Five Strategies for Growing Successfully

Not all growth is good growth, five tips to help you ensure that growth is good

Do you want to grow your business?  If so, do you know how you are going to grow the business?  And are you aware of the difference between good growth and bad growth?

People often want to grow for growth’s own sake.  This is more about taking on risk than taking on growth.

Strategy 1: Control Your Growth

You need to manage growth, not have it manage you.  I suspect more companies have failed through poorly managed and unplanned growth than any other reason.  At times you will also want to slow growth to allow you to “catch up” with yourself.  Fast and successful growth is rare.  You need to be able to absorb the lessons you learn as you grow and incorporate them into your next steps.  In doing this you also need to consider some of the risks that are associated with poorly controlled growth, these include:

  • Cash flow risks – growth consumes cash, and rapid growth consumes cash rapidly. If you are not careful you can find yourself with insufficient cash to cover your operating costs; you also run the risk of trading whilst insolvent.  It only requires one unexpected cost or one delayed customer payment to push you over the edge.
  • Operational crunch – to produce the volume required to support your growth can be difficult.  Equipment and/or people have to operate beyond what is practical, and things start to come apart at the seams with increasing inefficiencies and attendant risks.
  • Poor customer service – you have more customers to look after and not always the available people or resources to do so.
  • Rapid expenditure – with more orders coming in you may be tempted to spend more on people, infrastructure, and resources.  You want to invest, but not over-invest or leave yourself exposed.
  • People risks – existing people will be worried about the rapid changes, stressed by an increasing workload, exhausted by an expanded role for which they may not be suitable or experienced, and worried if you will be able to pay them each month.  St the time you need them most you may find your best people, who are the most marketable, may leave.
  • Decision-making changeswith rapid growth people need to step back from an operational focus to a leadership role.  There is a risk that leaders can become disconnected from what is happening at the front-line and make decisions based on the incomplete or inaccurate information.
  • Leadership shortfalls – people who may be operationally adept may lack the necessary leadership skills, business acumen or interpersonal skills to lead effectively.  This can cause problems and compound existing risks.

Strategy 2: Go for Good Growth, Avoid Bad Growth

Good growth is aligned with your purpose and what you are trying to achieve.  Bad growth is not aligned.  Often the problem of bad growth is that you are prepared to take a short-term gain but sacrifice the long-term future.  For example, taking on a big client who has a poor reputation for paying on time leads to serious cash flow issues later and takes a disproportionate amount of your precious time in managing the relationship and fire-fighting. This can also impact your team, lower morale and create stress and pressure.

Make sure that what you do, who you partner with, and who you sell to are aligned.  Good growth is about servicing the need of selected and targeted clients – not any client with a checkbook.  For good growth, you need to say no to opportunities to keep focused and aligned.

Strategy 3: Growth Means Letting Go

If you want to grow you need to prune back.  As the demands and needs of your business change so I remember, as a child, playing on the monkey bars.  The only way you can forward on the monkey bars is to let go with one hand, swing forward, and grasp the next rung. So you need to repeat it to get to the other end. Business is just the same. Let go to grow.

Strategy 4: Lead Your Growth

Growth is about change, and change is about leadership, not management. You need to lead your people and share with them the answers to three questions:

  • What are we changing from and why?
  • What are we changing to and why?
  • How are we going to do this?

Doing this remove any vagueness or information vacuums which can cause stress and rumors and stories (often inaccurate) in an attempt to fill the gap.

Strategy 5: Go Slowly

Business is not a sprint, it is a marathon. Paradoxically, by going slower you will get there faster – and with your risks better managed, and you be better prepared for them.

To grow, and to grow profitably, control your growth, go for good growth, let go to move forward, lead your people to growth and to grow well grow slow.

Please feel free to re-tweet, re-blog, email and share this article with others who may find it of use or interest.

To view or download a PDF version of this blog click here.

Share your thoughts and ideas here, or email me at andrew.cooke@business-gps.com.au

If you found this article of use or interest please don’t hesitate to share it with others.

