PMCC Interactive

Tag: Improving the Business of the Business

  • Back at it — and energized for what’s next.

    In July 2024, I stepped in to help lead a turnaround effort at Urban Engineers, Inc. After a focused and productive year, that chapter is moving into a new phase.  I Congratulate the two new leaders named today- Jim Bilella as CEO and Chris Bobrowski, CFO.  I worked very closely with each and know that each will do the job necessary for Urban to reach it’s objectives.  I will be remaining on the Board of Directors.   AND I’m excited to return full time to PMCC Ventures.

    For those who’ve followed the journey, this latest assignment brought things full circle. Urban’s HQ is across the street from where my consulting career began in 1984. The lessons I learned in my 20s — from auditing an ENR Top 5 firm — still proved useful in my 60s. Some fundamentals really do hold up.

    What’s next?

    • PMCC Ventures is once again open to new engagements
    • We remain focused on strategy, business readiness, leadership transitions, and unlocking value through better insight and execution
    • We’re continuing to help owners prepare for and execute successful exits

      The M&A market is active — but more crowded and complex than ever. Standing out requires more than just a good story.
      • Performance matters
      • Sound insight and foresight is rewarded
      • A clear sense of what is possible and achievable is essential

    We’re here to help business owners position themselves credibly and confidently.

    But M&A is only part of the work. At our core, we still believe:
    Good information + grounded leadership = real change.

    More to come soon.

    If you’re wrestling with complexity — or just want to sharpen your thinking — let’s talk.

  • Turn the challenge of C level exodus into an opportunity

    What are you thinking when you must replace a C- Level Executive?

    Most organizations grapple with replacing C level executives when one of the existing leaders decides to or is forced to leave.  Others, have the luxury of a bit more runway when they see either great new opportunities or significant challenges looming.  But the thinking around these three situations should likely be similar. 

    When a position is vacated, or a Leadership need arises, the functional requirements of the role  are usually pretty evident.  The subject matter expertise and specific “technical skills” for the role are also generally well understood.  The tricky part is deciding what “stance” you want a new leader to hold and what experiences would help create that stance and be good for your organization to access.  and experience are important but not the only set of considerations in choosing a path forward.  This note is about the six things you should consider as you paint in the shaping experiences you hope to find in a new C level Leader. To read more: https://pmccinteractive.com/wp-content/uploads/2022/05/20220510-c-level-exodus-turns-into-an-opportunity.pdf

  • Pat McCormick joins Urban Engineers Board of Directors

    I am honored to have the opportunity to serve the people and owners of Urban Engineers. Urban is an ESOP company so there is a lot of enthusiasm and team work evident in the business.

    I was impressed in our first Board event to hear the management team express how they treasure long term client relationships and the passion they have for dealing with complex situations in sound and innovative ways.

    To read more about Urban Engineers: https://urbanengineers.com/news/urban-appoints-patrick-mccormick-board-of-directors

  • Systems Thinking- When the going gets tough, go back to the basics

    As many know, there is an abundance of e-commerce data ranging from web site visits through sales and abandoned carts etc.  The data is arrayed over many different timeframes and it can be overwhelming to make sense of it and use it to shape generative decisions for growth. Because of some client work, with regard to sales growth- and all the levers you might push or pull to accomplish that, my focus turned in greater detail  to systems thinking and systems dynamics modeling as a way to reduce clutter and focus on the decisions and items that count. In other words, get back to the basics.

    AND

    I could not help but think that  systems thinking and systems dynamic modeling can add to our understanding about the progression of the Corona Virus and the impact it might have on us individually, our companies, the markets in which we compete etc.  As individuals we don’t have enough data to build a systems dynamic model, but thinking about what we read and hear with a systems thinking mindset, might help us make more sense of what is going on around us.

    I first encountered these concepts when reading Peter Senge’s book The Fifth Discipline.  I was lucky enough to participate in programs with some of the leaders in this field.  Since then, I have always been on high alert for  recognizing systems, articulating their performance and trying to understand why things happened the way they did- and moreover, trying to understand what alternative outcomes could be achieved if the system was “tuned” differently.  But- I moved away from detailed documentation and modeling- and now I will invest time to enhance my learning and focus my understanding.

