Category Archives: business continuity

Choosing Gratitude

Mindy Barker | Barker Associates

While this year has given us challenges beyond what any of us could have imagined, I choose to be thankful for all the experiences I have had and lessons I have learned in 2020. Thanksgiving is the perfect time to have gratitude above all else.  

Early this year, if someone had told me I would be okay with certain things, I would have said, “No, not me. I just can’t live like that!” Admittedly, there were many ‘I can’ts.’ 

I can’t: 

  • Go months without hugging my Mom tightly 
  • Deal with my Dad’s inability to speak 
  • Work out consistently at home, rather than at a gym  
  • Use paper towels other than ‘Bounty’ 
  • Use toilet paper other than ‘Charmin’ 
  • Not going out to eat twice a week 
  • Work at home every single business day, without physically attending any networking events 
  • Clean my own house 
  • Have naked fingernails and toes 
  • Do a TV interview without the assistance of a makeup artist  

Despite all of my resistance though, I did each of these things in 2020, and learned so much about myself and my ability to cope in the process. I met some amazing new people, had some wonderful new experiences, and learned that I can, in fact, do all of those things and so much more. I would never have known this about myself if 2020 had not forced me to adapt. 

I learned to be a more well-rounded business professional. Pre-pandemic, I was a master at in-person networking. I gain a tremendous amount of energy from walking into a room of people, seeing old friends, and meeting new ones. I love shaking hands, hugs, and engaging in conversation. Like so many of us, I love the human connection. 

As we all know, COVID-19 ended our ability to make that human connection. The isolation of working at home and not enjoying experiences with others was tough. I was also committed to going to the gym and to the group with whom I work out, all having been dear friends for over twenty years. Losing that treasured time was also extremely difficult.  

Yet, I survived these losses and foreign experiences. I figured out how to network with Zoom calls, join virtual conferences, and then follow up with attendees. I made connections that not only filled my pipeline of work, but also broadened my perspective of events that were occurring all around the world. I was able to work more efficiently and in ways that would have been highly unlikely before the pandemic. For example, I was able to effectively service clients in London, New Orleans, Sarasota, and Jacksonville – all remotely. I was also offered the opportunity to be the opening speaker of the embarcLA Virtual Conference, organized by the Mayor of Los Angeles. This event was designed to help those with entrepreneurial aspirations who lost their jobs. It was so exciting to see inquisitive young minds asking the right questions and learning the intricate steps of turning big, bright ideas into productive, profitable businesses. 

I work out at home consistently and love using the homemade barbells that my husband made for me. I am so grateful to be able to continue to take care of myself, and, of course, grateful to him. 

I got back into my kitchen and spent some time reorganizing. Now, I love to cook, and although I still enjoy the ambiance of a restaurant, I do so with a more critical eye on the food prep.  

When quarantine first started, my Mom had just experienced a stroke and was in Rehab, while my Dad was in Assisted Living. They were apart and kept in their rooms for weeks during the first part of the shutdown. Given that both have dementia, this was very difficult to explain to them. Finally, they were reunited in Assisted Living, but, of course, I was unable to visit. They were locked in their room, but at least they were back together. The isolation caused a significant decline in my Dad’s health, and there have now been times where he does not even recognize me. We all lost so much as a family. But now that the restrictions have been loosened, I am able to visit them. And I choose to be grateful for that.  

I learned to be happy with the paper towels and toilet paper I had. It turns out, it is not that big of a deal to have the ‘right’ brand, after all. 

I reconnected with a number of my college buddies, and I now treasure the Zoom cocktail hours we had during lockdown. Purposefully checking in with others was different, and in many ways, more genuine and engaging than a typical networking event. 

This was also a time where the news was not always the easiest to understand or process. I have found a healthy way to get the news that I need to be informed. I am so glad that I am inclined to learn what all sides have to say on a specific subject, so that I can silence the noise and understand the true issues better. When I recently tried to explain to someone that I enjoy being friends with all, and hearing everyone’s perspective, the woman looked me straight in the face and said, “It must suck to be you.” I simply laughed and told her it did not. I have learned so much, treasure the diversity of thought I hear from all, and am grateful for that perspective. 

As this year, with all its challenges, comes to a close, I will continue to choose to be grateful for each of these extraordinary experiences and for all that I have learned through them. I am exceptionally grateful to my clients, referral partners, friends, and family, all of whom helped contribute to my journey. I am grateful for each one of you.  

My hope is that each person who reads this has a safe and Happy Thanksgiving, remembering that the exuberance of gratitude can far overshadow any fear and anxiety if we allow it to. Choose gratitude each and every day. Happy Thanksgiving! 

Dogs Will Lie, but the Numbers Will Not

Mindy Barker | Barker Associates

Are you wrapped around your pet’s little paw? We are, despite the fact that we recently learned they will lie to us.

