Posts Tagged ‘Leadership’

Barrier to Entry for Small Business

Sunday, December 25th, 2011

By Dr. Wesley Carter
Stella stood with her hand resting gently on the whiteboard in the conference room. She had been in the office most of the night and all morning, working on a report for her father, the owner of a small business. Stella’s father had asked her to identify the barriers to entry for potential new competitors, or entrants, into their market. With a supportive pat on the back, her father had posed the question last night.

Stella was intent on convincing her father that she was ready to take over the reins of the family business. She absent mindedly twirled the dry erase marker between her fingers and mentally reviewed what she had learned about barriers to entry in business school and from years of experience in the family business.

New companies must be able to enter the market before they can actually become competitors. Creating strategic barriers is an excellent strategy to stave off competitors and deter entry into a market. Stella’s father posed the challenge to evaluate how the business would fair under Stella’s leadership. Her father’s faith in her ability motivated her to provide a thorough assessment.

Stella recalled Michael Porter’s five strategic market forces regarding barriers to entry for potential competitors. She quickly went through her mental checklist and scribbled her ideas on the whiteboard. Economies of scale can pose a barrier to entry when potential competitors must make large investments to compete in the same market as an established business. Typically, new market entrants will be forced to enter the market on a large scale to threaten an entrenched and established business in a particular geographical area. The access to proprietary technology, an advantageous location, or government subsidies can make it difficult to enter a new market.

Product differentiation creates a barrier to entry when customer loyalty for a particular product or service is strong enough to threaten businesses attempting to enter a new market. Customer loyalty can result from customer service, brand identification, or the status associated with a particular product or service. However, product differentiation is only a barrier to entry for the potential competitor if they do not have access to the capital required to compete.

Capital requirements can make it very difficult for potential competitors to enter the market of an established business. The capital requirements can result from the need for large start-up costs, heavy certification fee requirements, or research and development. Basically, when an industry requires a new entrant to make a large capital investment to enter the market, those capital requirements represent a barrier to entry.

Cost can also represent a potential barrier to entry. When established companies achieve either a lower “cost of doing business” or product/service price advantages, cost becomes a threat to a new company entering the market. If an established company is fortunate enough to operate profitability at a lower cost than a new company entering the same market, the established company has a cost advantage.

Established companies often have greater access to distribution channels than new companies entering the market. Access to distribution channels poses a barrier to entry for a new company if it will be difficult to gain access to similar or more efficient distribution channels.

Government policy and regulations have the potential of posing a tremendous barrier to entry. Industries such as liquor retailing, coal mining, or trucking are examples of government policy interfering with entry into the markets. The government can enact a barrier to entry by limiting the number entrants into a particular market such as public utilities or garbage collection.

The issue is not whether a potential competitor will enter the market, but “how long it will take a competitor to enter and challenge the market space of an established business?” Stella quickly wrote the potential barriers to entry for the family business, took a step back, and admired her work. She smiled with confidence as she prepared for a very positive discussion with her father. She looked forward to hearing her father’s feedback during their lunch meeting. The white board was white, no more.

WESLEY CARTER DM, authors an advice column that leverages leadership and management strategies to solve common business problems. Carter holds a Doctor of Management (DM) degree with an emphasis in Organizational Leadership, an MBA, and a B.A. in Management. Carter is a partner at KRS Consulting, LLC in Charlotte, NC. If you have a question, email wesley@krsconsult.com. All submissions become the property of Wesley Carter. Call (704) 992-1211 or email to book an engagement. This article originally appeared in “The Charlotte Post”.

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Posted in Business Development, Dr. Wesley Carter, Small Business | No Comments »

Leading through Partnership

Wednesday, August 31st, 2011

By Dr. Wesley Carter

Benjamin is one of the top three commercial contractors in his hometown. On Monday morning he arrives at work with an entire plan for reorganizing his operations process. He emails a memo to all of his employees with details of the new strategy and immediately begins implementing changes. 

