|
|
|
|
LEVERAGED CAPITAL NEWSLETTER Leveraged Capital, is a free monthly newsletter that presents growth and strategy issues effecting entrepreneurs and owners of small to medium size enterprises (SME's). Leveraged Capital is published and delivered electronically to subscribers. Your privacy is strictly respected and we do not share or sell subscriber email addresses to anyone outside of Graham Financial Corporation. If you enjoy what we present, please forward a copy of Leveraged Capital to clients and associates. They can subscribe to Leveraged Capital, by clicking on this link: http://www.GrahamFinancial.com/newsLetter.htm and filling out the quick form.
Last week featured a double dose of good news, as a number of companies posted positive earnings results and reports showed the economy could be strengthening. Manufacturing surveys revealed sharp increases in activity and hiring. The Fed’s “Beige Book” showed that 10 out of 12 Federal Reserve districts reported greater economic growth in September and the first weeks of October. As I engage in due diligence in companies in the south-east, I’m seeing the positive attitudes and real steps to growth first hand. Let’s hope Ontario’s newly elected Liberal government will take a hard look at the critical importance of sustained corporate investment in jobs, capacity, and production to one of the most robust business economies in the world. Much (long-term) success to you, DPG.
In This Months Issue: (Click on the Article Title To Go To The Full Story.)
Quote Of The Month: Investment Hindsight:
This
is the first of a two part series on Messaging in the workplace. Email is a great tool, but that is all it is, a tool. Don't
try and make it fit where it doesn't belong.
Let me
explain; "When all you have is a hammer, everything looks like a
nail.". This expression sums
up how many people treat email. They
use it for writing memos, project tracking, scheduling meetings, a personal
filing system and workflow. Email
is nothing more than a memo writer with one very fast delivery boy. The importance of streamlining process seems to be ignored
when dealing with email. How many
times have you witnessed co-workers complain that their email quotas are too low
or had an email rejected because the attached documentation exceeded the size
limits for outgoing mail imposed by IT. These restrictions were born out of
corporations' need to control rising costs of managing email. Email
has its place but…. In business today, removing email is not an option.
Corporations need to realize that it has its place and they need to use
it in ways they achieve the most value from it.
Consider the following scenario.
At no time is the actual document forwarded (to any reviewer)
and it is duplicated only once. The
existing company Email system is used to send the messages without the overhead
of storing the document. For a one-to-one communication, this process is excellent.
For a one-to-many communication this process is a necessity.
The example above is a Basic Review Process that is now automated and is
utilizing the email infrastructure. This
type of Basic Review Process is known as Workflow.
Workflow has been around for many years and has proven itself time and
time again to reduce costs and improve employee productivity.
Companies can implement workflow, utilize the incredible speed and
reliability of email delivery and reduce the amount of email traffic and storage
requirements in one effort. Multiply
this by the number of processes that can be email enabled and this becomes a
very attractive win-win situation. Adaptation
of workflow can improve how you do business, utilize your current infrastructure
investments, improve service and reduce costs. Kenception Technologies undertook an email audit of a
publicly-held processing/manufacturing company. In the initial sample test of the “cost” of forwarding
a relatively simple document by email, we discovered that the burden of
supporting the email was far greater than expected.
A simple 212k document was sent to 4 people for review, each person makes
their edits and replies. The cycle
was completed only 2 times in total. Assuming
each person kept a copy of the original email, kept their reviewed copy on their
hard drive and kept a copy of the email when they responded (with history) with
their edits. The cycle produced 43 copies of the same document in different
versions. This small 212k file is
now taking up approx 9MB of storage space and produced 21 separate email
messages. Using the messaging system to notify users, the basic review
process produced 2 copies of the document (95% less), 9 email messages (57%
less) and stores 0.9MB of information. A
remarkable 92% less storage is required using a simple review process than the
same process initiated by email alone. Consider the hard costs suffered by IT to back up these
duplicated files on a daily basis, the physical space needed to house the
servers that store this information, the time spent by users searching for the correct version of a file, the
amount of re-work needed when it is unclear which file is the most recent.
Now multiply that by the number of times in one year a busy organization
such as a law
or engineering firm initiate this type of review. The cost to the client for which Kenception Technologies
undertook the study was staggering prompting the CEO and CFO to reconsider
workflow review process throughout the organization. Organizations must sit down and work on the IT budget, not
from the perspective of increasing infrastructure to accommodate the amount of
information that is being stored, but rather how they will reduce the needless
and wasteful demands users are putting on the IT infrastructure.