Click here to find out more about Andrew Cooke and Growth & Profit Solutions.

7 Secrets for Successful Business Growth

If you want to grow your business, and I mean really grow your business, then here are a few simple but powerful secrets you can use. When you get to the end there is an eighth and even more powerful secret to share!

7 Secrets + 1

  1. Know what you do and what you don’t do.

The temptation for many small business owners is to do anything to earn the next dollar. In trying to be all things for all people you end up not being good at anything in particular. You are not even average, you are mediocre. And mediocre does not stand out, nor does it sell. No sales, no growth.

  1. Know your strengths.

If you want to grow successfully then you need to know what your strengths are. What are the things that you love doing that you do well?  What are the things which you do which have the greatest impact?

Using your strengths allows you to raise your performance and improve your results on a sustainable basis. Don’t make the mistake of trying to improve by addressing your weaknesses, all that does is improve your performance to an average level at best, and you may not be able to sustain the improvement.

  1. Be the prize.

Too often business owners are prepared to work with anyone to win more clients and earn more money. This just makes you look desperate and needy. Frankly, when were you impressed by somebody who was desperate to work with you? You weren’t! So be selective with whom you work with, and hold yourself out to be the prize they want to have and work with! By holding back, you appear more attractive.

  1. People don’t buy what you do

Sorry! The world does not revolve around you.

People are not interested in what you do. I know you are interested in what you do, and you love it, but it doesn’t matter. People are only interested in what you do for them – and there is a world of difference in this! They buy the results and outcomes that you help them realize. So, help people buy by articulating what you do for them clearly and concisely.

  1. Speak their language

Do you remember the first time you want to a foreign country where no-one spoke your language? What were the feelings and thoughts you had at the time? If you want to be understood, make sure you speak their language. Don’t use the industry jargon that you and other fellow professionals use, it just confuses and alienates your customers who don’t share your language. When people feel confused or alienated they want to avoid taking risks, and so they don’t do anything. So, speak with your audience in mind so what you say is what is heard.

  1. Don’t shout, just whisper

We live in a noisy world. Everyone is trying to gain our attention, we are submerged in a deluge of information whether we are at work, at home or elsewhere. If you try to shout louder than anyone else all you will get is a hoarse throat. To outshout others, you need to outspend them in broadcasting your message in the hope that somebody will hear you, and then hope yet again that they will act on it in the way that you want them to! Some chance!

Better to whisper.

To whisper, and to be heard, you need to have a message that your audience is already attuned to. Rather than broadcasting to everyone across all frequencies you need to pick a single radio channel and transmit to those who want to listen to your radio show. By broadcasting country music on your radio show there will be many who aren’t interested, but those who are will be ready to listen and act on your message!

  1. Being good at what you do is not enough

You might believe you are the best at what you do, but it doesn’t matter. Being technically good at what you do will not make you successful. I have come across many business owners who are good at what they do, but their business is in a terrible state. Having technical savvy does not mean you have business savvy. Look at your business through “business glasses”, not your “technical glasses”

Bonus Secret:

Now you know these seven secrets here is the bonus secret I promised you. It’s a simple three-word phrase you probably have already heard – “Just Do It!”

To grow requires action. So, don’t just read these seven secrets and think “Oh! That’s interesting!” – do something with them. Take action now. Choose one thing you can do – right now – and which will help you grow. Share the one thing you are going to do in the comments section below.

To view or download a PDF version of this blog click here

Share your thoughts and ideas here, or email me at andrew.cooke@business-gps.com.au

If you found this article of use or interest please don’t hesitate to share it with others.

Click here to find out more about Andrew Cooke and Growth & Profit Solutions.

3 Ways to Help Change the Perceptions of Others

Perceptions of Business Growth – What is REALLY happening?

by  Andrew Cooke, Growth & Profit Solutions

Is your business growing or not? Do you share the same view as your staff, your manager or your leaders?  How do you know if you do?  This article highlights the differences that exist, examines why they exist, and suggests ways to create a common understanding of the business’ growth potential and opportunity.

