Annual Letter to Employees from the President & CEO
As the CEO it’s my job to set the tone of the organization for the upcoming year. For us in 2014 we want to make sure we stay true to our vision and values as well as keep focus on the core business, something that we didn’t do in the past. As a manager or leader of your department or organization, you must set the tone for your team. Nowhere in a business is influence more valuable than where tone is set from the top
Here’s a copy of our annual letter from the President & CEO that we sent out to our 33 employees:
Nick and I would like to thank you for all of your hard work and outstanding contributions this year. We know how much time and energy this company demands and we deeply appreciate all of your efforts to make it a fantastic success. Our loyal customers can always count on you, your team can always count on you, and we can always count on you to go that extra mile. We have to thank you again for all you do for FCP.
2013 was a transformational year for us. We have enjoyed double-digit revenue growth bringing us to nearly $15 million in annual sales, we returned to profitability; and, most importantly, we re-established our values and made significant improvements to the organization developing a solid culture of service, support, and recognition.
As we grow and become more successful, it tends to attract bigger and better opportunities. As we succeed, a key challenge becomes prioritizing those opportunities, and what we’ve learned from experience is that trying to do too much results in a lack of clarity, over-commitment; and we wind up disappointing people, exhausting ourselves, or simply failing.
To prevent this complexity we have made a commitment to only pursue opportunities that help strengthen our core business, the core that has produced over a decade of remarkable revenue growth, the same one that has helped us through 2013 stronger than ever.
Now, we have a simple goal for 2014: Stay focused, follow our vision, aim for simplicity, and continue building our great team. We have committed ourselves to never lose sight of what we are trying to achieve. We will continue to focus our energy and attention on our vision: to set the standard for quality and service in the automotive industry.
FCP is entering a new era, in a new facility, with great talent, and a great plan.
Let’s welcome 2014 as our new home, we’ve all earned it.
Happy New Year,
Nick & Scott
What did you do to set the tone for your department or organization for 2014?
Constructive Criticism: 3 Simple Ways to Give Effective Negative Feedback
Let’s skip the “praise sandwich” and learn how to give candid constructive feedback.
In my previous article, The Power of Positive Reinforcement, I emphasized the importance of recognizing and reinforcing positive behaviors. There comes a time though when delivering negative feedback is inevitable. Most managers in my experience find it very difficult to give negative performance feedback, but if you show that you are motivated by the desire to help and not to punish, it doesn’t have to be an unpleasant task. Here are three ways that I preface constructive criticism or negative feedback to encourage my employees and keep them motivated:
Let them know that they are valuable enough to invest time and resources into them:
“I appreciate all you’ve done for us. The company is very supportive of your efforts and committed to putting resources behind your growth and development. There are a few areas where I think we can make some improvements to make an even bigger impact on the organization. “
Let them know that you are supportive of their development and success:
“You’ve shown a lot of commitment to this organization and drive to improve yourself. I know you have ambitions and want to improve so please realize that as your manager, I’ve got to be hard on you. “
Let them know that they contribute to the success of the organization:
“You’ve really made a difference here. I’m glad you joined the team and I’m happy to see the progress you’ve made. If you put in more time in these areas I know you can add even more value to the organization. “
Remember, the goal of any feedback, positive or negative, is to improve the behavior of the other person to bring out the best in your entire company. Learning how to deliver negative feedback will produce positive results and strengthen the relationships with your employees.
So, how do you give negative feedback? I would love to hear your thoughts!
The Power of Positive Reinforcement
A close friend and mentor once told me, “young strong leaders typically aren’t good at positive reinforcement because they don’t need it themselves.” He was right, I was awful at giving positive reinforcement. In fact, I don’t think I gave any of my employees positive feedback or encouragement when they did something right, but I could quickly point out when they did something wrong. I never quite understood the value of positive reinforcement until it came together for me while reading an excerpt out of the book 212 Degree Leadership.
Imagine you are sitting blindfolded with a tinker toy model on a table in front of you, just out of reach. Your task is to reproduce the model in less than two minutes. You cannot touch the model, but you do have a supervisor who can provide you with limited feedback and you have all the supplies you need. Unfortunately, your supervisor has been instructed to provide you with negative feedback only!
Can you imagine how you might feel? You do not know exactly what to make and every time you grab the wrong part you are told “no” or “wrong.” If you happen to grab the right part, you hear nothing at all. Not very inspiring, is it? Yet the simple demonstration represents the disconnect people all over the world frequently feel when the vision is not clear and they are not supported with positive direction and feedback.
Frustration. Anger. Anxiety. Depression. At that very moment I understood how detrimental and demotivating only giving negative feedback was to my employees. Not an ideal working environment for anyone. Plus, it’s exhausting and stressful for the person delivering the feedback.
