If we’re thinking about the future, none of us is passionate about the industry we’re in. We’re seeing troubles and struggles with every aspect of our current business model. How do we decide where to go from here?
THOUGHTS OF THE DAY: It’s not just startups that need to come up with a fresh-start business plan. Work backwards, building your new plan around success factors. Make a plan to align your company, top to bottom — vision, strategy, goals and tactics.
When businesses and the industries in which they operate run into major challenges, building a new business plan may be just what the doctor ordered. If you find yourself facing this situation, take a fresh look at how you plan to make money, who you plan to serve, how business will get transacted.
If you, as owner, have lost your focus, your enthusiasm and your ambition for your business, it’s time to make a change — and fast. Don’t let the company drift. The single biggest common denominator in the failure of privately held business is the loss of the owner’s drive and commitment to running a successful business. Take action now, while there’s still time to make needed changes.
Make a list of success factors you’d like to work with in the future.
- CUSTOMERS — willing to pay for quality, align with the identify of your company, recognizing the importance of brand value
- MARKETPLACE — sizeable enough to allow you to successfully grow as you compete for a small share (under 20 percent), limited marketing costs needed to acquire clients, high actual or perceived switching costs once client relationships are established
- OPERATIONS — some barriers to entry related to infrastructure, opportunity for efficiency improvements, ability to align with other players to magnify offer, efficient and cost-effective ways to deliver, limited need for no-fee hand-holding, technical solutions readily available and adaptable
- LONGEVITY AND EXPENSE — low cost to acquire loyal, long-lasting customers with moderate demands for service
Assess how much your current business meets your success factors. Decide what would have to change in order to increase the number of success factors that play in your company’s favor.
Make your company’s plan consistent. Let’s say that your model includes pursuit of high-paying customers. Make sure that there is a clear definition of what those customers expect to receive. Figure out how your company will match customer expectations consistently. Document how to control costs to allow for a profit after successfully delivering. Cite measures you plan to track so that you’ll know if the plan is working from every position in the company.
Check that you can sustain your model for a long period of time. It can’t be easily copied. Your organization is capable of delivering what’s promised. There is little or no likelihood of successful substitutions from other vendors for the foreseeable future. You use a model that allows the company, over time, to build brand equity and assemble assets that can be leveraged to support future growth and development.
The more of these factors you can build into your plan, the greater the likelihood of success. Keep in mind that most entrepreneurs love to jump in and get going with activities. It’s the advance planning phase that will lead to long-term success. Do your homework.
LOOKING FOR A GOOD BOOK? Try “Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers” by Alexander Osterwalder and Yves Pigneur.
Andi Gray is president of Strategy Leaders Inc., StrategyLeaders.com, a business consulting firm that teaches companies how to double revenue and triple profits in repetitive growth cycles. Have a question for AskAndi? Wondering how Strategy Leaders can help your business thrive? Call or email for a free consultation & diagnostics: 877-238-3535, AskAndi@StrategyLeaders.com. Check out our library of business advice articles: AskAndi.com