SMG’s powerful but less-obvious suggestions to help your business through this downturn.
1 - Fix Leaks
You've probably already stepped in to fix your company’s cash leaks. You’ve cut spending, reduced staff, and redoubled efforts on winning more business. Here are three additional ideas to conserve cash and customers:
Remove Process Inconsistencies and Assumptions
Most businesses fulfill customer needs using a core ‘relay race’-style process. A complete package of information must pass without contamination from sales/inside sales to customer service to operations to fulfillment to invoicing. If steps or handoffs are ill-defined, open to interpretation or require individuals to make assumptions then the company is wasting resources and producing service errors which negatively influence customers. Perform a start-to-finish process audit to make sure information is complete and passes quickly and clearly between steps. Note: a single error-at-a-time, corrective action approach can not deliver process-wide consistency. You must bring all the steps together and define what information is required at each handoff and ensure people know precisely what’s expected. Also forget about a complicated process analysis -- you're looking for a few meetings over a few weeks otherwise the audit itself becomes a waste of resources.
Revise Structures to Support New Strategy
Make sure the organizational structures which motivate employees support your downturn-strategy directives. For example, if your company is pursuing out of the ordinary sales opportunities, look carefully at your sales incentives (and other mechanisms) to make sure they reinforce the revised sales actions. Most organizations fail to revisit their incentives and give salespeople a rousing speech about a new sales emphasis while at the same time driving the old behaviors with the old incentives. The result: frustrated, less-engaged salespeople and precious little change in sales. Adjust your incentives and other structures before giving the ‘expand your horizons’ speech. Then you can send them out to execute the revised approach knowing the new, required activities are supported.
Strategic Customer Review for Additional Sales
List your top customers and quickly describe what each company must do to manage in this downturn -- put yourself in their management’s shoes. Take your list and for each customer identify which products or services you provide or could provide that would help them achieve their short-term goals. Forget long-term -- we're fixing cash leaks in the tyranny of the urgent. Done correctly this requires four to five hours, but no more. Involve your salespeople in the discussion, but this is a strategic analysis and occasionally sales staff need help thinking at this higher strategic level. This is a great opportunity for senior management to come alongside sales and provide quality assistance to help them revitalize sales.
2 - Frame Leaps
This is a perfect time to take a fresh look at your industry, where your business is positioned, and create opportunities to leap ahead of competitors. The current economic situation will encourage your people keep an open mind, even to revolutionary ideas.
Picture, Test, Move:
Picture
Picture your business upside down. Picture disadvantages as advantages.
If your IT infrastructure is more expensive to run but is superior to those of your competitors – could you offer administrative or customer related services to your less sophisticated competitors? You could increase market control, prevent competitors from making similar IT investments, and wedge your company between potential customers and your competitors.
Your company may have a higher cost structure with more qualified personnel. You could offer clients a more sophisticated level of service. You might offer skilled expertise to competitors if it were visible to clients that your company was providing essential expertise. Find a small opportunity for cooperation then communicate to customers that competitors seek out your talent.
Test
Find a simple, straightforward way to test your hypotheses. Anyone can easily test market ideas with hundreds of thousands of dollars. It is more prudent and more fun to tell everyone to test promising ideas with a limit - say $500 per experiment. No project should be allowed to proceed without validation of its premise, but the cap will unleash your people’s creativity. Just make sure you encourage the practical thinking that arises – it is critical to your company’s future.
Move
Find ways to build toward your leap. Start these projects and shield them from the standard requirements of the more established parts of your business. A promising idea has promise not established market results – that’s the promising part. Commit even limited resources to move ahead. Your employees will see your movement and will be tempted to bring their thinking caps to more typical parts of your business. Your customers will see it and will see your company as worthy of new business when money begins to flow again. Your competitors will see your actions as confirmation of your market leadership and will be more inclined to partner with you in the future.
Any way you look at it – your business will be stronger.
