I work with senior executives from all over the world with remarkably diverse industries, backgrounds, and cultures, yet it's always a surprise to realise that their development needs are very similar. How can it be that a French CFO of a luxury goods company has the same management problems as a Kuwaiti operations manager? Or that a Japanese quality assurance manager has to deal with the same people issues as a German investment banker?

The answer is partly due to the fact that there is a fundamental human psychology and partly because globalisation has narrowed the gulf between cultures. But there is another underlying truth: despite the billions of dollars, euros, and yen invested in coaching and management development, remarkably few executives can be regarded as skillful managers. It's my guess that the majority of managers with responsibility for large teams and significant businesses either do not possess the requisite skills of a manager — or they just don't put them into practice. Why?

There are three main reasons. First, lack of time and pressure to deliver results make it almost impossible for executives to reflect, consider, and apply their new skills. Second, budget constraints can result in a lack of support and follow-through on the best intentions. Finally, behavioural change is difficult — it's all too easy for a development plan to slip to the bottom of the to-do list.

With these thoughts in mind, I offer my clients a short and simple management development plan to get them going. After they have mastered these fundamental skills, we can move on to what I call the "higher order" skills that will transition them to leadership roles. There are three rules and five key development areas:

Rules:

1. Commit to the plan for six months. Be prepared to check in with your coach or line manager on any changes you notice and any suggestions for tailoring your plan.
2. Trust that the plan will make your life easier and less complicated in the long run
3. Be open to experimenting — and have fun learning about yourself and others

Development Areas:

1. Delegation
It is your job to delegate as much as you possibly can: your ultimate goal should be to delegate everything, find a successor and move on to a bigger job. If you are having trouble letting go or trusting others, try to remember how it felt when you were given the first big challenge of your career. Did you relish the challenge? How did you approach it? Did you succeed? What did you learn about the job and yourself? How did it help you to move forward in your career?

Remember that however talented you are, your career is likely to have stalled had your boss not trusted you with a challenging piece of work. He took the risk and delegated: now it's your turn to do the same. No excuses, just follow the rules.

2. Managing distance
One of the biggest mistakes you can make as a manager is to spend too much time either in your team or away from it. If you are too close, you risk becoming a micromanager, you can lose perspective on the business, you can become too friendly and lose authority within the team, and your team can become over-dependent on you. Being too distant, on the other hand, can result in a directionless team, potential crises, lack of control, and you being perceived as too remote or political. Also, maintaining social distance is an important discipline for managers that should not be overlooked.

3. Visibility
Visibility and personal profile are important for your career as well as your team, so make sure you are being seen and heard in the right places. If you don't manage your reputation and profile, someone else will do it for you — and they may not have your best interests at heart. Take time to network, share your successes, and ask to be included on steering committees or cross-functional initiatives to create opportunities to showcase your talents and your team's achievements.

4. Work-life balance
It's incredible that this point still needs to be reinforced. Remember that you are a human being, not a machine. You may pride yourself on being able to work long hours, never taking a holiday and putting your company before your own health and well-being (and that of your family). But be very clear that you cannot do this forever. Sooner or later your health will give up and you will no longer be in control. Burnout is a one-way ticket, so be sensible. It's smart to look after yourself. Work reasonable hours, keep the weekends sacred, leave early one evening a week and build in an exercise schedule. Not only will this help you keep effective, it will make you easier to be around and probably prolong your career.

5. Continuous learning and reflection
Adaptability and being able to flex your style as your company or situation changes are critical. Seeking feedback, identifying your development needs, and monitoring your own progress are all vital if you are to develop as a leader and a person. Lasting behavioural change requires time, patience, dedication, and support, so don't expect it to happen overnight. One of the best things you can do to support yourself is to give yourself time and space to reflect: try to schedule a meeting with yourself for an hour each week for reflection.