However, Nathan, also a top three commercial contractor, arrives at work on Monday for an 8:30 am meeting with employees from all levels of his organization to review the results of an employee survey about operational strategy. Nathan’s operation has grown by more than 60% and he invites his employees to provide guidance on maintaining the customer centric and employee friendly environment.

Both owners are intent on maintaining a competitive advantage and growing their business. Yet, their approaches are totally different. Benjamin drives from the top of the organization and Nathan leverages a participative approach from his business school days. Nathan relies on the insight from his employees to develop strategies and plans.

Both businessmen are successful and both are committed to their respective leadership approach. And while both approaches may be successful, one is clearly more employee friendly than the other. On a deadline crunch, Nathan has been known to put on a pair of jeans and work side-by-side with his engineers at a building site. He makes a point to help out wherever he is needed and enjoys a great relationship with employees at all levels of the organization.

Benjamin is a very successful businessman and while he treats his employees with respect, he rarely involves them in leading the organization. For Benjamin, employees are a means to an end. He pays well and expects total dedication. His company has thrived in a down economy. Convinced of the merits of his leadership approach, Benjamin rarely reveals the details of his strategy to his senior leaders until it is time to execute.

There are advantages and disadvantages to a top-down organizational leadership strategy, as well as, a partnership leadership strategy.  A top-down leadership strategy is grounded in control. Benjamin spends the majority of his time planning, organizing, and commanding. In his mind, Benjamin’s organization is a machine and his role is to drive productivity through the machine.  Benjamin’s autocratic leadership style is quite effective when decisions need to be made quickly. However, extended periods of autocratic leadership can lead to the lack of creativity and lower employee commitment.

Employees in an autocratic leadership environment often experience fear and resentment. Invariably, the lack of employee participation in decisions that affect work tasks fails to uncover obstacles that could be avoided if only they were included in the planning process. Choosing not to consider the ideas and opinions of the employees actually executing the work can have a disastrous effect on operations.

Nathan, on the other hand, engages internal and external stakeholders in developing strategies and plans. He respects his employees and trusts their judgment. Nathan recognizes the influence of technological innovation on the “how” of completing tasks at work. Completing even the simplest tasks requires a degree of mental work by highly skilled professionals. In fact, the confluence of different ideas and skills required to run a profitable business can only occur through partnerships.

Soon, if not already, Benjamin will begin recognize that he cannot keep pace with technology and maintain the quality of his decision making. Ultimately, Benjamin will have to adjust his operational style or suffer the consequences in terms of profitability and/or employee commitment.

At the genesis of his business, Benjamin’s autocratic leadership style may have been very effective. However, he will need to begin to rely on the talent within his ranks if he is to remain competitive. Additionally, he may find that his employees appreciate having a say in developing strategies and plans, since they will be responsible for executing.  

It is imperative that every manager periodically review their leadership style and adjust to the environment as necessary. While there is no one best way to lead, the strategy should align with the situation for optimal results. Have you evaluated your leadership style lately?

WESLEY CARTER DM, authors an advice column that leverages leadership and management strategies to solve common business problems. Carter holds a Doctor of Management (DM) degree with an emphasis in Organizational Leadership, an MBA, and a B.A. in Management.  Carter is a partner at KRS Consulting, LLC in Charlotte, NC. If you have a question, email wesley@krsconsult.com . All submissions become the property of Wesley Carter. Call (704) 992-1211 or email to book an engagement.  This article originally appeared in The Charlotte Post.

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Posted in collaboration, Dr. Wesley Carter, Leadership, Organizational Change, Organizational Planning, Partnership | No Comments »

The Office Tyrant

Saturday, July 9th, 2011

Dr. Renae Sanders

Imagine a workplace where the top official is a tyrant, a bully, a complete “donkey”! Belittling employees, frequent soliloquies (dialogue just does not occur), broken promises, subpar pay and boastful attitudes occur in many organizations and in some companies a litany of behaviors maybe documented. Bad behavior is occurs more in this down market than it did during the economic hay day of the past. This behavior is rampant in large and small organizations. But what toll does this take on organizations and its employees?