    I have made a personal decision to turn as much of the downtime or extra time that has been freed up because of the pandemic into an investment, vs. just spending it on random things.  I am going to focus more effort to deepen my understanding of systems thinking over the next few weeks.

    Also- the quiet time might also provide and opportunity to think through your life or business in this way, so that you are well prepared to “bounce back with authority” when the smoke clears.

    We would love to hear about your personal investment and what you hope to achieve.

    If this is of interest to you, particularly with the corona virus disease state,  I am listing some resources below:

    MIT Systems Dynamics Introduction  https://www.youtube.com/watch?v=AnTwZVviXyY

    Intro to systems dynamics modeling  https://www.youtube.com/watch?v=IenySRdkRu8

    Classic systems archetypes from Pegasus and Dan Kim  https://thesystemsthinker.com/wp-content/uploads/2016/01/PG01E-System-Archetypes-at-a-Glance.pdf

    Introduction to a basic system systems dynamics modeling software product  https://kumu.io/stw/insight-maker

    Good luck.  Stay Safe.  Stay Well.

  • PMCC Ventures Transaction Support Services

    PMCC Ventures been in business for over 12 years, having built on the prior 28 years’ experience – and doing what we have always done and love: Helping clients improve the business of their business.

    Clients have changed, industries have changed, the starting point and nature of the assignments have changed, but a few constants remain in our work with clients to help them improve the business of their business:

    • Run the business like they will be selling it tomorrow at the best possible price. Make smart moves that create or sustain value all of the time.
    • Know more about their markets, customers and operations and apply that knowledge each and every day. Have a strong sense of inquisitiveness guided by a passion for just doing it better.
    • Really know how you make money in your business and your industry. Stretch to know more and more each day about the systems and interactions that help you create value and take all steps necessary to support and develop those capabilities.
    • Make sure that decision-making is not only fact based, but that it recognizes systemic outcomes, and connects strategic, operational and economic factors.  Communicate and discuss key understandings about the business with your team so that all understand how to best create value in the business each and every day.

    We apply this thinking in all of our work for our clients.  It helps us focus and prioritize, and requires us to understand the system and interdependencies at play in each circumstance – and to not take anything for granted.

    Applying Our Process to Transactional Support

    As we look at the pattern of our work over the past several years- the one striking realization is that we are now employing this thinking in the more than 70% of our work that involves some sort of transaction.

    • Assisting sellers
      • Transaction Preparedness Assessments- quality of operations, strategy and results
      • Developing and implementing plans to enhance the value of the business
      • Develop and stress test business models
      • Business plan preparation
      • Sales strategies
      • Offering memorandum preparation along with road show support
      • Sales process assistance management
    • Assisting Buyers
      • Diligence
      • Deal structure formulation
      • Integration planning and integration support
      • Post-closing reviews and targeted analytical work
      • Ongoing operations support

    Cross industry and cross functional experiences applied in a strategic, operational and financial context are important to our clients

    We have found that working on both sides of a transaction helps us to better understand what is on the mind of the “other side”. As a result, we can anticipate many issues and challenges before they arise and deal with them “as a matter of course” in the process instead of them becoming hurdles to concluding a transaction.

    Our industry and process experiences obviously help us to do our work, but more importantly, our cross-industry and cross-functional experience helps us to better understand the fit and dynamics of each business and to foresee issues that might arise that could damage a transaction – before or after the sale.  We view these matters in the interrelated context of strategy, operations and economics.

    We work cooperatively and compatibly with all of the professionals to get the job done for our client in the most effective and efficient way possible.

    If you are interested in a good deal that has a great chance at creating value, we are very interested in talking with you.

    pjm@pmccventures.com

  • Changing strategies…. make sure to check the alignment

    We are in a period of uncertainty on many fronts….Technological, shifting go to market options and priorities, emerging and leap frogging competitors and opportunities, just to name a few.  Many are appropriately responding to the changes by revisiting goals and objectives, and their strategies to achieve them.  In these times it is important to remember to adjust business practices, processes and resources to support your chosen strategies to ensure sustainable success.  Read more:  Strategic alignment notes

  • Business challenges are not like wine and cheese….