These are my suggestions — but what do you think? Have you focused on any key areas that ensure you are more effective as a manager? If so, what difference has it made in your career? And what lessons have you learned from other managers?

Do you know how much cash you have? Do you know how that cash flows through your business?

The amount of cash you have on hand is one of the most important metrics for the growth and survival of your company. As a business owner three of your primary financial responsibilities are:

• Being aware of the business’ cash position
• Actively guiding the business towards attaining more cash
• Maximizing the return on cash reserves

To put it simply, you need to know where your cash is, plan its path through the business and how to make the most of every dollar.

Think of cash as the fuel that runs your business. Lacking cash can leave you stranded on the side of the road while the competition zooms by. A business, like a car, won’t go anywhere without fuel. The last thing you want is to be walking for miles with that gas can in your hand.

Accordingly, you must be aware of how much fuel you have in your tank at any time. You must understand the efficiency in which your business is burning it, where your next fill-up is coming from, and how well your reserves are performing. How do you monitor all this? By implementing an effective cash management system; which forms a part of every well managed company’s financial controls.

A Cash Control System

Managing this vital component requires the use of simple, well-documented control systems for the money flowing through the business. It needn’t be an overly complex system, but it must cover two categories: money coming in and money going out.

Money coming into the business includes:

• Sales Receipts
• Cash Handling
• Credit Transactions
• Invoicing and Accounts Receivable
• Collections

 Money going out of the business includes:

• Purchasing
• Accounts Payable
• Inventory Control
• Payroll

Keeping the Cash Flowing In Every Stage of Business

The complexity of your cash management systems will depend on your business’ stage of development.  

In the infancy or young stage of a business, you’re likely to experience periods of growth. Your cash is cycled from revenue to expense very quickly during this time, allowing just enough cash flow to add resources or fulfill demand. If at any point during this stage, there is a major cash shortage, you could be in big trouble. Your cash management system provides an early detection system for such events and allows you to make adjustments before it’s too late.

As your business matures, your cash management priorities shift slightly from a purely internal perspective to a more balanced internal and external focus. Cash on hand and meeting the day-to-day needs of your business is always top priority, but cash is too valuable to be sitting around doing nothing. Businesses with cash reserves can create competitive advantages through joint ventures, acquisitions, research and development, traditional savings and smart investments. While many of these activities may seem more likely for large public corporations, by focusing your efforts in a similar fashion, cash savvy small companies can leverage their cash position as a competitive strategy.

Where you do start?

The fastest way to get your cash and related money management systems in place is to perform a quick audit of your current systems. From there you can create an action plan to get from where you are, to where you need to be.

Begin by assigning a performance score to rank each component of your cash system according to how well it meets its intended goal After you’ve scored each component, or sub-system, prioritize the list in terms of relevancy and urgency. This becomes your development plan for making improvements.

For example, a retail client of mine recently set up a ranking system from -10 to +10, and ranked her cash management systems as follows:

• Sales Receipts +10
• Cash Handling +10
• Credit Transactions 0
• Invoicing and Accounts Receivable -5
• Collections -10
• Purchasing -10
• Accounts Payable 0
• Inventory Control  -5
• Payroll +10

After a careful consideration of which systems would affect her cash flow fastest she prioritized her system development as follows: inventory control, invoicing and accounts receivable, credit transactions, collections, purchasing and accounts payable. This simple step gave her a clear path towards improving all her cash management systems. Of course, each business is different, but this same ranking system and prioritizing your development will lead to the same result my client achieved: a feeling of comfort and calmness, as she experienced a sense of control over all areas of her cash systems.

Share Your Story

Have you implemented a cash management system? How has it helped you?

Six Steps to Maximize Cash Flow

Need help controlling the cash flow in your business? At our Six Steps to Maximize Cash Flow virtual seminar (next one is August 20) an E-Myth Business Coach will help you identify and maximize the cash in your business. We’ll offer tips you’ve probably never even considered…

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