Accountability

“Accountability breeds response-ability.” -Stephen Covey

Recently we were rear-ended by a hit and run driver on the DC beltway.  Thankfully, we weren’t hurt and no one else was involved.  Yet I am really ticked that I now have $500 worth of damage on my new(ish) car that I must pay to repair.  I was flabbergasted that this person would literally hit us and continue along their way…with absolutely no consequences or accountability. Doesn’t anyone have a conscience anymore?

Unfortunately, this experience had me thinking about the bigger picture. This lack of accountability seems to be more prevalent than one would like to think within the federal contracting community, particularly within small businesses.
Some examples in GovCon include:

  • Daily, accurate timekeeping (yes, we know it’s a drag, but “you gotta do it!”)
  • Payments to subcontractors (paid when paid, net 5…means exactly that – not when you have the cash)
  • Honoring workshare agreements, not stealing every position that becomes available
  • Paying out commission and bonuses as you promised, when you promised
  • Delivering when you say you will, from the mundane (status reports) to the latest software release

The basics ring true – CEOs are responsible for their team’s actions.  People make mistakes.  Things fall through the cracks.  Ultimately, how you handle these mishaps is on the team, the leadership and the CEO.  Do you admit you are wrong?  Do you take steps to fix the problem and resolve it for the future?  Are you known as being accountable in front of clients and industry partners?  Actions speak so much more than words these days.  We’re all filled with hype and talk about the latest management trends (who has servant leadership on their LinkedIn profiles these days?), but do you live by your mantras?  Do you stand by your word? Build a sense of responsibility and accountability into your company culture from the top down to ensure that your company doesn’t fall victim to these mistakes.

In the meantime, if anyone knows an inexpensive body shop in the DC area that does good work, please let me know!

Data Bullying

In the past month, we’ve seen no less than three clients who are actively being bullied by their own staff or their consultants.  What do I mean by bullying?  Being at the hands of someone who holds information as their weapon of choice.  People who deliberately make their jobs as vague as possible to hide their inefficiencies or inadequacies.  They do most of their work off the books or systems that their company utilizes.  This means spreadsheets that can only be filled by them, pipeline reports that have no context, CRM tools not updated, candidates whose resumes are not in their ATS or even access to company data not provided.

I’ve talked to CEOs who are the mercy of their bookkeepers who somehow mysteriously run payroll, invoicing and financials as if no one else can possibly figure it out.  CEOs who aren’t provided financial reports in a timely fashion to make important decisions about their companies.  I’ve talked to those who have outsourced their accounting functionality, only to find that they don’t actually own their own company data.  They’ve signed contracts with ridiculous clauses requiring payment for getting out early, while their data is either held hostage or not returned at all.

I’ve seen business development people run an entirely different CRM tool that they can take with them should they leave a company.  They use excuses such as the “data entry is tedious,” or that “the company CRM tool is too hard to use.”  They leave proposals on their laptops and forget to check entire documents back into the company’s repository.

I’ve seen recruiters who are “too busy” to upload resumes into the ATS or who correspond apart from their company email.  Or worse, they recruit for several different companies at the same time for the same candidates and positions, and play companies off each other (without their knowledge) in an effort to drive up their commission or fees.

Finally, there are PMs or Ops people who hold their relationship with the client hostage.  They are the only ones who can communicate directly.  They keep their deliverables on their laptops, they won’t allow their contracts shop, or even their management to speak with the program office.  They keep their relationship deliberately convoluted, yet report all greens on their PMR charts.

To this, let me be clear in my message – NO ONE, absolutely NO ONE is indispensable.  CEOs commonly think that they can’t live without a certain person.  They whisper that they will lose their re-compete or that they won’t have payroll processed or that their BD person will change companies, or they will lose financing with their banks. While there is no argument that losing this person will hurt in the short term, having this type of hostage situation resolved will absolutely provide peace of mind to your organization in the long term.  Not being beholden to someone for their data (which, is YOUR data) is freeing.  Coming to the realization that no one is indispensable is freeing.

Take back your company, CEO…. it’s your risk, your reputation and your livelihood.  Own it.

Do you feel you’re in danger of or in the midst of an information-held-hostage situation? Let’s have a conversation and see what’s really going on, [email protected]

M&A Culture

How many times have you heard “culture eats strategy for breakfast?”  How many HBR cases (among others) are out there citing failed mergers due to culture?  We all claim to recognize how important culture is to our organizations.  As is the case, how do we continue to see blown opportunities of mergers that fell flat with little of the gain that was promised?  Not to mention those “opportunities” that caused more harm than good?

As M&A continues to rise in the GovCon community, it’s important for those looking to buy (and even those looking to sell) to give considerable thought to the culture behind the two organizations and how they will mesh.  We all focus on the financial gains, the <wait for it…overused MBA word heresynergies to be gained by streamlining the corporate folks (i.e. layoffs) and the new clients and capabilities gained.  But how much thought has been given to the workforce and the impact in the post-merger world?

Most GovCons in the M&A mix this year have been services companies.  Meaning the proverbial “assets leave every day out the door.”  If this describes you, how much time and energy have you put behind the impact to your teams?  Everyone is excited during the dating phase, where numerous happy hours and get-to-know-you events are held, spreadsheets are modeled with expediential growth, new names are brainstormed.  The BD team is completely on board as they look to new capabilities to sell and enhance their commission (BD always thinks it’s staying for some reason).  The corporate team of the buyer looks to grow their fiefdom, while the seller’s team is busy negotiating as big of severance as they can.  The selling owner wants to take care of their people, but generally wants to take care of their exit more.  (We’re not in this for our health.)

Who gives the employees a voice?  Who has the watchful eye on culture to see whether the transaction makes sense?  The consultants will push for their commissions regardless, the bankers will look at financial risk, the attorneys will look at legal risk.  Who on your team is the voice of sanity that looks to see if combining the organizations really does add up, ensuring that there is retention of your core asset, your people?

Keep this voice of sanity in the forefront of every discussion as you navigate the M&A waters. Sometimes it is a slam dunk, but tread cautiously, as there are many more failed or missed opportunities in this area than we hear about in the industry.  We’re very good at glossing over our bad decisions when we want to. But look at retention rates, under-utilized funding on existing work, re-compete percentage wins and actual multipliers to see the real impact.

M&A is a credible and viable strategy for most GovCons that have built companies with value.  Tread cautiously and think of the company a year or two after the merger as you analyze whether it is a good business decision.  Don’t promise the world to your employees, but overlook them at your own peril.  Lest they do indeed, walk out the door.

If you’re looking toward an M&A opportunity but would like some guidance on your first, second or twentieth step reach out, [email protected] I’d be happy to have a conversation and help to point you in a positive direction.