    Over the past few months, I have had scores of discussions with people working in and providing services to Private Equity Firms.  The conversations have been interesting and focused on questioning and challenging the status quo.  I thought it would be fair and appropriate to summarize the themes of the conversations for your consideration.

    Business challenges are not like wine and cheese…. but more like bread and milk– they are common, but don’t get better with time…

    These are the most frequently discussed and vexing themes….

    1. The strike zone is expanding- Longer holds don’t generally seem to represent additional opportunity for incremental growth and development- but place extraordinary pressure for returns and maintaining expected IRR’s for investors… creating additional risk with little prospect for incremental reward
    2. Velocity on the sell side is emanating from A companies, while B’s sit and search for a way out…Plentiful debt and plentiful equity in search of the A companies, make this segment of the market hypercompetitive and Strategics, PE firms and lenders are in the quest to provide a value add- and make their green money even brighter and shinier
    3. Everyone has them, few like to acknowledge it. Every portfolio has a “bottom 50%”– those companies that are under achieving expectations, or underperforming on an absolute basis.  The surest way to make money is to not lose any.  But, the time energy and attention placed on the challenged companies, tends to be a trap that saps attention from the higher performing companies that likely have an opportunity to outperform
    4. Management teams have been built and curated to focus on growth and development and set up for the exit…. but most don’t have significant successful experience in dealing with types of challenges presented by the “bottom 50%”
    5. Quality information is elusive.  It is a challenge to sustain a focus on relevant, reliable and readily available information to effectively run the business.  This delays or impedes problem recognition and response- and in some cases does not promote confidence in the strategies and steps necessary to “get out from under”- at the very time confidence and resolve is critical to break the cycle and drive improvements

  • Helping create value in underperforming and underachieving Private Equity Investments

    The Best way to make money is to start by not losing it.  PMCC Ventures has worked with scores of private equity backed companies to improve performance and move from the bottom 50% of performers to the top 50%.  Our 35 years of experience span industries, company size, stages of development and  range of performance.  These individual experiences are good and interesting.  The combination of the experiences provides our clients with significant value.  We understand that underperforming is not a comfortable place for most organizations- and we know how to help stabilize the organization to enable it to execute a thoughtful and productive process to become the best it can be.

    The core investment hypothesis generally revolves around finding several good business ideas and businesses and provide capital to help them become value creating sustainable businesses.  That is the straightest path to value creation.

    Sometimes, companies stagger along that path.  Changes might occur in markets and industries, the company is leapfrogged by competitors, or the company just isn’t executing the way it needs to.  The bottom line is that the company slows progress and its  performance begins to deteriorate yields on investment.

    Most Private equity firms plan for and build to manage the upside.  That makes sense until the arrows start pointing down.  Our approach is to support our clients dealing with downturns, and underperforming and underachieving investments.  We have the skills experiences, and track record to help clients get out of the hole and back on the path to performance and value creation.

    If you want to learn more, click on the link below.

     

    20170217-pe-brief-challenged-situation

    s

  • Best wishes for a prosperous, healthy, happy and meaningful 2017

     

    As we move on to a new year, I wanted to take a time out to thank all of you that have supported PMCC Ventures in 2016.  I appreciate it.  We had an interesting year, and I hope we continued to serve our clients in the exact way they needed support- and to help them create value.

    As we committed at the beginning- now 10 years ago, we are once again sharing our reflections on our key learnings from the past year.  We share them in hopes that you find them interesting, but more importantly helpful in some situation you are yet to encounter.

    Most all of our assignments this past year, revolved around private equity, structured finance or dealing with some sort of performance gap.  It felt good to get back to our roots, as we really enjoy working in this space.  Not sure if it is our familiarity or the dynamics or both…  Each situation was different- and at the same time, they were the same.