Last night, I fed our Maltese and Bichon Frise their dinners and went about my evening activities. Later, my husband, Glenn, came into the kitchen and the little guys acted as if they had missed their dinner. Given the circumstances, he, of course, fed them again.

While our dogs may lie about whether they’ve eaten yet, some things never lie, such as the real data you need to run your business each day. And whether or not you intend to, it’s the same data you need to pitch to investors when seeking funding.

With the right infrastructure in place, you have answers at your fingertips, such as:

What is the seasonal fluctuation of my business so that I can prepare for the ups and downs?

What is the demographic profile of my customers so that I know where, when, and how to reach them?

What is the average cost, price, and profit of a sale? Am I losing money on my best sellers?

These questions and many more can be answered by having the right infrastructure in place and capturing the data as you conduct daily business.

What does the “right infrastructure” look like? The answer is different for each organization based on its size and complexity. At a minimum, an organization should have a list of existing and potential customers and a system to maintain communications with them. The optimal tool is an integrated Customer Relationship Management (CRM) system. An organization also needs to manage money and financial information to project cash flow for the next 12 weeks, have the correct information for tax compliance, and make the appropriate strategic decisions. This may mean you need a separate billing system and/or General Ledger. You also need to properly set up your General Ledger with the right coding segments to be able to report on profit and loss by product, location, customer, and department, among others.

If you feel that you are blindly making decisions about hiring, marketing, warehouse space, or any other issue, remember the numbers don’t lie. Let’s talk one-on-one in a free consultation to get you in the right direction. Check out these times on my calendar and choose the one that is best for you.

Stay Safe

Mindy Barker | Barker Associates

Stay Safe. People are closing emails with this entreaty, wishing it of friends and family at the end of a gathering. The caution is a new reality in our life.  

“Stay safe” has many different interpretations to each of us and it is difficult to lead a team and keep them “safe” with so many interpretations. We cannot, as leaders, let the fear factor impact our ability to lead. We must remember that we are working with humans and lead with empathy, while encouraging each person to work as part of the team to execute the strategic initiatives of the organization. The employment contract between a business and an employee is a financial one and the investment in salary dollars must create a result that supports the initiatives to drive the strategy. 

“The fear of failure can be one of the biggest impediments to making an impact,” said Aja Brown, mayor of Compton, California, noting that leaders don’t make excuses — they lead. (Bizjournals, 5 Leadership Lessons for Women, From Women, 9/25/2018) 

Let’s lead, not make excuses. To help with effective leadership during this time I’d like to share my reflections on the challenges we have faced. 

I’ve been thinking about the differences between this century’s big financial crises: September 11, the 2008 financial crisis and today’s financial crisis brought on by the pandemic.  

  1. 9/11 united this country, but the pandemic has hardened a divide that was already in progress in so many segments. This divide creates opportunity for risk within all businesses, as all businesses have employees with so many different views. 
  1. The economic up-tick before the pandemic was fueled by fast- paced growth in innovation and technology that was not always backed by the proper governance and accountability. 
  1. According to Bain & Company more money has cycled through the PE industry in the last five years than any other period in the history of PE. The number of firms chasing opportunities to invest created a tilted supply/demand dynamic that significantly lowered the bar on due diligence and investment. 

Why does all of this matter as we approach a post pandemic state and lockdown restrictions begin to loosen? Let’s analyze that. 

Controversy in the media means that your employees may be more inclined to share their feelings and reactions to current events, with their teammates. As their leader you cannot ignore the impact this can have on the work environment, even if it’s a virtual environment. Maintaining healthy, constructive conversations while still performing and measuring results of work performance could be difficult for some types of leaders. 

Financial leaders are generally not the best at managing the human factors of daily work life. Leaders must set priorities that have measurable results with employees, even if the employee is working from home or transitioning back to the office. Your goal is to create a team atmosphere with a sense of belonging and accountability for performance. You must stay mindful of your fiduciary responsibility to make sure the investment of salary dollars result in the desired outcomes. Be aware that the complexity of that is more difficult when distance and social issues divide the team. 

Leading from a position of knowledge comes from having the right information infrastructure in place to set and monitor goals and performance.  When you add leading your team so all feel they belong and are part of the solution development, you will have an edge over those companies that are blindly making decisions.   

Let’s set up time to talk about how to effectively set up your infrastructure to provide real time financial data so you can have all of the brain power of your team working on developing a solution rather than doing data input. Use this link to my calendar to pick your free 30-minute consultation with me. 

Stay Safe, 

Mindy 

Getting to Day Zero

Companies are going through year-end financial reporting. Just for fun, at cocktail parties and networking lunches, I ask executives and investors if they get the year-end results as quickly as they would like to get them. My unofficial survey says that most stakeholders are not receiving results timely.

