What would I do to your business if I took over?
In response to an article I published earlier, I received an interesting query. Jim, who is the owner-manager of a wholefoods distribution business based in Denver, Colorado, and who employs 20 people across two states, asks what changes I might make to his business if I took it over, sight unseen.
Before I thought “sight unseen” was a bit unfair, Jim explained that he felt his business performance was starting to plateau and wondered if there were any common changes he could put into place in order to shake it up.
This question raised issues about business growth as well as about efficiency, so it made me think of the key aspects of a business that any business should think about changing today. So, sight unseen, here is what I might do.
First, I would spend some time every day seeing customers, suppliers, staff and other key stakeholders, either one on one or in groups, or at least talk to them on the telephone. I believe business today needs to maintain good relationships with key stakeholders, especially customers, staff and suppliers. If you do business with friends, it is hard for friends to stop doing business with you. As well, you can get great feedback to your face – that’s always a catalyst for change especially if the feedback is (constructive) criticism! The topics for discussion would be how we are doing business together, could I help them more, and how we might be supportive of each other if times got bad. Added to that would be more personal topics if you feel this is appropriate, such as how their businesses were syncing with their personal goals. This type of personal information can help you both in designing different business models.
Too many business owners get so caught up solving problems that they forget the lifeblood of their business is not the solution to a problem but the relationships with their customers, staff and suppliers.
Second, I would ask the team to step back from planning and concentrate on execution. Planning is good; planning is critical to map out where you want to go and how to get there. However when sales are flat-lining, you need to have faith in your past planning and focus on implementing those plans. If there are many strategies from the past that have not been implemented yet, that may be the cause of the stagnation. Get things done, then see how your plans were affected by the results, then create new plans and not the other way around.
In today’s fast-paced and inter-connected business world concentrate on developing strategy quickly. Sure, reference past plans, but you may not have the time to re-purpose your previous 5 year plan into a new 5 year plan – you need to work reasonably quickly in getting things done.
Review your plans, but implement and execute.
Third, review the metrics you are using to measure performance. Save time and increase efficiency and focus by concentrating only on key indicators that measure the pursuit of growth out of stagnation. The older the business, the more it grew in the past, the more metrics there are being measured than are necessary. I have walked into businesses and queried the reason for certain metrics being measured, and received the reply: “because it’s always been measured”. Huh?
Don’t over-complicate the measurement of your performance. It is more important to set the goals and objectives that are congruent with the vision of where you want to go (growth) – from there you can select 4 or 5 metrics that drive that vision.
Fourth I would cut half the meetings that take place in the business. Cut the number, then ask that business be conducted without those “necessary” meetings. You will find that you free up staff time significantly, and yet the decisions made in those meetings will still keep getting made. Instill a policy that of the remainder of the meetings, they will only go ahead if the agenda first outlines the significant impact the result of the meeting will have on business growth.
We go to far too many meetings. I have been to meetings where half the people attending needn’t have been there. They only attended because they, or someone else, were afraid they might miss something or that their input might be required – nope, not really. I would not want to go to a meeting unless I knew what the meeting would accomplish, that it would impact business performance, that I could contribute, and that it would be tightly run.
Fifth, I would cut the annual performance review. Once a year, HR staff and managers spend days organizing reviews, preparing review forms and going into interviews. Staff meet with supervisors and everyone ends up in a frenzy comparing notes. This is a royal waste of time, why? Because more often than not, no development implementation comes from those sessions. Everyone is already too tired out by the process to implement anything until next year!
Instead I would instigate more regular, shorter reviews. Deal with current performance and issues, not those from up to 12 months ago. Concentrate on matters that affect performance such as training and development. Make supervisors accountable – what have they done recently to develop their staff? Shorter and more regular reviews fit into a culture where I spend part of every day talking to staff (see my first change). It means I and the supervisors have more frequent opportunities to change behaviour and performance, and it means I identify under-performers faster (and deal with them faster).
Lastly I would create an atmosphere of innovation. To do this I would implement a process for identifying potential ideas and manage innovation. An important aspect of this is the rewarding of innovation, and, the other side of the coin, not punishing failure but rather embracing it as an opportunity to learn. Innovation needs to be integrated into today’s businesses so the company would need a formal process to identify new ideas, quickly studying and experimenting with them, planning for their implementation and integrating them into the business model and processes.
You may have other ideas for quick-hits (but remember, sight unseen!) so send in your ideas, I’m sure Jim would be pleased to hear of them.
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