Spring is finally here- business best practices can be too!

April 2009 author’s note: I originally wrote this piece in April 2007! I’m updating and revising it because it was relevant then and it’s even more relevant now. I saw the economic recession coming two years ago and advised my readers, owners of businesses, to give serious thought to developing a robust marketing and sales plan. Sadly, many did not- they continued to do things the same old way, ignoring business best practices. They’re in trouble now. So, my revised article-

It’s All About The Tide

Those of us that have been around a while know that while ‘a rising tide floats all boats’, you can expect an ebb tide or, receding tide, to follow. That’s what has happened over the last year. By the way, my corollary to the saying, ‘a rising tide floats all boats’, is that in a good economy, even inept businesses can make money in spite of themselves. Now, be honest- has that been true for you?

Food For Thought

Really, how is your business doing? Are you performing at a high level or hanging on? At Performa, Our business is all about helping small businesses to perform much better and thus, grow. Even in this recession, I’m seeing many companies that are doing extremely well. Are you doing the things you need to in this downturn of our economy? Following are some basic questions for your consideration:

• Do you have a marketing plan?
• Have you studied your market?
• Have you figured out how to grow market share in a stagnant economy?
• Do you know the various business factors that affect your customers and in turn affect the health of your business?
• Have you developed a rock solid prospecting plan and sales process?
• What is in your sales pipeline?
• Do you have measurement systems in place to know where your sales are and what they will be over the coming quarter?
• Do you know what pieces of business are most profitable?
• Have you taken the time to examine your various product or service offerings to fully understand your gross margins?
• Do you really know what your gross margins are?
• Do you know about every opportunity and the sales cycle for each, and do you track your closing ratio?
• Are your sales conversations super effective and disciplined so that more deals are closed more quickly?
• Do you have an annual business plan in place? Does it include a strategy for employing business best practices?
• Is your organization operating as a bunch of individuals or are you really a top notch, engaged TEAM?
• Do you have a constant flow of new ideas that will improve your business operations internally and provide value to the market?

Relevant today

These are as relevant today as they were two years ago when I originally wrote them. Now is not the time to retrench. Now is the time to employ business best practices to take your business to another level. If you can dive in deep and tackle at least half of the above questions and really push through to execution, you will not only survive the current environment, you’ll thrive.

©April 2009

Spring is finally here- business best practices can be too!

Now is not the time to retrench. Now is the time to employ business best practices to take your business to another level. If you can dive in deep and tackle at least half of the above questions and really push through to execution, you will not only survive the current environment, you’ll thrive.

Why Isn’t Your Business Growing? Business Strategic Planning

If you don’t know where you are going and you don’t have a strategy to get there, you’re just lolly-gagging along and winging it. Ask yourself- where would any significant initiative or goal be without business strategic planning?

Using Experts

As a consultant or advisor, I often wonder why small business owners and managers, those with revenues less than $50mil, don’t reach out more for more help in learning what I call business best practices.

Using Experts

As a consultant or advisor, I often wonder why small business owners and managers, those with revenues less than $50mil, don’t reach out more for more help in learning what I call business best practices. I have a theory, which I’ll share later on.

It’s not a surprise that to be a business owner you have to have certain qualities. Here are a few:leadership, independence, drive or dominance, control and influence. Every owner has most of these qualities to some degree, with some much more prominent than others.Independence is the one characteristic residing within every business owner. Many people start a business in order to not ‘work for the man’ anymore. They want their independence and have the need to be in control- to be master of one’s own ship is a strong thought and feeling. And, the need to have all the answers is common trait- to be seen as the smartest and most knowledgeable person in the room. After all, you are the owner and boss and you should demonstrate your superiority. In fact, it should be available for all to tap into.

Running a business is not easy. The pressure to succeed is high, even for very intelligent, savvy, competent and experienced owners and managers. The need to be all over today’s results, to be focused on the immediate takes over. They really are working in the business and not working on the business. In my experience, 90% of businesses under $50mil do not do formal business planning or even do formal monthly financial reviews. They do not have an aligned and integrated roadmap for where they are going. They manage on a daily basis for daily results. Astounding.

Therefore, it becomes difficult to ask for help even though most businesses could be doing much better and need to employ business best practices.

My theory on why owners and managers don’t seek out counsel and expertise is related to the independence and working daily in the grind of business: many owners I speak to have ignored or forgotten one of the prime reasons they went into starting a business in the first place (in addition to independence). It’s called building personal wealth.

Building wealth is done in a variety of ways and I’ll mention just two. One way is to focus on the more immediate term, say a business fiscal or calendar year, wherein one can earn a bunch of money, live a good lifestyle and put the balance in what I’d call normal investment vehicles such as property and securities (and we’ve seen what has happened here recently). Too many owners get trapped in the yearly performance and reward trap. Another way to build wealth is by understanding that building a business long term requires consistent growth in sales revenue, gross margin and net profit. Continually grow your business in these areas and when it comes time for a liquidity event of your choosing (business sale or transition/succession) you’ll have a much more valuable asset.

Now, many consultants (advisors, mentors, etc.) like me will try to develop the need for a consultant-client relationship by bringing to the surface the current pain or future pain that the prospect has and getting affirmation from the prospective client that ‘something needs to be done’ to alleviate or minimize the pain. The pain is so great that the work must begin. The problem is most business owners don’t take action to work with someone who can help them with business best practices because they either think they can manage the pain themselves and then get rid of it, or they really don’t have future pain…because they don’t have an End-In-Mind for their business. More often than not, it’s not a matter of available cash for services. As noted above, they’re not focused on long term wealth building in the business and therefore have no pain associated with the future. It is just something they don’t think about.

So, tying all of this together and getting back to my main issue, I think the real reason consultants have challenges in gaining clients who could use their experience and expertise is that most business owners don’t really have a deep understanding of or thoughts about the long term pains they might face and the long term gains they can have if they focus on building wealth. Until we find an owner who has a clear long term goal, it’s pretty difficult to help by providing business best practices.

© 2009 Peter E. McDowellPERFORMA Business DevelopmentDifferent View/ Different Results

email @ pete@performabusdev.com

Web @ http://www.performabusdev.com

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