ImageA recent Australian study by Leadership Management Australia (June 2012) of over 2000 participants including Leaders, Managers and Non-Managerial Employees highlighted a major problem and disconnect facing business.  The perception as to whether their businesses were growing or not.

The Non-Managerial Employees firmly believed that their businesses were growing (71%) whereas Leaders and Managers have a considerably different outlook – with the belief that growth is declining. Only 47% of Leaders perceived their businesses as growing and 45% of Managers.  So what does this mean for business in dealing with the future?

An individual’s perception of a situation is their reality, no matter what you think.  It is how they ascribe meaning to a situation and is based on their beliefs, feelings, ideas and experience.  As such we are looking at how to overcome a clear difference of opinion and belief. Failure to do so can cause major problems between these groups.

So what can we do?

Firstly, the differences may be due to the time-scale that the respective groups look at the work of the business – employees focusing more on the immediate and short-term, managers for the mid- and short-term, and leaders for the mid- and long-term.  The longer the time-scale that you are working to the greater the level of uncertainty that you need to incorporate into your forecasts and plans.  We need to understand this.

Uncertainty comes from a variety of sources.  Externally to Australia there is growing uncertainty in relation to economic, environmental and even political conditions in a number of countries, whose ripples are being felt on Australia’s shores.  Within Australia there are internal uncertainties including the carbon tax and the mining tax which is exacerbated by a government suffering in the polls.

Secondly, employees need to understand the perspective of managers and leaders.  To do this the leaders and managers need to clearly and consistently communicate what the issues, opportunities and risks are and in doing so create trust.

Trust creates high-performing organisations (HPOs) and helps the business to achieve high revenues, profits and market share than low-performing organisations where trust is low.  These HPOs are also more effective at accomplishing their goals in critical areas including customer loyalty and retention; achieving predictable results; business agility and practicing innovation and creativity.

Thirdly, the business needs to actively engage employees in coping and dealing with these changes and engendering trust.  Key to this is establishing clear priorities and being able to cascade them to people so that they are meaningful, relevant and measurable; and building these priorities into their work creates alignment, traction and results.

To enable the business to grow requires more than leadership and good management.  It requires good communication, developing trust across and throughout the business, and the establishment of a commonly shared and understood perception of the business and its future growth. Creating this enables the business, holistically and at all levels, to engage proactively and develop opportunities and options for business growth.

Do you know how perceptions vary across your business and why?  What perception do you want to create for your business and how will you do it?  Share your ideas, experiences and examples of what has worked and what has not – ask your questions and let’s see what answers we can come up with.

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Click here to find out more about Andrew Cooke and Growth & Profit Solutions.

Why you need self-confidence, simplicity and speed in business

Why you need self-confidence, simplicity and speed in business

Many businesses, as they grow, develop a bureaucracy. This makes it hard for the business to adapt to the accelerating changes we are experiencing. As Professor Gary Hamel said:

“Today, the most important question for any organisation is this: are we changing as fast as the world around us?”

In the current environment if we do not grow then we do not stagnate, we atrophy. Jack Welch, while he was the Chairman and CEO of General Electric (1981-2001), developed the Three S’s.  According to Welch, the Three S’s are interrelated and mutually supportive and, as such, are a prescription for winning in business.

The Three S’s are:

  1. Self-Confidence. Always believe in yourself.  Embrace change before you have to.  Take consistent action.  You develop self-confidence by gaining experience and winning multiple times.
  2. Simplicity.Reduce things to their simplest level; not simplistic, but simplified.  When communication is clear, it travels faster.  Use clear communication to empower others.  You cannot have simplicity without self-confidence.
  3. Speed.When communication is clear, direct language causes action and decisions to happen faster.  Speed is a competitive advantage.  You cannot have speed without simplicity.

Bureaucracy fosters formality, which slows business down and creates complexity. This makes it harder for your business to change as fast as the world around you. Here you risk becoming irrelevant in business and out-performed by your competitors. So focus on the three Ss and build your self-confidence, develop simplicity and increase your speed.