Proactive organizations have “Day Zero” at the top of mind at the beginning of the month. If you don’t know what this means in terms of proactively managing your financial strategy, read on…

The truth is that almost every single employee in an organization can impact the ability of the accounting department to close timely, yet the company accountant may not be the best source to drive home that truth. The message from the top should convey respect for each professional’s time and support for more efficient month-end and year-end processes – where everyone focuses on funneling information in a manner to close the records effectively. The ultimate goal is to provide to the management team a Flash Report as soon as possible following month-end, followed by the official month end financials.

Day Zero refers to tasks your accounting and finance departments can complete prior to the end of the month to speed up the month end close. Decisions about the company require timely, accurate data – a smooth and timely month-end is vital.

Some “green eyeshade” accountants may balk at the idea that they can shorten the month-end process; however, the strategic finance professional digs into their process to find and tackle these tasks, as well as improving their process going forward. 

Mindy Barker | Barker Associates Getting to Day Zero

Here are some examples of what I mean:

  • Recording depreciation,
  • Making standard monthly entries for amortization of intangibles, and
  • Recording accruals of expense.

Once you have identified the pre-close tasks, create a Day Zero checklist with deadlines for each item. The finance manager should oversee that deadlines are being consistently met and if not, get to the root of the problem to correct the process. One solution may involve asking other departments to turn in their information based on a schedule you provide in advance.

Refining your month-end close process is an iterative process if you continually raise the bar to identify better ways to execute. Automating reconciliation and other process improvements contribute to shortening the cycle.

Document your processes with Standard Operating Procedures so that all team members have steps to follow should any one team member need backup. Keep your SOPs up-to-date through periodic review.

Spend time in the middle of the month following the month-end process to complete your review of the entire process. Engage your finance team and uncover those Day Zero tasks you can incorporate into your process. Everyone in the organization will benefit when leaders have more timely and accurate information with which to make decisions.

If you are disciplined and implement Day Zero and other month-end processes, you can provide a Flash Report of results to management as soon as Day 1 after month-end.

Barker Associates can facilitate a review of month-end processes with your team to ensure you have uncovered all the possible streamlining opportunities. Provide the best customer service to your management team possible – provide financial information and think strategically and become part of positive initiatives to move the entity forward and not the green-eyeshade accounting department about which everyone complains.

Leave Behind What is Not Working

Yesterday, as I was walking back to my car after a great networking lunch, I almost tripped over a pair of shoes left behind in the parking lot. They were probably part of a strategy to look fashionable and fabulous. Most of us can take a closer look and determine why they may not have been working from a practical sense and just had to be left behind.

Leave Behind What is Not Working
Mindy Barker | Barker Associates

From a practical perspective in business, some tools, processes, and even people have to be left behind. Leaders tend to get attached to all three at different stages of their careers and different stages as leaders. Financial systems are not typically customer-facing, being pushed to the bottom of the list of systems to upgrade. In addition, most Chief Financial Officers and Controllers do not have the level of Emotional Intelligence and skills required to stress the importance of the new system.

It makes sense, both financially and practically, that software vendors can only support a limited number of versions of their products.  Eventually, you receive notice that support for your outdated version of their system will cease.

When you finally decide to upgrade your system, consider my recent experience. I learned that it is impossible to migrate data from certain older systems to the newest version without upgrading it through each version of the system – some of which are no longer for sale. I was able to locate a CPA who had all the previous systems, and the client had to pay them to move the data through the updating process. 

Do you want your valuable accountants struggling to operate your business with an outdated system? Good accountants are in high demand, receiving multiple calls from recruiters who are offering them opportunities to work for more money in up-to-date software environments. They can walk out of your office today and have a job tomorrow.  Do you want them dealing with the 10th system crash that week, or trying to get a mega Excel sheet to balance because they can’t use the old software to get the correct financial data for decision-making? When the recruiter calls them it is highly likely your accountant will be in the mindset to listen to what the recruiter has to offer. Turnover in the accounting department will cost you a minimum of $15,000.

You must have the right financial system to report the right financial data to make informed and effective decisions about strategy. If you are selling multiple products or services without clear financial information, you might as well be driving blindfolded down the highway at 100 mph.

The moral of my story is that old systems are not serving your company or your employees well.  You must invest in upgrades appropriate to the stage and size of your company, or you are putting your business at risk.

Do the right thing, leave what is not working behind. Leave behind the old system, just like the owner of these shoes left them behind – because they were not working.

Barker Associates helps our clients evaluate their current financial systems to determine if it’s time to upgrade or replace, and we are happy to help you, too.

The 1st Year Audit – Master the Mystery

Does the word audit make your pulse race and put your antiperspirant to the test? Is your monthly financial review fraught with the same level of fear that a trip through the Halloween Hall of Terror brings? If you are a growing company and are required to go through your first audit, it can be scary. The fear of the unknown, worried what may jump out at you as you dig deep to tie out a balance can create real panic.

