Services
What’s your Gameplan?
In five years you’ll arrive.. the question is where? I have found it is amazing how many business owners struggle with this.We need to step back… people that aim at nothing hit it with amazing accuracy.
Most people don’t plan to fail, they just fail to plan.
In my 25 years as a Gameplan Profitcoach, I have found most business people are notoriously bad goal setters. One reason for this is that they find it difficult to relate a future objective to their current position and then come to terms with what needs to be done to bridge the gap.
Most business owners start their business with what Michael Gerber, author of the E Myth, calls an entrepreneurial seizure.
Although these “seizing” entrepreneurs might be technically good at what they do, they wonder what else they can do to build and run a successful business. Even those business owners who have managed to build sizable businesses can become bogged down in the day to day issues that constrain profitable growth.
As a result, the very factors that motivated them to start their business, such as Freedom, Peace of Mind, and Financial Security often go by the wayside, as they become buried in the Necessary Evils of daily operations.
In essence, many business owners are so busy working IN their business they have no time to work ON it. Or perhaps it is that they simply don’t know what to do or where to start to make their business run any better. The nature of the work that most accountants are doing for their clients is centered in the compliance area and as a consequence the accountant is more readily associated with the necessary evils of running the business rather than with helping clients achieve what they really want.
And that is why we do what we do here at Profitcoach. To help business owners develop businesses that work so that they don’t have to.
Thinking outside the box
For a long time I have watched clients sacrifice everything they had for their business. Sometimes to the detriment of their personal life.
All around us, we see and hear examples of how tough business is. The phrase only the strong survive is only partly true. The real truth is that you and I know of businesses that aren’t all that strong but who continue to hang in there.
Or maybe another way to think about it is…surviving VS. thriving.
In the past, many businesses generally enjoyed a solid income and customer base. However, in recent years many businesses in the United States and throughout the world have experienced many economic challenges.
Many businesses today are overcrowded. Margins are being squeezed as customers play one business off against another in their quest for lower prices while demanding “better” service. As a consequence, businesses retaliate in the marketplace by offering potential customers more service often at even lower prices.
It’s what we call the price/promise marketing strategy. For many businesses, business is not a nice place to be. We’re working harder for less. The price/promise strategy will only work if you have lower costs and better systems than your competitors. Rarely is this the case. But as is the case with any problem, there is also an opportunity.
The opportunity you have is to position yourself in the market as being demonstrably different from the rest of the pack.
Tom Peters states
“The key to success for Sony, and to everything in business, science, and technology… is never to follow the others.” Ah, how sad it is, in these turbulent times, to watch the average company, small or large, trying to succeed in the herd by moving maybe “a little bit faster than yesterday” or “delivering a little better quality or service than yesterday.” Forget it. It’ll be trampled.
Furthermore, from inside the herd it won’t even see the real competition: the company off to the side and heading in the opposite direction that just reinvented their industry (think Apple Computer).
“While they’re calmly shampooing the carpet for the umpteenth time, the competition is busy pulling it out from under them.”
James Morse said, writing in the Harvard Business Review “…For most companies today, the only sustainable competitive advantage comes from out-innovating the competition.”
After all, if you allocate your resources and do your “stuff” in exactly the same way as everyone else in your industry it stands to reason you’ll get more or less the same results.
As Stephen Covey, the author of The 7 Habits of Highly Effective People, said “…one definition of insanity is to do the same thing and expect to get different results.”
Differentiation can take two forms. First you may offer different services that are valuable to, and valued by your clients. And secondly, you can differentiate the process by which you deliver your service.
How to differentiate yourself, your business and the way you service your customers is the key underlying theme of our Gameplan Services.
Just look around you for a moment. You’ll quite likely see a business that was started within the past 10 years doing $10 million in revenues, next to a business that was started 50 years ago doing a tenth of that. Why is this? Is the younger of these businesses technically better? Probably not. Does it charge lower fees? Probably not. Is it more efficient? Probably not. Is it luckier? Who knows?
It is a fundamental trait in human nature to resist change. Our habits run deep. The unknown is perceived to be risky. And yet, if everything around us changing, we must respond to survive – Charles Darwin had something to say about this.
In practically every instance of “ordinary” business performance the reason can be found in the manager’s reluctance to change the way he or she does business in the face of a changing environment. This is typically rationalized with the assertion that “we are experiencing a recession” and that “we’ll come out of it as we have done before.”
Perhaps we will, but we all know that we are not in a “traditional” recession. We are in the middle of a massive restructuring of the economy as we move from the industrial era into the technological era. What if the changes we’ve experienced in the past 10 years, not only continue, but do so at an even faster rate?
