Identify and Develop the Next Generation of Leaders for Your Company

By Jacquelyn Lynn

One area of planning many entrepreneurs often overlook is grooming the next generation of leaders and managers for their organization. It is just part of the entrepreneurial nature to believe that they are invincible, irreplaceable, and will be around forever. But the fact is that just the opposite is true: Whether by your own choice or due to circumstances beyond your control, at some point, you’re going to leave your company — and you want to leave it in good hands.

Designate your successor long before your own departure — whether you are looking at retirement or starting another venture. The person you select should have both the ability and the willingness to do the job. Once you’ve identified your successor, you need to prepare him or her to take over. The best way to do that is by providing the experience with a hands-on, planned rotation through the key areas of the company to build the necessary and appropriate skills, as well as working closely with you. It also helps the process be more effective if you let others in the company, as well as your customers, know what you’re doing.

It should be made clear to everyone that this person is your heir-apparent. Other employees and even customers will usually be enthusiastic about helping the up-and-coming leader, which contributes to a seamless transition when the time comes. Also, when an individual knows he or she is the next in line, his or her loyalty to the organization is strengthened.

Five years or less is a good time frame for designating and developing a new leader. If you plan for more than five years, the enthusiasm for the new role will wear off. Also, there’s an excellent chance the person will be recruited away from you. Most people who have the potential to be the top dog aren’t patient enough to wait more than five years to take over.

An important point: Don’t confuse grooming your company’s next leader with developing managers. Leaders set the tone, the vision, the direction for the organization. They’re the people who are out front leading the charge, and usually in a small organization, there’s only one of them. You may have several managers; they are the ones who manage outcomes of individual activities and departments, and they need to be developed and trained so they are prepared for and can manage their departments into the future. Managerial development is often incorrectly referred to as leadership development. Know the difference and be sure you are doing both.

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Jacquelyn Lynn is a business writer and editor of Flashpoints, a comprehensive information resource for business owners and managers. For your free subscription to the Flashpoints newsletter and a free copy of The Mindset of High Achievers, visit www.theflashpoints.com.

On Monday, Feb. 28, he’ll be speaking to the Space Center Rotary Club at the Bay Oaks Country Club in Houston, Texas. The meeting starts at 11:45 a.m.; the program begins at 12:30 p.m.

On Wednesday, March 2, JK Harris will speak to a breakfast meeting of the Kiwanis Club of Plano at La Madeleine’s Cafe in Plano, Texas. The meeting starts at 7:00 a.m.

On Thursday, March 3, JK Harris will speak to the Rotary Club of Houston, which meets at Houston City Club in Houston. Networking begins at 11:30 a.m.

In addition to these public appearances, JK Harris will be meeting privately with a number of business leaders in the area to discuss the specific challenges faced by Houston-area companies. Harris believes that small business holds the key to economic recovery and growth. He wants to share his own thoughts on the subject as he continues to learn from other entrepreneurs. Future audiences will hear details on the successful strategies being employed by companies that are emerging from the recession poised for future growth and profitability.

JK Harris is the founder of JK Harris & Company, the nation’s largest tax representation firm, as well as Flashpoints Consulting, LLC. He is the author of Flashpoint: Seven Core Strategies for Rapid-Fire Business Growth, Sales Flashpoint: Fifteen Strategies for Rapid-Fire Sales Growth, and IRS Tax Secrets: The Individual and Small Business Owner’s Guide to Solving IRS and State Tax Problems, all published by Entrepreneur Press.

A franchise can be a great way to get into business for yourself. Investing in a franchise, rather than starting a business from scratch, lets you hit the ground running with your business because all the research, development, testing, and planning have been done for you. But as great as that may sound, it’s not for everyone.

What’s important to understand about a franchise is that you’re buying someone else’s business system and you’ll be subject to someone else’s rules. Some franchises are more strict than others about what franchisees must and must not do, but regardless of the particular franchise and its policies, you will not have the freedom to operate your franchise as you would a business you conceived and started yourself.

