…be prepared to revisit the purpose, structure, financing, systems and staffing of your organization.
This is the 4th recession I’ve been through and like so many other business owners, I resist layoffs. So I understand the temptation to tell your sales team to accept whatever they can get. This recession, I am seeing not-for-profit organizations going after government contracts to replace lost corporate sponsorships at the risk of losing their independence and positioning.
Accepting a mish mosh of clients, contracts, or projects may temporarily buy you some time, but it soon becomes expensive and risky. Leaders become “uncentered,” which leads to expensive errors. Plus, roles and structure quickly become confusing. Be prepared to spend more money on your marketing because it becomes more difficult to differentiate. How will your marketing be heard above the noise of the recession if the logic behind what you do and do not do has been lost?
In the first quarter of 2009, a handful of midsized companies brought me in to lead their strategic planning retreats. In 4 out of 5 instances, our preliminary research about market share, trends, and competition indicated that these companies were positioned well to at least triple their gross revenues over the next 5 years. The business is there!
I encouraged each company to commission some additional research focused on their target markets. Since so many people are concerned about cash these days, only 3 of the 5 companies acted on that advice. In all 3 cases, the market segmentation research corroborated that significant growth opportunities exist!
In one company, the executives had not realized that they had been losing market share across the past 5 years! Because they had been adding locations and their gross revenues had been increasing, they thought they were doing just fine! It turns out, if they triple to from $330 Mil to $1 Bil across the next 5 years, they will just maintain their current market share!
Imagine the difference this added perspective would provide when the President shares the “Billion Dollar Vision.” Instead of employees staring back in disbelief and wondering if [you] are demanding the impossible, someone might actually ask why the growth goal isn’t more aggressive.
When we look at market studies about buying trends worldwide, it is obvious that the overwhelming majority of businesses must make the shift to appeal to younger and younger customers. Even companies that provide vacations, housing, and healthcare for senior citizens must have excellent on line marketing because the children of the senior citizens are involved in the purchases. I just purchased Jitterbug® mobile telephones for my 87 year old parents.
Example: Imagine that your business provides mobile digital billboards. Great idea, right? If you are a “techie”, you might be tempted to promote the number of pixels, the variety of available colors, or how quickly the billboard advertising can be changed. That would be the classic problem of leading with features and not talking about benefits. If you understand the value of leading with benefits, you might point out that more prospective customers will see their advertising messages on a mobile digital billboard. You might even share how you match the advertising messages and your travel routes to put your customers in front of people who are most likely to purchase their products.
But, think about how many businesses are still using traditional terrestrial radio advertising or the same old display advertisements in newspapers that are being read less and less each day. Auto dealers. Grocery stores. Medical facilities. Restaurants. They seem so old fashioned…and that image costs them customers. Just taking the one step to place their advertising message on your new attention-getting colorful mobile billboards would convey that your customer is current and forward thinking. Young people are more receptive to buy from companies that embrace new technologies. The public would draw the conclusion that your customers must also be investing in improved customer service and new products. That assumption leads to increased sales for your customers.
If your product/service helps your customers seem more current and forward thinking, that one benefit could lead your sales pitch!
Is it time for you to start making the transition away from being THE decision maker for your midsized business? Perhaps you are a Baby Boomer weighing your retirement options. Maybe you are interested in starting a second business. Or maybe you want to stay active, remain the Chairman of the Board, still contribute, and serve as a mentor for a few key people?
If so, this is a good time to ask the management team to learn a new language to replace old habits with a new style of thinking. For example, it pays to ask them to always spell out which step is involved in a project (problem identification, research, design, implementation, or evaluation). That helps them cue one another about when to provide input versus feedback and to know when a proposed approach will be presented for their consideration.
It also pays to encourage the management team to think out loud and commit to writing who has authority to make decisions, who has responsibility to keep things moving, who must be consulted, and who should be informed at each step of a project. When you see things being handled, it’s easier to let go.
As a Baby Boomer CEO/President of a midsized company, you have reached the point when at least the question of succession and/or transition into retirement has come up. You’ve worked at it (and are a little lucky) so you have a management team that is interested and thinks they are ready to step up and make decisions you have been handling for YEARS. Perhaps, you’ve concluded that you want to stay on as the Chairman of the Board (or Emeritus CEO) to keep active, still make a contribution, mentor key people, and serve as a safety net. But will you be able to let go of day-to-day decisions? Will the managers be able to break the habit of depending on you?
One of my clients in this position said he felt like “a surgeon with a team of eager but junior doctors all around him, but he was afraid to let go of the bleeders or the patient might die”.
This situation provides an excellent opportunity for a business to make the shift from top down (autocratic) leadership to more participative management styles that encourage people to accept more responsibility, take initiative, consider consequences and weigh options.
It helps to promote/hire a President who views the role as facilitator, a hub, or orchestra leader. Replacing yourself with another top down autocratic leader simply protracts the over dependence on an individual. No matter how experienced or bright you or your successor is, a bottle neck develops and the business is less resilient. What if you or your autocratic successor becomes ill? Go on a long vacation? Lose interest? Have an accident? It is also a disincentive for talented people to remain with the company.