One of the most important topics of discussion in you business this year should be about growth. Most experts agree that that it is impossible to hold a business at a steady state and a business that is not planning for growth will decline.
That is the age old question that kids for generations have been asking parents when the family takes a long road trip. My brothers and I certainly did not fail to ask it during our frequent holiday road trips in the back of our family’s ’65 Chevy station wagon. We asked the question because we didn’t really know where we were going or when we would arrive. As a business owner, you might find yourself asking the same question as the economy slowly emerges from the “Great Recession.”
The reason you are asking, however, is out of concern for the survival of your business. But you may also be asking because you don’t know where you are going or you can’t be sure that you have arrived. Helping you take control of the trip is the purpose of this article. Being in control requires picking the right traveling companions, developing a plan that includes business growth and having a point-to-point roadmap that is frequently evaluated.
The Right Traveling Companions
If you are the owner or manager, you can start by moving from the back seat to the driver’s seat. Then, you should add some passengers who can provide lively and uninhibited conversations about the best route to reaching your destination. Contributors to this conversation might include employees, customers, and professional advisors. It might surprise you to know that employees have remarkable insight about your business. Also, you might consider recruiting a new employee with industry experience or knowledge of your target customers who can bring fresh perspective to your business. Jim Collins, in his book Good to Great, discovered that the most successful companies put a priority on “getting the right people on the bus” before deciding where they were going. He calls this principle, “first who, then what.” Do not assume that you have all the insight across all the required skill areas. Business success requires your vision and engagement but also your ability to pick the right people and make it easy for them to contribute to the conversation.
A Plan for Growth
One of the most important topics of discussion in you business this year should be about growth. Most experts agree that that it is impossible to hold a business at a steady state and a business that is not planning for growth will decline. According to a late 2012 poll conducted by the NFIB, the majority of businesses have no plans for changing their strategies this year because of the political and economic uncertainties. On the other hand, a few businesses see opportunity and 15% are planning significant changes to take advantage of current economic conditions.
In Kim and Mauborgne’s book, Blue Ocean Strategy, businesses that choose the strategy of maximizing growth are called “Pioneers.” The Pioneer Strategy requires a “Four Actions Framework” that includes the following: 1) eliminating anything you might be putting resources into that your customers take for granted, 2) identifying services, products or activities that can be reduced without being noticed, 3) raising levels of services, products or activities well above industry standards that will gain the most notoriety; 4) creating new services, products or activities that have not yet been offered in your marketplace.
Designing the Roadmap
Your business roadmap should include information about past performance and predictions for the future. Just as every successful road trip requires a point-to-point map, your successful business journey will require a written plan. This plan can be as simple as a one page summary of goals or it can be a detailed document including past performance, future projections and plans for how to achieve them. Pepsi is an example of a company that knew they needed a roadmap for the future. They were locked in a war with Coke for years as they both fought to dominate the soft drink industry. In recent years, Pepsi created a plan to focus their resources. Pepsi remains a distant second in total sales but they have developed a profitable niche market with the under 30 demographic. This year, they will partner with Twitter to launch a new campaigned called “Live for Now” featuring young soda drinkers living in the moment.
If you want to be among the 15 percent who are planning for significant change or recognize the need to focus your limited resources, then consider including internal and external strategies this year. Internal strategies include investing in employee development of skills and leadership, restructuring departments for efficiency, and updating product offerings to meet new or changing customer needs.
External strategies include considering mergers or acquisitions, improving relationships with business partners or combining efforts to create new products or services
Arriving at the destination
The benefit of having the right people on the journey, planning for growth and having a clear roadmap is that at the end of 2013, you will be able to answer the question, “Are we there yet?”
Bruce Barrett is a volunteer business counselor with SCORE . He can be contacted at 541-410-3484. Sign up for a free consultation at www.SCORECentralOregon.org. SCORE also offers short individual walk-in chats at the Bend Library every Tuesday 5 – 7 pm.
