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Tuesday, September 22, 2009

When things aren't working . . .

Our primary business consultant, Bill Caswell, believes that many business people focus on superficial problems. This failure to get to the bottom of the issue results in floundering, frustration and ultimately defeat.

His hierarchy, in order of depth, is:

  1. Results (Current Mood, Miscommunication, Wastage, Crisis)
  2. Operational (Sales, Production, People, Money)
  3. Strategic (Mission, Planning, Structural, Strategic Information)
  4. Accountability (Responsibility, Authority, Metrics, Information Flow)
  5. Mood (Individual - Leadership, Group, Department, Company
  6. Environmental (Company: 1. Can have some effect on it; 2. Can have little effect on it, 3. Can have no effect on it, 4. Is caught by surprise)
Caswell suggests that if the underlying issues are not resolved, nothing you do at the higher levels really matters -- your problems won't be solved.

This is fair enough but the problem is, how do you know what the real underlying issue is?

A few years ago, for example, as my business endured a major crisis, I initially attributed many of the problems to environmental causes. For example, our business had grown in the U.S. and we had been profiting from truly lucrative exchange rate differentials -- as these narrowed, our margins slipped dramatically. We obviously had no control over the exchange rates.

But I'm satisfied that the environment wasn't the cause of our problems during that business crisis; we had failings on several higher order issues, notably my ability to lead, manage accountability, and clearly define strategy.

In the last year, things haven't been easy, either. "It's the recession, dummy," may be a quick and easy answer -- but where do our responsibilities begin?

Today, we conducted interviews for a new administrative employee (our key office person is leaving for a new career in a field she prefers -- showing that recessions don't stop great people from finding opportunities.) Previously, in filling this spot, we had trouble finding people we would like to hire; now there is no shortage of candidates.

Our former editor visited the office in between these interviews. I had to lay him off earlier in the summer as the numbers declined and it became a choice of maintaining my salary or inviting him to use the government's Employment Insurance program. He doesn't like sitting around, and was ready to take a much-lower-paid job at a remote community publication. But that local newspaper, short of staff by about half of its key employees, can't hire anyone because of a corporate hiring freeze. So the employees who are left there are working themselves to the bone, while our editor sits at home. (I can't give him part-time work, which I have, because it would mess up his employment insurance benefits.)

Of course the other part of the equation is that while we have many candidates vying for available jobs (and we have a few posted, especially in sales, where we pay a starting salary), sales are much harder to come by. While advertising makes real sense in a recession, it is hard to justify discretionary expenses when you are laying off long-term, good employees.

So what do you do when the four letter hits the fan and you realize that things really are bad out there, and it isn't just your business management, accountability, mood, strategy, operations or current results? In other words, you are doing most things right, but things are still turning out wrong, for reasons which are beyond your control.

The answer is to remember some universal laws of business and life. I'm mangling some concepts of Brian Tracy and Bill Caswell, but here they are:

If you can't change the overall environment, you can adapt to where you are within it. If there is a recession, you may need to do what you have to do, which means humbling yourself, if necessary, and getting down to some really hard work.

You can control the things you can control but not the things you can't. Focus on what matters. Sometimes you need to fight. Sometimes you need to run for the hills when you are in survival mode.

Keep things in perspective. Recessions end. If you are doing (generally) what you enjoy, and you are good at your work, you will land on your feet though you may need to adapt and change directions -- using your core skills and strengths to find the new route.

If things are going really well for you or someone you know, be thankful. If they aren't, be thankful for the elements of your life that are healthy and work to make them more central to you. This will help you pull through the rough patches around you.

I'm not going to paint an overly optimistic picture here -- looking at my own business now, compared to this time last year, I'm amazed by the changes, challenges, and contradictions in expectations and experiences.

In a few weeks, we'll meet to review our 2010 business plan and look back at 2009. Yeah, "It's the recession dummy". I can't change that overall economic environment. But I can be satisfied that the other elements of the business are in order, we are lean, well-managed and ready to capture the opportunities going forward. You can survive, and succeed, too.


Matt said...

Good stuff, thanks!


gcastillo5665 said...

I'm a firm believer in treating the underlying issues instead of trying to Band-Aid problems and reacting to disaster. Your post was informative and reading this one makes me only want to read more. Keep up the good work!

Construction Marketing Ideas said...

Thanks for these comments. It is paradoxical that you can think the "environment" is the problem when really the issues are within your own business, yet you are fooling yourself if you think you can defy gravity - especially if you are operating in a cyclical industry, and one which is experiencing major technological changes.