Category Archives: Strategy

Vision

Posted on May 17, 2012 | 2 Comments

Last night my fellow THRIVEalists and I had a fun virtual meeting where we discussed what roles we play in our firms and how those may change as we grow. We’re at different stages in our career, but one thing we agreed on:

Someone (probably the owner) needs to set the Vision for the company. If there is no Vision, it is more difficult to see where the company is headed, who the company should work with and what needs to happen on a day to day basis to fulfill the Company’s WHY.

Inspired by our chat, I came up with this drawing.

A Vision is a puzzle, it could include pieces from the person’s past (stuff they like, or hate) what skills need to be acquired to reach our goals, what allies we need to make.

What’s your Vision? Have you shared it? Try it, you might be surprised that people are willing to help you get there.

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Posted in Business management, Napkin drawings, Strategy

How to Build an Awesome Business

Posted on May 3, 2012 | Leave a comment

This drawing was inspired by John Jantsch’s excellent post about starting a business BEFORE it actually opens.

Build a community of people that can’t live without you.

Within that community there are (hopefully) some folks that LOVE you -  your tribe, your raving fans, your homies.

Within the tribe there are people Seth Godin calls “sneezers“. (see page 41)

Take care of your community, wow them in your interactions, give more than you get.

Thanks for reading.

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Posted in Napkin drawings, Strategy

The Importance of Risk

Posted on April 26, 2012 | Leave a comment

Perhaps this should be called “The Necessity of Risk”.  We live in a time of change, sometimes very rapid. If you’re not innovating or at least keeping up by taking risks and trying new things, you might be in trouble.

If you asked 100 business owners if “growth” (either in revenue or profit) was one of their top 3 goals, my guess is at least 95 would say yes (maybe even all 100). But where does growth come from?

  • you can sell to new customers
  • you can sell more stuff to existing customers
  • you can sell new stuff
  • you can raise prices on existing stuff

These are all valid strategies, some likely more difficult than others depending on your industry. In addition, some strategies may result in revenue growth but not necessarily profit growth. That is something you accounting data should tell you.

We know profit comes from risk, so instead of cutting costs, trying to sell more widgets, increasing efficiency or other “top 10 ways to increase profits” you found on Google, perhaps risk should considered as the most viable option for increasing profit.

Risk can take 2 forms – either taking risk away from your customers or taking risks in your own company by doing something different. The best thing about taking a risk is the upside potential. Yes, you could fall on your face -  you’ll probably still learn something. But what if it works?

Apple could have remained a niche computer company and probably still been a tech giant. But look at what innovation did. Today Apple is everywhere and has changed many industries. (They also had a few flops along the way.)

Now, I’m certainly not suggesting taking crazy risks and potentially blowing up your whole business. Start small. Test on a segment of you business. Google gives its employees 20% of their work time to experiment, innovate and “blow stuff up”.

What if you took even 10% of your week (4 or 5 hours) and actually scheduled some brainstorming time? If you have a team, include them. Make it a priority. It may not be urgent, but it IS important work.

Please share your experience taking risk in the comments. What has worked, what hasn’t?

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Posted in Accounting, Business management, Strategy

Leadership & Management

Posted on March 7, 2012 | 1 Comment

I was listening to the excellent Dave Ramsey EntreLeadership podcast on the way in this morning and was struck by something the guest, Stepen M. R. Covey said about delegation. Mr. Covey suggests delegating results rather than tasks.

By delegating a result, you are effectively saying “Here is what I want, I trust you to figure out the best way to get it done.” This is a powerful, freeing concept, both to the leader doing the delegating and to the employee.

I started thinking about this in terms of the differences between managers and leaders. I suppose both are necessary in some organizations, but I wonder if, in some small organizations, the leader may slip into the manager role too often. Instead of taking a bird’s eye view of the business, they get bogged down in the minutiae of the day-to-day processes. We’ve all heard of the “micro-manager” and the horror stories that go along with that stereotype.