The impact of incivility on productivity and revenue in organizations are real, yet most business leaders are blind to the role they play in these circumstances and the impact of poor behavior on bottom-line results is clouded by perceptions of external factors and blaming “others” for organizational results. The truth is when you repeatedly chip away at coworker and employee confidence, self esteem, and creativity you are shooting your organization in the proverbial foot!

In fact, it seems these individuals get promoted rather than being dismissed. In this regard, short-term gains are given greater weight than long-term costs related to turnover, absenteeism, and increased healthcare costs (depression, hypertension, and stress), and even lawsuits from employees placed in harm’s way when a disgruntled, offended employee goes “postal” on colleagues.

Many books and articles have been written advising employees on how to cope with workplace tyrants and bullies. Yet, the real culprits are the organizational leaders who turn a blind eye on the bullies citing improved performance. Or the tyrannical leader who believes his or her behavior is the “authoritarian” style of leadership and who are blind to their own behavior.

You are an Office Tyrant if you believe:

  • Your way is always the best or only way to be successful.
  • Everyone is an imbecile except you
  • Others can only hear you if you yell at them
  • Employees should be able to read your mind
  • Employees work for you and not for themselves or their families
  • Insults are an effective motivational tool
  • People have no value unless they are driving revenue (even if you hired them in a non-revenue generating role)
  • If there were more people just like you in the world, the world would be a better place for everyone

As an employee, your ability to survive working for a tyrant is likely if your leadership team recognizes bad behavior as uncivil and costly to the organization and works to rectify the behavior via coaching, therapy, performance feedback, or time away for the office offender. Otherwise, your best bet is to find a new role away from these individuals and continue to contribute to your organization’s success. Unless, you are challenged by this type of work environment! 

In large well branded companies, these behaviors may get lost or be hidden in the complexity of the organization, but in small companies that rely more heavily on employee loyalty, customer referrals, and reputation. Such behavior can have detrimental, often immediate, effects on the bottom-line. Thanks to technology and social media the world fits in the palm of everyone’s hands. Your business’ future rests on the influence of others’ tweets or Facebook posts.

If you are the tyrant, discover what beliefs you hold about others and leadership and modulate /correct bad behavior. We are all on the same team!

Related Articles

In the Workplace: It’s the Tyrants Who Prosper

How to Turn the Table on Bully Bosses and Workplace Tyrants

Dr. Renae Sanders is the Managing Director at KRS Consulting, LLC, a management consulting firm specializing in organizational relationships. Believing people are the link between strategy and success, Dr. Sanders works with organizations, leaders, and managers to strengthen internal relationships. You can reach Dr. Sanders at info@krsconsult.com.

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Posted in Leadership, Management, Organization Relationships, Small Business, Workforce Development | 3 Comments »

Your Vocal Image is Critical to Your Personal Brand

Tuesday, April 6th, 2010

By Renae Sanders

One of the primary roles of leaders is communication – the ability to express your ideas effectively. Vocal expression is the ability to communication emotion and credibility through the words we use and how we use them. Your vocal image strengthens your personal brand.

Your personal brand encompasses experience, values, behaviors, attitudes, appearance and voice. Voice is underrepresented in the realm of professional development. Regional accents play an enormous role in building trust and credibility; consider the New Yorker, the Southerner, and the Valley Girl dialects. Moreover, vocal register or pitch has a similar affect. High pitched, nasal sounds make us more uncomfortable than lower, deeper tones associated with the middle voice relative to the deep, commando tone which reminds us of our parent(s), a drill sergeant, or the mean old teacher; consider Dennis Haysbert vs. Fran Drescher, Sean Connery vs. Chris Tucker, or Oprah Winfrey vs. Rosie O’Donnell, different vocal ranges and speech patterns illicit different emotions.

If you are being questioned more at work than others, it maybe that your speaking style contributes to your lack of trustworthiness as determined by others; do you have an “up speak” at the end of your sentences? Or is your voice high and soft (male or female)? Your vocal presence can be changed just like learning to run a marathon, training to build stamina, or weight loss; with the exception of birth defects, your vocal presence can be improved.

