Each day I have the privilege of working with business owners who’ve decided they want something more. Something more than that feeling like they’re running on a treadmill, expending a ton of energy, muscling their way through the hard parts, but not exactly arriving at the destination in mind. And it really is a privilege, because it’s not easy for CEO’s to ask for help, to set aside ego, to reveal that perhaps we don’t have all the answers, or have gotten too close to the issues to see them objectively. I know. I’ve been there myself, and confess that there were days I’d gladly swap jobs with the UPS guy.
Businesses vary in a multitude of ways, yet I’ve observed common themes as to why they get stuck. If that’s how you would describe your business right now, try looking at these commonalities. You might find an opportunity for growth where you weren’t looking before.
1. Lack of CEO & Business Goals. I have a mantra: “Goals, Strategy, Structure.” It’s my reminder that absent CEO & business goals, it’s impossible to create a winning strategy or a structure to support it. Most businesses are started by bright folks with passion, courage and significant subject matter expertise, but without longer term goals for themselves or their business. To avoid a whole lot of pain and disconnect, we really must start by defining our personal goals. It’s imperative to grapple with such questions as: Am I motivated by a flexible lifestyle or the excitement of growth? Am I truly an entrepreneur or am I really a technician? (Read Michael Gerber’s seminal book, The eMyth Revisited to really understand this distinction.) Do I want a business that finances my lifestyle or will I plow earnings back in to the company in order to create a saleable asset? What risks and sacrifices am I willing to make?
When we’re willing to confront these questions, it becomes possible to reconcile what we want with what we are prepared to risk. For example, saying, “I want flexibility and freedom ,” does not reconcile with, “I want to build a $50 million enterprise” – certainly not in the early years. There are no right and wrong answers, but trouble arises in conflicting goals, and many of us find ourselves stuck in that space of conflict without recognizing it. Whether small or ambitious, without personal and business goals we find ourselves fully stuck in the purgatory of “working in it not on it,” spending more time on the same tasks, making the same decisions and hindering the opportunities for growth.
2. Unarticulated Value Proposition a/k/a Does Anybody Care? We fall in love with our businesses. We totally understand why we’re valuable and why prospects should be banging down the door. But they rarely do. Even with a strong referral base, it gets very difficult to expand outside that circle and grow revenue when we’ve failed to articulate our value proposition. That means that we’ve not yet told a compelling story, created a message that resonates with our prospects, makes them want to engage, and become evangelists for our brands.
It’s noisy out there and most companies operate in a highly competitive, commoditized space, so it’s imperative to work REALLY hard on figuring this one out. The idea is to differentiate your offering, to tell your story, such that no other company can compete in the prospect’s mind with the value your business delivers. To help you find those stories, those “aha’s,” brainstorm with the folks in your organization who interface with customers daily. Your customers will tell you, too. Ask. What you uncover will provide the foundation for rewriting your marketing materials, sales reach outs and pitches. If you need some help thinking about this, grab a copy of Seth Godin’s Book, All Marketer’s Tell Stories. It will get your creative juices flowing.
3. Lack of Values and Dysfunctional Culture. Failure to define our company values, what we stand for in this world, and what we expect from one another, sets us up for trouble down the road. It’s really no different from the foundation we set any serious relationship upon. Think about the inevitability of a failed marriage if the partners are not in synch about fidelity, finances and children. So it goes with a company. It’s less obvious during that honeymoon period when a business is new, the work is just plain exciting, and the few employees on board are in lockstep. But when we begin to scale, it’s harder to disseminate that early shared experience to new employees. Values and culture determine the personality of the organization, the way its employees compete and cooperate, the way they hold one another accountable, the way they treat customers. Culture fills the gap that handbooks and process manuals fail to anticipate, providing a framework for decision making that makes it possible to allow autonomy in decision making at all levels. Tony Hsieh, Zappos CEO, discusses this magnificently in his book, Delivering Happiness.
The opposite is also true. Without a guiding set of values, aligned with the CEO’s goals but agreed to (and bought into) by all, it’s easy for individuals to highjack an organization, toxic relationships to develop, and growth to falter. Get a pulse on this quickly. Talk with your trusted lieutenants; have conversations with the disgruntled few that you’ve been avoiding. Tough conversations often reveal information we need to get back on the growth curve.
