It’s OK For A Business to be “Boring”

Whether it is the media’s focus or just human nature, the business world seems to be divided into two types of companies — those that grab all the headlines and those that fly under the radar.

You might assume that the headline-grabbing companies are the success stories and the under-the-radar businesses muddle along as mediocre enterprises. But when you look deeper that is clearly not the case.

A huge swath of the nation’s businesses operate successfully outside the glare of the media spotlight. Many of these companies are models of business execution, innovation and growth. They might be considered “boring” by people obsessed by the next big thing, but their sustainable success year after year makes them a critical part of the bedrock of the U.S. economy.

There are hundreds of examples of this phenomenon. But two examples stick out and show why “boring” should never be underestimated or underappreciated.

 

Danaher unlocks the code

Danaher Corporation is a conglomerate that includes diverse manufacturing and life sciences businesses. But the true key to the company’s success (Danaher has outperformed the S&P 500 by 1,200 percent over the past 20 years) is its business operating system.

 Based on the concept of “continual improvement,” the Danaher Business System is a blueprint for success of each business the company acquires. Similar to the famous “Kaizen” lean manufacturing concepts that made Toyota Motors a model of quality and efficiency in the automotive industry, the business system unlocks business performance, allowing each acquisition to become a building block of the company’s next stage of growth. Many of the elements of the Danaher system are not all that revolutionary — re-organization of manufacturing floors to increase output and improve employee engagement — but done well across all companies they can add tremendous value to the conglomerate.

The key here is execution. Danaher isn’t in cloud computing or semi-conductor manufacturing — industries with remarkable cyclical growth trends. Instead it has brands that are hardly recognizable like Videojet, which prints “best-by” dates and barcodes on food products. But they find repeatable, long-term growth through an innovative business system that gets the best from each employee, business division and company in its portfolio. Having the best idea doesn’t always win in business. Oftentimes it is the internal operations of a business that dictate success.

As the old business adage goes about investing in “A teams with a B idea rather than B teams with an A idea,” Danaher found a way to create A teams across many companies, and that model has proven immensely successful even though it has none of the headline appeal of a social media startup or electric car company.  

 

Jack Henry and Associates shows technology is not all apps and social media

When you think of technology companies, most people’s minds go directly to Facebook, Twitter, Apple and Amazon. But technology permeates everything we do, and some of those technology platforms embedded in our daily life don’t make the news every day. Jack Henry and Associates develops and deploys little-known technology platforms that power banking systems and financial transactions.

The company has gained little of the notoriety of its more public-facing technology peers, but the company has grown into a highly successful business in its own right, building on a technology that is vital to the U.S. economy and to banking institution’s competitiveness in the mobile and digital age.

Since it became a publicly traded company in 1985, the company has been a standout performer, growing revenue, acquiring other technology and becoming a remarkable long-term winner for shareholders. The business performance is on-par with any of the companies that make headlines regularly, but Jack Henry flies under the radar because what its technology does is less public-facing than many others.

The company is an example of a superior technology application in a sector that is investing heavily in digital infrastructure. While other technology companies were soaking in the spotlight, this financial platform was happy to build a powerful, thriving business far away from the headlines in a thriving sector of the U.S. economy. And it is a lesson that technological disruption touches many different industries in many different ways, and some of the long-term business opportunities are not always all in the most high-profile sectors.

Finding a niche and thriving in that niche doesn’t have to mean that you think smaller or pare down your business goals. As Jack Henry and Associates proves, becoming an industry leader in a lucrative corner of the U.S. economy can be a recipe for remarkable success.

 

John Solari is the managing partner of J.A. Solari & Partners. He has 25 years of accounting experience and is also a member of the American Institute of Certified Public Accountants and the Nevada Society of Certified Public Accountants.

 

This post was originally published in the Reno Gazette Journal and can be found at this link.

