December 2, 2005

Our startup’s latest management challenge is cash flow ever since my CEO had to give up the negotiated revenue terms with our key value added reseller (VAR). Changing the financial structure of this deal has forced us into a situation where we no longer have the revenue that we projected over the next three years.

Now, we’ll run out of cash by fall of 2006 unless we have exceptional sales performance that hasn’t been projected. With this latest management challenge, each Management Team member must keep its department’s focused on existing priorities.

Preparing for another Pitch to Lead Investor

In our Management Team meetings, we’re currently reviewing our budget, reviewing numerous scenarios. We’re preparing to pitch Mr. Investor our lead investor for another round of funding. Right when we thought we’d have this discussion with him in January, it turns out that Mr. Investor will be in city on December 13 for the day, so we’ve now bumped up the timetable. Over the next week, I’ll have to refine the marketing budget, while the Management Team will have to reassess headcount that we were hoping to hire, and we’ll have to finalize our current financial situation.

Past Experiences Driving their Zen-like Approach

This is my first time being on an executive team, making the decisions that affect the company. I’m used to making these decision my company, but not someone else’s company. I’m impressed with the calm, cool, and collected atmosphere in the conference room with my CEO, CTO, Controller, and COO. You can tell they’re concerned, but not ruffled, since they know how to make tough decisions and have weathered tougher weather than this. Before they repositioned the company, my CEO and this Management Team had to evaluate their business, product, and lay-off employees to survive. I’m fortunate to be a part of such an experienced team.

Staying Focused on Current Projects

Because we’re running scenarios on the cash flow issue, it’s easy to stay quiet about these management issues, as to not freak out employees. Right now, my direct report and I are currently in the process of a redesign of our corporate Website. My CEO’s immersed in the possibilities of what it can be, so we’ve had his undivided attention over the past few days.

Meanwhile, the COO informed me that one of his contractors (a former employee) is trying to find a position for may be available for Marketing. We were trying to hire her into a client support role, but this may not be a good fit or good use of her skills. I’d like to add her to my team, she could easily fit in, and so the COO, CTO, and I will be pitching my CEO in today’s Management Team meeting.

Key to Management Team Success

A key to success in this company is to learn from past crises. It’s also the ability to compartmentalize, separating our Management Team duties from our functional responsibilities by keeping our respective departments focused on existing priorities.

The Smart Lemming Diary is a series that chronicles a journey of laid-off worker, who becomes a Vice President of Sales Operations & Marketing for a small entrepreneurial healthcare technology company. For previous entries in this series, click here. For the first diary entry, click here. For the highlighted Smart Lemming Diary entries, click here.

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