    In the world that we work in, it is an oft repeated phrase: “But you don’t understand: We are different”.  So over the past year or so, we concentrated on understanding differences, but of course to do that effectively, we had to also focus on similarities.  We found that there are of course differences—but they are generally rooted in the management team and the backgrounds they brought to the current situation.  In the world of underachieving organizations, there are a lot of similarities- about what the company is experiencing- and how they got into the situations they are encountering.  Our reflections below will share some of those insights.

    We are going to place a lot of focus and intention on underperforming and underachieving organizations in 2017.  We know that there is a lot of opportunity created by organizations as they “bounce off the bottom”.  We want to work with them, to minimize the disruption and maximize the height of the bounce.

     

    Reflections on 2016

    Underperforming and underachieving organizations—similarities and differences-

    Conditions that seem to be common:

    • Markets in flux… Difficult to grasp meaningful movement and change in direction… differing pace and intensity of changes experienced serve to further disorient and generated confidence in a direction to follow
    • Leapfrogging technologies… Shortening product life cycles… Difficulty keeping up with emerging opportunities and disappointments of disappearing opportunities… Uncertainty about where to place bets… Difficult to recover development costs… Staffing and knowledge base challenges…
    • Shifting customer needs, performance and loyalties… Customers face similar challenges… The importance of the relationship to weather these challenges is significant… keeping up with the various stages of relationships and lifecycle events was costly and required a lot of attention and time…Not getting it “right” was a death knell…
    • Critical resources: time, talent, capital and information are in short supply and not optimally applied… The longer the challenge, the more resources evaporated or became stretched… Market and technology changes make it tough to keep fresh and relevant talent available to pounce on opportunities… Capital or loan opportunities are already stretched, making new sources a real challenge to obtain and likely costly… The lack of relevant information- particularly about changing conditions was the most insipient and critically important… Resources frequently diverted to ministerial matters and strategies that were not promising….
    • Shifting contexts are confusing and make it difficult to plan and act- systemically and consistently… Difficulty keeping up with changing situations… Rest of organization characterizes management coping with this poorly, without fully understanding the volume of change, conflicting insights and information that management is juggling….
    • Time and focus shifts to dealing with ministerial duties and away from the things that help an organization create value… Increased time dealing with regulators, lenders, investors, lawyers etc.…. less time and energy available to focus on customers, markets and operations… can become a spiraling situation further driving organization from value added thinking and action
    • Responses become operational… and less strategic…and less cognizant of the system…. less value placed on thinking and more on motion than forward action… concepts of motion and action became confused… More inwardly focused…. People satisfice and focus on surviving and not thriving

    Underperforming and underachieving organizations—Conditions that are different

    • Type of presenting issue…Industry wide… or specific to the organization… influences the dimensions and probability of positive outcomes
    • Management team Experiences… many teams’ experiences and persona are growth oriented… many individuals and rarely teams have the experiences to manage through the downside… Team members selected for deep functional excellence- when the premium capability… is cross-functional systemic thinking and action
    • The starting point… Objectively how deep is deep? … How much effort needs to be extended to get back to “even”
    • Recognition and resolution…How well does the team recognize the challenge at hand?… How prepared are they to come to grips with it… Denial,,, Anger… Acceptance… Resolution and Healing….
    • Time and what has transpired so far…Passage of time and prior decisions and actions can either negatively or positively influence the outcome and the [re] starting point for any transformation activity
    • Capacity and capability… Influence the effort, the timing and the intensity of the change effort that can be applied- and hence the duration of the transformation period
    • The ability to execute the steps needed to … gain control and stabilize- what has been done- what needs to be done… when should it happen… distinguish urgent and critical… What might foreclose opportunities to maneuver later….
    • Resources… Does the organization have the resources (time… capital… talent… information) or can they be secured or created] to accomplish the necessary changes…. If not, what is a practical level of desired achievement in the best possible timeframe…

    Be diligent with diligence

    • Set a plan… Execute the plan…completely…. particularly in new or challenged situations… make sure that the basics of the deal are covered….  Risks are articulated and strategies in place to manage them… Know the structure that the new entities need to work within… head that direction… make sure that the inventory of service level and retention agreements are adequate and that they are favorable to provide the time and focus to accomplish “newco” requirements…Don’t assume… focus on key risks… identify transitional resources… remember, you don’t always get what you thought you would buy