When Kenception Technologies is mandated to review companies
information needs and when installing our Cognition Suite of
products, we often are asked by CEOs and CFOs how to make the most of the
technology they currently have and stretch their IT dollars,
all the while dramatically improving their level of service. To respond to these questions and define best practice
solutions, we have developed a 5 phase process. 1.
Developing
an IT strategy that is in line with the overall Organization Strategic Plan.
This may sound obvious, but the Financial Executives Institute (FEI)
reported in 2001 that 40% of the companies polled had an IT Strategic Plan and
only 30% of those were in line with the Organization Plan. 2.
Investigate
adhoc Review Processes and centralized information repositories to reduce the
dependency and misuse of email. Typically
these solutions can be implemented quickly at little cost and receive high
employee buy in. 3.
Graduate to
a Knowledge Management Strategy. Look
at ways of capturing specific data and mining it, phase in cultural change,
integrate end user and back office systems. 4.
Phase in
with training and end user education seminars and find out what information the
employees really need. Run a pilot
with one department, then cut back the email storage limits and impose email
memo restrictions. 5.
Take what
you've learned and extend it to include your suppliers and customers.
The costs to companies, big and small, are compounded further
as employees rely on their email as a filing system instead of a centralized
collaborative framework of applications. The amount of knowledge unavailable to colleagues or lost
when people leave a company is costing companies millions of dollars a year
because they are not able to capture the expertise held by the employees.
The Basic Review Process mentioned in this article is a first step in
capturing the information concisely and effectively while improving employee
efficiency and reducing long term costs. Email is a great tool that I use it everyday.
I also see the true use of email as misunderstood, misused, abused and,
frankly, a significant cost to organizations.
However if used where it best fits, email will be one important part of a
larger solution. I never over estimate its abilities and I don't under estimate
its true costs. Joseph Amato is the Founder and President of Kenception Technologies Inc. a Toronto based company that has developed the KTI Cognition Suite of Products. Kenception specializes in Knowledge Management and Information Deployment Solutions. Joseph can be reached by email at jamato@kenception.com . Visit www.Kenception.com .
I've been an entrepreneur for most of my life, ever since founding CyCare Systems in the 1960s, and I've also always had an interest in aviation. In fact, Southwest Jet Aviation, the company I most recently launched, is a provider of services such as charter, hanger, and aircraft maintenance management. Thus, I can't help turning to aviation lore to explain to today's entrepreneurs that what they must do to build great companies is adopt the attitude of the fighter pilot. That is, they must always be in control of the plane; they must be the person calling the shots. However, something else separates the great fighter pilot from the true ace, and it isn't exceptional skill, daring, education or weapons accuracy - those characteristics are given. Instead, aviation lore has it that what makes the difference is the pilot's wingman - the individual flying in the cockpit beside the fighter. A great wingman gives the pilot the chance to be great. Similarly, the essential number two gives the entrepreneur a chance to be successful. Think of Steve Ballmar to Bill Gates at Microsoft, "Charlie" Munson by the side of legendary investor Warren Buffet, or Mort Myerson who ran Ross Perot's operations for years. In Praise of the Wingman . CyCare Systems was a pioneer in the group medical practice billing and insurance software systems business, for years maintaining a 35 percent share of the market. That, in no small part, was due to the people I was able to recruit. This group included executives such as Ron Grey, the chief financial officer who got us ready for our initial public offering (IPO) in 1981; David Mitchell, who built our professional sales force; Harry Moore, who weaned us from batch processing to modern technology; and Jim Dyer, who eventually took over from me as CEO. They were great, but it was Burgmeier who was the wingman. He joined shortly after I founded the company, when our staff numbered a scant 15 and stayed on for 19 years before leaving in 1986 - only to return five years later for another four-year stint. In his 23-year tenure, CyCare Systems metamorphosed from fledgling to fast growth and again, with its listing on the New York Stock Exchange in 1988, into maturity. Throughout it all, Burgmeier wasn't necessarily in training for the fighter pilot's job. Indeed, that may or may not be the outcome for the wingman. At Microsoft, Ballmar did succeed Gates as CEO. At CyCare Systems, on the other hand, when it came time for me to step down, I turned to Jim Dyer instead, for his marketing prowess. What It Takes. At its most basic, the job isn't one for the person selected by flipping through resumes and hoping for the best when the hire comes on board. It is a role best filled with someone the entrepreneur knows personally - and respects greatly. I met Burgmeier in the early 1960s at IBM, where he was working in systems and I in sales. From my observations, I could see that he possessed tremendous knowledge of data processing management, the equivalent of today's chief information officer's role. In