What if we led with trust and focused on WHY we are doing this project, instead of managing every little detail of HOW the job gets done. I bet the employees would appreciate the ability to flex their creative muscles and who knows, they may even discover a terrific new way to achieve a great result.

What do you think?

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Posted in Business management, Strategy

How My Kids Will Pay for College

Posted on March 3, 2012 | 2 Comments

Full ride hockey scholarship.

Well that’s my dream at least.

Just in case that doesn’t work out, we’re making them save $1,000 per year. Even our 1 year old will bank another $1,000 this year. Our 4 year old (if not for the stock market crash when he was about 1) would have about $4,000. Even with that dip, I’m confident we’ll bounce back before he’s 18. He learned early investing ain’t for crybabies.

You’re probably thinking we’re nuts about now…how the heck do these people make their kids save $1,000 per year? Heck, little Stella can barely talk.

Here’s our secret: the Child Tax Credit.

That’s right, the IRS will actually credit you up to $1,000 per qualifying child. Rather than blow our refund on some extra crap we don’t really need, we’ve opted to invest it for the kids.

If they choose to go to college, they should have roughly $20,000 – give or take – depending on how happy the stock market is between now and then. Will that pay for 4 years of college? Maybe not, but there are plenty of other strategies we can look at to close the gap.

If they don’t want to go to college, they can use that money to start a business (anybody know a good CPA?) or maybe do a little traveling (Mom & Dad will be happy to tag along).

Financial planning is really about planning for what you want out of life. Figure out your goals, get creative with a plan on how to get there and get started TODAY.

If you need guidance, give me a call, email me or leave a comment.

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Posted in Personal financial planning, Strategy

On Humility

Posted on February 20, 2012 | Leave a comment

One huge benefit to being humble is admitting we don’t know what the future brings. Imagine how freeing that can be.

We don’t have to make the perfect decision. We can allow ourselves to fail, iterate and move forward. We can define point A and point B and realize the journey may be a messy one.

On the other hand, our hubris effectively tells other people “I see into the future and THIS is what will happen.” That doesn’t leave much room for interpretation or error. We’ll probably get pretty frustrated if something goes wrong along the way.

Realizing that most of our lives is the messy middle, the Journey, humility sure seems like a good path.

(I love the word iterate. I’m glad I got to work it into this post somehow.)

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Posted in General, Strategy

Success is Rarely a Straight Line

Posted on February 2, 2012 | 4 Comments

Failure is OK. On the way to any destination that is worthwhile, you probably have a clear idea of where you start and where you want to end up, but the middle can be messy. That’s the inspiration for this drawing.

How many times have you failed this week? This month? Whatever the number is, chances are it is probably too low. That’s probably counter-intuitive to what you were taught as a kid, I know it is for me. It took me 35 years to realize failure isn’t bad.

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Posted in Fun, Napkin drawings, Strategy

Year End Review

Posted on December 15, 2011 | Leave a comment

December is a great time for tax planning, but it is also a great time to sit down and think about what went right (and wrong) with your business in 2011. Here are some questions I compiled from a few places around the web to help explore that topic and maybe push you toward a prosperous 2012:

  1. Were sales up or down compared to the past 3-5 years? Why?
  2. Were profits up or down for that same period? Why?
  3. Look back at the goals you set at the beginning of the year – which ones did you accomplish? If you didn’t set any goals, now is a great time to do that for 2012.
  4. Did you stick to budget in 2011? What about 2012?
  5. Is your business worth more now than it was last year? Entrepreneurs work hard – taking a look at your balance sheet will give you a snapshot of how the business changed over time.
  6. How has your industry changed over the past year? Are there new risks or opportunities? Is your company nimble enough to take advantage?

If you’re having trouble answering any of these questions, it may be time to re-evaluate your accounting system. Is it providing the information you need to make key decisions or do you simply see it as a necessary evil you maintain for compliance purposes?

