2) Remember the Basics
Ask any business owner, and you’ll find that their story is neither one of unbridled success or abject failure. Even businesses that are facing the prospect of closure have usually experienced success in some aspect of their operations this is particularly the case in struggling businesses with a long history, which were previously financially successful but currently are not.
Tip: The key to reviving a struggling business is to remember those successes, and repoint your business to take advantage of those successes whilst recovering from the issues you identified in the previous step. This may involve cutting unprofitable product lines, closing underperforming offices, replacing or reinvigorating a substandard management team or employees, or adapting previously successful products or services to meet the changing needs of your market.
3) Get External Help Early
Don’t make the mistake of trying to fix things yourself. Engaging with an experienced, objective advisor is critical to the turnaround process. I say this for three reasons; firstly, the right advisor will have gone through the same process with other businesses in the past. Business turnaround is a delicate balancing act, where quick decisions must be made but the wrong decision can tip you over the edge, and it is critical that you have someone on board who can find this balance. Secondly, having an outsider’s viewpoint is valuable; because business owners spend so much time in their business, they tend to become blinkered and set in their ways. An outsider will help to remove those blinkers and cause the business owner to see how things could be, not just how they are. Thirdly, business turnaround is stressful, and having someone there to talk to and provide support is extremely important.
Tip: Get help, and get it early. Make sure your advisor is qualified and experienced, and pay close attention to the advice they give you.
4) Make Tough Decisions Quickly
You’re in trouble, so there’s no point in beating around the bush. Many business owners struggle to make bold strategic decisions such as cutting staff, closing offices or discontinuing unprofitable product lines when their business is in distress. Some feel making these decisions is an admission of failure, some get caught in the trap of feeling that action is not required because ‘change is just around the corner’, and some feel personal attachment or loyalty to particular staff, offices or products. These feelings are understandable, but they don’t help with dealing with the reality of the situation. As Henry Ford famously said, “if you always do what you’ve always done, you’ll always get what you’ve always got”.
Tip: The best way to approach business turnaround is with decisive action.
5) Maintain Your Balance
The most common response from business owners who are facing disaster is to work longer and longer hours, pushing themselves to the point of exhaustion. Understandable? Yes. Helpful? Usually, no. In fact, overwork probably contributed to the situation in the first place, as overworked people are less productive and more prone to errors.
If your business is in trouble, you need a clear head to address the issues at hand. It might feel unusual, but in order to have this clear head you need to take care of yourself.
Tip: Exercise, nutrition and adequate sleep are vital. Make sure you’re getting enough of all three.
Has your business ever been in trouble? How did you handle it? Comment below!