Team Dynamics Dictate Business Success

Real Estate Services, J.A. Solari

Pop open the hood on any successful business to see the inner workings and you will come face to face with the engine that drives success — a network of effective and inspired teams.

Teams are often not the first things people talk about when they talk about company success. They are typically way down a list that leads with leadership, management, innovation and other business buzz terms.

But teams are the core of a company. How employees operate in these small groups, what makes them successful and how they can be replicated and strengthened should be constantly on the mind of every company leader.

There is a lot of human psychology that determines what makes great teams, as well as a lot of practical elements. Here are three things to think about when you are building, reconstituting or strengthening teams within your organization.

 

Human dynamics rule

As much as we want to think that our work selves are unique from our personal lives, the same dynamics reach across both. We are humans after all. Trust, commitment, ego, conflict — all these basic human drivers determine how we function in life and at work. I’ve learned a lot about this aspect of teams from author Patrick Lencioni. His books The Ideal Team Player and The Five Dysfunctions of a Team are thorough examinations of the characteristics and personality traits that make great teams. Trust and commitment are key, but so is accountability. According to Lencioni, the best team players are humble, hungry and smart. When you are building your team around skills and functions, don’t underestimate the human qualities like humility, drive and the ability to gain trust that are vital for teams to function correctly both in terms of their internal workings and their client-facing relationships.

 

Balance is critical

Teams often need to perform a variety of functions, even if their most apparent task falls into one category — an engineering, technological or accounting project. This requires a balanced team, one with the right mix of personalities, skill sets and aptitudes to make the team function at the highest level. This sum-is-greater-than-its-parts approach to building teams brings together not only varying skills, but also varying attitudes and aptitudes — mixing visionaries with detail-oriented organizers, executors with communicators and even optimists with pessimists. Where an imbalanced team might excel in one part of the project but struggle in others, balance will bring together a group where tasks are naturally divided according to the individuals’ strengths. An organization can use a tool like StrengthsFinder from Gallup to understand their employees’ natural strengths and weaknesses and use those insights to build well balanced teams that match complimenting team members.

 

Rethink hierarchy

When some people think of teams they think of hierarchy — a team leader with a group of team members who execute the leader’s directions. But Stanford professor Lindred Greer notes in her research on teams that having flexible dynamics within a team — what Greer calls “hierarchical agility” — is best. This allows the team to operate in a “flat” structure without hierarchy at times, which unlocks honesty and creativity. But the team can also quickly transform into a leader-driven group when structure is needed and deadlines are approaching.

Rethinking how a team is organized is a powerful way to ensure that the best ideas are heard and the decision-making and idea-generation doesn’t just get stuck with manager-level employees.

 

John Solari is the managing partner of J.A. Solari & Partners. He has 25 years of accounting experience and is also a member of the American Institute of Certified Public Accountants and the Nevada Society of Certified Public Accountants.

 

This postwas originally published in the Reno Gazette Journal and can be found at this link.

When to Persevere and When to Pivot

Perseverance is almost a religious principle in the world of entrepreneurship. And for good reason. Many companies that seemed too ambitious have become industry giants through the perseverance of dogged company founders. And many entrepreneurs overcome their first failures to achieve immense success through persistence.

But for all those success stories there are many tales of company executives plowing ahead blindly with an idea that doesn’t work or a company whose customer base has evaporated. In entrepreneurship it is hard to know when steely determination is admirable and when stubborn single-mindedness should be exchanged for the flexibility to pivot to a new market, idea or customer base.

But how do entrepreneurs know when they should double down on their current path and persevere through some bumps in the road, and when they should pivot?

Here are three things to consider when making important decisions about the future of your business like whether to keep plowing ahead or whether to change course.

 

Perseverance, over time, pays off

The very definition of “perseverance” implies the presence of difficulties, opposition or failure. Perseverance only comes into play when things go wrong. And studies have made it pretty clear that perseverance, over time, does pay off. That doesn’t mean that perseverance will turn things around every time. It just means that when entrepreneurs persevere, even through multiple failures, they are rewarded in the end.

