Monthly Archives: December 2010

7 Tough Questions To Win In 2011!

1. Should You Spend Less Time At The Office?
Given the hectic, stressful lifestyles of most business owners and managers, it is no wonder that ‘enjoy life more & take more vacations’ is a popular new year resolution. Get hotel reservations and airplane tickets one year in advance of your next vacation to make sure you do what you want to do. And don’t take your cell phone or computer! Plus go out and see at least 20 customers over the next 20 days weeks.

2. Should You Start Your Fitness Program?
Can too much exercise can be bad for your health? Plus if you don’t workout today, you’ll be more rested tomorrow and then can workout even harder. Working out also reduces your ability to be at work more hours, take on more responsibilities, and make more money! So, when you finally make enough money, then you can afford to buy some workout clothes that make you look fit, join a gym, and get on a program. What about the fitness of your company as well? Are you also examining what needs to improve, where you need to trim the fat, or what areas need to get fit? Look at your business fitness goals for the next 12 months. Think about your future and imagine what you want to be different or better one year from now.

3. Should You Gain 175 Pounds?
After all, skinny people look worse than heavy ones. Over 66 percent of adult Americans are considered overweight. So it’s not surprising to find that weight loss is one of the most popular New Year’s resolutions. In your business, where should you add some weight to lessen your load? Perhaps you need to add a professional office manager, accounting manager, project manager, estimator, or field superintendent. When you add a real pro who can help take some of your workload, you’ll be able to focus on the priorities that will increase your sales and improve your bottom-line.

4. Should You Spend More Than You Make?
Live way, way, way beyond your means is the new normal while you wait for the economy to turn around. In business, don’t sell your equipment and even consider buying more at irresistible prices. This will force you to hire a mechanic, buy a service vehicle, and rent a bigger yard to house all your equipment. This will force you to work harder to make the payments and cover your monthly overhead. And the new economic stimulus will hopefully provide enough opportunities for you to keep your fleet working at least some of the time! A positive New Year’s resolution is to get a handle on your finances now! As you have heard me say many times, you must know your numbers to grow your business and make a profit. When you’re strapped, you make desperate decisions and poor choices just to keep afloat.

5. Should You Get Completely Stressed and Out Of Control?
Stress is a good thing to have. When you’re stressed, you wake up at night and make those valuable lists that help your business and personal life become better. Stress helps you multi-task and never be in control. Besides, if you get in control, you can’t get enough things done in a day. So sweat the small things, take care of every detail yourself, and worry about all those little things you don’t have control over. In business, only a few things are worth stressing over. What are your top three priorities in your company? I suggest the only things business owners need to stress about are sales, revenue, and customers. When you have enough sales and customers, the rest can sort itself out with good systems and people. How many more hours will you dedicate to your top three priorities over the next year?

6. Should You Keep Doing What You’ve Always Done!
When you learn new ideas, you don’t have enough time to do all the things you want to. So not learning new things is a great way to get by in life. Read less books and stop trying to improve. Besides, too much learning can really wreck your head. I suggest you watch more television as an alternative solution to your predicament. People who don’t commit to written resolutions or goals, continue doing things the same way. They get trapped in what I call the “un-comfortable” zone. They know they want to break out of their situation by doing something different, but don’t. They live with continuous dull pain, stress, and discomfort rather than do something new, exciting, or different. What do you want, dull pain or positive results?

7. Will You Win Or Lose In 2011?
If you could start over, what would you do different? Why aren’t you doing it? Everyone needs time to stop and think about their future. You need input, help, advice, wisdim and ideas to decide what you need to do to go out and build a better business. I will be holding a special “Win In 2011” Profit-Builder Circle Academy in Costa Mesa, California. I am offering a special rate never offered before to help construction business owners jumpstart their companies and figure out what they need to do to take them to the next level based on the reality of the economy. – Where do you need to add new business? – What do you need to stop doing? – What do you meet to eliminate? – Where are you stuck? – What decisions are you postponing? – How should you reorganize your staff and management team? – How can you implement your plans to make a profit & grow your business? Email me at: gh@hardhatpresentations.com for more information if you are interested in participating in the Profit Builders Circle.  Please place “Profit Builders Circle” in the subject line.

