Finding Profits Among Increasing Margin Pressure
If you’re like most companies, making money off your spreads has only gotten tougher. Cutting expenses can only get you so far before you truly start limiting future growth. Pulling on the same ol’ tried and true financial levers only gets you so far as to improve your financial picture. To strengthen the financial outlook and future of your organization, you’ll want to look at how your organization optimizes and synchronizes all of the moving parts of your business.
Let’s Dig A Little Deeper…
If your company is like most, your managers, supervisors, and employees wrestle with the 136 issues simultaneously. For the organization not fine-tuned, “fire-fighting” and undue stress are often the organization’s modus operandi. These reoccurring issues fatigue employees, drain company resources, and chew up profit.
The following are just a few of the common signs that the moving pieces of your business are not optimized or synchronized as well as they could be to improve your bottom line:
- The organization is working on too many initiatives.
- Your business is more complicated than it should be.
- Your leadership team is under constant stress and spends too much time fighting fires.
- You have personnel issues.
- You’re experiencing a higher turnover of employees and/or customers.
- The organization seldom ever really solves issues at the root making them go away forever.
- Communication breakdowns occur too frequently creating confusion and a lack of accountability.
- Quarterly and annual goals and milestones are not hit.
Eight Questions To Help Optimize and Synchronize Your Organization
To begin to solve some of the issues listed above, your leadership team must invest the time to answer eight simple questions as a means of getting your organization more aligned and optimized.
Those questions are:
- What are your core values? – Core values are just an essential set of guiding characteristics that define who you are at the core and what you want from the culture of your organization.
- What is your core focus? – Core focus is the sweet spot of your organization. It’s what your company does best. Once it’s clearly defined and articulated, the trick is to stay laser-focused within your core focus.
- What is your 10-year target? – This is just a long-range big business goal. It’s a clearly articulated, simple number one business goal for your organization. It gets you all on the same page with where you are going long term.
- What’s your marketing strategy? – Your marketing strategy is simply designed to get the leadership team all on the same page with who you should talk to and what you should say to get the biggest return on your precious sales and marketing energy.Once your leadership team has answered the first 4 questions and gotten on the same page with your core values, core focus, 10-year target, and your marketing strategy:• You know who you are at your core.
• What you love to do and are best at with your core focus
• Where you are going long term•
• How you are going to get there with your marketing strategy
You then need to crystallize the vision for the organization and bring it down to the ground and start making it real which brings us to the 5th question.
- What’s your 3-year picture? – This is not a detailed 3 to 5-year strategic planning process. All we’re trying to do is get every member of your leadership team to crystalize and visualize exactly what your organization needs to look like in 3 short years. If every leader can see the same picture in their mind’s eye, the chances you are going to achieve it are so much stronger!
- What’s your 1-year plan? – We use the same predictions as we did when establishing your 3-year picture, revenue, profit, and measurables. We then establish what your business needs to achieve this year or next. Then we establish 3 to 7 company goals and 3 to 7 goals for each member of the management team. This brings great focus and prioritization to the leadership team which cascades down throughout their direct reports.
- What are your quarterly rocks? – Rocks are just 90-day business priorities that get every employee 100% on the same page with what’s most important over the next 90 days. 90-day rocks create discipline, focus, and accountability so that every employee is executing on your vision every 90 days.
- What is your issues list? – A company’s nagging and reoccurring “issues” create a cascading effect on every aspect of your business. Employee and customer turnover, customer service, sales, and operations are all plagued with the impact of unresolved company issues. Because of that, there’s no expense line item you can point to that spells out just how much money your company spent on “issues.” Facilities, insurance, and communications are separate line items and therefore easier to identify the cost of the expenses. However, the cost of a company’s “issues” is much harder to quantify but make no bones about it, they’re impacting your bottom line. It is imperative to create a culture where all employees feel safe enough to raise their hands and call out issues. Then you need a process that all employees can utilize to brainstorm issues and solve them.
You cannot achieve great success, let alone optimize and synchronize all the moving parts of your business without getting real good at solving your problems as they arise, solving them at the root, and making them go away forever.
If your leadership team will take the time to answer these 8 questions, you will advance your business in meaningful and measurable ways. Ultimately you get to the point where everybody in your organization is 100% on the same page with your vision, executing on that vision with discipline and real accountability, and working together as a healthy, cohesive bunch of people who enjoy spending time together.
If you’d like help answering these eight questions for your institution or company, click here or call me at (760) 720-9270.
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