Is Your Business Stalling Out?
If you are running a business and are really ambitious, then sooner or later you’re probably going to feel that you are stalling out. Maybe your business is still growing but not at the pace you’d really like. Or maybe you just have this feeling that your profits and your profit margins could be higher, a whole lot higher, than they currently are. I’ve been in this situation a whole bunch of times and it can be very frustrating.
I think the biggest problem you may face—and certainly the biggest problem I often faced—isn’t the lack of ambition, capabilities, tools, and techniques to really ramp up your business. Rather, the biggest problem may be that you are human, and your employees, assuming you have employees, are human, too—and human beings by nature love consistency and they develop habits. Back in the jungle, when we were prehistoric people, being a creature of habit served us well—we tended to always avoid the path near the lion that roared and we tended not to swim in the river with the poisonous snakes!
Related: 7 Strategies to Double Your Profits
Breaking Bad Habits Can Boost Your Business to the Next Level
However, in running a business, especially when trying to take a business to the next level, being a human being, a creature of habit, is a huge obstacle to achieving high levels of success. On the other hand, if you try really hard to break old habits and try new ways of doing things, and make the changes that really matter, you can take your business to a much higher level. To have a chance of succeeding at this you need to first appreciate and acknowledge how difficult it can be to break out of old habits that tend to hold you back.
For several years, in the early days of running my book publishing business, I’d start the year with a grand, bold plan, including a sales plan and especially a profit goal that made me very excited and yet seemed achievable. But then, time after time, something happened during the year—I would find some new marketing idea, or more often some slick salesperson would sell me some new advertising program that seemed so good, so promising, that even though it was way outside my budget I would do it anyway! Then, sure enough, the new marketing didn’t work out as well as promised—we roughly reached our sales goals, but we were off, way off, from our profit goals.
Have a Great Plan and Stick to It
Finally one year, I said to myself, “Come heck or high water, I am absolutely not going to just have a plan for the upcoming year, but I’m actually going to follow the plan and not overspend with some new major unplanned advertising campaign.” Bang! The business took off. My profit didn’t just go up—it tripled! I was in a whole different world! I was suddenly running an outperforming—rather than an underperforming—business. I was rich, and the firm had a lot of cash coming in that I could invest back into the business.
What happened? I entered that rarefied world of a small business not just having a business plan, but having a great business plan and actually following the plan.
I finally broke my bad habit that was killing my profits each year—overspending on unproven advertising programs.
So keeping in mind how difficult yet how powerful it can be to break old habits and to try new and different ways of doing business, I offer you several ways to change your business and really ramp it up.
Alternative #1: Incrementally Try to Improve All Parts of Your Business
This is an obvious approach to try to take your business to the next level, and it’s possible that it can work, but it is not the approach I recommend. I think the chances for it really working in a big way are limited.
If you do want to try to improve all aspects of your business, I think it is especially important that you do so with a detailed rewrite of your business plan. I suggest you set specific goals and measurements for every single area you are trying to improve.
The big problem with trying to improve all areas of your business is that you lose focus, you don’t really change any area enough to really matter, and you shortly run out of steam and can’t even remember the changes you hoped to make and the specific goals you wanted to accomplish. You get frustrated that, even after expending all that energy, nothing seems to have changed much at all.
If you go this route, you should identify highly specific changes and objectives. For example, for customer service you might set a goal to respond to every email within 24 hours and every phone call within one hour. If you decide you want to improve relations with major customers, perhaps your specific goal is to visit one key client every week.
Specific improvement steps, specific measurements of results, and specific time goals—identifying exactly what you can do today, this week, this month, this quarter, and not some time later in the year—can make a big difference.
This approach works best if you already have a great strategy and are used to operating with a business plan and if all of your major business functions are working more or less okay (but there is room for improvement). It could work especially well if your business is operating on a very low profit margin and any changes in costs will send profit soaring. This approach will generally work better at sharply improving your profit margin rather than your sales growth rate, but it could incrementally help growth, too.
Related: Quick Ways to Boost Profits
Alternative #2: Totally Rip Apart One Area of Your Business
Zeroing in on just one area of your business, an area that will really make a difference, has strong potential to send your business soaring. Because it is so hard to change habits and to change how you are running the business, it is much easier if you choose just one area to focus on. There is even more potential if you choose an important area that is currently a mess with a lot of room for improvement. Knowing that you are attacking a problem area gives you additional impetus for change, and that is important.
When I talk about “ripping apart” an area of the business, what I really mean is to rethink that if part of your business didn’t exist at all today, how would you totally design it from scratch to make it the best it could possibly be? How could it be best designed to support your strategy and your ability to make profits and grow your business?