Rather than sweating bullets and launching into panic mode, think of an audit as your annual wellness check-up and not an attempt to incite fright. If you eat right, exercise and take care of yourself your check-up typically is not cause for concern; but if you’ve consumed one too many lattes or value meals and ignored what you should be doing, the scale and your doc will remind you to pull it together and get back on track for a clean bill of health.

The 1st Year Audit – Master the Mystery
Mindy Barker | Barker Associates

An audit is very similar, but instead of your doctor, it’s your CPA telling you to get your business organized and your financial health on track for a clean opinion on your audit. An audit is beneficial in many ways, but essentially an audit provides peace of mind that your financial statements paint an accurate picture according to Generally Accepted Accounting Principles. This assurance is vital if you are growing and need funding or if the funding you currently receive has compliance requirements.

An audit is important, but it doesn’t have to be as scary as looking into a funhouse mirror. Follow this 5-step process, before your audit begins, it’s like having the answers to the test and will provide you with the clarity needed to minimize anxiety and help you master the mystery behind the first-year audit.

1. Communicate with your CPA.

Your CPA is hired to help you and is not out to get you. Have them set the stage for what you should expect during the audit. Ask them what documents you will need to provide and what tasks you should complete before the audit begins. Talk about the timeline, when will it start, how long will it take? Who will be the primary contact to ask questions and submit documentation? A little fact gathering on the front end will go a long way to help the audit process move along seamlessly.

2. Map out a project plan

Take the information provided during your initial meeting with the audit firm and identify the tasks that need to you will need to complete. Assign the appropriate person to the task and determine a deliverable date. Work with your team to ensure that tasks are appropriately assigned and document any dependencies and concerns that may interfere with the deliverable date.

3. Communicate with your team and launch the project

Project kick-off is essential. A proper kick-off demonstrates leadership supports and identifies the objectives to accomplish as well as risks, assumptions, dependencies, and timeline. Many of the teammates that are responsible for supporting the audit are completely busy doing their “day job” and don’t have a ton of extra time. Communication upfront with clear requirements, expectations, and deadlines will help them to plan appropriately to coordinate the additional work into their schedule so they can work much more effectively.

Clarity is the antidote to anxiety. Effective leaders are clear.

-Marcus Buckingham

4. Get Organized

One of the most frustrating aspects of an audit is related to cost increases. Additional costs arise because the audit team has to do extra work to clean up your mess. Many times, clients can avoid costly increases to their audit bill by ensuring they have all their documents in order. For instance, are your accounts reconciled? Do you have supporting documentation for revenue and payments? What about lease schedules, do the payments tie out and do you have addendums and invoices to support lease and CAM payments? Does your trial balance tie out, and is your general ledger mapped appropriately to your financial statements, including the statement of cash flow? Get organized, make sure your accounts tick and tie and have the appropriate documentation on hand.

5. Review your progress

Schedule regular touchpoints to communicate progress. Think agile. In the IT world during implementation, the team meets for 15 mins each day to give a quick overview of the task they need to complete, progress, and concerns. Short, frequent meetings allow the team to stay in synch, mitigate risks, and provide support along the way. If you know how everyone is progressing, there are fewer surprises, and likely you can head off any significant delays or concerns.

Invest the time to follow the steps. As a former auditor, I’ve come to learn that prepared clients are collaborative, not combative. Their team is happier, well informed, productive, and the result is peace of mind and financial clarity. A little communication, structure, and organization go a long way to help you and your team manage the process and stay on task, bringing you one step closer to a clean bill of health for your business.

Do you need help solving audit mysteries or getting organized? Barker and Associates can help you overcome audit anxiety and set you and your business up for success. We’ve created a Year-End Checklist for Audit Preparation that will help you streamline the process. Click the button below to enter your email and we will send the checklist to you right away via email.

Related articles:

On My Soapbox About Regulations

Unintended Consequences of Regulation

The Last 60 Days – Evaluate Envision Execute

Danielle Moga, Barker Associates

The Last 60 Days – Evaluate Envision Execute

There’s nothing that brings on a bit of panic that the end of the year is coming like seeing Christmas decorations prominently displayed at retailers before you’ve even heard the knock of trick or treaters at your door.

For me, as the year-end approaches, I tend to count down shopping days and furiously plan out how I’m going to get it all done. It’s an approach that many of us take as we navigate holiday parties, shopping, travel, and the million other things that are synonymous with the end of the year. Whether you’re a holiday enthusiast or just a busy parent who is driven to make this the best holiday ever, It’s easy to get super focused on the end of the year hoopla for your family to ensure you get it all done, but what about your professional life?

For the business world the last quarter of the year is full of opportunities though I’ve heard countless excuses for the end of the year slack ranging from PTO, lack of focus or just plain ole procrastination but this is the best time of year to outpace your competition and get a jump start on the next year.

