Think: You Are "New" Management Each Day

When I think back, it is startling to think about the number of times I have seen boards of directors find themselves disappointed with their Co-op's previous General Manager because the new General Manager immediately starts to poke around.  That is what "new" General Managers are supposed to do.  It is startling the number of times how the Board is disappointed that their previous General Manager was "managing" how sales and expenses were accounted for between and among departments.

"New" General Managers are free to ask questions.  They are not afraid to tear apart financial statements.  To look underneath the hood.  For six to twelve months after they are hired, they enjoy a grace period when every issue or weakness they find is the previous General Manager's.  You can be the "new" General Manager each day as you walk through the door.

When General Managers walk into the front door of their Co-op each day, consider thinking of yourself as a brand new General Manager who is brought in to the Co-op to breath new life into the Co-op.  This advice applies to almost every aspect of your job.  But in particular I'm thinking about the methods for accounting for sales and expenses between and among departments of your Co-op.    

The market - particularly the market in which farm supply and grain cooperatives operate - is changing constantly.  Each day Co-ops are having to reinvent themselves. It is hard enough to make money and generate profits without handicapping yourself with assets or employees that are not producing income for the co-op.  No one likes to sell assets or move employees around.  Challenge yourself each day to think about yourself as the "new" General Manager.  Today is your first day on the job.  Is the departmental information your accounting department produces really an accurate portrayal of your profit centers?  Your loss departments?  

These "previous" General Managers were well intentioned. They were not malicious. They were not stupid.  But in each case, those General Managers were trying to protect pet departments, hide purchases of assets that were a mistake in retrospect, protect key or pet employees.  Those previous General Managers may even have been protecting the board of directors from having to make hard decisions, or protecting the co-op's reputation with members.  Stop it.  (But be careful with reputation and members - that spooks me the most)

As often as not, perhaps there are genuine questions about to which department sales really should be credited or expenses charged.  What should a General Manager do with sales that, for example, were acquired from a purchase of assets but now those sales could be credited to an existing department rather than the purchased assets because you realize that your sales folks have successfully transitioned the business to the assets your previously owned.  You've succeeded in gaining efficiencies from purchases of competitors.  Are the "new" assets that you acquired needed anymore?  Are the new assets now obsolete?  

When I think back, those "new" General Managers did not know more than the "previous" General Manager. They were not more talented than the previous General Manager.  Their most important strength was that the new general managers had fresh eyes and a fresh, inquisitive mind.  Their second most important strength was that they were not afraid to bring questions to the Board of Directors.  Sometimes there are not clear cut answers.  Sometimes the Board of Directors just needs to know that there are open questions and that the answers will become clear somewhere down the road.  

You don't have to be a "new" General Manager to have "fresh" eyes.  You just need to think of yourself as a "new" General Manager.  Each day.