Last year I had two small business turnaround experiences that sent my learning curve through the roof.
Small Business Turnaround Experience # 1
I was invited by another consultant to be part of a team to help turnaround a small business.
Of course I agreed and packed my bag and jumped on a plane and landed in another Caribbean Island. After all this is what I do.
As I listened to family members across generations share the story of how that business was built - from nothing to a multi-million dollar business - the passion, the pain and the emotion tugged at my "small business" heart.
The results? I found myself desperately searching for ways to save a business that I knew I should have advised: Close this! And now!
Small Business Turnaround Experience # 2
A business owner, colleague and friend of mine asked me to look at his business for him because he was in "a bit of trouble".
So I threw on my turnaround consulting hat (you know the one...the one that's purple and shaped like a crown) and rushed off to his business.
Pretty soon, I was able to spot a number of things in several areas that were wrong in the business. Naturally, I recommended a number of small business turnaround strategies and offered my services for the business turnaround management. And of course he agreed.
Then he did nothing. Except paid me.
I don't know about you but for me, being paid for advice that is then ignored is not something my ego or my business standards can take.
So my next trip was back to the drawing board in my "intelligence room". Sure enough, wisdom came...And the lessons were BIG.
BIG lesson # 1 - Small Businesses Are Led By "Real" People
While big business and small business might find themselves in need of a business turnaround for similar reasons although on different scales, applying industry solutions, even in the correct scale, to small businesses just won't cut it.
You see, a small business is often owned and led by the same passionate person(s).
This means that they will often have personal preferences and a vision which might not be in sync with the operational strategies a Turnaround Consultant is proposing.
Add to this, the possibility that they might have to close the business, a reality for them that is much like having to admit that a marriage is over.
BIG Lesson # 2 - Don't be fast to "sell" and communicate
Because my friend approached me, I really believed that all I had to do was to "download" the appropriate "small business turnaround" strategies on him and we were good to go.
What and idiot I WAS (and it rinses out my belly to admit that)! The man is 70+ years old, business management is not his technical competence and he intends to leave this business as a legacy of his life.
In cases like these, it is important to sell each idea to the owner - one by one.
This is important because while you are recommending small business turnaround strategies which they need to implement fast, they are hearing a myriad of things they have done wrong.
What I should have done was to identify, isolate and address his emotional issues first, instead of focusing almost exclusively on the business. I should have communicated better.
Big Lesson # 3 - Timing Is Everything
Just because a business is hemorrhaging does not mean that the owner is ready for a transfusion.
Yes, they want to experience the improved profitability.
But you are asking them to give up a part of their dream. You are asking them to acknowledge that they might just be playing at business or what you are proposing might change the very soul of the business. And they are not ready for this.
The answer? You have to show them the benefits of implementing the plan and the consequences of not implementing the plan. Then you just have to wait...A small business turnaround plan cannot always be rushed, however urgent the situation.
Updates on my business turnaround activities
The outcomes in experience # 1 remain inconclusive. The pill is just too bitter for the family to take, even though we coated the pill in sugar.
Fortunate for me, experience # 2 has a happy ongoing...My friend came back to me and said he was ready to give the business one last chance.
This time, with my new understanding, I put on my turnaround consulting hat. You know the one...the one with the big pink bow.
I used the same sound small business turnaround strategies but this time, I focused on the owner. I recommended a path to profitability that acknowledged his personal peculiarities and personal objectives for the business.
Working collaboratively with him, in the first two months of our start date, we have been able to achieve the following:
- We have been able to plug leaks that stop the flow of approximately US$ 53,000 out of the business.
2. We have streamlined a number of processes and implemented several systems to streamline operations.
3. Staff morale has improved considerably
4. Productivity has increased by about 30%
5. Customer relations are improving by leaps and bounds
It's easy to understand why my friend now declares this small business turnaround plan to be "fantastic" and says he now has time to do the things he really wants to do.
Your next "turnaround" step
We live in such global economic conditions that turning around your business is the only answer to your business survival.
But it is so easy for your consultant to overlook the 3 key aspects to a good small business turnaround plan - as I did, at first.
I now certainly understand how the emotional commitment you have invested in your business could stand in your way.
And certainly on my part, I fully understand the role of timing and the need to "sell" you on what's right for your business.
But here's what I want you to do, so you can win with your turnaround plan.
First, read this post so that you can get an understanding of your own reluctance to take the first step which is to accept the need for help in saving your business
Then, if you want to experience a version of the small business turnaround which worked for my friend in your business, then contact me and find out how I can turnaround your darling business.
To your small business turnaround success...