    Strategy is not just adding and doing new things

    • Strategy is about placing resources and bets to win… it is not about adding efforts and requirements without ensuring that key resources are available…. .it is about making choices… overloading (or under-resourcing) an organization is a sure fire way to help a strategy fail…be thoughtful, realistic and practical about what it will take so succeed

    Strategic, financial and operational information is not like wine or cheese… the situation doesn’t get better with age when you don’t have them readily available

    • Integrated and systemic information is key to success… What insights do you need to run the business…is it readily available… against a context or model that makes sense for the business…Do the timeframes represented make sense…. Is it published in times and ways that can help make a difference… are all of the answers to the repeated or likely questions presented… Can you say immediately….” Now I understand” … Or do you have to do some of your own digging or calculations… Late or incomplete information are bad within themselves, but more importantly point to the existence of other organizational challenges…the organization that invests the effort to do this right will improve performance because of better insights…. And will improve processes and data models that will increase quality of controls… administrative effectiveness… efficiency….

    Marketing is a key turnaround tool and weapon

    • Getting the basics of marketing straight has never been more important…If you don’t understand your markets, your customers, their needs and wants- cold… be assured that someone else is trying to figure it out…and might beat you to the punch… Whether you deploy it physically, digitally or better- both… the basics are key…. No one has the time or the luxury of getting it wrong with customers today… few have extra resources to deploy in a wasteful way… though this waste is rarely evident- it represents a lot of cash and a lot of unmet opportunity…There is someone out there right now trying to know and attract your markets and customers… they just hired “that person” who knows x, y, or z technique cold—and they are deploying it for your customers…now

     

  • Private Equity backed global business marketing firm

    Client Description:

    Private equity owned- Global business marketing firm

    Client Opportunity or Challenge:

    • The Client is a European private equity backed company; new investors have an aggressive growth plan in mind. Within 9 months of investment, the Client acquired 3 companies in the US- its first US investments.  Since growth via acquisition was not part of the core experience of our Client, our European Affiliate, Greene 6 Partners, based in Paris was engaged to support post merger integration and assimilation.  Since the diligence period was short, many risk areas were not well understood and required post acquisition remediation.
    • Most of the existing management team was leaving the company because of the relocation of  company headquarters, hence there was a time sensitivity to dealing with issues
    • We advised on a wide range of issues including
    Organization structure IT Risk
    Severance Tax structure
    Recruiting new employees and leaders Marketing
    Cash management and forecasting Finance and accounting
    Performance Management Outsourcing of key functions
    Real Estate and Leases  

    Role:

    Consultant and advisor

    Outcomes or Benefit:

    • Created due diligence and acquisition assimilation guide book for client to use in subsequent transactions
    • Devised strategy and criteria for Leasing decisions
    • Executed risk assessment as well as IT transition plan
    • Established structure for revised performance reporting including data structures
    • Provided criteria and assessed outsourcing proposals for key functions
    • Project managed issues resolution
    • Mentored interim staff
    • Served as surrogate general manager

     

    NOTE:

    Client names are not used because of Client privacy and Confidentiality Agreements.  Similarly, facts are cloaked to preclude people from deducing the Client name or situation.

  • Improving your Business IQ

    Relevant, Reliable and Readily Available information is key to improving the business of your business and acquiring the knowledge necessary to make smart moves.

    Attached is a recent presentation given at the introduction of Cognos Insight at Overbrook Golf Club.  The presentation outlines the business intelligence life cycle as well as provides four case examples where organizations have combined strategic, financial and operational information to make smart moves in their business to create significant value.  Click here to go to the Business IQ Presentation

  • Reflections on 2011 learnings and affirmations regarding improving the business of the business

    As we pledged when we started, we would periodically share our learnings and affirmations with our friends and supporters.  We are a bit late with our learnings from 2011, partly because we were busy, and partly because there was so much ambiguity and paradox operating in our client situations.  As a result, we wanted to take time to sort out what we believed to be most meaningful and beneficial.  None of our thoughts are groundbreaking, but we believe it is healthy and helpful for leaders to frequently revisit the basics and to question how they are operating in their own areas of responsibility.  We hope the following is helpful and not pedagogic.  Our intent is to help you improve the business of your business.

