Times are tough. The “new normal” way of doing business requires smart thinking to protect, and even enhance, your profitability.
Here are five smart ways to boost your bottom line:
- Stop Doing Some Things. In tough times, a more radical focus is essential. So many activities creep into what you and your people do every day that you don’t even realize they are now unessential. Cut that waste-of-time meeting. Cease doing business with that never-satisfied customer. Flow chart some of your business processes such as your billing steps. (Just Google “flow chart a process.”) You are likely to find redundant, non-value-added work that you can eliminate.
- Vent Your Key Staff You can’t get financial stability in your business until you have psychological stability. Right now some of your staff, probably your best employees, are thinking about where they might go to work next, or what to do if the axe falls on them. Therefore, they are frozen in their work, their innovation, engagement, and their commitment. Stephen Covey famously said, “People can’t listen until they’ve been listened to.”
Gather your staff for a long meeting. Announce that “we have to get every issue out on the table.” Announce you’lll go around the room for each person to briefly name an issue for you to write down on flip chart pages. No long speeches. No defensive counters. There will be no retribution for anything that is said. It is a safe environment. People can pass if they wish, but you’ll go around the table until the whole group has passed three times in a row.
Be prepared to hear some tough issues, some likely about you. Then have the group prioritize the issues into A’s, B’s, and C’s, or into issues easy to resolve versus longer term challenges. If you’ve done this exercise well, you’ll now know some critical things you must do to enhance your financial performance.
- Unleash Some Tiger Teams You can’t do everything yourself, and you can’t afford to send people off for “training” in these tough times, so you need to spread the challenges around and unleash the leadership latent in some of your staff.
Ask for volunteers to lead some temporary Tiger Teams of other volunteers to attack and solve the A priorities (or easy-to-resolve issues) that were identified. Give them a one-page charter outlining the problem (or opportunity), the specific goal(s), the time frame involved, their authority and budget (if any), who they report to, and how they’ll communicate progress. The volunteers can be people outside the firm too. I was CEO of an organization that reduced 15% (!) of our purchased products costs by forming these teams with trusted vendors.
The best way to develop the leadership capabilities of others in your organization is to give them project assignments and to coach them along the way.
- Find Some Sanctuary You can’t think smartly and strategically when you are buried at the office and under great stress. Consistent with “stop doing some things,” you must get away on weekends, find the time to get away into a place to really relax (without your email and smart phone), or to just get 30 minutes a day to not be on high octane adrenaline.
- Make a Strategic Move Your competition is back on its heels. Coming out of your sanctuary, you may realize that now is the perfect time to buy out a weak competitor or enter a complimentary market with a new value proposition.
Boosting the bottom line by cutting customer services or across the board layoffs won’t help you these days. Be smart in how you boost your bottom line.
Bob Vanourek is a senior consulting for GEM Strategy Management and the former CEO of five companies from a start-up to a $1 billion NYSE turnaround. Bob is a “turnaround specialist” working with boards of directors, CEO, senior management and leadership tems. He is an award winning co-author of, Triple Crown Leadership: Building Excellent, Ethical, and Enduring Organizations, a 2013 USA Best Book Awards Winner and Leadership Wisdom: Lessons from Poetry, Prose, and Curious Verse. Bob writes for a number of publications including Fast company, Financial Executives, & People and Strategy.