous, Native American:

“There’s nothing more despicable than dishonesty. When someone’s trust is broken, it can rarely be gained back. This is something that holds true both in our everyday lives and our professional ones as well.”

 

Think about these leadership traits and what you are doing to keep these front of mind as you go into the second half of this year.  Leverage your resources – your CEO group, to stay on top of your leadership skills.

4 Essential Strategies for Working with Remote Clients

4 Essential Strategies for Working with Remote Clients

4 Essential Strategies for Working with Remote Clients

4 Essential Strategies for Working with Remote Clients

Working remotely with clients has gotten infinitely easier over the last 25 years. Computer technology, video conferencing, and real-time data have made workflow between cities and even countries commonplace in the last two decades.

That said, working remotely still has its inherent difficulties, and a proper game plan must be in place to work cohesively and successfully. Here are four essential strategies for working with remote clients.

 1. Establish great communication protocols starting with a kick-off meeting encompassing:

  • Your client’s communication preferences – does your client prefer email? Phone calls? Texts?
  • Establish a back-up person to the key account manager – ensuring that there is a resource if you are not available for your client
  • Do your homework – do you know your client’s industry? Does your team? Do you have a full discovery document completed to ensure that you are all on the same page on the history and needs of the client?
  • Create a project plan with action items for all responsible parties (use a project management online platform to help manage timelines and deliverables)
  • Establish roles and responsibilities on both sides of the relationship – and set clear expectations of the deliverables associated with your project plan
  • Create a share drive enabling you to provide access to files needed to complete and manage the work
  • Set up standing internal and external meetings – to make sure that projects are moving forward

2. Monitor your progress after the first month and again after the first quarter

  • Provide a report of your accomplishments – present it formally in a meeting closing with any outstanding work assignments including a review of the updated project plan
  • Ask how you are doing. Not only the work but how you are presenting the work. Is there anything missing? Is there anything you could be doing better?
  • Conduct this evaluation regularly. All relationships take work. If you don’t monitor your efficacy, you are likely to run into issues or roadblocks in the future.

3. After the initial work has been instituted, can you scale back your regularly scheduled meetings?

  • In the interest of time, perhaps meetings can be scheduled monthly vs. bi-weekly or weekly
  • Possibly provide a dashboard accessible to the client that he/she can access ad hoc remotely? That way you are all saving time (and money)

4. Invest in in-person meetings when possible:

  • At a key juncture – schedule in-person meetings. Did you know only 7% of what you intend to communicate by words in written communication (letter, emails or texts) gets across? And only 38% by the tone of your voice via phone calls or voicemail. In person, 55% of what you say is communicated by your body language. Think of how much you are missing if you are not taking advantage of in-person meetings when you can. Your communication escalates incredibly when done in person—both sides get a better understanding of the words, the tone, and the body language. 100% communication!
  • An option instead of an in-person meeting is a video conference–whereby you share your desktop and can see and engage with one another during meetings.