Is your organization a “fixer-upper”?!
Success is great. It’s rewarding. It’s the culmination of hard work. Except when it isn’t what you are experiencing, when you are caught in the whirlwind of a downturn, a market change, or the results of poor decision-making.
I will never forget the Great Recession of 2007-2009. We thought we were positioned well for a downturn because of the breadth of clients we had in our industry. What we didn’t expect was for our entire industry to go into a depression, with several key clients seeking significant US and Canadian government financial help to navigate Chapter 11 bankruptcy.
Here are some questions that may help you with your “remodeling” plan for your organization:
- Have you harnessed the Collective Genius of your entire team? Putting the best minds together to work through your situation is vital to an organization’s success and your culture.
- When we are growing, we sometimes add team members out of expediency instead of doing proper due diligence to ensure that they are the best fit with the organization and the role they need to fill. Do you have any people that are not the best fit with the team? Force-ranking your team may be a healthy step in this process.
- Cost avoidance is vital. Have you as a leader taken a pay reduction and are you asking more of yourself in pay reduction duration and amount than you are of your team? Leading by example is vital to an organization’s culture.
- Can you restructure your debt to reduce monthly cash-flow obligations?
- Has your product or service portfolio grown too large, thereby increasing your cost structure? Activity Based Costing can be an outstanding tool to help determine what should stay and what should go.
- Do you have assets that could be sold that are not vital to your organization’s success?
- Is there a new product or service that you should be pursuing that can improve the organization’s performance and lead to greater success? Adding a similar product or service in your existing market is easiest to do, the opposite is the hardest (Ansoff Growth Matrix).
- Is your pricing appropriate for the market? Is your price too low? Too high? Are you taking advantage of pricing opportunities when they present themselves? A reduction of competition may be an opportunity in a downturn.
- Laying off employees is a very difficult process but, unfortunately, can be almost unavoidable at times. Do you have a performance review process that clearly identifies your best and worst performers?
- Tough times bring out the best and worst in people. Have you been monitoring how people are handling your challenging situation? This may play into staffing decisions you need to make.
- The basics make a huge difference. Are you focusing on expense control and your receivables to build cash?
How you handle your tough situation can have a significant impact on your organization.
