Solving Business Problems

 

Once every month a number of CEOs get together, not to strike up business deals among themselves, but to listen to each others’ ideas, opportunities, problems and issues and to give constructive feedback about each others’ businesses.  Their intentions are to support and help each other lead and manage their companies better.  They are members of The Executive Connection (TEC), an international network of CEOs set up in the USA in 1957 and introduced to Australia by Dr Phil Meddings in 1986.

TEC is based on the basic tenent that being a chief executive is often a very lonely job.  The group acts as an objective sounding board for CEOs to bounce ideas off with their peers.

TEC groups comprise 12 to 14 CEOs from non-competing businesses.  Each group meets monthly for a full-day session.  In the morning they are exposed to the latest business ideas from visiting Resource Speakers.  In the afternoon, members discuss opportunities and issues about their businesses.

These confidential sessions are facilitated by a group chairman who is a former CEO with wide business experience or an experienced strategic management consultant.

During meetings, members share their issues, problems, opportunities and experiences to learn from one another.  As a TEC Chairman I know of nine years, I know that the members of my groups have considered most business problems including:  strategic direction, divestment, acquisition, restructuring, quality control, systems, decision‑making, communication, incentives, sales, marketing, human resource management, customer service, profitability, staff morale, financial reporting, key performance indicators, product and process research and development, and value adding activities.

What we do for members is get them to focus on the fundamentals of business and become committed to continuous improvement.

In the afternoon executive session, members raise their specific business issues.  Opinions are candid and honest.  Members from different industries provide different perspectives about the topic.  Over a period of time a high level of trust is built up as there are no hidden agendas.  At the end of the day, each member takes home a personal action summary which is reviewed and followed up by the Chairman at their next one-on-one session.

In recruiting members, a Chairman has to consider whether the person will be a good fit to that group, with the right chemistry with the other group members.  This is a long-term commitment and each party has to be comfortable.  Some of the strategic issues discussed in TEC meetings include:  competent leadership, skilled and competent people, effective planning systems, improving customer relations, supporting suppliers, superior products and services, efficient processes, capable value adding processes, effective distribution systems and appropriate information systems.

 

COMPETENT LEADERSHIP

The effectiveness of a company is directly proportionate to the effectiveness of its leader and the actions he or she takes.  TEC is a laboratory which helps CEOs to develop as leaders.  In some cases, the Chairman assisted by the group, counsels the CEO to appoint a professional General Manager to develop the business to the next level.  This requires courage, security and a willingness to change by the CEO involved.

This has happened to several members.  The benefits to the business have been enormous and the CEOs involved have been delighted with the results.  Linked to this is having skilled and competent people.

 

SKILLED AND COMPETENT PEOPLE

This is often a weak area of a business with many companies having no Human Resource Plan or system in place to select, induct, develop, reward and retain good staff.  Particularly relevant is to what extent learning organisations are being developed.

Many TEC members have been introduced to this important area and to linking this aspect with their strategic plan.  One TEC member has developed a detailed human resource plan, undertaken a training needs analysis, implemented a training and development plan, succession plan and career development plan.  Staff are part of an on-going process of learning which of course begins with each CEO.

 

EFFECTIVE PLANNING SYSTEMS

Most TEC members have implemented an annual strategic planning process with quarterly strategic implementation and reviews.

Planning systems are not just documents, but the process of change integrated and embraced by everyone in the company.  I am particularly committed to the strategic change processes and have conducted over 35 Enterprise Reviews and 65 Strategic Planning processes.  Unless the company is thinking about its future strategically and changing, it won’t have a future.  Every TEC member presents a detailed business review and their thinking about the future to get feedback and input.  This helps members to avoid mistakes and to move forward strategically.

One member, as a result of the TEC process, was challenged to buy his company when it came up for sale.  He did and made a handsome profit.  He wouldn’t have achieved this without the TEC group.  Another member implemented a strategic plan on advice from the group and as a result of this strategic approach was positioned strongly to acquire a major national competitor with meticulous timing,

 

IMPROVING CUSTOMER RELATIONSHIPS

This aspect of business includes the formation of relationships with customers.  It also looks at the way the relationship is managed, how satisfaction is measured and the feedback used for improvement.  Additional areas include competitive analysis, customer communication and customer feedback.

TEC has always had a strong focus on customer relationships.  If the CEO is not customer focused, then of course staff won’t be.  It is important that each CEO is challenged to change and is committed to personal visits to customers, setting up a customer database and utilising customer feedback.  One TEC member who had never visited his customers now visits every Australian state annually.  This has had an enormous impact with the business continuing to expand at the rate of 10 per cent per annum.

 

ECONOMIC VALUE ADDING

TEC is about creating shareholder wealth.  Members are constantly asked questions such as:  Why are you in business?  What business are you in?  What client needs do you satisfy?  How can you meet these needs?  How can you best communicate effectively with customers?

The bottom line is the creation of shareholder wealth and value.  We constantly remind members to focus on these questions, as many CEOs can destroy company value through not assessing the return against the cost of capital.  Key indicator reports are checked in monthly one-on-one meetings to ensure that progress is being made.

 

PERSONAL CHANGE

Ultimately all company change must be preceded by personal change, especially at CEO level.  TEC groups focus on this to ensure that all CEOs are being helped to build something that money can’t buy – a better life and change process – which both require learning and time.

In conclusion, the outcome of solving business problems by the TEC process is dependant upon four things:  the process used, the level of participation, the quality of inputs and the TEC Chairman.

The process of TEC involves problem solving, brainstorming, discussion, confronting, feed-back, support, mentoring, coaching, challenging and a multitude of other things.  The level of participation and commitment of members preparing for the meeting, at the meeting and networking between meetings is vital.  The quality of input of the resource speaker, the Chairman, the group and the member are all highly important.