Forbes Post: The ‘8 Great’ Challenges Every Business Faces (And How To Master Them All)
The following article originally appeared in my column at Forbes.com.
This week I interviewed a personal mentor of mine – his name is Neal Jenson, Managing Director of consulting firm Qazztek, in Salt Lake City. He has one of the most diverse business backgrounds I’ve known, ranging from stints with Fortune 500 firms including Citigroup and Bank of America to start up firms looking to bootstrap or seeking their start through Angel funding or SBA loans.
He’s also one of the only people I know closely who actually has two masters degrees – an MBA from Brigham Young University (my own alma mater) and a masters of science in Information Service from the University of Utah. In addition to acting as a mentor, Neal is also a friend—his son is the husband of our daughter, which makes us co-grandparents to two extremely adorable little boys, Riley and Peyton (our next generation of business leadership is in very good hands).
From his client base of all sizes, I asked Neal to narrow down for me the greatest challenges he sees for the businesses he counsels, as well as his thoughts on the ways to navigate each. Here are his responses.
First off, Neal notes that navigating a business is extra tricky these days. The speed of economic and technological changes means that the right path yesterday may not work today and could be a disaster by tomorrow. Solving these dynamic problems is what separates those who excel from the companies who are closing the doors.
While Neal’s experience base ranges from Fortune 500 CEOs to small business entrepreneurs, he notes in our first interview a set of challenges that are common to both:
1. Integrity. Business has never faced the type of moral challenges that it faces in today’s global economy. Everyone is struggling to be more successful, to make the next quarterly earnings estimate, to keep their job, to earn a big bonus, or to compete effectively. The temptation to cut corners, omit information, and do whatever it takes to get ahead occur every day. Many business employees and executives succumb. Sadly, the theme becomes highly infectious and soon people actually start to feel like lying a little, or stealing a little, or deceiving others, is just “a part of business”. These practices erode the trust that needs to exist between employers and employees, between business partners, between executives and shareholders. Without trust, the business will not be able to compete effectively and it will eventually fail.
2. Cash, Borrowing, and Resource Management. Cash is King! We’ve all heard this maxim and it is more true today than ever before. A healthy profit may look nice on your financial statements, but if capital expenditures or receivable collections are draining your cash, you won’t be able to stay in business for long. Too often executives and small business owners fail to focus enough on cash flow generation. In order to head off this problem, businesses must either be adequately capitalized and must shore up cash reserves to meet all obligations as they are needed and to handle downturns and emergencies that may arise. Cash management becomes even more important during recessionary times when cash is flowing more slowly into the business and creditors are less lenient in extending time to pay. For small businesses, handling business accounting and taxes may be within the capabilities of the business owners, but professional help is usually a good idea. The complexity of a business’ books go up with each client and employee, so getting assistance with managing cash and the bookkeeping can allow you to excel when others are calling it quits. Cash flow challenges are exacerbated by the lending climate, particularly for small businesses. Bankers are unlikely to be more liberal in their lending policies any time soon.
To continue reading please visit my column at Forbes.com.