High Performance Teams Part 4

This is a four part series outlining Tips for Running a Family Business by creating High Performance Teams.
Part 1 Types of Teams
Part 2 Team Key Elements and Keys to Success
Part 3 The Decision Making Process

Developing Empowerment and Boundary Management

Empowerment is a form of decision making. It involves individual and not team decisions. Ownership of the business, for clarity purposes must formally approve the overall Empowerment of each High Performance Team. The team in turn determines individual empowerment and boundaries.

Define what the power is

The key issue is what the team is empowered to do without Ownership approval. Additionally what levels of empowerment are allocated to core areas of the business; namely Sales, Marketing, Operations and Finance.

Who has it?

Who are the members and how many will there be? Will therd be an advisory member? Who will be the Team Leader? What skill sets reside on the Team and what level of empowerment is given?

Boundary Management

Ownership needs to define Where it starts (Boundary) and Where it ends (Boundary). Once overall boundaries are defined each member of the High Performance Team will be identified for one or two areas of key strengths. Inevitably tasks and responsibilities will be passed along to another person. Therefore the team will set internal boundary definitions of Start and End.

A plan for Boundary Management within the team should consist of:

• Method(s) for negotiating constraints
• Agreeing on constraints
• Which team members are free to make decisions on their own

The Empowerment Grid

The Empowerment Grid is a simple and effective tool to keep High Performance teams performing! Download The Empowerment Grid and see how easy it is to use. The grid should be developed by the team and used regularly to track performance. The grid consists of four constraints/parameters to answer the question of “how are we going to do this?”

• It explicitly states what each team member has the authority to do.
• If it is not stated explicitly, the team member must consult with others before acting
• The leader creates a target for each constraint

The Objective is set by Ownership

The Constraints in each box are initially set by the team leader. The Constraints are then negotiated with the team. As things change, the Grid forces the members to go back and check the validity of each constraint. The grid allows each team member to know what lengths they must go to without asking for permission. The grid helps define boundaries and provide the Joint Accountability necessary for obtaining high performance.

Summary

Family Businesses consist of Economic, Human and Intellectual Capital. Families by their makeup are natural High Performance Teams. High Performance Teams capitalize on obtaining the best of the Human and Intellectual Capital through Empowerment and clearly defined Boundary Management.

I urge you to try this in your family business to during these tough times to insure your business is there for the next generation.

All the best!
Dom Celentano
Tips on Running a Family Business

High Performance Teams Part 3

This is a four part series outlining Tips for Running a Family Business by creating High Performance Teams.

Part 1 Types of Teams
Part 2 Team Key Elements and Keys to Success
Part 3 The Decision Making Process
Part 4 Developing Empowerment and Boundary Management

The way a team decides to decide is the most important decision it makes. The team must decide, in advance on how the team will decide. The Ownership circle of the 3 Ring Family Business Model sets the guidelines on decision making.



Decision Definitions


Here are the most appropriate Decision Processes and Definitions for Family Business. Note that some are neither appropriate nor desirable in all circumstances.


Consensus


Compromise is used so every team member can agree with and commit to the outcome. This produces innovative decisions, but can be time consuming.


Majority Rule


A simple Majority agrees upon the decision. This allows a quick decision process but can only be successfully used for routine and administrative issues.


Minority Rule


This usually takes the form of a subcommittee that recommends actions. If is appropriate for decisions that require special expertise that may only be in the minority of the team. However it does not use all team members’ capabilities and therefore should be used infrequently.


Authority Rule without Discussion


Decisions are handed down from Ownership. This is best for administrative needs or for emergency situations that do not allow for an elongated decision process. The downside of this process is that one person never can be knowledgeable for all decisions and is not taking the collective knowledge of the team.


Authority Rule with Discussion


This process is a hybrid. Those with decision making authority make it clear that they have the authority. They start by gathering all team member inputs. The final decision is made with team member input and leader lets team members know the decision and how their inputs affected the decision. This requires good communications skills between decision makers and team members.

Example Decision Making Process


You can download an example of a Decision Matrix and Escalation Matrix outlining a process that allows a Family Business to institute a High Performance Team. It spells out in detail what each decision process can do and where it is escalated to the next process.

High Performance Teams Part 4 covers Developing Empowerment and Boundary Management


All the best!
Dom Celentano
Tips on Running a Small Business

Small Business Advice Cloud-based Accounting Software Advice from the Experts

Here is a guest blog post from Michael Koploy, ERP Analyst, Software Advice

Because of its attractive pricing model, collaboration benefits, and little-needed IT resources, more small business should look into online accounting software.

Software Advice, a website that reviews both on-premise and cloud-based software programs, recently held a roundtable discussion with three cloud-based accounting software CEOs. These executives from Intacct, ePartners (a Microsoft Dynamics GP VAR), and Kashoo offer solutions for a wide range of industries and sizes of businesses, but they agreed on a number of qualities that make online software a good choice for small and medium-sized businesses.

