Andrew Simon: How Beautiful If You Could Do A Business Turnaround

By Andrew Simon, Business turnarounds are never easy, especially if it is your business and you must do something drastic to turn it around.

Andrew Simon: How Beautiful If You Could Do A  Turnaround

Andrew Simon

We have had experience at Simon Associates Management Consultants (SAMC) helping clients turn around their businesses. We have also had hands-on experience turning around one of our own entrepreneurial ventures. But whether we are supporting someone or dealing with a turnaround ourselves, broken businesses are never pretty. Wouldn’t it be beautiful, though, if you could do a business turnaround for your business?

Where Do You Begin?

At SAMC, we often get engaged to help a company that is going in the wrong direction. Often, there is a crisis. How do you know if you are facing a critical moment in your company’s development? We have found there is a recurring pattern often marked by one or more of the following crisis moments:

For a period of time many of our turnaround clients were experiencing limited or even zero growth. Sometimes it was for as long as three to five years. They had typically hired a new sales manager, developed new products, launched a new marketing campaign, and still saw sales flatten or stall.
Some situations come from the realization that their customers are changing. One client saw his largest customer leave for a competitor because that competitor had a larger scope of services that were more relevant for the customer’s needs.
In some cases, more competition is emerging or different types of competitors are disrupting the old style of business.
Demographic trends have an impact. We have found this to be true with many higher-education clients where enrollments are being affected by changing demographics. With fewer high school students, and hence fewer traditional college freshmen, colleges have been facing major crises impacting everything from who they are to what they do and who they do it for.
It doesn’t matter if you have a heavy industrial company or a B to C business, something is changing and you are stuck in the past. Your own efforts to change have led to dissent among your staff and little growth among your customers. Sales are flat and it is time to start a turnaround.

You see yourself facing a crisis. What to do?

If you are facing any of these conditions, or ones unique to your own company or industry, you are ready for some turnaround training. You have always known how to run the business. You learned it in your MBA program or on the job. Now you have to become an expert in an entirely new leadership role – designing and driving a turnaround.

Here are some things to think about:

  1. First, take stock of where you are and assess your current condition. Review all of your core assumptions. Are they still good; still valid? Rethink such issues as: Who are your customers of the future and how should you serve them? Where are customers located and how do they purchase your services? How good are your marketing and sales efforts? How do you use technology? What types of collaborations do you have inside and outside your business? What is your company’s culture today and is it set up properly for the future? What types of people do you have and will you need, and are they the same? We could go on, but you have the idea. Everything is open for review and rethinking.
  2. Next, reverse everything. You are going to need some tools to rethink those assumptions. We like to use Innovation Games® because they help you and your team to rethink everything in a safe, creative environment. One game that works particularly well is called “Reverse Everything.” It enables you to take everything apart and put it back together in new ways. When I was in the consumer packaged-goods business my boss always told me that “good marketing people pull things apart and rebuild in different ways.” Try it sometime. You can learn more about it here.
  3. Don’t narrowly define yourself. Sometimes we fall in love with categories. But these categories are too narrow and even if you own everyone in the category there isn’t enough volume to make a business. Think across categories. As Franz Johansson wrote in his groundbreaking book “The Medici Effect: Breakthrough Insights at the Intersection of Ideas, Concepts and Cultures,” the more ideas you have the more likely you will have big ones. They come at the intersections
  4. Blue Ocean Strategy®, nonusers, and unmet needs. As Blue Ocean Strategists, we approach turnaround situations as if they are in need of a new strategy, a blue ocean one. To continue to do more of the same, even cheaper, is a very difficult strategy to embrace when a business needs an overhaul. Instead, we would urge you to think about nonusers and unmet needs, the central core of blue ocean strategic thinking. 
    This is critical to your success; to that turnaround. Spend time asking people what keeps them awake at night; what problems do they have that seem to be unsolvable.
  5. Be brave. Turnarounds require emotional courage. Eighty percent of businesses aren’t around five years after launch date. There are startling statistics about companies that 50 years ago were in the Fortune 500, but now are no longer around. However, there is also research that suggests that if those companies had been brave they might still be here. Kodak is one of those types of frightened companies that could not see the trends that were all around them, building digital cameras to replace their film. Blockbuster denied that NetFlix was relevant. They thought Apple and Walmart were their competitors. Blackberry never saw the iPhone coming.
  6. Build a team. You might be the greatest, the best. But you can’t turn everything around by yourself. If you are the chief strategist, you need people who not only believe in you but can execute for you. Think about how you are going to convert your team to lead the transformation rather than undermine it. As John Kenneth Galbraith said, “Faced with the choice between changing one’s mind and proving that there is no need to change, most everybody gets busy on the proof.”
  7. Believe in yourself. Turnarounds are never easy. But if not you, who else? If you think you are right, you need to lead so that people follow and trust that there will be rewards that come from the changes.

