Holding out for better days is not a viable business recovery strategy. The recent re-tightening of lockdown rules should prove that this external locus of control – expecting factors outside our business to fix our business – is really no control at all.
If you’re a business owner struggling to keep your head above water, you’ve surely taken some steps to stay afloat. But maybe it’s time to get unreasonable, time to adopt extreme measures.
“Extreme” doesn’t mean cutting costs to the bone, though that might be needed, or taking reckless risks. I mean trying new combinations, or trying entirely new things.
“Extreme” includes trying on thoughts and emotions that you’ve been afraid of, until now. Here are some thoughts that might be scary, but life-saving for your business...
1. Get help
The combination of economic uncertainty, social distancing (physical isolation) and a bleak vista of the middle-distance future easily conspire to thwart even the most optimistic personalities. Getting help should span business consulting, personal mental health and everything in between for you and your team.
Take an agile approach and contract on just the next month’s quick wins or next 3 therapy sessions. A business coach can help keep you focused on near-term goals. A therapist can help preserve a positive outlook. It needn’t cost more than a few thousand rand.
2. Change your strategy
Start with your owner’s mandate: can this business give you the returns you deserve for your time and money? How can you build confidence and commitment in this?
Can you change your business model i.e. the fundamental way you make money? For example, with the property rental market declining since COVID started and, rather than holding empty rental space, property developers are switching from build-to-let to a build-to-sell model.
Analyse your product-market mix and prioritise your intersecting niches of product lines and customer segment. Which niches have the most profit, the best cash flow, the quickest sales cycle, or least competition? Can you shut down poor-performing niches and survive on only the one or two best niches?
3. Overhaul your operations
Take a zero base budget approach and imagine re-building your business from the ground up. Can you deliver the same value to customers with less infrastructure, less labour, use outsourced services, or find suppliers with better payment terms? Can you automate or exploit better technology to improve productivity?
4. Consider business rescue
In the same way that a debt rescue practitioner negotiates easier payment plans with personal creditors, business rescue can ease the burden with business creditors and develop a plan to turn around a decline. The success rate is not high – estimated at 10%-30% – but it could be a better option than immediate liquidation. (fin24, 07 Jun 2020)
Could you achieve this result informally? E.g. contract on exclusive supplier agreements to get longer payment terms and extend your payables’ days.
5. Keep comms channels open
When there’s bad news, the worst thing you can do is keep your support team in the dark. Keep your partners, staff, even clients and suppliers informed of your plans.
Now might be a good time to lean on them a little differently and ask for input in designing your turnaround. Getting their contributions also could build a sense of shared ownership, which raises their commitment to seeing you win together.
6. Micro manage your plan
This is not about micro managing people – focus on the results. Get obsessive about your short-term goals because you don’t have the luxury of waiting.
Break down your planning into shorter periods. If you had monthly management meetings, run them weekly with weekly targets and deliverables. If you had weekly team meetings, start daily stand-ups, and again, set goals to match the new timelines.
7. Do what scares you
Each of these tactics is surely not news to you, but maybe there are combinations of them that you’ve not yet thought of. As the saying goes, if you want different results, take different actions.
But different actions start with different thoughts and feelings. The bigger the result, the scarier those new thoughts and feelings.
If ever there was a time to epitomise entrepreneurship, it’s when the going gets tough. Because this is what it means to be an entrepreneur: the courage to bring things into reality that others cannot.