Mindy Barker | Barker Associates

“If you fail to plan you plan to fail” – Benjamin Franklin

While everyone else is planning their vacation, surfing online stores for that coveted gift, and running around to countless holiday parties, what are you going to be doing?

Now is the time of year for a full-on sprint to the finish, but to cross the finish line a winner, you need to take some time to evaluate.

What did you set out to accomplish this year?

Did you accomplish all your tasks, achieve your goals?

The last 60 days is an excellent opportunity for a big push to check off those last few boxes on the company to-do list. If you haven’t set specific goals, think in terms of categories and get your team together for a review. The more involvement in the evaluation process, the more likely you will get the support and momentum you need to push ahead.

Financially – Did you meet your profitability goals, move inventory, or land the big customer you had your sights on? If not, design some strategies and draft an action plan for the next 60 days. Is there a campaign you could run, a promo, or maybe a customer appreciation event?  

Projects – Review your project list. How many did you complete? Did your accomplishments align with your goals? Assess current status on open projects and determine what you can accomplish now.

Teammates – Look around, is your team tired, haggard, and barely hanging on? What have you done this year to take care of your team and show your appreciation? People can only push so hard for so long, so if your team has been knocking it out of the park, look for ways to acknowledge and reward. If you don’t know what to do or want to find creative low or no-cost strategies, enlist teammates across all levels. I think you will be surprised at how a little goes a long way towards building a loyal following in the workplace.

Customers – What’s your retention rate? How about an acquisition? Have you on-boarded the customers you desired, and are they generating profitability as you anticipated? Customers are essential in our business, and like teammates, they need to be appreciated. A simple thank you note, a holiday gift, a discount…all simple ideas that make a difference.

Conversely, you may have customers who cost more to serve than they add to revenue. Now is a great time to review those customers and ask why. It may sound crazy to think about firing a customer, but if they are hurting profitability, morale, and taking too many resources, now is the perfect time to devise a phase-out approach.

Environment – Take a look at your surroundings. Have you spent the year head down so focused you no longer see the stack of files or the supply closet in desperate need of a KonMarie makeover? What about empty desks? Did you have layoffs this year, and now a sea of cubes with an errant stapler is your only reminder of what once was. Clean it up. No one needs to see that; it’s depressing. Reorganize your space, check lighting, bring in some plants and ask yourself, is this a place people want to spend most of their waking hours? If not, make a change. Enlist your team. Nothing drives enthusiasm like a DIY project. Set some guidelines and go for it, then plan a celebration to cap off the year.

Once you’ve evaluated your year and have an accurate assessment of the current state, envision your future…dream big with your team. Throw out a few SWAG ideas, brainstorm, put all options on the table to discuss, and leverage to take massive action to reach your goals. Collectively ask “if we were to look back in 60 days, describe the perfect close to the year?” If you know what ideal looks like, then you have something to work towards.

Lastly, map it out. Studies show that we are more likely to be successful if we know what our goals are and then create SMART strategies to turn those goals into reality. Write them out, prominently display them and continually work with your team to get to the finish line and celebrate you’re winning year.

“If you don’t know where you are going, any road will get you there.” – Lewis Carroll

Do you need help creating your winning strategy, finding focus, or creating an action plan for success? Barker Associates is here to help you kick it into gear for the end of the year sprint and plan out your roadmap for future success.

Start with Happy Employees – Gain Happy Customers

Danielle Moga, Barker Associates

If you don’t know where you are going any road will get you there.
– Lewis Carroll

Customer experience (CX) has been a hot topic for the last several years. Companies have invested in teams to analyze data, customer service issues, survey results, and they’ve utilized sophisticated tools such as the Net Promoter Score (NPS) to understand how likely the customer is to share their experience and promote the company.

Companies have increased their budgets and resources to understand the habits, needs and desires of customers to create the perfect journey and ultimate experience for those they serve but, despite all their efforts, some companies are still falling short, which means lost revenue, customer churn, and retention issues with their employees.

CX is the sum of all interactions. According to a 2018 survey by  Gartner, nearly 90% of businesses compete on customer experience alone. Whether your company is transactional or subscription-based the competition is fierce and if you want to attract, retain and grow your customer base you have to lead with the end in mind and design the ultimate experience.

Happy Employees

Employee Experience EX

The exclusive focus on the customer alone has not resulted in the business outcomes companies desire. Perhaps the focus should be on something a little closer to home…the Employee Experience (EX). After all, without employees you can’t serve customers, so maybe the old adage “customer first” should take a back seat for organizations that truly desire to be transformative in the market place.

Social media and platforms like Glassdoor and Indeed have created complete transparency so that organizations can no longer hide from the real-time employee workplace reviews. In this competitive market, where skilled talent can be scarce, companies cannot ignore the need to make the Employee Experience a priority.

