The Power Diet for Business
Do you want to cut fat or build
health, muscle and vitality
—and more profit?
A
down economy coupled with extreme competition is causing more organizations to
look at ways to reduce costs.
It’s easy for costs to creep up and a continuous
challenge to keep them in check—much like keeping your weight and waistline
in check. In organizations that already have been reducing costs, symptoms
of ineffective cost reductions may be surfacing such as fewer sales and more customer
complaints. A vicious cycle of slower turnaround begins that propels losing customers, sales, and slices
into profit margins. Some organizations have actually seen lower costs and lower
margins go hand-in-hand--not what was intended. Low staff morale may be adding to difficulties, distractions and
unhappy customers.
The question is, do you
use liposuction or diet and exercise to get in shape? Jane’s story.
Jane has
always watched her appearance, but personal distractions and stress in her life
have over time increased her dress size beyond acceptability. Jane’s health is
also suffering and the risks for heart disease and stroke have become alarming.
Unfortunately, instead
of a longer-term health focus, Jane’s opts for liposuction for the “speed
and convenience.” Post-surgery Jane is thinner, however, her skin is sagging
and she is in pain and severely depressed. Moreover, her blood pressure is still
high, her cholesterol unacceptable and the eating and exercise habits that got
her in this shape have not changed.
Has Jane moved forward
or stepped backward?
By choosing a quick
fix, emotionally and physically Jane may be in poorer shape to face her new
situation—and she’s spent a lot of money to feel and look worse and is in no
better health.
Organizations can get
in a similar bind.
The Power Diet and Exercise Program for Business
1.
Don’t’ rearrange the deck chairs on the Titanic.
Enormous energy is wasted “discovering” we have too much
non-essential activity rather than a concentrating on what makes us money and
how well we execute. Make your focus on what keeps your business healthy. Look
at the revenue drivers in your business and what keeps your customers coming
back. If you cut back
service and lose profitable customers as a result, is your business better? Are
you “bean counting” or developing winning strategies with business models
that can be implemented in your operations?
2.
Install preventative maintenance, not more controls that increase your
cost. If you just add more signatures and cost controls, you haven’t
reduced cost—you’ve hamstrung your business with more paperwork, cost and
less profit. Develop performance capabilities and continuous improvement as
goals in your operations. Make your managers accountable and monitor progress
regularly as part of “the way we work around here.”
3.
Ask the right questions about your processes and business dynamics. Do
your employees spend time and energy on serving your customers and making your
products and services more valuable in their eyes? If your customers want faster
service, spending time on improving speed is worthwhile as an investment.
In a Wall Street Journal article on tire manufacturers winning
higher prices for better manufactured tires for SUVs, General Motors replied,
when asked for comment, that they were always looking at ways to get better
prices from their suppliers. Better prices from suppliers may not serve your
customers or long-term business interests. Talk to Ford and
Bridgestone-Firestone about over-using a cost reduction strategy. Is GM asking
the right questions? One client reduced a major six-function process 45%. They
found those savings in five one-hour sessions. By asking the right questions and
involving the right people, they made lasting changes that improved speed and
customer service plus produced these results within 60 days! Business execution
of strategy became everybody’s business.
4.
Know the vital signs of whether sales and operations are on track. It’s
too late if it’s in your accounting numbers. What is vital to business growth,
sustainability and profitability in your business? Do you have ways to monitor
whether you’re going in the right direction? Good metrics can accomplish two
things—metrics let you know where you are and provides feedback. If used
properly by rewarding direction and not expecting perfection, feedback will
provide your employees working satisfaction from doing something hard. Employees
respond to real challenges, “we choose to go to the Moon, not
because it is easy, but because it is hard.” Set
milestones and celebrate reaching them. Reward new behaviors so they become
productive habits.
5.
Know
when and how to use a fitness trainer. The
behaviors that got you overweight are not easy to change. You may need someone
who is not part of the problem and who will keep you from injuring yourself
while you change poor habits. Make sure your “coach and trainer” is
concerned with your fitness. Find consultants who are experienced, will be
involved in the actual work and are focused on making YOUR business better—not
the quick fix that addresses symptoms only. Find objective individuals who pride
themselves on implementations that work. Look for individuals who transfer know
how to your organization.
6.
If you’ve waited too long. . . Remember Jane. She weighs less,
but her health is no better. Go back to item one to figure out what to cut.
Simplify what you do to make money to avoid a new boom-bust cycle. If you
don’t, customers, boards, stockholders and talented employees may start to
question how viable your management really is! Execution and follow through are
vital to leaner operations. Avoid “silver bullet” solutions that can often
shoot you in the foot or worse! Look for ways to become more effective and
profitable.
Use the
power diet to strengthen your business. Start at the front-end, the customer,
and gain a “big picture” of what must happen so that you build muscle,
health and vitality-- not just liposuction fat that returns. By working from the
“outside-in” and asking the right questions of the people doing the work,
you’ll find real opportunities that strengthen your business vitality and
long-term health.
Janice Scanlan helps organizations when they don’t have
much time to get it right. Contact her at 281 261-2320 or janicescanlan@earthlink.net
if you aren’t achieving success as fast as you need to!
Who is Janice Scanlan?
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