In reality, the biggest problem faced by business today is that of lost opportunity. It is the customer who doesn’t return because of indifferent service. It is the team member who doesn’t perform because of inadequate training or poor motivation. It is the sale that wasn’t made because no systems were in place to consistently convert a casual inquiry into a long term valuable customer.
Many business owners (and accountants alike) have paradigm paralysis. They view the business performance two dimensionally based on the outputs…the financial statement. It is not sufficient today simply to measure the results of doing business, ie, an Annual Income Statement and Balance Sheet. Nor, in my opinion, is it sufficient to just dabble with the odd cash flow projection or profit plan. Businesses need more than this even though they may not be aware of it.
Typically, people try to improve the profitability of their business by reducing expenses without any regard to the revenue impact or by increasing revenue without any (or little) regard to the expense impact.
The extent to which you can reduce expenses is limited. There is a point below which you simply can’t go without seriously, and perhaps terminally, affecting revenue and hence profit. In other words, it becomes self-defeating. The thinking to think about with expenses is that, except in the case of blatant waste, the costs themselves generally cannot be controlled or influenced by management other than by negotiation with resource or service suppliers.
Management emphasis, therefore, needs to focus on the third dimension, the activity, (or more specifically, the productivity of the activity) that gives rise to the cost. This calls for a subtle but profound change in emphasis. Or, as W. Edwards Demming says, “manage the process, not the outcome.” Many business managers have gone broke by seeking to increase their profit by reducing costs, ie, by cutting back on quality and by eliminating or reducing discretionary costs such as advertising, team training, accountancy fees, etc… What they should be focusing on is what benefit the business is getting from the costs it is incurring.
Are You ready to go on the Gameplan Journey?
Moving away from the abstract visions
Finding the potential hidden in your busines
I make extensive use of the analogy between planning a journey (such as an extended holiday or business trip) and running a successful business. (By the way, the reality is that most people take more time to plan their holidays than they do to plan their businesses.)
What’s your business potential… the hour Gameplan Journey potential
A meeting (either in my office or your own private webinar to review and identify the following:
- Consider the impact of certain key ratios on your business.
- The hidden potential for profit in your businesses.
- The concept of working ON the business, not IN the business.
- The need to build systems to help run a better business.
- The need to plan to achieve greater success.
Take a couple of minutes (quick, first impression answers will do) and fill out the following form. Tell me your basic business numbers. Fax (858-481-7868) your last annual Balance Sheet and P&L to review, and I’ll review for our Journey review.
What businesses are good candidates for the Gameplan services?
The number 1 critical success factor is the passion of the business owner and his/her team. Businesses that can achieve at least a minimum of $100,000 of business net income in the next year or two. Most, if not all the growth should be self funding.
Game Plan – Next Level
Our Gameplan services are centered around a monthly meeting where we will discuss your business and help you better manage your business. We will review “in plain English” what is happening in your business, and how to improve it. We will explore the possible routes to go on your business destination – routes that will get there but some of which are more fraught with danger than others. This process will involve a “financial health check” and explore various “what if” scenarios. We will look at the topline drivers of your business. We want to make the invisible visible. Monitor your performance indicators like a sports car driver. A constant theme of ours is “What you can measure, you can manage. What you can manage, you can control. What you can control, you can leverage.” Using leverage is what makes your business successful.
Cash is King, or Show me the Money!
We will show you how to take the mystique out of your financial statements and reduce your personal anxiety about cash flow by letting the numbers tell you what went wrong, where you are, versus where you want to be, and what action you need to take to reach your financial goals.
As a business owner, you must always know the answer to the question, “Where am I going and when will I get there?” Remember, effective cash management must always attempt to answer in advance:
- How much cash will I need?
- When will I need it?
- Where will I get it?
Go it alone, or monthly Gameplan Profitcoaching?
We will hold you accountable, making you do your financial pushups. Just like diet and exercise. We all know people with good intent who go it alone but never seem to follow through. You can scour the internet until 4am tomorrow morning looking for a quick fix, but all you will find is either nauseating, get-rich-quick e-books, or else vague, fluffy shrink wrapped stuff.
Begin with the end in mind
When you arrive in five years, where will you be? How much do you want to sell your business for, regardless if you want to sell it right now? If you’re not currently selling your business, you’re constantly buying it. Let’s make sure you are growing and buying your business in the most effective and leveraged way.
Regardless of your direction, it should be a journey to results.
Click here to start that journey together.
On your mark, get set, go!…