It’s not about your level of intelligence or education. Don’t make it personal. It’s a physical thing. To become a better leader, personally or professionally, remember it’s often not what you say but HOW you say it!

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Speaking from a Podium: Tips to Get You Started

Renae Sanders is the Managing Director at KRS Consulting, LLC, a management consulting firm specializing in organizational relationships. Believing people are the link between strategy and success, Renae works with organizations, leaders, and managers to strengthen internal relationships. You can reach her at renae@krsconsult.com.

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Posted in Dr. Renae Sanders, Leadership, Organization Relationships, Professional Development, Trust | 7 Comments »

Four Steps to a Solid Crisis Response Strategy

Friday, February 12th, 2010

An unexpected crisis can happen to any company at any time. Companies with a well conceived and tested plan improve their chances of maintaining public trust and clients in the face of a major crisis.  Here are a few steps to get you going:

Assemble a cross functional and diverse team.  Evidence support that teams with diverse team members (i.e., hierarchy, age, gender, ethnicity, etc.) produces better ideas, products, and outcomes. The idea that different experiences and beliefs give way to more innovative solutions is more than a notion.

Create a broad strategy in advance. Past experience is a good place to start. Use past incidents, yours or other companies, to help define the types of unexpected events which might occur and set a broad strategy to combat them; one that is specific to your company or industry.

Train internal representatives in advance. A periodic test of the plan is always a plus as well. Schedule drills to test the operational steps of the plan.

Consolidate the public relations function. Nothing is worse than different, uncoordinated sources interacting with the media and providing inconsistent information. Remember, once trust is lost it is nearly impossible to rebuild. Drive on contact with the media through a single or centralized source. Be sure all employees understand the importance of let the designated individuals interface with the media.

Partner with external organizations for assistance. An objective view can help bring perspective to the situation. The nature of the crisis might well warrant the use of a Public Relations (PR) firm. Identify and interview the firms during the plan development stage. Incorporate suggestions for the PR firm into your plan.

Let us know if you need assistance with your Crisis Response Strategy.

Sources

Kraemer, H. M. J. (2003). Doing the right thing: Values-based leadership is not an oxymoron in corporate America. Vital Speeches of the Day. 69(8), 243 – 247. Retrieved January 30, 2010, from University of Phoenix Proquest Database.

Tritz, T. W. (2002). Crisis management strategy utilized by the United States Department of Defense following the terrorist attack on America: A case study. Journal of Undergraduate Research. Retrieved February 8, 2010, from http://www.uwlax.edu/URC/JUR-online/html/2002.htm

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Posted in Leadership, Management, Organization Relationships, Trust | 10 Comments »

Crisis Leadership: Toyota and Tiger Woods – Pass or Fail?

Tuesday, February 9th, 2010

When a high profile company like Toyota unexpectedly lands in “quick sand” the rest of us stand in stunned silence or quickly point out what they could have done differently. Certainly, Toyota’s handling of the situation is reminiscent of the Tiger Woods scandal, specifically, ‘don’t deal with it immediately’. The idea that most people would forget about this – in time – is a less than courageous move.

Toyota and Tiger should be seen, by business owners, not as spectacles but as reminders. The difference between ‘us’ and ‘them’ is our approach to managing a crisis. Business leaders, small and large, should pause to prepare for their own crisis situations.

A crisis by definition is a low probability – high impact event! Most businesses plan for high probability – high impact events and spell out risk mitigation activities in the strategic or business plan. Low probability, low impact events are handled with relative ease as a part of our daily operations; as are high probability – low impact events.

The blind spot for us are events we deem unlikely to occur but if that one event occurs, it will change the course of business. A crisis response strategy will make, shake, or break even the ‘best of the best’. Execution of the plan is paramount!

Execution in Crisis Mode

A quick, prompt response sets the tone for media interaction and public interpretation. The initial response allows the company or its public relations team to establish the flow of information rather than the media. If not dealt with immediately you’ll find the media will control the initial public opinion.