There are sound reasons for this. Good franchisors have done their homework. They know what works and what doesn’t. They’ve made mistakes so you don’t have to. And they want everyone who operates under their name to be singing the same song and representing the brand in the same way.

That consistency and reliability is a key part of what makes franchises work—when you go into a McDonald’s anywhere in the world, you know you’re in a McDonald’s and (with only slight variations by region) you know what to expect. Established franchises have made substantial investments in building brand recognition. Franchisees benefit from that—but only if individual operators stick to the system.

The benefits of owning a franchise include: The failure rate of new independent business ventures is higher than that of franchises. Franchises offer a system that has been proven to work. There’s a community to turn to for support and advice. Banning together, individual franchisees that might otherwise be considered small businesses enjoy the strength of a large corporation when it comes to purchasing, marketing, research and development, and overall brand awareness. And it usually much easier to get financing for a franchise than for an independent new company.

Of course, when you buy a franchise, there’s the initial franchisee fee and usually some sort of an ongoing payment in the form of fees or royalties (or both) to the franchisor. This is on top of your other start-up and operating expenses. In many cases, the benefits of the franchise system make the cost well worth it—but that’s a decision you have to make for yourself.

A more important issue is this: If you are independent, creative, or a maverick, and you don’t like having to operate within someone else’s structure, you may not be suited to being a franchisee. A better strategy for you might be to build your own business and consider eventually becoming a franchisor.

A franchise is a great way to get into business for yourself quickly without a steep learning curve or a lot of trial and error—but it’s not for everyone. Do a candid self-examination before you take the franchise plunge to be sure it’s right for you.

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JK Harris is the founder of Flashpoints Consulting, LLC and of JK Harris & Company, the nation’s largest tax resolution firm. He is the author of Flashpoint: Seven Core Strategies for Rapid-Fire Business Growth and Sales Flashpoint: Fifteen Strategies for Rapid-Fire Sales Growth, a popular and respected speaker, as well as a successful business consultant advising mid to large-sized businesses around the world.

Sales Flashpoint: Fifteen Strategies for Rapid-Fire Sales Growth

in Bookstores Oct. 1

Charleston, SC—Sept. 20, 2010—JK (John) Harris’ latest book, Sales Flashpoint: Fifteen Strategies for Rapid-Fire Sales Growth (Entrepreneur Press, 2010), co-authored with sales expert Richard D. Dickerson, will be available in bookstores and online Oct. 1.

In Sales Flashpoint, Harris and Dickerson reveal fifteen proven strategies that will put any business on the fast track to higher sales and greater profits.

“No matter how great your product or service is, you have to be able to sell it for your business to be successful,” says Harris. “Sales Flashpoint tells you how to hire, train, and manage a sales team of one or hundreds to get the results you want, no matter what industry you’re in.”

It begins, say Harris and Dickerson, with hiring the right people. They recommend using whole person assessments and job benchmarking to be sure the sales candidates you select are suited both for sales in general and for your company’s culture in particular. Next, use a proven, sequential sales system that allows salespeople to move through the process in a customer-focused, principles-based way. Finally, recognize the special management needs of salespeople and learn to manage them in a way that allows them to excel.

Throughout Sales Flashpoint, Harris and Dickerson illustrate their points with real-life examples from their own experiences—Harris as an entrepreneur and Dickerson as a sales consultant and trainer.

Harris and Dickerson are both available to speak to groups about the strategies in Sales Flashpoint. Readers are also encouraged to sign up to receive the online newsletter, Flashpoints, at no charge. The newsletter is targeted to business owners and managers. Subscribers to Flashpoints also receive JK Harris’ ebook, The Mindset of High Achievers, as a gift—a $19.95 value. Visit www.TheFlashpoints.com to take advantage of this great offer.