The 7 Questions for Growing Your Business

How you can improve employee commitment and engagement demonstrate respect.

When you are looking to grow your business there are three steps involved: firstly, determining what your business will look at a given point in the future; secondly, what the business currently looks like; and finally, how you are going to bridge the gap between the two.

I always begin by looking at what I want the business to look like in the future. Why? The future does not yet exist, so I have the opportunity to create it from scratch. The future is not just an extrapolation of today – it is new and exciting! Your future can include current offerings, adapted offering, new offerings or offerings that you no longer make available.  Similarly with your customers you may be serving existing, adjacent or new customers, or you may no longer serve some of your existing customer groups. In short, starting with tomorrow frees you from the constraints of thinking of today.

At the heart of growing your business are two key outcomes you are looking for:

  • Growth – you are looking to grow and develop your business
  • Profit – you want your business to be more profitable in the future to make it sustainable

Driving these two outcomes are seven areas, the seven Ps, which surround them. This is shown below.

Th e 7Ps  Driving Growth and Profit

  1. PurposeWhat is your “Why”? – what is the reason for being for your organization that inspires and engages you and others?
  2. PatronsWho are you customers? – what customer segments do you serve and with which offerings?
  3. ProblemsWhat issues do they have? – what are the problems they need help with, or the jobs they are looking to get done?
  4. ProductsWhat are our solutions to their problems? – how do you help your customers with their problems in a way that the customers sees as valuable, which differentiates you from your competition and which will make you money?
  5. ProcessHow do we deliver the solution? – this includes everything that is involved in creating, supporting and delivering the solution. This includes everything within your business, and with the other businesses you work with or through in creating and delivering the solution.
  6. PeopleWho do we need to run the process? – what people do you need and in which positions, and what skills, capabilities and attitudes do they need to have to do the job efficiently and effectively?
  7. PromotionHow do we promote ourselves to our Patrons? – how do you reach out to your different customer groups and how do they want to engage with you, and what channels are most effective for doing this?
  8. Growth & Profit – this are the outcomes you achieve from getting the above seven factors right, and being able to leverage them effectively.

Use these questions as outlined in the table below to help you think this through in three steps:

  1. WHERE do you want to be? (future)
  2. Where are you NOW? (present)
  3. HOW will you bridge the gaps? (strategy)

So don’t wait – start this now. Share your thoughts and ideas with your colleagues and see how you can create your own future and bring it back to today!

To view or download a PDF version of this blog click here.

Share your thoughts and ideas here, or email me at andrew.cooke@business-gps.com.au

If you found this article of use or interest please don’t hesitate to share it with others.

Click here to find out more about Andrew Cooke and Growth & Profit Solutions.

2 Insights for Building a Stronger Business

Building a stronger business through network effects & collaboration 

Network effects are becoming increasingly important for businesses; especially those involved in technology, as by understanding them you can not only build better products but also a better business.

A network effect occurs when a product or service becomes more valuable to its users as more people use it. For example, when people first started using telephones they had little value as there were very few other people who you could call. As the number of people who had telephones increased, then so did the number of people with whom you could communicate – this making telephones more valuable to those who had them.  More recent examples of this include communication and social media applications such as Skype, Facebook, Linked-In etcetera.

Telephones, of course, don’t perform better as you add more of them to a network. But people and institutions do. And that’s where the concept of network effects gets more interesting – when you apply it to how people might perform better.

Example: World of Warcraft

The online role-playing game World of Warcraft (WoW) provides an intriguing example. Performance in the game is measured by experience points, which are awarded to players as they successfully address progressively more difficult challenges. It takes roughly 150 hours of accumulated game play to earn the first 2 million experience points but players on average are able to earn another 8 million experience points in the next 150 hours of accumulated game play. Even though within the game, experience points become more difficult to acquire as you advance, World of Warcraft players are improving their performance four times faster as they continue to play the game.

