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Volume 3; Issue 2
“I Don’t Know if I Still Have a Strategy” – Part 1 of 3
Most owners of small companies have to stop and think when we
ask, “What is your company’s competitive strategy?” We are creatures
of habit. Most of us come into work each day and begin where we left
off yesterday. Before long, sales begin to dip, salespeople begin
demanding price concessions for fear of losing key accounts, and/or
customers stop buying from us. One day we sit back and ask
ourselves, “What’s going wrong with my business?”
All industries move through life cycles and the businesses within
each industry are affected accordingly. Old strategies that used to
work, no longer appear to be effective, but we don’t know why. There
is a scientific term called the “invisible baseline”, which refers
to the subtle rate of changes around us that we tend to miss because
they happen slowly and in small increments. For example, you may
have lived in a town for the last 20 years and it has gone through
tremendous change. Because you live there and drive the streets
daily, you fail to notice the changes in aggregate. However,
somebody that left this town 20 years ago and returned for a family
reunion can hardly recognize the place.
All our businesses are facing a changing market. Some changes are
dramatic, like the announcement of a new Home Depot to be built
across the street, while others are subtle and take time to really
notice. How long does it take to notice a change in customer
demographics like the aging of a customer base or geographic shifts
in population? We tend to miss or react too slowly to the subtle
changes in our markets; those that were telling us that yesterday’s
customer needs have been changing.
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Try the following quiz. How many of the questions can
you answer factually with no assumptions or guesses?
- How many different reasons are there to explain why
customers buy from me?
- How many of my customers also buy from my competitors?
How much do they buy and why?
- What makes my company different than my competitors?
(Include the good things and the bad.)
- Is my goal to keep up with, stay ahead of or be
different from my competitors?
- Do I have the right mix of products and services or am I
trying to be too many things to too many people?
- Are my customers in growing, mature or declining
industries?
If you must guess or don’t know the answer to any of
these questions, you may no longer have a strategy. Equally
disturbing, you may have a strategy but you don’t understand
what the strategy is. In either of these situations, you may
want to take a time-out and find the answers to these
questions. Multiple brainstorming sessions to deal with each
question works very well to uncover the true answers. Include
your key people in the brainstorming sessions, especially
salespeople and others who have regular contact with
customers. To insure you have a productive brainstorming
session try the following.
- Have each person write their answers to the specific
question in advance of each meeting. It is not important
that answer sheets be signed. Anonymity is preferred to
achieve truthfulness and candor. Require that each answer be
supported with the factual data that backs up each person’s
answer. Provide a single and secure drop off place for this
information to ensure anonymity.
Begin each meeting by writing the question on a white
board. List each answer given. Hand out separate sheets that
include the specific answers given by each participant as
well as the data to support each answer. (Be sure all
handwritten answers have been retyped to help preserve the
anonymity factor.)
Initiate the brainstorming and discuss each answer and
the supporting facts until the answer is accepted, modified
or dismissed by the group.
Based on the above, leave the answer up on the white
board, erase it or modify it based on the group’s final
input.
Each question may result in multiple correct answers.
Record all accordingly.
Once you have completed these sessions and have arrived
at the answers to all of the questions, you’re ready to begin
step two which is “Formulating a New or Improved Competitive
Strategy”. This is the topic of our next BizMACH
Newsletter.
Readers are welcome to send the results of
their brainstorming sessions to BizMACH for a FREE Strategy
Evaluation. If selected, your company may be used as a case
study in an upcoming newsletter (actual names will not be
used).
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| BizMACH Affiliates are Experts in Small Business
Transition Strategies |
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Call us for a Free and Confidential Consultation. After
all, you have spent a lifetime building a company and sooner
or later it will be time to cash out. Wouldn’t you like to
know where you stand today so you can determine where you need
to head tomorrow?
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POSITION
FOR TRANSITION |
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BizMACH is an association of highly skilled
consultants, evaluation experts and merger and acquisition
specialists.
We take ordinary companies and create extraordinary value.
Best of all, we only work with lower mid-market companies
and our fees reflect our confidence.
Ninety percent or more of our fees are contingent upon the
successful transition of your company - even if that sale is
years away.
Competitve advantage is the key to revitalizing your
company's growth and profitability.
Call us if you'd like a free consult and to learn how
BizMACH can grow your company and increase its value.
Ed McCormick, CEO
Ann Coffou, President
Click to Email
BizMACH
Solid Oak Consulting, LLC
522 South Elmwood Ave
Oak Park, IL
60304
708-524-0886
telong@solidoakconsulting.com
Accredited by the Institute for Independent
Business
Contact
Tom Long
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