Like CX, EX is the sum of every day to day interaction the employee has from the first contact to last. It’s every touchpoint they have with recruiters, HR, their boss and peers, the software they use, the processes they must follow; each touchpoint is specific and distinctive.

The Employee Experience is a full spectrum of all their experiences and a well-designed EX should empower employees with the tools and know-how to serve customers successfully, provide employees control over their professional growth and development, and create an atmosphere for positive and healthy collaboration in a well-designed workplace. When EX strategy is developed and correctly implemented the end result will be happy employees with a commitment to the company and their job.

According to a 2016 report by Deloitte University Press, organizational culture and employee engagement was a top priority in 2017 and is still a top focus. The report noted that nearly 80% of executives rated employee experience very important or important, yet only 22% felt that their companies were excellent at building a differentiated employee experience. Of those same responders, more than half were either not ready or only somewhat ready to address the challenge.

In lieu of a true strategy that focuses on understanding and implementing modern actionable solutions to promote a positive EX, employers are using perks like casual Friday, free ice cream and an occasional “bring your pet to work day” to solve the problem. Companies use these perks in an attempt to build a great culture without any actual thought to what creates a great culture.

Jacob Morgan, the author of The Employee Experience Advantage, analyzed over 252 global organizations to understand the attributes that promote EX and drive employee engagement. The top 3 companies that excel in this area are no surprise: Facebook, Google, and Apple. We’ve all heard about some of the amazing perks these companies offer, but according to Morgan, leadership in these organizations has focused on the bigger picture to yield positive results. They focused in areas that really matter to employees: culture, technology, and physical space.

Culture

Culture is a nebulous word and people define culture in a variety of ways. Morgan describes culture as a side effect of working for an organization. Are your employees frustrated and burnt out? Do they have a voice and an opportunity to present ideas or provide feedback without fear of backlash? Is there role clarity and a clearly defined path for growth? If you’ve heard negative chatter, you likely have a culture problem impacting the EX, which will ultimately impact the engagement level of your employees and your customers.

Technology

Employees should have access to technology that supports their function. Technology should be a help not a hindrance to employees. They should be able to work successfully and with ease with the help of technology, but sadly, many companies have convoluted systems that don’t sync, resulting in errors, rework and duplication, all of which are time-consuming, costly and put not only the employee experience at risk but your company as well. Leaders who fail to stay current with new technology and upgrade the employee experience through exposure to more advanced technology risk losing those employees to companies who do make such investments.

Physical Space

Lastly, a great employee experience is dependent upon the physical space in which employees work. Is your office well lit, clean, free of clutter? Do you participate in initiatives that support a healthy workplace? Are employees situated in an environment that supports their tasks? For instance, if call centers are placed next to employees who must utilize quiet focus to get their job done, then you likely are going to have some unhappy and frustrated employees.

Companies that invest in the development of a focused EX have seen improved results with attracting and retaining skilled employees who are passionate about the company and the brand, and play an active role in the ongoing success of the organization. Employees want and expect to develop their skills as the company grows and adapts to market demands. Maintaining stale, obsolete skills is the ultimate morale killer.

Although developing a focused strategy has not been a priority to organizations, of the 252 global organizations analyzed by Jacob Morgan, only 15 companies, or 6%, have created a winning employee experience; companies that don’t focus their strategy are at risk for both employee and customer churn.

Focusing on long term solutions means taking the time to engage employees to understand their needs, wants and expectations and work to align tactics with developing a winning experience. In the end, you get happy, productive employees who bring tremendous value and drive positive business outcomes.

Are your business outcomes meeting your expectations?

Where is your focus, the CX or the EX?

Have you invested in your Employee Experience or paid it lip service?

Barker Associates will help you review and understand opportunities to enhance your Employee Experience – the work environment, use of technology and company culture. Together we can design and implement employee experience solutions that yield happy employees and positive results. Contact us today at (904) 394-2913 or by email at here.

The Cure for Founder-itis

Founder-itis is a serious condition that occurs when one or more of the founders have remained in their position in an organization for far too long.  They have remained physically, mentally and emotionally in a position that is preventing the organization from healthy growth. This condition can occur in small to very large organizations.  I have witnessed very strong impacts of Founder-itis at large companies.

The cure for this condition is an emotionally evolved founder-turned-leader to fight against their natural tendency to hang on to what is comfortable, what worked in the early stages of the company to catapult its growth.

Long-term CEOs of successful companies such as Jeff Bezos at Amazon and Howard Schultz at Starbucks have broadened their horizons as the company has grown.

How to transition in business from founder to leader.

Successful founders who transition to long-term leaders by avoiding Founder-itis have learned these four key qualities.