    Good luck!

    Cash is King, Information is the power behind the throne

    Creating and managing cash were certainly key to survival in 2011.  While there was a lot of focus on cash, few focused on the value of knowledge in the business.  Information that can be synthesized has much greater value than cash- as it can grow and renew- and is not really a one or few-time event.  Like cash, idle vessels of data and information sit around the organization and are never harvested for the benefit they can provide.  While a trait of a successful business is that they significantly invest in gathering and using information, a trait of a company that is struggling to survive- is that they don’t focus on what they can learn about the business through the resident data and information they can create.  Like many who develop their careers in cash starved businesses don’t appreciate and are frequently loathe to use cash resources to invest or develop, those that have developed in information starved environments, don’t have an appreciation for the value of information and don’t have the resolve to find out how to get it and capitalize on it for the business.

    To help businesses thrive- they have to capture, harness and use all of the resources available to their business.

    This past year we have been particularly focused on the collection of Accounts Receivable and have used information in client and payer billing files to reduce outstanding balances and increase cash flow.  We moved this organization from one that closed its books 6 times a year and presented corporate level financials, to one that can now close in under 3 days and present business level financial information. This has become information that can help positively impact operations before the middle of the next month, helping business leaders to improve the business of their business.

    As leaders you have to strive to know, and can’t take no for an answer

    In many organizations- particularly those that are challenged and stressed- it becomes increasingly easy to accept “no” or “we can’t” as an answer- particularly in domain of items that (as the Brits say) fall into the “too hard” bin.  Data and information about finances, transactions, operations, and competitors are frequent visitors to the “Too Hard Bin” as it frequently takes less than glamorous actions to make that data helpful and useable.  But, this information can be a tremendous resource to the organization- and for all intents and purposes, once it is acquired (usually as a by-product) its development and use is practically free.  Knowledge will build and enhanced perspectives will help people in the organization continuously make better, more informed and more aligned decisions.

    As leaders you have to set the example by displaying and demanding your satisfaction of a huge appetite to know and understand more about the business.  You have to energize the organization to work and think in the same way.  As ad-hocracy gives way to fact based decision practices, the organization will respond positively.  Wistful and Pollyanna like requests will give way to solid requests and decisions about the business that add value.

    Like tough-love parents we have to inspire the organization to search, be innovative and creative in the development and communication of fact based information.  We can’t take “ I can’t find it” as an answer, but instead have to know enough ourselves about data and information (and its attendant structures) in the organizations to inspire and guide others about how to access the data, create information and use it in decision processes

    You can never fight hard enough to achieve strategic and operational fit and balance in your business

    In years like the past one, it is difficult to attract or create additional resource or capacity for your business to work.  Yet, many organizations allow existing organizational resources to be wasted and dissipated by continuing with organizations practices and processes that don’t fit with their strategy and prevailing market conditions.  The cost of lack of alignment or fit is sometimes difficult to isolate, but we all know that friction and rework sap organizational resources.  Lack of alignment and fit, is simply too costly to continue to fund.  Further, the folks in the trenches see it and understand it and question why leaders don’t do something about it.  That makes the issue an implied question of leadership authenticity, connectedness and understanding.

     

    While this concept is more customarily discussed on the strategic level, we find plenty of daily examples where operational components don’t “fit” together, much less align with corporate strategy and the realities of market conditions.  Perhaps it is because in environments where more resources were deployable, resources were “thrown” at patching these cracks, and they really only protruded when those resources were taken away.

    The issue of strategic alignment is of course critical, but it seems that until organizations that are underperforming, can’t address operational fit issues they don’t or won’t have the capability to address the more critical issue of strategic alignment.  So the first step on the path from surviving to thriving is to deal with the issue of operational fit.