Sales Flashpoint: Fifteen Strategies for Rapid-Fire Sales Growth is the second book in the Flashpoints series. Financial Flashpoint is scheduled for release in Oct. 2011.

About the book

Sales Flashpoint: Fifteen Strategies for Rapid-Fire Sales Growth, JK Harris and Richard D. Dickerson (Entrepreneur Press, October 2010), $21.95

About Flashpoints Consulting, LLC and JK Harris

Flashpoints is a comprehensive information resource for business owners and managers. Our mission is to provide innovative, useful ideas delivered through print and electronic media supported by customized consulting services that will equip entrepreneurs with the tools they need to start, grow, and effectively run an efficient and profitable company.

Flashpoints was founded by nationally-recognized entrepreneur JK Harris, author of Flashpoint: Seven Core Strategies for Rapid-Fire Business Success (Entrepreneur Press) and founder of JK Harris & Company, the nation’s largest tax representation firm. Harris has combined his own business savvy along with his partners to create a resource that will allow any business owner or manager to put a company on the fast track to its Flashpoint.

About Richard D. Dickerson

Richard D. Dickerson is a tenured Vistage speaker and the national accounts manager for The Brooks Group, an award-winning sales and sales management training and assessment company.

A. Welcome to my world! I’m an introvert. I’m happy spending long hours alone in my office, crunching numbers and doing strategic planning. When I’m not working, I’d much rather be at home reading a book by myself than at a party with a lot of people. But networking is an essential part of being in business today.

Even while I recognize the importance of networking, I question the value of events that more closely resemble speed-dating cocktail parties than opportunities for real business interactions. I recommend joining the civic and business groups your prospective customers belong to. Attend meetings and take your time getting to know people. Join your major industry association and attend its events so that you know what’s going on in your industry and among your competitors and suppliers. You can also network online, using social media outlets such as Facebook and LinkedIn—these are perfect networking vehicles for introverts.

As you consider the people who will staff your company, be sure to bring extroverts on board—people who will enjoy getting out there and doing the networking you don’t like to do. When it’s appropriate, make it part of their jobs descriptions and reimburse them for association memberships and other costs.

Do you have a question for JK Harris? Visit www.askJKHarris.com to submit your question, or send it to info@theflashpoints.com. If we use your question in a future newsletter, you’ll receive a free autographed copy of Flashpoint: Seven Core Strategies for Rapid-Fire Business Growth.

Submitted by: Jacquelyn Lynn

When you think about it, life is a series of negotiations. The American Heritage Dictionary defines negotiate as conferring with another or others in order to come to terms or reach an agreement. You negotiate with others far more often than you may realize—negotiations that include interactions with family and friends, getting the best deal on a consumer purchase, and a wide variety of business activities.

Though effective negotiating does come more easily to some than others, it’s a skill that anyone can learn and everyone should. Though the consumer culture in the United States doesn’t leave much room for negotiation—you’re not, for example, likely to be able to dicker over price in a major department store—there are still plenty of opportunities for negotiating. The clerk at Bloomingdale’s might not have the authority to give you a discount, but the owner of a small store certainly could. And if you’re in business, you’ll find yourself negotiating on a wide range of issues on a daily basis, from prices and terms with vendors to salary and benefit packages with employees.

Fundamentals of negotiating

There are three fundamental components of negotiating: listening, obtaining information, and overcoming objections, and they occur simultaneously. To be a good negotiator, you don’t need to be pushy or overbearing, you don’t need to be the loudest or most forceful speaker, and most importantly, you don’t need to be offensive. Successful negotiations come from understanding these three components and using them in a way that results in a win-win transaction.

Good listeners place as much or more emphasis on what others are saying than on what they themselves are saying or planning to say. You can develop your own listening skills by changing your attitude from one that is self-centered to one that focuses on the other person. When you are truly focused on what the person you are negotiating with has to say, the information gathering process is enhanced. And that brings us to the second component of negotiating: obtaining information.