Be open and honest about the issue. The media and public stakeholders should have easy access to company players and information. Otherwise, the sentiment leaves the public wondering about company’s integrity and might damage its reputation.

Allow for the constant flow of information and a consistent message. Frequent updates as developments or understanding unfold demonstrate responsibility and control by the organization. Inconsistent or conflicting message erode trust.

Show compassion for consumers, employees, and others affected by the problem. Compassion coupled with action also sends a message that organization is in control and taking appropriate action.

Perhaps, Tiger Woods and Toyota, have crisis management plans. I am uncertain of what the expected outcomes of either plan; except, Toyota and the Haitian crisis have re-established perspective; and, for now, the heat is off Tiger Woods. According to Kraemer (2003), “leadership, values, integrity and credibility are not items you can pull off the shelf when times are tough” (p. 246).

Toyota has already launched is reputation recovery ad. Is it too little too late? Tiger is still M.I.A. How would you grade the two?

Sources

Kraemer, H. M. J. (2003). Doing the right thing: Values-based leadership is not an oxymoron in corporate America. Vital Speeches of the Day. 69(8), 243 – 247. Retrieved January 30, 2010, from University of Phoenix Proquest Database.

Tritz, T. W. (2002). Crisis management strategy utilized by the United States Department of Defense following the terrorist attack on America: A case study. Journal of Undergraduate Research. Retrieved February 8, 2010, from http://www.uwlax.edu/URC/JUR-online/html/2002.htm

Related Articles

Toyota and Tiger Woods Kindred spirits

Renae Sanders is the Managing Director at KRS Consulting, LLC, a management consulting firm specializing in organizational relationships. Believing people are the link between strategy and success, Renae works with organizations, leaders, and managers to strengthen internal relationships. You can reach her at renae@krsconsult.com.

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Posted in Leadership, Management, Small Business, Trust | 254 Comments »

Lead with Courage, Manage with Grace

Tuesday, February 2nd, 2010

Courage mental or moral strength to venture, persevere, and withstand danger, fear, or difficulty – Merriam-Webster’s Dictionary

Grace disposition to or an act or instance of kindness, courtesy, or clemency; the quality or state of being considerate or thoughtful  – Merriam-Webster’s Dictionary

In times of challenge or change, we look to leaders to demonstrate courage. In war, in sports, and at work, we rely on leaders to emerge and implore teams to remain calm; work together and harder; and focus throughout the challenge or period of change.

Individuals with the ability to build strong relationships and establish an environment where team members are encouraged to develop their skills have a leadership advantage. While charisma is a plus, the ability to clearly define the vision and expectations, give actionable feedback, and build confidence require temperament and self awareness.  For example, the leader who preaches risk-taking then punishes team members for taking initiative actually does more to erode team growth and trust.

Individuals grow and learn best when they are given the information and tools needed to succeed. Coaching then becomes a critical element to strengthening performance. In baseball, coaching occurs before and throughout the game. Signals and queues are given to keep the team focused on what is important and what to expect. The coach does not play the game for the players.  Defining success, openly sharing expectations, and setting goals are critical to leading and developing teams. Most of us have dealt with nebulous communications from managers such as “I don’t know how to explain it but this is definitely not what I wanted” or “I, somehow, expected more from you”. But the ability to communicate meaning, show empathy, and give direction is the mark of a leader.

Leading thoughtfully challenges managers to protect the person while explaining mistakes. Grace takes judgment off of the individual and places focus on the task, decision, or behavior.  It takes courage to assign an important project to a developing employee; it takes grace to recognize the importance of helping the employee succeed rather than standing back and watching her fail. Courage is allowing the successful employee to receive credit for her success; and grace is standing with him in failure.

Courageous leaders lead their teams by taking bold stands; making the right decisions; demonstrating appropriate behaviors; celebrating successes; and understanding how they also influence positive and negative outcomes.

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The Mark of Great Leader

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Posted in Leadership, Management | 2 Comments »