    We encountered one organization where the monthly payroll exceeded revenues in 8 months of the year; the workforce was only 30-40% productive by the most basic of measures, yet 40% of transactions were allowed to pass through business systems with critical errors.  While you could argue, that the organization was overstaffed- it was even more of a shame to see that the obviously excess organizational resources were not deployed to fix critical business processes and the related data and information quality issues that resulted.

    In most cases, significant leaps in organizational performance can be made in a cost neutral way.  It requires vision, engagement and clear thinking, but can indeed be achieved.  Organizations that can’t take the first step to improvement will likely not be able to make a leap to outstanding organizational performance.

    Our job as leaders is to help the organization build and sustain this most basic of “muscles” and to inspire and lead the organization to above average performance. This resource can create its own energy, replicate itself each day and make little waste, making this activity one of the “greenest” that can be undertaken in any organization – Now!

    Build and develop leadership and management capacity throughout the organization- use it and don’t work around it

    The silent victim of the recession in the business world has been the “surviving workers”.  They have seen colleagues’ careers interrupted, and have seen their own somewhat stymied.  Lack of growth has staunched opportunity for real advancement and the few “field promotions” that have taken place because of reassigning work etc. because of reduced resource levels, have not been the type of advancement to which many aspired.

    Many organizations that were development oriented had to reduce budgets in this area, so real development opportunities have been placed on hold.  As a result, the surviving resource is (and has been told to be) appreciative that they are employed, but many are frustrated and looking for developmental pathways.  The frustration suffered by many is deafening- it is just that its roar is overshadowed by many other challenges being suffered in the organization.

    As the economy brightens, one of the first areas for companies to invest will be in the development of existing high potential employees.  They should be challenged with developmental opportunities and rewarded with positions of increasing responsibility.  That investment will have to be conditioned.

    In many of the challenging situations we encountered, we have observed senior management frustrated with performance in the workforce, and instead of making the tough and right people choices, they have let underperforming management in place, and instead “go around them” to people they trust to get information, make decisions and implement change.  In place management can feel the neutering that is taking place, and while initially appreciative of the “vote of confidence” they question the authenticity of the management practice- and wonder if they will be next.

    For organizations to move from surviving, they will have to objectively assess the people talent in their organization and make the right management decisions to put the right people in place to lead the transition from surviving to thriving.  They will have to develop the people and establish the conditions for their success.  Satisficing will not be a successful strategy to effectively make the transition.

    You can no longer just tell people to change

    This year has been profound in terms of refining our understanding of the conditions and the “moves” necessary to set the stage for and realize successful change.  We are not talking about gratuitous or peripherally beneficial change, but basic fundamental changes necessary to “stay in the game”.  We observed in great detail the approach followed by many- just tell them to change (parenthetically:  they ought to be happy to have a job) and they will do it.  This was an “expedient change model” for tough times- and then when the desired outcomes did not take root or happen- the “changees” failed and it was their “fault” that it did not happen.

    Instead- in good times or bad, it is the responsibility of leadership to set the conditions to enable and promote change- and to establish the strategies that are based on solid principles and objective assessment of the situation.

    The change strategies have to be based on:

    • A solid assessment of the organization’s capability to change- the intersection of the understanding of its willingness and capacity to change
    • The depth of change required
    • The pace of change required

    Moreover, the context for the change needs to be firmly established, communicated and understood.  To give the people a chance to embrace the change, the need to at least understand, if not (preferably) embrace the need to change.

    Lastly, the vision for the end state needs to be clear.  It is best if that end state is mutually created by interdependent members of the “system”.

    The days of merely telling people (and employees) to change are over- in all but the evacuation of a clear emergency situation.

    We hope these learnings and affirmations are helpful to you.  We don’t think we have broken new ground with what we have learned or affirmed in the past year or so, but we believe it is important for Leaders to frequently focus on and take courage for action from the basics.

    We wish you the best for a healthy, happy and prosperous 2012!

