In this economy, you’ve may take your pick of one of 4 strategies.
1. Quit
This might be the best choice for many. Don’t mortgage your future to prolong the death of a failing business. It’s wiser to start something new.
2. Don’t Change Anything
Though the path to demise, it’s the easiest of the choices. You can hope things will get better. I would guess that the rules of engagement are changing and business will never be the same. Fighting change feels safe yet this is the riskiest choice. Look at the past 150 years and find a 5 year period without change. Oddly, this is the choice most will make unless forced to do otherwise. Too bad.
3. Cut, Cut, Cut
Keep cutting until you’re back in the black. For a few, this will work. For most, it will be a slow march into oblivion. Cut too deep and it will be impossible to recover at the pace of economic recovery unless you have huge cash reserves.
4. Make Lots of Small Changes
Yes, this might include pruning. You may have to reduce expenses but don’t make cost-cutting your focus. Every business can make 1,000 changes which will incrementally add to the positive side of the balance sheet. Spend more time thinking. Look for small changes. I promise you, they are everywhere. The bigger your business, the more of them exist. The smaller the business, the bigger the impact each small improvement will have. Changes don’t have to cost money.
In periods of desperation, people want big, immediate ‘fixes’. They don’t work. The government rushed to spend $2 Trillion Dollars to turn the economy around. Are you seeing results? Not enough time spent thinking.
Spend more time thinking.
When I tell CEOs I need time to think, they often see that as a weakness. They want an immediate answer with an immediate result. CEOs will go with a million dollar ad campaign before they will think about little leaks that, if fixed, could save them millions of dollars. They cut back phone service and spend fortunes on automated systems. They relocate off-shore to save labor and add the headaches of diminished quality control. The bet the farm on a new product that no one wants. CEOs like big gambles with big possible returns. They ignore the 1,000 little risk-free changes that could bring them the return they seek while minimizing the risk.
Please. Spend more time thinking.
Chris Reich, Author of TeachU’s Business Talk Blog
Chris@TeachU.com