During the 2020-2021 business cycles, leaders were driven to look at their businesses, customers, products, services, and their staff through different lenses. They had to pivot to doing things differently than maybe they had in the most recent past. At the time the elements of the unknown and survival were part of the driving forces at hand. All these converging dynamics cause some business to accelerate positive progress as they made tough decisions to narrow down on many aspects of their business. Although having a global health challenge should never be the impetus behind strategy and tactic changes, it can sometimes put enough energy behind making difficult decisions that in the end enables rather than cripples a business.
This is a solid practice for all organizations to review on a somewhat cyclical basis. Maybe not every planning cycle but at least every few years to determine if the expansion to the business was broad and wide or focused and narrow. Too much distraction seeps into the operation of the business when it is not being looked at through the lens of profitability and contribution to the long-term vision, strategy, and purpose of the organization.
A couple examples may help to frame some considerations for your business as we move toward 2023 and are in the review, reflect and recalibrate seasons for next year.
- Third generation family business with some carry over staff from second generation leadership that had the associated legacy cost, but their contribution was not aligned with the cost. Due to long family heritage and work history the present leadership could not come to grips with taking a planned or engineered staff reduction. This legacy cost, although not astronomical was impacting not only profit but attitudes amongst other staff members. A financial event happened and forced the hands of the leadership to finally act. Upon doing so they restructured their internal operations and made it more streamlined (narrow) and efficient. They went deep into restructuring for the overall benefit of the company, the customers, the staff etc. Outcome was greater staff, and customer experience and more profits.
- A multiyear stable business with retail product offering seemed to always be looking for that next big item to add to their suite of products to attract more customers and sell more goods. Although they had a general vision for the arena they wanted to play in, they tended to drift into areas that were just on the edge of their core offering and justified getting into added inventory and retail space claiming the return on potential sales. This caused them to be very wide and have many distractions. Not only was inventory a project to manage but many dollars were tied up in retail goods that did not turn effectively. By focusing the organization on a key purpose and strategic vision they were able to realign their product offerings, get their staff to be experts rather than generalists and their customer experience made them more of a destination than a shopping store.
Too often the pursuit of growth brings distractions into our outcome path. At the time it all seems very harmless until one leads to two and then four and so on. Eventually the mechanisms which were designed around the original focus break down under stress because the number of distractions have multiplied. This week reflect on where you really want your vision to take you and how the assets of the business are aligned or out of alignment to take you there. Focus on being narrower but go deep into the segment so it is done at an expertise level and bring greater overall customer and employee experiences to the forefront.
Can’t see the forest for the trees in your organization? Time to bring in an objective third party Promise Guide to lead you out of the forest while pointing out all the trees of opportunity in the path. Give JKL Associates a call to schedule a time to talk with a Promise Guide about your journey. In Florida – (407) 984-7246 or Michigan (313) 527-7945