Click here to learn more about the Profit Builders Circle

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Work Harder or Smarter? Plan Your Success in 2011

If you were on a cross-country car trip from New York to Los Angeles and found yourself ‘lost in Bonkers,’ what would you do? Most likely you would stop, consult the map, and get back on the right road. In life, it’s hard to slow down when you are “maxed-out” traveling fast with a heavy load. You don’t have any extra time to stop, pull out your road map and reflect on your destination. In the race for “more and better” food, clothing, shelter, business commitments, customers and stuff, you’ll get lost, forget where you were going and often lose direction and focus.

Time management experts tell you to work harder, smarter, faster, and more efficiently and then you’ll eventually gain control of your life. By trial and error, you’ve learned this approach doesn’t work. To gain control of your life and business priorities, you must know the right direction to go and have a map or plan to get where you want to go. Speed is not an issue—only progress and balance are important.

Busy?
I often hear: “There just isn’t enough of me to go around. I try to set clear goals and act in an organized manner, but things keep happening and getting in the way.” When you “max out” your business and personal commitments– physical, emotional, mental, spiritual, and financial – there’s no time to live life ‘On-Purpose…On-Target.’ There’s only time to react to the stress and strain of your ever growing ‘to do’ list. The standard question you often get is “Are you busy?” In today’s “hurry up” society, “busy” means successful, important, making progress, healthy, and valuable. Do you think busy people are productive and happy?

Being busy is not my objective. Making active and balanced progress towards my life purpose is my benchmark. Being balanced does not mean being busy and doing something in every area of my life every day. It does, however, mean that I am making progress and moving towards a balanced life – being interrelated, fully integrated and entwined in all areas. A balanced life is the sum of the whole life working as a unit and rolling along smoothly towards your targets.

The World’s Formula Translation
Food                                                 Upscale or fast
+  Clothing                                          Expensive and trendy
+  Shelter                                             Big home in right neighborhood
+  Modern conveniences              Everything
+  Education                                      Expensive private college
+  Hard work                                     Overwork
+  Lots of stuff                                  Debt is normal
+  Important career                       Over committed
+  Bigger business                           Out of control
+  Involved in everything Other people’s priorities
=  Peace and happiness       Superficial power & prestige

Clear your plate! Eliminate!
As your ‘On-Purpose…On-Target’ life and business evolves, you begin to realize that more is NOT better. Less is better. Get Simple! “Stuff overload” causes too many distractions. Learn to say “Yes” to activities, commitments, and causes aligned with your priorities and purpose. Learn to just say “No!” to activities not aligned with your priorities. It’s much easier to discern what you want to do, purchase, and get involved with when you know where you are going and why.

Living life ‘On-Purpose…On-Target’ according to your priorities is a cleansing and freeing process. Right now, list some activities and things that you can eliminate from your personal and business life that hold you back, distract you, and divert you from keeping on track with your targets and goals.

Live life’s 6 F’s!
Several years ago, I went to a goals seminar to get control of my business and personal life. The following Monday morning, I got to work early and made a list of things to do. Then after a full day putting out fires, several panic phone calls, faxes, e-mails, interruptions, and an emergency conference with a job site superintendent, I hadn’t done one thing on my hot list! At 4:00 p.m. my best customer called and invited me to play golf the next morning and discuss signing a big construction contract. I didn’t have time to play golf with my best customer! I had forgotten my focus. I couldn’t even remember my priorities!

A business that works always is ‘On-Purpose’ and ‘On-Target’ according to your priorities. It gives you what you want! What will make your business ‘On-Purpose’ for you?  I want my business to always make a profit, create repeat loyal customers, be 100% run by my management team, grow my equity, create wealth, and allow me the freedom to enjoy the 6 F’s:

Freedom
Family
Friends
Faith
Finances
Fun

Do what you want!
Mike is a friend who of mine who owns a steel manufacturing company. He attended one of my Profit-Builder Circle boot camps for business owners. Afterwards, he asked if we could meet to discuss his management style. He told me he wasn’t reaching his personal goals and wanted to have more time off from work. After we discussed this goal, I asked him to be more specific. He admitted, “I would just love it if I could have at least four hours off on Sundays!”