Don’t find yourself struggling or stalled. Remember “Insanity: doing the same thing over and over again and expecting different results.”

If you believe that you can turnaround your company, it will be a beautiful transformation for you and your team.

Survive Business Disruption Beyond Control

Business plans – like all plans – can go awry when business disruption beyond the control of the owner of business disrupt the everyday routine.

Survive Business Disruption Beyond Control

Business Disruption

Such disruptions could be because of a dip in the economy, a natural disaster that creates havoc, a shift in the public’s buying habits, or new technology that can do what you do better.

“Interruptions within a business are as much a part of life as breathing and blinking,” says Raméz Baassiri, author of Interrupted Entrepreneurship: Embracing Change in the Family Business (www.ramezbaassiri.com). “They are viewed by some as hiccups, challenges, or even crises.”

Baassiri, a board member of AHB Group, a multinational and multigenerational family business, says such moments can prove deadly to a family business, which about 80 percent of all businesses in the United States are. But those disruptions also can be the catalyst for even greater success, depending on how they are handled.

He says a few things family businesses can do when life upends the daily routine include:

-Don’t just adapt to change, embrace it. “Every family business has dealt with and will deal with interruptions, from the expected changes and challenges of growth to the unexpected interruptions resulting from loss and poor decision-making, and everything in between,” Baassiri says. “You must be ready to accept and even embrace such changes as they come, to get creative with them and use them as a catalyst for improvement.
-Find your “Mass Transformative Purpose.” Think about the way in which your company plans to change the world. In other words, why does your business exist? “Knowing that can help you stay focused and overcome seemingly impossible obstacles when they arise,” Baassiri says. “The first time I was asked what our family business’s main purpose was, I replied that it was to ‘stay united as a family with a purpose.’ But the more I thought about it, the more I realized that our purpose isn’t just about family; it’s more than that. It’s to be good citizens, contribute to society, and create educational opportunity. We strive to work hard to achieve great things so that we will be able to give back to society.”
-Turn challenges into opportunities. Missed opportunities and failures to turn interruptions in entrepreneurship into positive change abound in the business world. One famous example is how Blockbuster turned down the purchase of Netflix in 2000 for $50 million. Netflix was valued at more than $32 billion only 15 years later. “As much as we may tell ourselves that we need to think beyond how well our company is doing today and plan for future opportunities, it’s much easier to stick with the path that we’re familiar with,” Baassiri says. “Disruption is uncomfortable, but it’s necessary if we’re going to evolve.”
-Hire a diverse team for your business. “You can get stuck in your comfort zone because you see the same things every day and revolve in the same circles,” Baassiri says. “You need an extra set of eyes looking at the company from other angles and letting you know where your weak links are and where you can grow. Of course you won’t always agree, but that’s healthy; it means you’re being challenged.”

“Controversial thoughts are where innovation thrives,” Baassiri says. “They were the origin of the telephone and the car, the airplane, and spaceships. By asking questions, by thinking beyond the given and looking at the possible (or even the impossible), we grow, and in growing, we thrive despite the disruptions.”

