At the moment there are supposedly 2 million plus businesses in Australia. This isn’t a very accurate figure because a lot of businesses get registered and never make it out of the gate. Plenty of other businesses do get started but trot along never getting anywhere. Many business owners remain at the helm of these under-performing businesses because;
- they aren’t accountable to anyone and quite simply they can get away with it. As long as the business is treading water no-one will be any the wiser.
- they think “What else would I do?”.
- they don’t want to work for someone else.
The reality is that as business owners we can hide behind the façade and let everyone around us think that we are running really great businesses where everything is going well, staff are really happy and we’re making heaps of money. The real story is of course often quite different.
In one case I asked a client why he liked being in business. Essentially he told me he felt there was a certain prestige from having your own business and that he liked his friends knowing that he was a business owner. I asked him what he’d think if I brought his friends in and showed them his Profit and Loss. I don’t think I’ve ever seen the colour drain out of someone’s face quite so quickly.
The reasons above are not good reasons to stay in an under performing business. If your business is not profitable, not creating wealth for you, not paying you a good salary or leaning towards giving you a great lifestyle then you have to ask ‘Who am I fooling?’ and ‘How long should I let this continue?’. A quick way to determine whether you’re going well is to ask yourself this simple question; “If I hired a general manager to do my job and they performed like I did for the last 12 months, would they still have a job?”. If you’ve said yes, congratulations. If you said no, think about the consequences of your business never improving. The effects reach wider than your own pride.
So how do I turn this around?
The first area you may need to work on is you. If you have been in the habit of letting yourself off the hook then that needs to change. You need to be ready, willing and able to run an organisation that is goal oriented and target focussed.
Then you need to look at your model. Is the business model that you have chosen the best it can be? Is your business consistent? Do people want to work for your business? Many people focus on the product or service but it’s not just about that. You may have a product or service that is better than your competitors but if you’re not marketing, managing cash flow, hiring people and creating systems better than they do, your model is not working properly and could be improved.