Have you talked to your insurance agent lately and evaluated whether or not you are adequately covered?

Have you talked to your banker lately to see if they have any input?

Have you checked your credit report – it is free. Simply go to www.annualcreditreport.com.

Maybe most important – have you talked to your customers about the value you provide them? Sometimes simply talking to a few key people can open up new opportunities.

I’d love to hear in the comments or via email how you take stock in what has happened in the past year. If you have questions or would like to discuss it more in depth, please email me at kevinmccoy.cpa (at) gmail (dot) com and we’ll set up a time to chat.

 

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Posted in Business management, Strategy

Fun with Business Plans

Posted on October 17, 2011 | Leave a comment

Today we’re going to have a little fun with a topic I enjoy, but some people find utterly boring – business plans. Arguments abound whether you actually need a business plan, or not. A friend of mine passed along this hilarious blog post on the business side of Ghostbusters.

Of course, some of the numbers are made up, and some items are missing – insurance and legal fees are two big ones I can think of right away – but even in this simple analysis it is pretty clear our 3 jump-suit wearing friends better get some paying customers very quickly or their new enterprise wouldn’t last more than a couple months.

Do you have a business plan? Did you come up with it before starting out  or to obtain financing or some other external motivation?

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Posted in Business management, Fun, Strategy

Book Report #1 – Start With Why

Posted on September 1, 2011 | 1 Comment

This is the first entry in what I intend to be a series.

One of my favorite ways to find new ideas or improve is to read. Short of buying a mentor a cup of coffee, there are not many ways where just a few dollars can open up your mind so much.

These “reports” won’t be long (like our teachers used to make us write!) – just a quick summary of the main point(s) of the book and a few ideas or passages I found memorable. And maybe how I am (or hope to) applying the knowledge to my business. I hope you find them useful and learn something along the way.

Start With Why‘s main theme is: people are drawn to you (and potentially buy from you) because of WHY you do something, not necessarily WHAT you do. Thus, your WHY can be used as a basis for your decision making – whether it be marketing, product/service offerings, etc. I particularly liked Sinek’s “Golden Circle” concept that is essentially a progression: WHY—>HOW—>WHAT. In the book he argues most companies just focus on HOW or WHAT to their detriment.

Sinek uses the example of Apple quite a bit throughout the book. He admits at one point it seems repetitive, but it IS a good example. Not only are they hugely popular which makes them easy to identify, but their WHY really hasn’t changed since they started.

Sinek’s example of WHAT vs. WHY for Apple:

WHAT “We make great computers. They’re beautifully designed, simple to use and user-friendly. Wanna buy one?”

WHY “Everything we do, we believe in challenging the status quo. We believe in thinking differently. The way we challenge the status quo is by making our products beautifully designed, simple to use and user-friendly. And we happen to make great computers. Wanna buy one?”

Some other ideas that stand out:

  • the role of a leader is not to come up with all the great ideas, but rather create an environment where great ideas can happen
  • find people who believe what you believe, instead of selling to anyone. These people will perceive greater value and tell others about you.
  • filtering decisions through your WHY is more efficient and everybody can then see what you believe
  • Success comes from waking up every day in pursuit of WHY.
  • industries holding on to legacy business models should be forewarned – you could be next (talking about Apple’s innovation of the music industry via iTunes – I found this one particularly interesting when it comes to CPAs – who typically hate change)
  • (on competition) – if someone asks what makes you better, you might say “we’re not better in all cases, but the work we’ll be doing will be better in 6 months than what we are doing now” (basically you are competing against yourself)
  • keeping your WHY clear over time is difficult

I am really happy I read this book. It has truly made me think deeply about WHY I am doing what I do.  Many CPAs complain about our business becoming commoditized, but I think that is just an excuse. After all, how can any profession that, at its core, relies on personal relationships become a commodity? Perhaps they have simply lost their WHY.

I’d love to hear your thoughts if you’ve read this book. What was your takeaway?

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Posted in Book Reports, Strategy