FASTSIGNS of Kirkland to relocate to larger location on 85th Street

FASTSIGNS KirklandOn May 1, FASTSIGNS of Kirkland will be doing business in a new facility at 12644 NE 85th St., which is located half a mile east of its current location and is 700 square-feet larger.

“As our business continues to grow and we take on more comprehensive sign and visual graphics projects, it’s time to expand to a larger facility,” said Greg Shugarts, franchisee of FASTSIGNS of Kirkland. “Our new location allows us to serve customers even better with an improved layout for production and additional office space for our growing team.” 

FASTSIGNS of Kirkland’s new location Continue reading “FASTSIGNS of Kirkland to relocate to larger location on 85th Street”

AWB statement on proposed House budget

AWB LogoKris Johnson, president of the Association of Washington Business, issued the following statement Monday in response to the proposed 2015-17 state operating budget heard by members of the House Appropriations Committee.

“Although this budget makes some important investments in education and social services, it is disappointing for Washington employers, particularly small-business owners, because it proposes to pay for them by raising taxes on small businesses, a group that already pays more than its share of the state’s tax burden. Washington businesses pay more than 54 percent of state and local taxes.

“Raising the state’s gross receipts tax, known as the business and occupation (B&O) tax by 20 percent on services, as this budget proposes, would hit more than 100,000 small businesses hard at a time when most of the state is still waiting for the economic recovery to arrive. In 37 of 39 counties, Washington’s unemployment rate remains higher than the national average and in many counties, including Pacific, Grays Harbor and Okanogan, the unemployment rate is above 10 percent.

“We also have concerns about the proposed capital gains tax. Although it’s described as a tax on high-income individuals, it could impact a wider group than intended, including some small businesses.

“Raising taxes in this climate, and repealing tax incentives that voters have previously endorsed, will make Washington less competitive for many employers, particularly small, family-owned businesses, and will not stimulate much-needed job growth.

“Washington is expected to bring in $3 billion more during the next budget cycle. That’s about a 9 percent increase over the current budget, a rate of growth that most businesses would be delighted to see. Voters have made it clear they want lawmakers to fund necessary services while still living within their means.

“We look forward to seeing the Senate Majority Coalition Caucus’ budget proposal soon.”

About the Association of Washington Business

Formed in 1904, the Association of Washington Business is Washington’s oldest and largest statewide business association, and includes more than 8,300 members representing 700,000 employees. AWB serves as both the state’s chamber of commerce and the manufacturing and technology association. While its membership includes major employers like Boeing, Microsoft and Weyerhaeuser, 90 percent of AWB members employ fewer than 100 people. More than half of AWB’s members employ fewer than 10. For more about AWB, visit www.awb.org.

16,000 Jobs Lost Under House Bill 1355

NFIB logoWashington state could lose more than $7 billion in economic output and 16,000 jobs should House Bill 1355 become law, according to testimony given today by Patrick Connor, Washington state director for the National Federation of Independent Business, America’s largest and leading small-business association.

Connor presented the findings from a report conducted exclusively on HB 1355 by NFIB’s Research Foundation to the Senate Commerce & Labor Committee at this afternoon’s hearing on the measure. “Common sense alone should warn what would happen if you shocked employers with a nearly 30-percent spike in the state’s minimum-wage rate,” said Connor, “but our study, which uses the most sophisticated economic modeling available, puts in graphic detail the economic peril contained in HB 1355.”

Michael Chow, senior data analyst for NFIB’s Research Foundation, used the Business Size Insight Module to produce the report on HB 1355. BSIM is a dynamic, multi-region model based on the Regional Economic Models, Inc. structural economic forecasting and policy analysis model, which integrates input-output, computable general equilibrium, econometric, and economic geography methodologies. The BSIM has the unique ability to forecast the economic impact of public policy and proposed legislation on different categories of U.S. businesses differentiated by employee-size-of-firm.

