Get the junk out of the trunk: Now is a great time to reassess your business.

Every year about this time my wife organizes the house in preparation for the holidays. This includes going through all the stuff we have in our closets, shelves, hampers and trunks. The ritual is fairly painful, because she pulls everything out to reassess usefulness and how each item might fit in our plan for the next year.

Now is the time to get the junk out of your trunk and reassess your direction, tools, products and people. How much baggage does your company carry into every year? Evaluate your business as objectively as possible and get rid of those things that have no place in 2012.

Some areas to look at include:

Your business model

Many businesses and industries have materially changed since early 2008. We hear many people talk about the “new normal”; this may mean that products and services that you have relied on for years are no longer valid going forward. One company I work with has relied on a personal one-to-one service model and has added books and videos to their product offering. This was done to diversify their revenue and reduce the reliance on a business model that requires the principals to be involved with the generation of revenue during an 8:00 to 5:00 business day.

Opportunities

What opportunities have you missed in the past that might have put your company in a different place today? I meet with a number of business owners that discuss the actions they could take that would improve their business, but then go on to say “we discussed these areas 12-18 months ago and just couldn’t find a way to execute.” Does this sound like your company? Many business owners and leadership teams can sit down and plan how to take advantage of new opportunities, but fail to execute. Objectively evaluate your opportunities and develop a plan to get them implemented.

Strengths

When was the last time you and your management team identified your company’s strengths only to find a list that included things like “good customer service” or “good customer relationships”? Evaluate your company from the view point of your customers, partners, competitors and prospects. Does good customer service or good customer relationships set you apart from others in your industry? If not, then look deeper for sustainable areas of differentiation and identify how you can further exploit these strengths for a competitive advantage.

Weaknesses

Deep down we all know what some of our weaknesses are, but in many cases don’t confront them. It is difficult without outside input to develop a complete list of areas in which your business needs to be improved. Take this time to have candid discussions with your customers to learn how your company can improve. There are also some excellent tools and resources to perform a loss analysis, to develop insight into how your company can improve for the future.

People

Do you have the right people in the right places in your company? Many businesses have not strategically evaluated their most important asset… their people. Take a hard look at the direction of your company against the skill sets in your business and identify gaps that your management team can work on in the coming year. It may mean moving people into new roles, implementing training programs to help develop your employees, or hiring new people to supplement your team.

Yourself

As senior leaders we have a tendency of overlooking our own developmental needs. Are you ready to make the changes necessary in the new year to be successful? Just because you have been successful in the past, does not necessarily mean you will be successful doing the same things going forward. Successful leaders are those that can manage in changing environments, retool their company, and operate during times of ambiguity. Take an objective look at yourself and get ready for whatever the future brings.

Look at the junk in your trunk

Take the time to pull your leadership team together and objectively look at these areas as you prepare for 2012. Get an outside facilitator to work with you and your team to help develop the objective thinking and forward look needed to develop the basis of your operating plan for next year. Be prepared to gather additional information from your customers and partners to help guide you through the process. Taking the time to evaluate your business with independent input will help you develop a strong plan.

Larry Turner is CEO of Roundhouse Advisors, Inc. and has over 25 years experience growing, starting up, repositioning, and revitalizing organizations. Roundhouse Advisors is a consulting practice focused on helping businesses increase enterprise value by managing pain, growth and owner exits. Larry is a consultant, public speaker, and the author of two books “Owner Exit Planning: Leave On Your Own Terms” and “Mapping Your Recovery: Grow sales in difficult times”. For additional information visit www.RoundhouseAdvisors.com

“Mapping Your Recovery: Grow sales in difficult times” provides additional information on areas that can positively impact your company.

Managing Through Tough Economic Times

Many say we are in for another 12 - 18 months of difficult economic times. Things were tough enough earlier this summer and it looks like it just keeps on getting worse. There are a number of things you should focus on in your business in order to work through the tough times. In this blog we will discuss spending associated with customer facing activities.

Customer Facing Activities
Evaluate your spending and start cutting back on those that are not customer facing. Any customer facing activity needs to continue until you absolutely have to cut back further. A natural reaction is to cut back on marketing expenses… I have to admit that I have taken this approach in difficult times only to regret it during difficult times and then again when better economic times started to arrive.

Marketing is cumulative and any drastic cuts in marketing communications will take at least twice as long to get back any momentum that you have created. If you have ever started a marketing program, in many cases early months do not yield much in results but as the program continues it seems to snowball. This cumulative effect is lost if you take the tack to going “dark” for a few or many months, so be prepared that it will take a good 6 months to get any momentum back once you start your programs again.

Cutting back on marketing activity also limits your business development efforts. Sales are generated by your sales people, but marketing softens the market and helps drive demand. Cutting back in sales and/or marketing only hurts your ability to stay with your current market.

An Alternative
An alternative to cutting back completely on marketing communications is a good PR program. In my experience, it is the best bang for the buck. It costs a fraction of what advertising costs, and it allows you to craft the message that you want the market to hear. PR provides a great vehicle to offset some higher advertising dollars without going “dark”.

Be prepared, just as advertising takes time to build momentum so does PR. Give it some time and it will help you drive your brand and sales. I recommend using a good outside agency to handle your PR activity. This is what they do and they can help you craft your message and still be a variable cost.

Just because you are going to an “agency” does not mean that you will need to spend big dollars at a large firm. There are a large number of independent contractors that specialize in PR that do a great job and cost a fraction of the big integrated marketing firms.


Spend wisely, focus your efforts and expenses on customer facing activity and it will help you work through the tough economic times.


Larry Turner is CEO of Roundhouse Advisors, Inc. and has over 25 years experience growing, starting up, repositioning, and revitalizing organizations. Roundhouse Advisors is a consulting practice focused on helping businesses increase enterprise value in all stages of company life cycle. For additional information visit www.RoundhouseAdvisors.com