How? Most improve their performance by leveraging a broad set of discussion forums, wikis, databases, and instructional videos that exist outside the game. Here the players share experiences, tell stories, celebrate (and analyze) prodigious in-game achievements, and explore innovative approaches to addressing the challenges at hand. This “knowledge economy” is impressively wide and deep.

The more players participate and interact with WoW’s knowledge economy, the more valuable its resources become, and the faster players increase their rate of performance improvement. Said more generally, the more participants – and interactions between those participants – you add to a carefully designed and nurtured environment, the more the rate of performance improvement goes up. This is the “collaboration curve.”

Collaboration Curve

Collaboration curves hold the potential to mobilize larger and more diverse groups of participants to innovate and create new value – they could be users of your offerings, or people from different groups who can contribute (for example employees, suppliers, customers, competitors, regulators etcetera). In so doing this can help you improve your level of performance. This is already seen in the development of open source software, product development through crowd-sourcing, new product launches through crowd-funding etcetera.

So look at how you can create and leverage network effects for your product offerings, and in doing so create collaborative effects by connecting and leveraging different people, groups and stakeholders around your offerings. In doing this you generate greater levels of experience, better networks, greater engagement, and develop more knowledge – all of which can be used to create value and realize the profit.

To view or download a PDF version of this blog click here

Share your thoughts and ideas here, or email me at andrew.cooke@business-gps.com.au

If you found this article of use or interest please don’t hesitate to share it with others.

Click here to find out more about Andrew Cooke and Growth & Profit Solutions.

4 Questions for Debriefing and Learning

Four key questions by which to learn from your experiences!

We often get so involved in doing the work, that we rarely make the time to review how we are doing in a structured and creative manner that allows us to extend our curiosity into what has happened, and to learn why. In short, we rarely take the time to debrief and when we do so, we generally do it poorly.

Debriefings can help you accelerate projects, innovate new approaches to problems, and hit difficult objectives. More than a casual conversation about what did and didn’t work, a debriefing digs into why things happened.

“Two things are infinite; the universe and human stupidity; and I’m not sure about the universe” – ALBERT EINSTEIN

A debrief should review four key questions:

1.What were we trying to accomplish? Start by restating the objectives you were trying to achieve.

2.Where did we hit (or miss) our objectives? Review your results, and ensure the group is aligned and has a shared understanding of what has happened.

3. What caused our results? This should go deeper than obvious, first-level answers. You need to go beyond the symptoms and get to the underlying causes of your results. A good way to do this is to use the Five Whys Tool.  Here you take the first-level result, and ask “Why did we achieve this result?” This exposes a second-level item. Ask the same question again. You normally do not need to ask this question more than five times.

Example:

Results:  Sales down by 25% compared to the same time last year.

Why? #1 – Because the market is more competitive.

Why is the market more competitive?

Why? #2 – Customer demand for our products is down

Why has customer demand reduced?

Why? #3 – The market price has come down and we are charging a high price.

Why are we unable to sell our quality products for a higher price?

Why? #4 – Because the sales force lacks the skills to sell the value of our product.

Why is the Salesforce unable to sell on value?

Why? #5 – Because we don’t hire the right people with these skills, or develop these skills in our existing sale team.

Solution: to address the fall in sales we need to train, equip and incentivize our sales people to sell on value, not on price.

1. What should we start, stop, or continue doing? Given the root causes uncovered, what should we do next, now that we know what we know?

Debriefing provides you and your team with a structured learning process that allows you to continuously evolve plans while they’re being executed in the light of your experience and results.  This helps you to learn quickly in rapidly changing situations and to address mistakes or changes quickly and effectively.

Remember, no plan goes to plan – never. We need to learn to adapt, and we need to adapt to survive, and we need to survive if we are to thrive.  Debriefing is an ongoing process that needs to be built in as a core part of your work, not something that is ancillary to it.

To view or download a PDF version of this blog click here

Share your thoughts and ideas here, or email me at andrew.cooke@business-gps.com.au

If you found this article of use or interest please don’t hesitate to share it with others.

Click here to find out more about Andrew Cooke and Growth & Profit Solutions.