  • Deals with ambiguity – When an organization starts out the management team may find themselves working around someone’s dining room table, in a basement or their garage. All the stakeholders communicate and keep each other up to date in real time because they can, literally, reach out and touch.  Modern-day conference software works for small teams as they start a business.  During this stage, the Chief Executive Officer (CEO) is engaged in very detailed decisions and aware of every move that is made. When it’s time to move effectively upward with a growing organization at some point, the CEO must effectively delegate those detailed tasks to move up to a more strategic role with the organization.  Details they knew off the top of their head intuitively will have to be delivered to them in a report that is generated as a result of a quality process.  The CEO must learn to deal with some ambiguity and trust the management team is effectively executing their responsibilities. Founder-itis comes in when the CEO will not let go of knowing small details and continues to micromanage staff.  This is not an effective use of CEO or staff time.

 

  • Hires well and timely – CEOs of high growth companies hire professionals for positions that will challenge them and help develop the strategy as well as successfully execute it. If the CEO lets Founder-itis slip in and only hires puppets who will execute only on what they are told without challenging the status quo, they are holding the organization back from the ability to grow effectively. I recently heard a private equity partner state that is one of the things that holds back the execution of the strategy that fuels growth.

 

  • Leads and supports rather than controls and micromanages – If a CEO constantly talks about how easy a certain task is and should be with 1980s style processing; is not open to a suggested change in process, upgrade to a new system or hiring enough staff to complete tasks, they are choking the organization. Two examples I often see of this are processing payroll internally instead of outsourcing and gathering paper receipts and matching against a paper credit card statement. You may think that only happens in smaller companies; however, it has happened in companies that have over $50 million in revenue and operate in most of the fifty states. Such situations persist because one of the Founders thinks that since they had always processed payroll manually when it was their responsibility, it’s just not a big deal.

 

I also have seen recently where a very young company got hit with an $8,000 fine from the state department of revenue related to incorrectly processing unemployment.  This happened as the founder wanted to save money and not incur the payroll processing fee. The fee was taken from their bank account before the receipt of the letter that explained the error and related fee.

 

  • Embraces pivots – Founders who believe they can keep doing what got them to their first $1 million in revenue are not pivoting. Founders need to realize their role has changed and it is essential for the strategy of the organization to change. The world is changing so fast – just when an organization is up to date with technology, it is time to change again. Embracing that change and the short term disruption it causes is not easy, but it is essential if the organization is to remain relevant, keep talented and engaged employees and execute sustainable strategy.

 

Leadership and sustainability go hand-in-hand and truly make a difference in a growing organization. Especially with today’s low unemployment, leaders must recognize part of their strategy is to provide a working environment that will keep top talent engaged.  Expecting employees to be happy that they receive a paycheck while you expect them to deal with 1980s technology and stone age processes will lead to high turnover and unnecessary chaos and is a sure symptom of Founder-itis.

 

Schedule a consultation with Mindy Barker Associates today for help with:  

Heading Off Unintended Consequences

Heading Off Unintended Consequences

In recent emails, I’ve updated you on regulations going into effect this year as well as consequences we realize from previous legislation (namely, SOX). The legislation was enacted because of the erosion of accountability in this country. How do you hold your company accountable while also raising the bar for maturity of processes? Here are my recommendations, based on my experiences in private equity firms, for-profits and nonprofit organizations. It means going back to the basics that technology may have allowed inexperienced staff to circumvent.

Unintended Consequences of Financial Regulation

Assess Your Procedures for Payments and Bank Reconciliations

Paper checks – Get rid of them; but if you must have them, make sure to use Positive Pay through the bank. Positive Pay uses information from a file that you provide to the bank each time you process checks. As checks are cashed or deposited, your bank compares the checks they receive against the checks you wrote to ensure they match and are not duplicated.

 

ePayments. If you can eliminate paper checks, consider using an ePayment service. Such services provide a comprehensive payment process with built-in controls. The due diligence process to determine which service will work for you can be overwhelming, but you can request a free ePayment vendor selection checklist I put together with the information you will need about your company and the questions to ask potential vendors during the evaluation phase.

 

I applaud companies who had the foresight to move to the ePayment process. Make certain the IT department has proper documentation on how the process works. With low unemployment and the resulting turnover, you do not want to find yourself with no one who knows how to push the buttons and fix this if something goes wrong with the process.

 

The checkbook is a thing of the past, and many young accounting professionals would not know what one looks like.  I have asked many accountants, as they are processing a stack of checks, how do you know you have enough money in the bank account to cover those checks? Most of the time they put a very proud smile on their face and report, “I checked the online bank account balance this morning and there is plenty of money to cover the checks.”

 

After I hear this, I work to control my facial expression. I should become a poker player so I can practice the poker face I need when I hear this response.

 

So, I ask, “What about the outstanding checks that have not cleared the bank account? What about the auto draw of ongoing expenses like rent and other items? How do you account for that? Do you maintain a checkbook?”

