There are a suprising number of quite sizeable businesses out there that, when they are under-performing call in a consultant to tell them that its anybody’s fault but theirs. I’ve always told potential clients “don’t call me if all you want to hear is how great you are”. For one thing life ain’t like that and for another that isn’t my job, go ask your Mother!
I’m quite clear about my business role. I’ll introduce you to the good and bad in your business, help you work out what you need to do to fix the bad and make the good even better. If you don’t want to put the work in, I’ll settle, with a little frustration (because I hate to see anything that could be fixed, not working) for watching your business go down with all hands, but if you are up for the challenge I’ll be there with you every step of the way as you put your plan into action.
The business environment is highly geared. If you are not focused on being the best in your class, history leaves us in no doubt that you are on a short road to nowhere. Sadly I’ve encountered two businesses in the last couple of weeks who think they can beat the odds. Of course, they won’t.
The first was a sports equipment challenger brand with an inflated opinion of itself and the second a digital content company that behaved like a Christian Scientist with appendicitis – what they needed to do to fix their problem was against their religion.
The sports company was like a lot of mid-sized businesses stuck in their original, small business mindset. I organised a “meet the end-user day” where sporty people tested their products, wrote reviews and entered them in a prize draw. The feedback was clear. The products were far from cutting edge, weren’t exciting, weren’t what customers really wanted (although at the right price they might consider some of them) and the prices were too high. The company’s principals decided the customers didn’t know what they were talking about. At the price points that customers were talking about the business would operate at a loss. My conclusion: this isn’t a business, it’s a hobby!
The content company was one of a group of businesses that had been acquired over time by a larger group. They are good at what they do, but are finding themselves in the same position as a lot of other marketing services businesses in recent years – doing a lot of one-off jobs on low margins for medium-sized businesses and not making a lot of money out of it. Although for many marketing services firms much can be achieved by the introduction of a decent management information system, what this lot need is to get out of the commodity-supplier rut, which, for a marketing services firm, means putting their offer in a broader context, leading with and owning their clients’ strategy. These days, positioning your marketing services business as a production facility is like putting your own head in the noose. The problem for this business was that other businesses in the group owned the strategic mantle and strategy was seen as “out of bounds”. A case of woolly thinking, maybe both at group and business unit level, which until that was sorted out was going to continue to condemn them to the treadmill – a lot of hard work for little return.
SMEs that I encounter often don’t deserve to be anything more. The confusion between hobby and business mind-set is a common malaise, but, more fundamentally, the people running these businesses frequently aren’t being honest with themselves. A consultant like me isn’t in the business of being destructive, but we are there to deliver home truths. If you can’t take it on the chin then perhaps you shouldn’t be in business. The important thing though is for consultants to always present the reality with a clear and practical solution to the problems it represents. If the solution is still rejected, we sadly have to accept that these organisations are the runts in Britain’s new business litter.
June 7, 2010