In order to propose an acceptable agreement, you need to understand what both parties need. You already know, of course, what will work for you; asking good questions and then listening carefully to the answers is a very direct and quite effective way to find out what will work for the other person.

Finally, as you negotiate, you will have to overcome objections. Many people fear objections, but a good negotiator welcomes them. Why? Because what is often perceived as an obstacle is really just a request for more information. When people seek more information, it usually means they are looking for reasons or ways to make the deal work.

Objections typically come in the form of questions but may be statements. If possible, find out what’s behind the objection before you respond to it. You may discover that it’s not really an objection at all.

Good negotiators are not adversarial or challenging. They listen, gather data, and address concerns, then offer a proposal that will work for all parties. Develop and refine your negotiating skills and you’ll find that every aspect of your life will become much smoother and more rewarding.

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Jacquelyn Lynn is the editor of Flashpoints newsletter. Flashpoints is a comprehensive information resource for business owners and managers who want to take their operation to the Flashpoint. Visit www.theflashpoints.com to sign up for a free subscription to Flashpoints newsletter plus an extra free gift: The Mindset of High Achievers by JK Harris and Jacquelyn Lynn.

If there is one thing most entrepreneurs can agree on, it’s that time is our most valuable asset. It’s a non-renewable resource, because once time has passed, it’s gone and there’s no getting it back. That’s why articles, books, and courses on time management are so popular—we have a lot to do and we don’t want to waste a minute.

But the phrase time management is a misnomer. You cannot manage time; time simply is. What you can manage is yourself and how you use the time you have. High achieving entrepreneur apply these strategies to use their time well:

• Set clear, specific, measurable goals. Know what you want to accomplish and when you expect to do it.

• Develop detailed plans. Know exactly what you have to do to accomplish your goals and leave nothing to chance.

• Make and prioritize daily task lists. Know exactly what tasks you need to perform each day and which tasks are most important; refuse to do anything that is not on your list. When you are organized, you’ll get more done.

• Concentrate on one thing at a time. This is especially challenging for entrepreneurs with ADD-type personalities—they tend to jump from one thing to another or they try to multi-task. But if you focus on one thing at a time until it is completed, then move on to the next task, you’ll get more done in less time.

• Develop a sense of urgency. Do not procrastinate; when something needs to be done, do it.

• Do what is the most valuable use of your time. Anything else is a waste of time.

• Build a team you can trust and delegate. You don’t have to do everything yourself. Surround yourself with talented, motivated people and then get out of their way.

• Spend time with yourself, your family, your friends, and on rest and recreation. Don’t work every waking minute—there’s so much more to life than that.

Submitted by:  JK Harris

Rightsizing your company is often thought of as a nicer way of saying “downsizing” when you want to cut staff, but it’s actually far more than that. Rightsizing is getting every aspect of your company to the right size—and that includes staffing, equipment, supplies, operations, and so on.  Sometimes getting to the right size means contracting; sometimes it means expanding. And it’s something that every company will face usually more than once.

Rightsizing is fun and exciting when you’re growing and adding people and resources. It’s not so much fun when you’ve gotten fat or circumstances are forcing you to cut. In either case, it can be stressful, but it’s something you have to do. When you are not rightsized, you are like a race car that isn’t running on all cylinders—the other cars in the race are going to pass you. You’re going to be behind rather than setting the pace.

Most rightsizing initiatives begin because something has happened that makes you aware of the need. It might be a drastic change in market conditions, a financial issue, or even a regulatory situation that is affecting your company. In some cases, you will notice profit margins shrinking over a period of time and realize something needs to be done to reverse the trend before those profits turn into losses. In others, you may realize that your service levels are suffering because you are growing faster than you are equipped to handle. However you become aware of it, take a systematic approach to getting your company back in shape.