  • PMCC Services Overview

    Built on more than 30 years of experience, we tailor services to meet our client’s needs. For an overview of our capabilities and point of view, read: 20110425PMCCI Services v2

  • To be more effective, Financial Management has to become more offensive

    Despite being decades old, the debate about the role capability and performance of financial management  continues whenever financial leaders gather.  Our view is that no matter the side of the debate you take, your impressions of the barriers to effectiveness or your perception about your organization’s capabilities, most every organization needs more effective financial management capabilities to successfully compete in this hyper-competitive business and economic climate.

    Financial leaders need to set the tone and engage in the dialog that will produce positive and generative results for their business.

    Read more….20110425 EFM Offensive Financial Management

  • Further Thoughts on Effective Financial Management

    The topic and concern for enhancing the effectiveness of financial management has been around for decades.  Despite the length of time this matter has been on the stage, many leaders still are concerned and frustrated with assessing and enhancing their organization’s Financial Management Effectiveness.  PMCC Ventures has been dealing with this issue for 30+ years and offers some insights on why the issue is still front and center- and what practical things a business can do to enhance its financial management capabilities.

    To us, the fact that the issue is still front and center is a good thing.  We believe that the role of finance and hence its actual effectiveness will always be in a state of change.  The challenge for many companies is that in this constant state of flux and change- they are seeking insights for solutions in many of the wrong places.  Insights for meaningful change don’t likely exist within the organization- they are sourced by changes the business undertakes, changes in competitive situations, government or regulatory changes and the economic climate and its impacts.

    In many companies, the finance organization is buffered from dealing with shifts in strategy, changes in market conditions, and emerging issues.  This is particularly true where the traditional role of finance has primarily been to efficiently process transactions and accurately prepare compliant financial reports.  Plenty of new survey material suggests that the role of finance is changing and expanding, and the most recent economic situation has caused the overall organization to be more dependent on the effectiveness of finance- throughout the company- not just in the “finance department”.

    In today’s environment the source of enhanced effectiveness will likely be developing new capabilities- or dramatically enhancing existing capabilities- not just doing the same things incrementally better.

    To gain more insight on the subject, review PMMC Ventures’ brief presentation on Enhancing Financial Management Effectiveness- Seeing what is missing.

     

  • Improving the Business of the Business- A Maiden Blog…

    Thank you for joining in on our Maiden Blog. The inspiration for the blog about “Improving the Business of the Business” has come from several friends- all in different roles- but all in the search of wanting their businesses to be better.

    Over the past few months, we engaged several people with the question: “Do people in your business [who manage resources and whose decisions have an impact on strategic, operational or financial performance] really understand the business of your business- how you create value and make profits?”

    Generally, after a recognition smile emerges, the conversation opens and covers a range of current concerns, and aspiration that once leaders developed and objective and shared view of the real “Business of the Business, a lot of potential will emerge.

    The conversation engendered a lot of rich dialogue and we thought it might be really informative to engage a wider group on the subject. We think it might be timely, because as the economy begins to turn, it would be refreshing to turn thoughts from merely surviving- to thriving. We also believe it is a fundamental question because this understanding (or at least this set of beliefs) should be the starting point for assessing your own business, its performance, devising strategy etc. Without this settled, the foundations of strategy, day-to-day operations and ultimately performance could be at risk.

    We thought this might make for a rich conversation topic. I know that most all of the people on the initial announcement have an interest and a passion in always improving the Business of their Business- and can only assume that many of their contacts share the same passions. We encourage you to share this topic with folks you think might have some sharp insights- and drive up the quality of the conversation and benefit from it as well.

    We hope to host and operate this as a legitimate Discussion Forum- with a rich conversation as opposed to a monologue with a few comments thrown in for good measure and feaux legitimacy. We will see where this journey takes us and once we get a few of these “logs on the fire” we can really jump off into some meaningful conversation.
    So- we leave you with a series of related questions:
    • What are your thoughts on the importance of a shared agreement among business leaders with regard to the essence of the Business of their Business- what does it take to create and sustain value?
    • What are the critical elements to consider as you embark on “improving the business of the business”?
    • If you could do just one thing to improve the business of your business- what would it be? – and what’s holding you up from getting it done?