Stanford psychologist Carol Dweck’s work shows that perseverance is a vital path to learning new skills and developing deeper knowledge. Entrepreneurs who view challenges as opportunities to learn and grow benefit in the long-term. They gain new insights and new ideas through these challenges that make them more likely to succeed in the future.

 

Perseverance should not be blind

The old saying that “the definition of insanity is doing the same thing over and over again, and expecting different results” — often credited to Albert Einstein — is a great way to argue against blind perseverance. Perseverance is not stubbornly following bad ideas to their inevitable conclusion. Perseverance should be paired with intelligence and flexibility.

One study examined by Harvard Business Journal showed the harmful downside of blind persistence. Studiers gave thousands of people a boring and unproductive task, and found that certain personality types continued to perform the task over and over again even when it was clear that there was nothing to gain from the activity. Make sure your persistence is paired with thoughtfulness and a clear strategy, and don’t be afraid to alter course as market conditions change.

 

Pivoting can be compatible with perseverance

Pivoting and persistence are not mutually exclusive. Many studies warn of the dangers of tenacious individuals who refuse to change course even when they are clearly confronted with the fact that they are on a losing trajectory. This is the time to pivot and focus that tenacious attitude on a new vision or business idea.

Don’t equate pivoting to quitting. Keep your options open and remain flexible enough to change course when the signs clearly show that you and your company need to adapt to new consumer demands, market changes or technological changes. Even the best companies in the world — industry giants like Microsoft and Apple — have had to adapt, innovate and change.

In fact, in a world consumed with technological and generational change, constant improvement is vital for long-term success. Pursue those relentless changes with persistence and perseverance, instilling a culture of life-long learning and adapting in your company.

John Solari is the managing partner of J.A. Solari & Partners. He has 25 years of accounting experience and is also a member of the American Institute of Certified Public Accountants and the Nevada Society of Certified Public Accountants.

 

This post was originally published in the Reno Gazette Journal and can be found at this link.

How to Spend Your Time in the New Year

Manufacturing Industry

The start of the New Year is a period of reflection and goal-setting. We are able to take a step back from our day-to-day duties, enjoy a holiday breather and evaluate what went right or wrong in 2018 and what we want to do better in 2019.

 I’ve been thinking a lot lately about time — how we spend it, value it and manage it. The end of the year is the perfect opportunity to reflect on this. While the rest of the year we might be too entrenched in projects and deadlines to think clearly about how we are spending our time, the changing of the calendar allows us a moment to take inventory of what we prioritized in 2018 and what habits we built and followed through on.

 Here are things I am thinking about in terms of how I spend my time in 2019. I hope they spark some ideas for you in the New Year.

 

Focus on process over outcome

This is a common maxim in both the athletic and entrepreneurial worlds. The idea is that if you focus all of your attention on the things you can control in your professional development or athletic training, you will eventually build a level of consistent and repeatable excellence that will result in success.

Focusing on a single outcome —  which can be affected by many different variables — can sidetrack you from this long-term path. The idea is that a single athletic competition or business project can go right or wrong for a number of reasons. Focusing too much on the outcome — good or bad — can shift focus from the really important things.

 

Instead of concentrating on whether you won the race or nailed the project, think about how you performed in terms of training, nutrition and rest — or in the business world, the critical thinking, planning and execution that went into the project. If you get those things right over and over again, in time you will perform at your highest level.

Focusing on process over outcomes is a recipe for continual improvement, personal satisfaction and consistency. The outcomes in business will fluctuate over time given market conditions and business cycles. But over the long run, success will come as you focus on becoming a better entrepreneur or business professional, no matter the ups and downs.

 

Take time to think

 In a world focused on productivity and deadlines, sometimes we don’t take the time to think deeply about emerging industry trends or the trajectory of our businesses. But that is exactly what we should be spending significant time doing.