4. Inadequate Sales Engine. Too often, companies confuse sales and marketing. They are not the same thing. For me the easiest way to think about it is this: marketing is a one-to-many conversation while sales is a one-to- one conversation. It’s in that one-to-one where relationships are developed and deals are done. Most small businesses do marketing in some form or another – and clearly the internet age has made that easier, cheaper and quicker – but few have an adequate sales engine. I often hear from business owners that they “don’t do sales” because they only do business on referral. The good news there is that the company’s product or service is extraordinary enough that they’ve created a loyal following. Rarely, however, does that referral base provide a sufficient pipeline for growth. Note I’m distinguishing between referrals coming in – inquiries are inbound – versus a sales strategy where we actively seek and leverage referrals for new business. The latter is among the best ways to grow.
I also hear from CEO’s that “nobody else can sell our company like I do.” And I get that belief, because who is more passionate about the business than the owner? (If not the case, see #6 Leadership below!) But it’s simply not a true statement if we hire the right people and train them well to represent our firms. The reality is that the more complicated and/or expensive the product, the more difficult it is to scale a business without a dedicated sales engine.
Leveraging referrals, filling the pipeline, meeting with stakeholders, developing relationships, following up and closing deals requires a sales engine. We must create a sales strategy and tactics, establish revenue targets, assign responsibility for delivering on them, measure activity and manage the sales cycle. Companies without a sales engine cannot predict their revenue stream, but rather operate with a “whatever comes in, comes in” mentality. If your business can no longer drive revenue, it’s time to evaluate whether the lack of a sales engine is a key to the problem.
5. Inability to Execute. Entrepreneurs by definition are an action oriented bunch, excited about the potential we see on multiple horizons, thrilled by possibilities, eager to try the next new idea. In fact, ideas are cheap and too often take us away from our goals and commitments, resulting in either nothing getting accomplished or shoddy craftsmanship.
I spent much of my career in the IT services space and learned how easy it is for a project to run amok when project managers allow scope creep before a deliverable date. Running a small business is no different. Just in the same way it’s hard for IT project managers to stave off the desires of the stakeholders, it’s hard for business owners to focus on priorities. Not doing so is a recipe for “stuck. “ It also creates immense frustration with employees. Do you ever hear whispers in your company that you’re “all over the place?” If so, get clear on how this inability to execute is costing you, both in terms of growth and morale. It’s essential we pick our priorities, create a plan, and then focus, focus, focus on delivery. Pick 4, no more, then deliver.
6. Leadership Breakdowns. Are you engaging your employees, evangelizing for the company, modeling accountability, making tough decisions around hiring / firing, creating transparency? Or, are you hiding in your office behind the computer screen? A client said to me recently, “I wish everyone would just leave me alone to do my job.” It didn’t take long to discover why his business is stuck. While an extreme example, it represents the truth of what many CEO’s experience. I love Susan Scott’s book, Fierce Leadership; she opens with the question, “What Fresh Hell is This?”
Yes, there are days when we simply want to close the door and be left alone. To defer decisions, avoid tough employee conversations, stay out of the customer’s line of fire. We’d rather hide away to write memos, devour spreadsheets, attend to minutia. Because that feels like being in control, an opportunity to say, “I’m doing my job.” But those aren’t the leader’s jobs at all. If this is a recurring theme, get honest with yourself about what’s going on. There really are only 3 options: stay stuck, fix it, or get out. Option 1 will take your company down.
Business growth is rarely a simple trajectory. If only. It gets messy along the way to creating something we’re proud of and passionate about. Sometimes we backslide; sometimes we free-fall; sometimes we just get stuck. But if we know where to look, and develop a muscle for making hard decisions, we can get back the growth track.
Let me know where you’ve looked to get your business unstuck. We all have much to learn.
| Categories: Blog, Culture, Growth, Leadership, Sales, Value Proposition
Tags: culture, entrepreneur, growth, leadership, revenue growth, small business, values