fact, given his likely future at IBM, it took some convincing to lure him to my start up. As skilled as he was, he possessed talents that were different from mine, which is also essential for a company's second-in-command. In the early days, ours was the classic Mr. Outside, Mr. Inside split. While I was busy pursuing customers - it was I who elected to go after group medical practices rather than municipalities, the alternative opportunity in those days - Burgmeier was forging the operation that would serve those customers. As Mr. Inside, he created the company's guts - its data-processing operation in Dubuque, Iowa - eventually building a staff of 250. In the process, he solved problems as they arose, such as having suddenly to service 35 rather than 10 accounts during a period of especially fast growth. With Burgmeier, it was never a matter of my telling him what he had to do, but rather his telling me what he had done. In short, he took responsibility and ran with it. A good wingman must have an outstanding degree of integrity, and that characterized Burgmeier as well. I don't think he could tell a lie if his life depended on it, which was more than just a matter of moral exactitude. It was critical for a small company in the throes of building lasting relationships with customers. When I named Dyer rather than Burgmeier to the top job in 1984, I took comfort in knowing how Burgmeier would react: I knew that he would want what was best for the company. This is what lies at the heart of the job that is essential for the making of an entrepreneur. As I said, a good wingman makes it possible for the pilot - or the entrepreneur - to be successful. Jim Houtz, 67, founded CyCare Systems, a group medical practice billing and insurance software concern, in 1967 and operated the company for 29 years. The company went public in 1981 and was sold in 1996 to Atlanta-based HBOC Inc. for $270 million. Currently, Houtz serves as a chairman of Southwest Jet Aviation, a provider of aviation services such as charter, hanger and aircraft maintenance management. Southwest was one of 10 companies in which he invested through JaGrand Ventures, a venture capital firm that he founded in 1998.
Many people think
they are communicating when they provide information in the form of memos,
e-mails, reports and the like. But they're not. Information is giving out;
communication is getting through. As you can imagine, there is a world of
difference between giving out facts, figures and other material and actually
getting through to people. I can't offer you one
surefire method of communicating that is guaranteed to make your audience
understand you completely every time you open your mouth. I can, however,
describe nine vehicles that--when viewed correctly and used consistently--can
help you get through more often. Here they are: 1.
Behavior. 2.
Relationships. 3.
Emotions. 4.
Values. 5.
Words. 6.
Listening. 7.
Expressions. 8.
Compassion. 9.
Change. I've
given you nine ways to get through. But the communication puzzle has one more
very important piece: integration. Let
me explain. If you use four of the nine of the nine vehicles consistently,
you'll be a much better communicator than if you only use two of them. If you
use eight of the nine, you'll get through more often than if you only use five.
In other words, the more of the nine ways you use when you communicate, the more
effective you're going to be. Do
you want to get through to the people you lead? If you do, evaluate how well
you're utilizing these nine vehicles and begin adding the missing elements, one
by one. Stop being an information provider and start communicating. Used with permission from Dr. John C. Maxwell's free monthly e-newsletter 'Leadership
Wired' available at www.MaximumImpact.com. Dr. John Maxwell, founder of Georgia based Injoy
Group and has cultivated an
extensive following amount the most highly respected business leaders around the
globe. He reaches more than 350,000
people a year through speaking engagements, and over a million more through his
resources such as Maximum Impact. John
is committed to developing leaders of excellence and integrity through his
philosophy that “everything rises
and falls on leadership”. Author
of more than 30 books, Maxwell’s titles include these best sellers:
The 21 Irrefutable Laws of Leadership, Failing Forward, and The 17
Indisputable Laws of Teamwork.
We came across an interesting web site this month, sponsored by
Expansion Management magazine, which offers insights and practical information
for businesses expanding into new regions across the U.S. and abroad. The online
version of the magazine includes full-text business features as well as special
reports on particular states, countries and regions. This is greater emphasis on
U.S.-focused articles, but you'll still find good international
information—including quick facts and feature articles—in each issue's
Global Expansion section. Issues
are archived back to January 1998, providing a wealth of detail on general and
specific expansion and relocation topics. See www.expansionmanagement.com .
To Advertise in Leveraged Capital: If you are interested in advertising in Leveraged Capital, email us at: ads@GrahamFinancial.com and we will contact you. Feel free to forward a copy of Leveraged Capital to clients and associates. It is free to subscribe by clicking on this link: Click Here For Your Free Subscription To Leveraged Capital.
To Unsubscribe from Leveraged Capital: If you wish to removed from our mailing list, send an email to us at: ezine@GrahamFinancial.com with the word "Unsubscribe" in the subject field. © 2003 Graham Financial Corporation, All Rights Reserved.
|
|
|