Begin the process with a thorough analysis of your current situation. Figure out what has created the need to rightsize. Did something dramatic happen or did it creep up on you over a period of years? Once you understand what happen, you need to look at the market, staffing, facilities, technology, suppliers, other resources—every aspect of your company. Decide on what you need to do and put together a plan to accomplish it. Don’t just start cutting randomly or engaging in knee-jerk expansions. Effective rightsizing requires a systematic approach.

If your rightsizing process requires downsizing—eliminating people, product lines, offices, whatever—don’t equate that with failure. You haven’t failed if you’ve recognized a need in your company and taken steps to meet the need. In fact, rightsizing will often put you in a position that is far more profitable than you were before—and a profitable smaller company is far more desirable than an unprofitable large one.

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JK Harris is the founder of Flashpoints Consulting, LLC and of JK Harris & Company, the nation’s largest tax resolution firm. He is the author of Flashpoint: Seven Core Strategies for Rapid-Fire Business Growth, a popular and respected speaker, as well as a successful business consultant advising mid to large-sized businesses around the world.

Answer: Not necessarily. I call someone who does that a serial entrepreneur, which is what I am. I start or buy a business, get it running and profitable, and then I get bored and go looking for new challenges. Sometimes I sell those companies, sometimes I turn them over to a management team and continue to own them but am not active in the day-to-day operation. Not every entrepreneur does things the way I do. There are plenty of true entrepreneurs who start and build businesses that they continue to run for decades. Consider the family-owned companies that are kept in a family for generations—the people who start, inherit, and run those operations year after year are as much entrepreneurs as I am. They just have a different operating style.

Do you have a question for JK Harris? Visit www.askJKHarris.com to submit your question, or send it to info@theflashpoints.com. If we use your question in a future newsletter, you’ll receive a free autographed copy of Flashpoint: Seven Core Strategies for Rapid-Fire Business Growth.

According to its website, the U.S. Small Business Administration (SBA) is an independent agency of the federal government that “helps Americans start, build and grow businesses.”

It’s true that you can go to the SBA and they will tell you how to start and run a business, how to get all the necessary licenses and permits, how to keep your records and pay your taxes, and so on. But they’re also going to tell you that you need all of your ducks in a row, your business plan completed, checked and double-checked, and absolutely everything just right before you open your doors. So if you have enough cash to survive a year or so before you can start making money, that might work for you.

I’ve heard stories of the SBA telling people it can take a year to get a business started. It took me a couple of months of research and planning, and then only one day—the day I ran my first advertisement—to get JK Harris & Company going.

Planning and preparing is important, but don’t spend so much time planning and preparing that you never get around to taking action. When you’re getting started, don’t worry too much about aiming, just shoot the gun and then look to see if you hit anything. Jump into the deep end of the pool and don’t worry about whether or not you can swim—if you have to, you can let yourself sink to the bottom, the push off to reach the surface. Yes, you need to be prepared. But preparation won’t get you anywhere if you fail to act.

Most important, get your advice from people who have done what you want to do. Don’t take financial advice from poor people and don’t take business advice from people who are not entrepreneurs. They may mean well, but they don’t have the experience you need.

The exception to that, of course, is advice on legal, accounting, and tax issues—but your advisors in those areas should be professionals who understand and think like entrepreneurs. They should be telling you how you can accomplish your goals, not why you can’t.

Keep in mind that all successful people will have experienced failure at one time or another—and probably multiple times. Learn from their failures. If they made mistakes, figure out what they did wrong and don’t repeat it. If it was just circumstances that couldn’t be overcome, study what they did so you can make better decisions if you are ever faced with a similar situation.

Most entrepreneurs love to share what they know. Take advantage of that. Knowing how other winners have done things right and what they’ve done wrong has helped me immeasurably over the years. Let it help you, as well.

JK Harris is the founder and CEO of JK Harris & Company, the nation’s largest tax representation firm, and the author of Flashpoint: Seven Core Strategies for Rapid-Fire Business Growth.