We are entering an age where tasks can be completed efficiently by software systems and digital tools. The higher value we can offer clients, which cannot be delivered by a computer program, is thoughtful strategy, carefully considered counsel — and, in the rare case, visionary ideas. This requires a commitment to wall off time from meetings and tasks and think deeply and creatively about our own businesses and our clients’ needs.

Whether you are in professional services, manufacturing or product development, spending the time to think critically and creatively about your business is an investment that is sometimes hard to commit to, but is critically important for your long-term growth. It can result in the next quantum leap in your career or your company’s growth.

 

Value other’s time like your own

It’s cliché to say, but time truly is our most precious commodity. Understanding its value not only to personally but also to your partners and employees is foundational to long-term success. This doesn’t mean rushing through things at all costs to preserve time; sometimes it means slowing down and appreciating the moment. It means building a company culture where employees’ time both inside and outside of work is respected and valued. It means making work meaningful and professional relationships fulfilling.

As you think about how you want to use your time in more meaningful ways in 2019, think about how you can empower your employees and partners to do the same. That will ensure that not only you get the most fulfillment, accomplishment and success out of the next 12 months, but your entire business network does the same. Here’s to a happy and healthy 2019.

John Solari is the managing partner of J.A. Solari & Partners. He has 25 years of accounting experience and is also a member of the American Institute of Certified Public Accountants and the Nevada Society of Certified Public Accountants.

 

This post was originally published in the Reno Gazette Journal and can be found at this link.

 

What is your Differentiator?

Look across the numerous choices that customers face each day and you’ll see a whole lot of nearly identical options. Peet’s Coffee or Starbucks? Nike or Under Armour? Southwest or Delta?

If we’re being totally honest, there are few differences between a cup of Peet’s or a cup of Starbucks and a flight on Delta or Southwest. But many consumers have vastly different perceptions of these nearly identical companies. The same is true of small and medium-sized businesses across the country. While some of these opinions have to do with price and product, often the deciding factor comes down to the customer experience.

 While customer service has always been a keystone of good business, the growing ease of customer choice facilitated by digital tools now makes the customer experience one of the key differentiators between a company and its competitors. Given the ability to compare and research consumer options online, companies will always compete on price and product. So the customer experience is the one place where a company can make a connection with a consumer that will have them coming back time and time again.

 Sometimes it is little things that make a big difference— the feeling of opening up the beautifully designed packaging of an Apple phone, the humor of a Southwest flight attendant during flight announcements or the way Les Schwab employees hustle to your car to make sure you are back on the road as soon as possible. These are the times when a company can be more than just a delivery mechanism for merchandise or services, and actually show that they have a personality and a human side.

 While plenty of Fortune 500 companies spend large sums of money focused on delivering the best customer experience possible, small and mid-sized companies are perhaps even in a better position to do the same. Their ability to interact with customers on a more personal level can lead to long-standing customer loyalty. Here are three ways small and mid-sized businesses can excel at delivering a customer experience that differentiates them from their competitors.

 

Know your clients

While publicly traded companies spend tens of millions of dollars on sophisticated business intelligence platforms that personalize shopping recommendations and customize discounts, small and mid-sized businesses can do this the more personal way — by actually knowing their customers as people. Being greeted by name or having your daily order remembered has a big impact on customers. They feel like they are in an establishment that cares about them and remembers them. Small and medium-sized businesses can foster this environment by retaining employees and encouraging personal interactions and special offers for long-standing customers. Happy employees who stick around provide that critical connection between company and customer. And when ownership and management liberate them to go the extra mile for each customer, the results are often measured in years of customer loyalty. Ritz Carlton is a perfect example of this with their legendary “gold standard” of customer service. Their mantra “ladies and gentlemen serving ladies and gentlemen,” empowers their employees to treat customers with the highest level of service.

