When we are in business or are running a business, we often have to face this reality that the business is sinking or the business is not growing as fast as the competition or as we would like it to.
In my tenure as a consultant, I have seen more businesses fail than succeed. It has taught me some fundamental lessons. One of them is to visit this chart below and go back to the basics. I call it the Asset Mirror. You will find this on google or in other places and they may have different names. The reason for calling this the Asset Mirror, is that these components (in the different colored circles below) need to be treated as your “Asset" and you must be very clear about it. This means also, that you must value them and re-engineer them from time to time. One should treat this diagram or chart below, like their mirror and when they look at it one should ask this fundamental question – “Am I treating each of these components as an asset and do I really value their existence and their growth?" You could also ask yourself this question instead – “Is this image mirroring the respect I give to each of these components in my business?". Your heart should answer this question, and not your mind.
Deep down inside your soul and spirit, you will really know if you have treated each of them as an asset or not?
What mostly happens is that entrepreneurs begin their journey with enthusiasm but loose focus and diligence to develop each of these components and give each of them the respect they deserve.
Sometimes, entrepreneurs want to micromanage these resources and hence loose the spectator’s view or the helicopter viewing capacity. So they do not develop a management team and a method of management governance. Then we also have entrepreneurs who have inefficient managers or leaders and inefficient processes or no processes or no systems. Therefore there is lack of good methods and there are several holes in the management system. We also see business often failing to deliver products and services according to the demands of the market. Entrepreneurs get possessive about their idea and their business and they fail to recognize their market or to define the correct market.
Machinery and materials seem to be lesser of the problems in the beginning of a business as most entrepreneurs realize their value but we do see often that when a business is stepping out of the accelerator mode, entrepreneurs forget to reevaluate the capacities of their materials and machinery and/or innovation required therein.
Finally, we have the father and mother of all problems and that is a shortage of finances. This problem becomes very severe when there are poor financial systems, managers, and administrators in place.
Adding RELATIONSHIP and INFORMATION to the above model
Other than the above components in diagram above, there are two other assets which are worth mentioning in a business (they are not there in the diagram). One is “Information" and the other “Relationship". Both of these have their own value in any business. Information is very important to any business and is the foundation stone of taking decisions and making choices. Lack of information, inadequate information, incorrect information or incomplete information will lead to poor decision making and will cripple the business slowly over a period of time.
Finally “Relationship". This is a little abstract component but this acts as the mortar between business and its market. Understanding how to develop strong relationship models with its clients, employees, suppliers and shareholders will help in better bonding of the company with its market which is ever evolving. Relationships models and relationship values should be measured from time to time. Some metrics to measure could be brand loyalty or brand recall or first time resolutions of client complaints or client referrals or all of them. There could be different metrics based on the kind of the business and complexity of relationships
Steps one can take to address growth issues in business
I would suggest the following steps for small, midscale, startup business and matured organizations always. Please have a strong financial consultant and legal advisor by your side to assist you. Secondly, focus on hiring good quality manpower and pay them better than the market. You can have a very small team but get the best of the best people and they will be willing to multitask for the business if you have set the expectations right when you recruited. Make sure to recruit good teamplayers. Thirdly, even if you have people multitasking make a career plan for them. Make sure to identify at an early stage which departments you will set up which will need leaders and how do may want to map out the careers of these leaders. Fourthly, think well if you are in the right business or in the right market. If not shut down the business or restart and if required to change or shift your market. Fifth, do not waste money and time. Dont rent a place if you dont need to. Try to look for coworking space by sharing services or selling shares. Dont hire inefficient people or untrainable people and hope them to provide amazing results. If you have, get rid of them. Do not procrastinate decision making and else you will pay the price sooner than later. Please use a good human resource consultant or agency to recruit people but have your own selection criteria and make sure job descriptions are documented and they keep evolving according to the job market. In addition a financial consultant or a finance manager could help you in reallocating your finances and minimizing financial waste.
Finally, please make sure that you evaluate all the above assets mentioned throught an Asset Evaluation & Improvement Process. In such a process, you should measure how each of your asset performed. That means, finance, process, human resource, machinery and tools, materials, market, management, information and relationships- how did these assets perform and what needs to be done to help them improve their performance and boost their evolution. You can run this processes every 6 months to get an overview on your business.
Golden Rule: Please let the business develop its own character separate from you (i.e. you meaning, single or group ownership). Let the business develop its own destiny and own path. Let it understand the market and behave according to demands of the market. If it is a market disrupt-or, the market will decide that, and not you. Don’t make the assumption that you or your business is doing to disrupt the market by its presence and behavior.