Here are some highlights from the roundtable discussion:

• More small and medium sized companies (less than $2 million in annual revenue) are choosing to adopt online accounting and ERP solutions.
• Users are becoming more comfortable with putting their important financial information in the cloud, thanks to users warming up to the idea of storing sensitive information on vendors’ servers.
• Most industries are quickly moving to cloud-based financial systems. One of the industries that is not? Manufacturing.
• Benefits of switching to online systems from on-premise software include: less IT requirements, improved financial visibility, improved process automation, cash preservation, and increased collaboration.
• Mobile technology, decreased data entry, and more accounting-focused, cloud-based ERP solutions are seen as future trends in the industry.

For a full transcript of the discussion check out: State of the Online Accounting Industry: Executive Roundtable.

Michael Koploy ERP Analyst Software Advice All the best!

Dom Celentano

Tips on Running a Small Business

High Performance Teams Part 2

This is a four part series outlining Tips for Running a Family Business by creating High Performance Teams



Part 1 Types of Teams

Part 2 Team Key Elements and Keys to Success

Part 3 The Decision Making Process

Part 4 Developing Empowerment and Boundary Management

Team Key Elements and Keys to Success

High Performance Teams must be designed properly and adhere to a process for the team to be successful. So here are the key elements of team design.

A Purpose

The purpose should be in the realm of transformational

. Examples are Innovative ways to run the business, new products or major shifts in corporate strategy.

Performance Goals

Performance goals or Key Performance Indicators (KPI) are a must. It is not enough for the Objective to articulate "increase sales". The objective must be a clearly stated Business Objective such as "Compounded annual revenue increase of 5% over 3 years through the introduction of 5 new products specifically targeted to a Customer Segment satisfying specific needs of that segment." The goals must be attainable and the team needs to decide on what Objectives are attainable based on the company’s human, intellectual and financial capital. In other words the company must have enough money, enough people with the right skill sets to meet the Objective.

Small Wins

All teams need enough small incremental gains to keep the enthusiasm within. The big picture should always be the overarching goal, but the short term objectives are the steps that get you there!

Problem Solving Approach

Every team needs a process that is Replicable, yet allows flexibility and creativity. The Problem Solving approach is easily implemented in any organization. The Team goes through each step to arrive at “what needs to be done”. The six steps are

• 
  Issues.... defining all issues identified by the team
  
  
• 
  Root Causes... narrowing down to a few causes related to the issues
  
  
• 
  Define the real Problem or Problems
  
  
• 
  Set the Objective(s)
  
  
• 
  Develop the Strategy
  
  
• 
  Create a Tactical Plan
  
  

Summary

Family Businesses consist of Economic, Human and Intellectual Capital. Families by their makeup are natural High Performance Teams. High Performance Teams capitalize on obtaining the best of the Human and Intellectual Capital through Empowerment and clearly defined Boundary Management.

High Performance Teams Part 3 will talk about the Decision Making Process.



All the best! Dom Celentano Tips on Running a Small Business

High Performance Teams

The word Team is used (incorrectly) interchangeably with Work Group. The key difference between the two is that a Work Group is tied to individual performance. However a High Performance team has both individual and group accountability. I will outline what a High Performance team is and how it can be readily incorporated into your Family Business.



This is a four part series consisting of:

• Part 1 Types of Teams
• Part 2 Team Key Elements and Keys to Success
• Part 3 The Decision Making Process
• Part 4 Developing Empowerment and Boundary Management

The most appropriate definition of a team that I find applicable for closely held family businesses is: "A team is a small number of people with complementary skills who are committed to a common purpose, set of performance goals and approach which they hold themselves accountable for[Joint Accountability] ". Therefore the key “ingredients” for a team are Complementary Skills, Common Purpose, Performance Goals and Joint Accountability.





The last point, Joint Accountability, facilitates Self Management and is the capstone for a successful High Performance Team. Without this, the group is only a work group and adds substantially less value to the organization.



There are three types of teams with the following key points and differentiators.



Those that recommend

Handing off is critical aspect of this type of team since they have to get top managements attention which can sometimes be difficult. There is also a delicate balance in getting outsiders involved in part of the process so they have an easier time taking ownership of the recommendations.



Those that make or do things

These are teams responsible for manufacturing, operations, marketing, etc. They key differentiator is these teams have an ongoing responsibility and usually do not have a team completion date; they of course have milestones to achieve. They must have key performance indicators for the team related to specific metrics such as revenue, costs or some added value.



Those that run things



These teams are a minority and generally consist of a small group. These teams are most effective when an organization is going through a major changes and where overall company behavior has to change. For example this type of team is very valuable in a Family Business environment when there is a need for succession of leadership from one generation to the next. This type of team is very effective for the transition.



High Performance Teams Part 2 will focus upon Team Key Elements and Keys to Success







All the best!

Dom Celentano

Tips on Running a Family Business