 

Think like a customer

Companies often get caught up in the operational rhythm of running a business and end up with a tunnel vision that only sees things from their side of a business transaction. When you reverse this perspective and take time to look at things from the customer’s point of view, you have the ability to make important improvements to the customer experience. When you think of pain points at your business, don’t just think about what happens in internal company processes, look even more closely at the pain points for the customers. What would make you come back to your own business again if you were a customer? How can you surprise and delight your loyal customers? None of this is overly complicated or new. But it does take commitment to maintain a customer focus. Anyone can see things through the eyes of a customer, but consistently doing so takes discipline and creativity.

 

Align your culture with your customer

Company culture is often thought of as an internal dynamic that effects recruiting and retention. But it also has a huge impact on how a company treats its customers. When your company culture is aligned with your customer’s needs many of the customer experience issues take care of themselves. Promoting attentiveness, service and relationship-building will create an environment where your employees naturally display these traits in their interactions with customers. Culture often wins over processes and company mandates because it is something that employees across the organization buy into and embrace as part of their commitment to the company. This makes things like the customer-first mentality a natural and authentic trait rather than a mandated policy.

 

 John Solari is the managing partner of J.A. Solari & Partners. He has 25 years of accounting experience and is also a member of the American Institute of Certified Public Accountants and the Nevada Society of Certified Public Accountants.


This post was originally published in the Reno Gazette Journal and can be found at this link

 

Playing the Long Game Pays Off

Health Care Industries

We seem to be living in an entrepreneurial world obsessed with speed. We celebrate the companies that are first to market, the entrepreneurs who are first to cash out with a huge payday and companies that go public without ever turning a profit.

A great counterbalance to this prevailing impatience is longevity. The act of building a durable and long-lasting company should never go out of style no matter what business trends come and go. It is one of the ultimate tests of true success in the business world.

But often, this gets lost in the allure of the flashiest new business idea that could come and go in a matter of months — which is odd because many of the business success stories we hold up as the gold standard of entrepreneurial achievement are examples of longevity in business. Warren Buffett’s patience and belief in the power of compounding turned him into one of the world’s richest men — but only later in life. Jeff Bezos was an enigmatic online bookseller until many years into his career when the world finally found out the breadth and genius of his ambitions. Finance giants like Ray Dalio and Jack Bogle refined and stayed true to their vision over decades, making landmark achievements and lasting legacies in their.

One of the commonalities in all these stories is the allure of entrepreneurship not just as a moneymaking endeavor, but as a true passion for the problem-solving and transformational potential of work.

Like life, entrepreneurship is about the journey, not just the destination. Cashing out early in the journey robs an entrepreneur of some of the richest experiences and lessons in business life.

Imagine if Jeff Bezos had sold Amazon when it was worth a few million dollars and spent the rest of his life sitting on a beach, or if Warren Buffett had offloaded Berkshire Hathaway decades ago and spent the rest of his life in retirement. It would be like a runner sprinting out to a lead in the first couple miles of a marathon and then stopping and claiming victory. The experience would not even be close to the same.

The richness of the entrepreneurial life is in the challenges, obstacles, joys and successes of a lifetime of dedication to not only a business endeavor, but the co-workers, clients, partners and competitors that make up a life in business.

You can’t learn these lessons sitting on a beach with a cocktail in hand after a few years of hard work. You earn those rewards through a lifetime of dedication to entrepreneurship through thick and thin.

Our economy and our business community have many of these lifelong entrepreneurs. We even have dedicated multigenerational business families. These are the examples of business success we should celebrate: the ones who play the long game, and build businesses that last — and in return receive the unrivaled experiences that only a life committed to entrepreneurship can deliver.

John Solari is the managing partner of J.A. Solari & Partners. He has 25 years of accounting experience and is also a member of the American Institute of Certified Public Accountants and the Nevada Society of Certified Public Accountants.


This post was originally published in the Reno Gazette Journal and can be found at this link