Everyone is in a different place. But to get what you want, start by being specific about how you will balance your business and personal goals! Make a commitment and say, “I will leave the office at 5:00 p.m.” “I will not check my e-mails or voice mail from 5pm until 7 a.m.” “I will not get involved in decisions my managers or key employees are authorized to make.” “I will take a three or four day weekend off every month.” Be ruthless. Stick to your priorities and get what you want out of your business to enhance your life. Resolve every day to:

– Read and focus on your personal and business priorities.
– Make progress towards achieving your balanced life goals.
– Not postpone your life and family for business pressures.
– Live your priorities to get what you want.

Live life’s 3 R’s!
Putting your priorities first is tough. Each day of your life involves difficult demands and tradeoffs. To be ‘On-Purpose…On-Target!’ you must be ruthless about your decisions, choices, commitments and priorities.

Successful people say:         Losers Say:
“I can do that!”                                 “I could never do that!”
“I’ll do that!”                                      “I’ll try that!”
“No”                                                       “Yes” to other people’s priorities

What’s the best time to try new ideas and work different? (Hint: It’s not “ASAP.”) The best time is now! Trying new ideas and doing new and different things daily is hard to accomplish. But, forgetting old ideas and comfortable ways of acting and doing is even harder! Putting your priorities first is tough. Each day of your life involves difficult demands and trade offs. To be ‘On-Purpose…On-Target’ you must be ruthless about your decisions, choices, commitments and priorities.

Accept Responsibility!
The following responses to circumstances have become the norm in today’s society: “It’s not my fault.” “It’s just not fair.” “It’s not my job.” When business owners, entrepreneurs, and winners take on a job they get it done. Period. No excuses. No rules. No reasons why not. Need I say more?

Accept Reality!
Sitting and waiting for “it” to change is counterproductive to living ‘On-Purpose…On-Target!’ Accept your current situation as it is. You can’t change the past! However, YOU can change your future – starting now! Get on with it. Go for it. Make the best of what you’ve got and make tomorrow even better. Start making those slow but steady changes in how you manage your life. You can do it!

Accept Risk!
Most successful businesses were started by individuals with a clearly defined vision, purpose and goals. The definition of an entrepreneur is one who “assumes the risk” in a business in expectation of gaining a profit. Step up and step out in both your professional and personal life. Take a stand. Take a risk and act like an entrepreneur. Expect the best to become the best! Take that first step to get what you want. Yes, the first step is often the hardest. I encourage people in this predicament to ask: “What are you waiting for? What’s the worst that can happen?” If you never try, you’ll never achieve.

Failure Is The Key To Success!
As a youngster, my dad often took me snow skiing to the local mountains. I’ll never forget his instructions as I watched the expert skiers racing quickly down the slopes with perfect parallel turns. He’d say, “You’ll never better standing there watching and wishing you could ski like they can.” With that I would take off and swish down the mountain as fast as I could. My goal was to fall down on every run. This way I knew I was pushing it to the max. You don’t get better if you don’t fall down often. You get better and when you try new tricks and techniques. What new tricks have you tried in your business lately to make it better, to make more profit, or start hitting you long term goals?

Have you ever noticed in life successful people always get up when they fall down. And the really successful ones fall down a lot! Stay alert. Watch for opportunities. Be quick to change. Make your own luck. Always be ready and well prepared. Know where you want to go and let others know where you want to go too. Ask others how they did it. Seek advice. Stay informed. Keep improving. Stay on top of your field. And always go for it!

“Give to the world the best you have and the best will come back to you.”

Have you ever noticed that successful people who have their lives in order are also more active, involved, and generous with charity, church, and volunteer organizations? They find time to make giving a top priority in their lives. The fact is your success is an outcome of how much you do for others. Your deeds have lasting impact, not your stuff, power, position or busy schedule. Successful people make more time to serve others. Becoming a success is directly proportional to what you give. It’s a fine line—some people give to get—but that won’t work for most.

What you get is a RESULT of what you give!
I receive an overwhelming return on my investment every time I give my time, talent, and money. Giving is the outward expression of your inner commitment, character, and dedication. There is a direct conduit between your heart and your wallet. A banker once told me that the first line he looks at on a loan applicant’s tax return is “contributions.” He tells me he can usually judge a person’s true integrity and sincerity by looking at that one single entry. People who donate money generously and on a regular basis can be trusted. People who don’t find time or money to give to others are self centered and can’t get everything in life they want. People who don’t give are the only ones who complain about giving. Give giving a try. I guarantee you will get more in return than you ever give.