HB 1355 would raise the state’s hourly minimum-wage rate to $12 from its current $9.47, already the highest of any state in the nation (the District of Columbia’s rate is $9.50). The federal minimum-wage rate is $7.25. HB 1355 squeaked out of the House on a 51-to-46 vote on March 3. Today’s hearing in the Senate was its first in that chamber.

“It will forever bear repeating that the minimum-wage rate is an entry-level wage earn almost entirely by teens and young adults starting out on their working lives,” said Connor. “Raising it has mainly one effect, and that is to remove the first rung up the economic ladder for tens of thousands of young people. This state also has a disingenuous history with this issue, after voters were promised that a 1998 ballot initiative linking future increases in the minimum-wage rate to rises in the Consumer Price Index would forever solve the issue and remove it from politics.”

The entire 19-page BSIM analysis can be read here.

For more than 70 years, the National Federation of Independent Business has been the Voice of Small Business, taking the message from Main Street to the halls of Congress and all 50 state legislatures. NFIB annually surveys its members on state and federal issues vital to their survival as America’s economic engine and biggest creator of jobs. NFIB’s educational mission is to remind policymakers that small businesses are not smaller versions of bigger businesses; they have very different challenges and priorities.

Staples Survey Highlights Importance of Technology To Small Business Owners

For small business owners, email rates as the top software tool (47%) for running their business, followed by financial management software (29%), according to a Staples’ study of 510 small business owners conducted online by Harris Poll during late summer 2014. Additionally, the survey shows the importance of technology to small businesses of all kinds.

“More than ever, small businesses rely on technology to make more happen every day,” said Alison Corcoran, senior vice president, North American stores and online, Staples. “Staples offers an expanded assortment of the latest technology products in store and online, as well as Staples EasyTech™ services to help our small business customers so they can focus on running their business.”

The survey also shows that this is a crucial season for small businesses, with 62 percent looking forward to fall as the start of the holiday. Overall, about a third (31%) plan to invest in online marketing this fall.

Additional facts revealed in the Staples Small Business Owners Survey include:

  • Drive profits: Small business owners want to improve business by increasing promotional marketing (26%), developing social media (21%) and managing inventory better (14%).
  • Technology focus: 71% of small business owners say the computer is the most crucial piece of office equipment.
  • Everyday focus: 63% of small business owners don’t have a five-year plan.
  • Buying decisions: 96% of small business owners are involved in purchasing products for their business.
  • Omnichannel shoppers: More than half (53%) of small business owners use the convenience of shopping both channels, with 82% shopping in store and 66% shopping online.
  • More efficient:  Small business owners plan to “get smart” increase efficiency this fall by focusing on marketing and advertising (28%), cash flow management (26%) and social media use (26%).
  • Fall clean-up: 56% of small business owners actually plan a fall clean-up.

To help small business customers prepare for the busy fall and holiday seasons, Staples is celebrating small businesses throughout October with special savings and business tips. For small business expert tips and details on savings visit: http://www.staples.com/Small-Business-Main/cat_BI823623

Methodology

This Staples SBO Success survey was conducted online within the United States by Harris Poll on behalf of Duffy & Shanley and their client Staples, between August 26 – September 2, 2014 among 510 U.S. small business owners, in each of the 4 regions (East, Midwest, South, and West). This online survey is not based on a probability sample and therefore no estimate of theoretical sampling error can be calculated.

About Staples:

Staples makes it easy to make more happen with more products and more ways to shop. Through its world-class retail, online and delivery capabilities, Staples lets customers shop however and whenever they want, whether it’s in-store, online, on mobile devices, or through the company’s innovative buy online, pick-up in store option. Staples offers more products than ever, such as technology, facilities and breakroom supplies, furniture, safety supplies, medical supplies, and Copy and Print services. Headquartered outside of Boston, Staples operates throughout North and South America, Europe, Asia, Australia and New Zealand. More information about Staples (SPLS) is available at www.staples.com.

