There’s no denying it. An unhealthy business can rapidly deteriorate.
Chances are your business is your most valuable asset. It is the source of cash-flow for your home, your kids’ education, weddings, vacations, parents’ expenses, and your retirement.
Here are some indicators of an unhealthy business:
- Poor financial performance
- Overreach
- Unclear goals and expectations
- Out-of-control growth
- Frequent crises
- Hubris
- Too much or too little Inventory
- Missed forecasts
- Denial
- Leadership issues
- Cash flow problems
- Lender fatigue
- Excessive diversification
- Shaky customer base
- No succession plans
If a few of these symptoms sound like your business, what’s your Plan to fix it?
The path from underperformance to failure can be measured in months. The longer the deterioration, the higher the risk, the more difficult the fix.
Here are five key strategies for turning around a business. Consider all of them.
- Leadership: Make an Assessment. Take control. Communicate. Cultivate support. Admit errors. Make changes. Act on the top priorities. Balance urgency and calm.
- Stop the bleeding: Manage cash and control expenditures.
- Increase: Selling efforts at reasonable margins and cash collection activities.
- Restructure: Organization, products and services, debt and supplier payments.
- Contribute more capital.
An unhealthy business does not recover on its own. It takes specialized experience to diagnose and prescribe strategies leading to recovery.
If your business is frail, get some help. Now.
© Let’s Get Down to Business, a Consultant’s Journal, by Terry Myers (available on Amazon)
Terry Myers, Principal of Business Edge, is an experienced Management Consultant. He partners with Tom Schnurr to guide companies to bridge the gap to revitalize and optimize stakeholder value. Contact Terry at tmyers@bizedgeusa.com, or Tom at tschnurr@bizedgeusa.com.