Albert Einstein said, “Only a life lived for others is worthwhile.” I built my business with the slogan: “Do a good job for the customer and the money will come.”  Putting others first always works in both business and life. So go out and give, get, and enjoy what you’ve got!

It’s Bonus Consideration Time!

I hate bonus time and figuring out how much extra to pay employees at year end. People today expect a year-end bonus or incentive compensation for their efforts. Plus they need the extra $$$ to pay for all their holiday shopping and expenditures. Sometimes bonuses even seem like an entitlement instead of compensation for extra effort and results. What should I do? I try to be generous but the economy is slow and profits are dwindling. Should I pay out lots of cash and hope there is enough to last the next year? Or should I tell everyone there just isn’t enough to go around this year? Or should I get everyone a turkey and tell them to have a great holiday? Here is an email I received from a reader of Construction Business Owner magazine. I write an “Ask The Expert” column every month.

Question: George, As I sit at my computer I’m reflecting on how blessed I am as an individual and business owner. I have been wrestling for some time with how to fairly compensate our senior management team comprised of 6 people: three senior guys including me and three young VP’s of Operations, Administration, and Business Development. These 3 attended your two day Profit Builder Circle boot camp recently in Atlanta which definitely reinforced my philosophies and mentoring of these 3 young men. You really do a great job.

Do you have any suggestions on incentives or bonuses for the management team? In the past, we have used a program that established a set percentage of net income for retained earnings; a set percentage for owners as a return on their ownership equity, and a certain percentage of net income as a bonus to the management team. But now, the older management team members are not putting forth nearly the effort they used to. They bring a lot to the table, but their interest and drive has waned. It is an entitlement problem in my opinion as they are financially secure. I have positioned the 3 younger VPs to run the company and they are doing great and progressing well, but I’m not quite ready to turn things over to them completely. I am still very involved as the CEO and mentor these young managers on the business side.

How do I compensate the 3 younger managers for running the company? How should the older managers be compensated for their ownership, even if they are not providing much on a daily basis as they are being paid a six figure salary now? And what percent is recommended for retained earnings?

I hope to back further away from this business this coming year and improve my golf handicap and want to be fair to everyone, old and new. We have built a very successful specialty service business and my goal is to continue to monitor our processes and procedures and continue to find new ways to improve while continuing to grow all our people. I know there is no magic formulas but I thought you might share your thoughts on this topic. Ken D. CEO -CES LLC

My Answer: Ken, as your older managers get more conservative and less enthusiastic about growing your company, it is time to make a positive change for everyone. First stop confusing compensation with return on equity. Everyone needs to be paid a fair salary and compensated for their contributions based on what the fair market value demands for the job they perform. If an employee is worth $50,000, that is their salary without exception. If they aren’t worth that amount, pay them less or more accordingly.

Profit is return on shareholder’s equity. Owners should share the profits based on their stock ownership less what you keep in the company as retained earnings before profit distribution. The older managers should be paid a salary based on exactly what they are worth to your company. If they only work a few days, they get paid less. As owners, they participate in the overall company profits. If you want to give them a little more like a car, health insurance, or extra pay, that is a gift for tenure and a result of your soft heart. But remember, the extra compensation you pay the older owners for not working a full load makes your overhead higher than it really is, makes you less competitive in the marketplace, and forces you to pay out profit before your really earn it. This actually reduces your company’s net profit and lowers the incentive potential for your younger managers.

The key managers who run your company should receive a healthy salary and benefits based on what they are worth as well. Plus give them a percentage of the pre-tax profit for their efforts and contributions. I recommend the first 15% return on equity stay in the company before any profit split takes place. If the 3 managers are 100% responsible for the company results, allow them to earn up to 35% of the profits as their incentive. Then the owners will receive the next 50% of profits as their return. – George

Well now it’s your turn to decide if company bonuses are in order for your employees. Good luck doing the right thing. If you have any good employee compensation ideas, email me please post them here or on our LinkedIN Group HardHat Biz Hub.