Benefits of Video Conferencing for Small Businesses

According to Huffington Post, the average manager in the workforce spends about half of their day in virtual meetings. This is a huge difference from the actions of corporate leaders a few years ago who rejected or didn’t really understand the significance of integrating video conferencing in the workplace. Now, with executives singing a new tune, the business world is expected to keep evolving, in terms of technology and the addition of even more efficient features as time goes on.

While big corporations are expected to delve into the video conferencing phenomenon, many small businesses are still warming up to the how much these platforms could actually benefit them. Obviously, costs and going outside of a tight budget is mostly being taken into consideration by companies that are still on the rise. Still, Blue Jeans Video Conferencing features should be viewed as a worthwhile investment that’ll eventually pay off in numerous ways.

  • Environmentally Friendly

In the last few decades, the use of paper in companies has gradually become a big no-no. This is especially true for individuals in corporations that promote taking better care of the ecosystem by recycling or being mindful of using paper only in dire circumstances. As a small business owner, you’re getting the most out of new wave corporate practices while simultaneously endorsing a meaningful cause that many people take to heart when you choose to invest in Blue Jeans Video Conferencing.

  • Less Time-Consuming

You also have the freedom of keeping more flexible hours. Figuring out a time when everyone can physically meet can be an unnecessary hassle, not to mention all of the meaningless small talk that people use in conventional business meetings. Granted these are sometimes effective ways to break the ice or transition into the next agenda item in a smooth fashion, but there’s a tendency of getting carried away with idle conversation.

  • Boosts Productivity

That said, online meeting participants are less likely to lose interest due to unproductive talks. Consider the times you’ve stared at a speaker’s face without fully processing his or her words because mentally, you’d already went into your own world of thoughts. Don’t feel bad because everyone’s had a similar feeling at some point in their career.

Unfortunately, this is a normal response that indicates the lack of engagement in many face-to-face meetings. Virtual conferences, on the other hand, help you stay focused on the bigger picture. Corporate webinars force people to get to the heart of their meeting’s outline without rambling or digressing.

This, in turn, triggers a higher participation level that has better chances of wooing people into speaking up and voicing their opinions. Keep in mind that some people are still very self-conscious when it comes to speaking in public, but with this kind of approach, more people feel at ease about contributing to the conversation.

  • Promotes Versatility

There’s basically no limit to the amount of features that are present in online meeting platforms. Small business leaders should take this factor for what it’s worth and try to get the most out of the tools that equip them to carry out spectacularly structured discussion. Believe it or not, the large assortment of features available keeps your audience stimulated as well. There’s simply no time to yawn or entertain wandering thoughts when you have the opportunity to learn art of bi-directional document sharing or how to manipulate video layouts of a certain speaker.

  • Saves Money

Don’t get left behind in the dinosaur world of outdated business processes that sometimes plague the corporate sphere. Shareholders and top executives yearn for change and innovation. One of the top ways to show them that you’re on board with their ideals is to integrate Blue Jeans Video Conferencing systems into your daily work routine. Make the mark of a lifetime in your chosen profession by taking control of the advantages the online meetings that are within your grasp.

  • Promotes a Health Work/Life Balance

Have you ever felt like you’re the majority of your life during the week was spent in conference rooms? It’s not a good feeling to dwell on, as this brings up a very important point: if you’re stuck in an office conversation during most of your days, you really don’t have time or energy for anything non-work related.

In addition, excessive travels can put a damper on your spirits and drain you since it’s not done in moderation. When this happens, you’re no good to anyone, and you tend to get less work done because you’re focused on how bad you feel.

Online video conferencing gives you the power to dictate your work/life balance. Managing interactions on this platform gives you more time to put your energies toward your personal life and the activities that you enjoy doing outside of work.