All too often, executives get focused on the day-to-day or short-term plans plan of their business, looking at what they are going to do rather than what they should be doing and what would create the biggest breakthrough for their company. They fail to work with intentionality and instead just get swept along with the momentum. So how do you make sure you are running your business, rather than your business running you?
If you just keep doing what you’re doing – even if it is more or less working – growth will continue to be steady at best. If you’re looking for a breakthrough, however, you must instead stop to look strategically at your business, taking a step back to ask what is needed to make your business, say, ten times larger in the next three years. What obstacles need to be removed? What financing do you need? What laws may need to change? What customers would you need to gain?
Ultimately, you must examine what you should keep doing, what you should start doing and what you should stop doing. The last part is typically the toughest – while people are usually comfortable adopting new organizational structures and procedures, they are not comfortable giving things up, whether it be a long-term account or a once-successful product. For instance, one company we worked with generated 85 percent of its revenue from 15 percent of its customers, but they were terrified to let go of the 85 percent of customers that only made up 15 percent of revenue. Because the 85 percent of customers took up most of their time and generated a higher quantity of business, they continued to throw the old print versions of their product and these customers and did not stop to realize they were actually losing money on that part of their business (with a gross margin of $256 and an average order cost of $326, they were losing $80 an order). By taking a step back, however, they were able to re-evaluate their customer base and properly focus their attention on their most profitable accounts.
Everything has a life-cycle, including your products, your processes, your customers, your organization and your employees’ roles within your organization. Going through the process of looking strategically at your company may not guarantee that you will grow your business ten times, but it could easily help you double your sales or at least avoid a backslide. If you feel that the time is right to take a critical look at your company, contact us at Arc (email@example.com) for more information on our strategic audit offering and other services to assist you in creating your business breakthrough.