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What is Your Management Style?
Originally Posted:  03/02/09

There is a unique way to look at your personal management style that I have noticed is a strong indicator of how successful you will be in this business: you either manage by fear of failure or you manage by pursuit of success.

Every owner approaches his business armed with one of these two styles. Each decision you make in your business, from simple day-to-day operation decisions to big picture strategy issues, such as the acquisition of your property, is governed by your individual style. Most owners, however, aren't really aware of the perspective they bring to their business. They are who they are and they seldom question why they make the decisions they do.

The fear of failure management style is by far the most prevalent, which also correlates as to why so many owners are just average financially in their businesses. The old 20/60/20 rule does definitely apply to our industry as it does to almost every other small business. In this rule, 20% of the owners will make money beyond the norm, 60% are average and the bottom 20% should get jobs and stay away from owning anything. Someday we will talk separately about the bottom 20% and why that happens.

For now, let's concentrate on the other two categories. The 60%, or eternally average group, hardly ever escapes being mediocre because of their choice of management style, in this case the fear of failure mind set.

If you are a fear of failure manager, you make every decision, no matter how big or small, based upon protecting or maintaining what you have, not on growing or increasing your business. All decisions are made to simply keep what you have going a little longer. You don't buy enough new equipment because you might fail next year. You don't spend to train your staff because you might train them and then they will leave you, not thinking about what happens if you don't train them and they stay with you for another year.

These owners don't seek new information because they are afraid change will lead to loss. They don't paint because a member might complain and leave. These owners won't risk buying a building because you never know when the next big crash will come and they might lose some equity for a year or two. They don't market because they tried it once and it failed to flood the club the first day and the owner didn't get his money back today.

Most everything fails for these owners because they never commit and finish anything completely. I tried a juice bar, they claim, but because he never committed to the project fully it did fail; but it wasn't the concept that failed, it was the owner who was so afraid to spend the money and do it right the first time that the bar was doomed from the first blend.

Loss dictates every decision these people make and leads to a constant pulling in or shrinking of the business. Over time, your business gets worn out and less successful because the members will go somewhere new where the owner is responsive and not afraid to innovate.

Here are a few cues you might be a fear of failure manager. You operate in fear of failure if you can't stop training clients because you are afraid you will lose income. In this case, you also have an ego issue because you believe everyone asks for you because you are the best. Because you are afraid your income will suffer, or the clients will leave for other facilities if you don't personally train everyone yourself, you continue to train clients instead of learning to manage and operate your business at a higher level.

Many of you also believe you are over thinkers, meaning you believe you like to take your time and make slow, agonizing decisions. The process is slow and frustrating, but not because you are a person who over thinks. This person is slow to react because he or she is so afraid of making the wrong decision and perhaps losing a few dollars or a member or two that they do everything they can to slow the process down and not make any decision at all.

This group is the one who is very slow to react to market conditions. I am currently working with two owners in this subgroup who has intense competition coming into their markets but just will not react fast enough to protect their businesses. Each owner is so afraid of making a decision that will hurt their business (fear of failure) that they just keep putting off the important things in their businesses to some point in the future. At this stage, each one of them should be painting, increasing their marketing, buying new equipment and reworking their price structures to anticipate what the new market will bring.

Always remember that no decision is a decision: you decided to do nothing. Doing nothing is occasionally the correct thing to do, but in the very fast pace of independently owned fitness businesses, doing nothing is the same as standing on the road with your eyes wide open in disbelief waiting for the car to run over your nonresponsive ass. The car is coming and you either react or you get crushed. Competition is coming for these two and the choices are the same; fight or wait until the auction to see how much you will get for your stuff when the club closes.

The top 20% of the owners live by a different creed. These owners manage by the constant pursuit of success. Each decision is made to either grow the business or project it into the future. All decisions are important and are made by constantly responding to trends, market conditions and your ever-changing club population.

For example, a club owner who only has a few hundred members but signs on with a third-party financial service company is an owner who is projecting her business forward and building a foundation for future growth. Instead of fearing loss of control, she seeks a business partner that can help her focus on growing the business instead of protecting pennies by having her mama do the memberships in the back office. One owner projects by hiring a third-party firm, such as ASF, and the other saves a few bucks by doing it herself. One manages by fear and the other anticipated success.

You can also get a clue if you might be one of these more aggressive owners, which includes anyone who practices business by the pursuit of success, by how you react to marketing in your area by your competitors. You practice fear of failure management if you wait and react to the competitor's ads and offers but you practice pursuit of success if you market every single week year round forcing the competitors to react to you.

The types of long-term positioning strategies you make are also a reflection of the type of management you believe in for your business. For example, if you are a full service club with group exercise and you still let your old aerobics director manage your program (I might lose members if I let her go) then you are living the fear of failure nightmare.

On the other hand, if you use a national group exercise development company, such as Body Training Systems, then you are adding another layer of quality service to your business and setting your business up not to be held hostage by a single person, such as your current group director who threatens to leave you and take all the instructors unless you let her do exactly what she wants you to do.

In these two examples, one owner lives in fear something might be lost and the other makes decisions that are best for the business over time. Sure, you might make change and lose a few members but the pursuit of success manager understands that losing 10 now, along with the old aerobics' diva, might lead to 200 new members in the future.

Perhaps the biggest difference between the two management styles is who innovates and who doesn't in their business. Fear of failure clubs are always years behind in their offerings and business plan and make do with what they currently own or offer because they are afraid if they change all might be lost. These people are also usually extremists as well. "How many will I lose if she leaves? Everyone! "What if I start to change my training program? All the trainers will leave taking all my members.

Innovators, or pursuit of success people, are usually the ones offering what is new and relevant to the members. These are the people who adapt to EFT training rather than sticking to endless packages or sessions. These are the owners who are in Perform Better Summits or are at an Anthony Diluglio certification getting new ideas and equipment for their business before anyone else in the area does.

The failure thought is what will I lose if I change? The success thought is what will I gain if I do and how can I position my business for success during the next 10 years?

If you are a fear of failure manager you can change. Every time you make a decision and worry about what you will lose, simply add the other thought; what will I gain long-term if I do this. You will find that the long-term benefit often offsets the short-term pain.

On the road: We just finished Philadelphia and it was one of the largest workshops we have ever had with about 170 students at final count and another 30 or so alliance team members hanging around. This was also our first morning workout that topped over 100 people. My special thanks to Aaron Moser and the rest of the morning gang who managed to give that many people something exciting to take home. Next stop Orlando. I am teaching the new training and point-of-sale selling system and it has been nicely received.

We will even be more prepared by Orlando to put on a powerful show.

And a special thank you to Jill and our NFBA staff for the hard work to fill this event. Nicely done everyone and thank you for the amazing group.

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