From the Blog
Management Advice From Joe Gillette
Recently, we at Deksia had the opportunity to hear some of Joe Gillette’s thoughts on management. Joe is the chairman and CEO of Stage 2 Networks, a New York-based telecommunications company. He has received more than $70 million in investor capital and, in 2012, he was awarded the American Business Awards Gold Stevie for Executive of the Year in Telecom.
Joe stresses the importance of forming a group of advisors and working with them frequently, and that all successful business people are of value to you, as they can share valuable lessons regardless of whether they’re in the same industry. On the topic of gross margins and infrastructure, Joe preaches the benefits of raising capital to create a sustainable business model; he also said a minimum 50% gross margin is required for adequate cash flow.
On the subject of staffing, Joe recommends keeping critical functions to a minimum, and that only positions of real value for your customers should be considered for hiring. He notes that outsourcing allows for more financial leverage, and to consider motivating workers with metrics and bonuses while paying lower salaries.
When it comes to employee development, Joe emphasizes the importance of being patient and deliberate in the hiring process, and the need to hire on a 90-day probationary basis. He advises the use of consultants until it makes sense to hire an employee, and the need to provide oversight and training as well as monitoring and feedback throughout the process.
Regarding capital, Joe’s golden rule is “he who has the gold makes the rules,” and that you can raise capital while also retaining control of your business. But you have to remember to keep these capital raises to a minimum. On leadership, Joe encourages business owners to use the metrics used by the best practice companies in your industry. He urges the development of a method for consistent tracking of these metrics, and the need for businesses to develop a daily cash report.