Now let’s try another round of the exercise. This time, imagine you are still blindfolded with two minutes to reproduce the model, but your supervisor can now provide you with positive feedback. In other words, if you grab a part you need, your supervisor will say “yes” or “right.”
Self-Esteem. Motivation. Confidence. These are the feelings that come to mind when I’m receiving positive reinforcement, giving me the physiological freedom to be creative and do great things.
We all know that positive reinforcement makes it more likely that the behavior will occur again in the future but we often focus our time on what employees are doing wrong versus reinforcing what they are doing right. As I change and grow, I’m learning the value of giving much more positive than negative feedback. Making this shift in my approach was transformational to the culture of my organization, my employees well being and attitudes, and my own personal development and well being.
Try it for a week. I started small by creating two reminders each day in my Google Calendar reminding me to give positive feedback to an employee that is deserving of the praise.
You can also use the five to one method; for every time you offer corrective action or constructive criticism to an employee, make sure you acknowledge them for five things they’ve done right.
Just remember to keep it authentic though. Too much positive reinforcement can lead to praise overload, diminishing the value.
Managing Business Growth Stages- A Diagnostic Chart
This diagnostic chart by PricewaterhouseCoopers is a fantastic tool that helps identify your company’s stage of growth as well as the management concerns within those stages. It’s something I have referenced back to throughout the years and gives valuable insight into what you may face at the next stage of your business. Planning is one of the most important parts of running a business, and when you know what to expect you’ll dramatically boosts the odds of your success.
We’ve been online since 2001 with annual revenues of $15 million and 34 employees. Our business currently has the characteristics of survival, growth, and expansion with the majority falling in in the growth stage. I give copies of this diagnostic chart to members of my management team and we compare our assessments. It not only gives my team a road map of things to expect as the business matures but also promotes a healthy dialogue between the group.
Here’s a link to the chart: PWC Diagnostic Chart
How Do You Spend Your Time at Work?
Mastering the art of getting shit done takes discipline and lots of planning. As the CEO of a $15 million online business I often get asked how I allocate my time during the working day. Well, here it is:
Employee development – 50%
This is the most critical part of my job and the one that I allocate the most time resources toward. Investing in employee training and development strategies is critical for the success of any business. It’s the only way to create sustainable and managed growth. As an entrepreneur who’s bootstrapped a business from $0 to $15 Million, there was a time that I did it all; janitor, shipping clerk, customer service, order entry, human resources, purchasing, accounting. It’s debilitating and exhausting, and will only lead to burn out. As a leader, you’ve got to leverage yourself through employees.
Tactical – 20%
This is the day to day, answering emails, talking with employees, putting out fires. Emails usually take up a majority of this time and I try to limit the email to less than 10% but after all, email ” is a game of tetris. ”
Process Improvement – 10%
I focus on two things here: How can I simplify the process and how can I make the process run better? Typically I will either work directly in the process or scan through email correspondence in my teams email queues or Gmail groups (we have email groups for sales, product team, customer service, products, purchasing, warehouse, and technical support.) I’ll find the bottlenecks and discuss with the department leads how we can simplify and improve.
Thinking & Strategy – 10%
This is my quiet time which is usually on my commute home. I reflect on the day and assess my performance; did I make improvements to the organization? Did I stay focused on what I set out to do in the morning? Did I get caught up in day to day (tactical) issues that prevented me from allocating my time appropriate? What do I want to accomplish tomorrow?
This time also includes working directly with my leadership team in achieving organizational alignment. It usually consists of a 2 hour offsite each week.
Professional Development 10%
This includes listening to podcasts and audiobooks, or reading articles and blogs. My commute to work is 45 minutes so it’s perfect amount of time to get into a chapter of an audio book or two 20 minute podcasts.
How do you spend your time at work?
How Do You Balance The Needs of Employee Welfare and the Financial Needs of the Company?
“People before profits”
If you want to build a company of substantial value you need to always put “people before profits.” Culture is ultimately what differentiates successful businesses from failures, and you can only build a strong culture by putting your employees first.
In extreme circumstances when the welfare of the company is at jeopardy you make personal sacrifices before you cut into the muscle or bone of your organization. Don’t be a fool when you your company get’s into a jam by slashing payroll or your marketing spend. Ultimately the leadership is responsible for the direction of the company and any trouble it may get itself into, and this is where the sacrifices need to be made. Defer salary or guaranteed payments and put them on the balance sheet, or reevaluate the executive comp structure.
When all of the employees and bills are paid, and long term investments are made, the very little that’s left over goes to the owners. Often that’s nothing. It’s a small return for a large risk but that’s the chance you take and sacrifices you make, but things of substantial value rarely involve little risk.