All the answers to your unique business lifestage questions
One of the reasons why businesses that appear to be stable and on a growth path fail is because the company’s owners and managers don’t spot red flags and mitigate problems before they happen, says Garrath Rosslee, turnaround management specialist and owner of Retention Strategies.
So, what if you could spot red flags and avoid disasters before they happen?
Here are Rosslee’s top five ways that you can keep your business growing – instead of suffering an untimely death.
1. Be detail orientated
“There’s a well-worn adage that says work on your business and not in it,” says Rosslee. “While this is critical for a business owner, who should be focusing on strategy instead of operational issues, it is also important for owners to be focused on the right things.”
If you don’t have the right information at your finger tips, you can’t make the right decisions. It’s as simple as that.
As a business owner, sit back and critically evaluate all the facets of your business on a regular basis. These should include:
- Understanding cash flow: what is in the bank, how much is owed and who owes it, and how much does the business owe to whom.
- Evaluating where the market is and where it’s going
- Measuring key processes and evaluating where the critical points are
- Understanding all touch points with stakeholders (from suppliers to customers) and where things could be improved
- Understanding the business’s full supply chain
2. Understand your business’s lifecycle
All organisations follow a lifecycle. As they grow and their offerings diversify, so the business changes and evolves. According to Rosslee, the problem is that business owners don’t always change with their businesses.
“Have you ever been guilty of continuing a practice simply because it’s worked before?” he asks. “Have you evaluated if that same decision is right for the business now? You need to shift business operates to suit where your business is in its current lifecycle.”
To avoid this trap, you should be constantly evaluating:
- Where your business is in its lifecycle
- What you are currently trying to achieve
- Whether the key measures you use are relevant.
3. Agree on what’s relevant
This can be a bit tricky because it involves everyone (from the owner, to shareholders, to managers) being completely honest and frankly addressing what problems the business faces.
“For example,” explains Rosslee, “does your management team have monthly meetings where it honestly discusses what is and isn’t working in the business? Remember, as long as problem areas are ignored, it is impossible for the business to operate efficiently and cost effectively.”
4. Talk to your customers
“Do you routinely ask your customers: ‘How would we improve our service?’ ‘How do our employees treat you?’” asks Rosslee. “If not, why not? How your customers perceive you is vitally important in spotting red flags. If they aren’t 100% satisfied, what’s to stop them switching to a new competitor should the opportunity arise?”
5. Review, review, review
For Rosslee, this is not only the most important point, but it relates to each of the points above. “If you aren’t reviewing your progress, you have no idea where your business is, or where it’s going.”
Reviews should tick the following boxes:
- They should be short and to-the-point (this isn’t a weekly two-hour meeting).
- They are designed to make sure the owner and managers are all on the same page in terms of what the business is currently focusing on (ie areas of importance).
- The owner should be able to see if their managers are meeting key deliverables.
- Managers should report on their teams’ deliverables.
- Are targets being met, and if not, why not?
For more information contact Garrath Rosslee at [email protected]