 

The responses or reactions run the gamut from blank stares, to statements such as, “I keep a running total in my head,” “The checks we issue get cashed quickly.” These answers only serve to challenge my poker face so that I can keep good customer relations. Rarely does the person I am asking show me the checkbook kept in the general ledger system and a proper cash reconciliation they prepared for the previous month. I find this lack of process in organizations of all sizes.

 

Bank reconciliations. In general, if the organization has escaped the Sarbanes Oxley controls, which, as I stated before, more and more are doing to escape the enormous and overreaching regulation, there is no timely bank reconciliation.

 

Make sure that, at a minimum, these controls are in place:

  • Blank checks are locked in a secure place and only check processors and checks signers have access to them.
  • Ensure there is a review of the bank reconciliation and the bank statement two times a year by a C-Level executive, Finance Committee or Board member or investor. Request a free step-by-step bank reconciliation checklist on how to do this here.

 

This is a true story. I received a check for payment from a large, publicly-traded company. I was shocked when I received the same check number for the same amount twice in the mail. I called the insurance company to report it, but they never called me back. I received a letter about the duplicate check weeks after I had received the second check and made the phone call. The letter I received was very factual and did not offer an apology or do anything to try to mitigate the branding impact. This was a shocking revelation to me that the lack of controls over payments was everywhere.

 

Get Corporate Credit Card Usage Under Control

 

Credit Cards – If the US government ever creates a Corporate Credit Card office, I am going to run for the position and work myself out of a job. Corporate credit cards are a nightmare to manage in all companies, from small to large.

 

Large, publicly traded companies hide behind the fact that they are audited to ignore credit card controls. Yes, you are audited, but the corporate credit card balance is small and immaterial, which means it does not meet the audit criteria for detail testing. Remember, the outside auditors are focused on what the SEC is going to ask them about – the corporate credit card is not on the list. Many small, fraudulent credit card transactions can add up and instill a culture of weak financial responsibility in an organization.

 

In small organizations, the office manager, bookkeeper, (remember the one who figured out how to print a check out of QuickBooks?), or even the receptionist has a company credit card. This usually happens when a C-level person realizes they may have to pick up the toilet paper at Sam’s Club with their credit card and they do not want to. It’s OK to delegate that responsibility as long as controls are in place to prevent fraud and misuse.

 

In my work with all sizes of organizations, I have found that often they do not have a credit card policy. Get a policy, even if it is short and sweet, and have each employee sign it who is holding a company card. Email me for a free credit card policy template to get you started.

 

Fraud on corporate credit cards is running rampant. Often the employee is incurring small, unauthorized charges that add up to a significant number.  The Accountant, Purchasing Manager or whoever oversees the corporate credit card may be faced with ethical dilemmas every day when executives in higher positions are the guilty parties. Such situations make it difficult to manage and monitor effectively without a signed policy as backup.

 

Small organizations and nonprofits tend to have no automation of the credit card process, relying instead on cardholders to provide receipts for accounting purposes.  When cardholders are late in providing the receipts, accountants set up a holding account in the General Ledger, (which is often QuickBooks), where they charge the payment of the credit card to avoid paying late.  With no accountability for the balance sheet reconciliation, the account just grows. If the accountant responsible for collecting the receipts takes their job seriously, they will walk around the building asking for the receipts and, as an added bonus, hit the goal of 10,000 steps on their Fitbit – the search for the receipts will take care of that!

 

Tighten up controls on the use of corporate credit cards with these process improvements:

 

  • If you work for a public company and have authority over credit cards, set up a process where the Audit Committee of the Board has someone designated to review a monthly or quarterly report of corporate credit card usage. Internal Audit should be reviewing executive expense reports and corporate credit card statements annually. I suggest they pick randomly from the group for about 10% coverage each year and always review the CEO and CFO.
  • Nonprofit Board – make sure there is a policy that each cardholder signs. Review how the process works and suggest implementing automation of credit card receipts. Expensify, or a similar technology tool, can serve that purpose.
  • Private company – Set up automation of collecting credit card receipts and a review process like the one described for nonprofits.

 

Readers of this email who work for well-organized companies with mature practices in place may be thinking, “Surely there are not companies operating without these fundamental business practices in place.” My response is that if that was the case, I would not be writing on this topic or asked repeatedly to present these concepts to audiences!

 

You can easily implement the actions from this post. I’ve made the tools available for you for free.

Get them sent straight to your inbox and download the ones you want.
Tools:
·       Free ePayment vendor selection checklist

·       Free step-by-step bank reconciliation checklist

·       Free credit card policy template

Simple click here – Yes, send me the free tools.

 

If one of your 2019 goals is to build up your company infrastructure with financial process improvements, Barker Associates can help. Contact us today at cfo@mindybarkerassociates.com

 

Find the other related articles here:

Unintended Consequences of Regulation,

ASC 606 Revenue Recognition