Ideally, in your first pass, you don’t even think about your current employees, your facilities, your existing ways of doing business—you just design hypothetically as though you were starting from scratch.
Then in the next phase, you allow some reality to creep in. At that stage, you consider how far you want to go toward adopting your design for the “from scratch plan” and how much you want to retain the existing ways of doing things and the current resources you have.
Of course, if you have talented, motivated employees (and I believe that underneath, almost all employees are motivated and the vast majority have many talents), then you can integrate them into the process. Ideally, you want them to suggest changes. Sometimes you will have to make difficult decisions to change employees’ roles and responsibilities, or even let them go, but that’s why you are the boss and why you carefully do your planning before making any decision.
The upside of this approach is limited by the function you choose to focus on and how much it is underperforming. Even if its performance was average before you focused on it, you can still really pick it up significantly. However, the huge benefit from this approach is when you have one function that consistently holds back the performance of the rest of the company. Often, a business owner is surprised how much upside there is when the weakest link in the business becomes the strongest. This approach can add significantly to profits and growth potential, and perhaps more important, avoid deepening problems in the underperforming function down the road.
Alternative #3: Rip Apart Your Strategy and Redesign Your Business
I think this is the most powerful approach if you really want to blow the roof off your current business—but it is hard! This approach particularly requires you to break out of old ways of thinking about your business.
You have to be very open-minded about the core of what your business stands for. You have to be willing to admit that you may not have had a good strategy or even an average strategy in the past. In fact, you need to be open to the possibility that you made some deep strategic mistakes.
Don’t feel that you are alone! Most businesses of all sizes have major strategic flaws. However, few business entrepreneurs or corporate CEOs are ever willing to sit down and acknowledge them. You can benefit by being one of them. That’s a competitive advantage. I could say it doesn’t cost anything. But it does. It chips away at your ego. Me—I left that behind long ago! You don’t publish a book based solely on your mistakes in business if you are trying to pretend you always run businesses perfectly!
Furthermore, strategy is the core of a business, and most small businesses and many large corporations have bad or weak strategies. Often, I see established businesses that once had a great strategy drift away from it. I also see plenty of entrepreneurs who never had a good strategy sentence themselves to working like slaves every day with no hope of achieving outstanding results because they are handicapped by a weak strategy.
Although ripping apart your strategy and redesigning your firm is difficult, the results can totally transform your business. If it works, profit margins can soar, growth rates can triple, and losing businesses can turn into winners.
Alternative #4: Change Yourself
This is probably the most difficult alternative of them all. But it can make a big difference.
What do I mean by change yourself? Well, are you the model business manager? Do you come to work upbeat and vibrant each day? Are you in top health and physical condition to add further to your energy level? Are you full of positive energy for every interaction with customers, suppliers, and employees? Do you work long hours without any ease in your pace? Do you follow your well-thought-out business plan creatively? Are your financial projections up-to-date? Do you see setbacks as opportunities? When you hit roadblocks do you brainstorm creative solutions? Do you not waste any energy worrying about any part of your business? Do you have a positive, vibrant vision for the future that never dims? Do you not worry but only rationally strategize against your competitors? Do you sell and make customer presentations without ever getting anxious? Do you patiently and positively help your problem employees improve their performance? Do you leave work recharged with plenty of positive energy for your personal life? Do you have a systematic and well-thought-out plan for how you spend every day?
If you answered yes to all of these questions, you are not a model business manager—you are a liar!
No one is the model business manager. Everyone, including myself, has plenty of ways that our personal traits hurt our business performance. Yet it is hard for entrepreneurs to realize just how much room they have for improvement because, as Shakespeare said, “the eye does not see itself.”
That doesn’t mean we can’t start, run, and grow a highly successful business. However, it does mean there is a huge opportunity to improve ourselves and improve our business in the process. I will get into this more in another presentation.
So Which Alternative Should You Try?
You might be thinking, that’s four different alternatives . . . which one should I try?
Generally, I suggest you first consider ripping apart your strategy and redesigning your business. However, you need a lot of mental energy for that approach and a really open mind.
Realistically, you may be better taking on a smaller challenge first. Then maybe 90 days later consider identifying and tackling the one underperforming business function that could really improve your entire business. Then maybe after that you take on the challenge of rethinking your entire strategy. Next, you may want to redo your entire business plan.
What you do and when you do it is not important; what is important is that you do something! That you get going today, break some old habits and ways of thinking, and try something new.
Be bold with your changes, but think them through carefully, digest them, and get comfortable with your plan before you charge ahead and turn it into reality.
Takeaways You Can Use
- Being human means having bad business habits: find them and fix them.
- It’s not just about having a great plan—it’s following that plan!
- Strategy is the core of your business; don’t be afraid to rip up one that isn’t working.