What’s this year’s plan?
© Roger La Salle
Who’s winning in this economy?
With the new financial year upon us, we are now looking back at the years end results and seeing how we tracked in business compared with past years.
Despite assurances from the Federal Government that all is well with the economy, in fact all but the mining States are doing it tough, very tough indeed.
In this economy, again if we remove the mining States, the businesses that are prospering are the lawyers overwhelmed with litigation, receivers and administrators trying to make sense out of failing businesses, accountants trying to make 2 minus 3 equal plus 1 and the child care sector as more mums move into the workforce in an attempt to make ends meet.
The age care sector is also doing well as more people move to retirement or nursing homes, but then again, many people are deferring the retirement decision courtesy of the world economy, economic uncertainty and general fear of the future.
In fact if your business is down in real dollars terms compared with the past realise you are not alone.
Many business operators are 40% and more down and they see no immediate “light at the end of the tunnel”.
Some that may have had done well in the past are now wondering whether to close up shop and call it a day, especially if they have a secure nest egg put away after years of hard work. Why now throw good money after bad in such an uncertain environment? The answer for many is simply, don’t.
Three vital questions need to be addressed
1. How are you tracking compared with last year?
2. Are you going to weather the storm or simply “shut up shop”?
3. If you are in for the long haul what are you going to do differently in the coming year?
The Business cycle
If we look at any business that is at some stage extremely profitable, unless there is protection of sorts or huge barriers to entry others will enter the market in competition. You can be sure over time as more competitors enter a lucrative market that profits will soon be eroded to make the business just an “also ran”.
Petrol stations, convenience stores and coffee shops may fall into this category.
Indeed as profitability falls with market saturation, one thing is sure, when the tough times come, only the fittest survive. Further, when the good times inevitably return, the landscape is far more hospitable as the weak have disappeared and are no longer competitors. In this regard there is definitely “light at the end of the tunnel”.
Going the Distance
If you have made the decision to stay the course and be around for the good times, then questions one and three above need to be addressed?
Question 1 Compare your results and assess the weak areas and decide how to address them, if indeed you believe they are worth saving
Question 3 Ask yourself, “What are you going to do differently this year in order to get a better result?”
We all know the old saying, if you keep doing what you have always done you will keep getting the same result. Perhaps it may be time to embrace a new approach and look at the opportunities afforded by systematically innovating your offering and searching for the next opportunity for your business.
Take Microsoft for example. Ten year ago who would ever have thought Microsoft would be in the hardware business with mobile phones and gaming machines. Who would have thought Nokia, formerly in the lumber business would have become the number one cell phone maker until quite recently and can you imagine an Apple phone – never.
These companies have embraced innovation on a grand scale and so far been extremely successful.
How about You?
The “big boys” if you like, had the financial capacity and brand presence to take some risk, but what of your business? The small local foundry, the machine jobbing shop, the powder coating service or even the suburban Milk Bar, what of these micro businesses, what can be done for these?
The simple answer is Innovation.
Find out what people are doing that is working and do it better. Not everybody in your industry is “going to the wall”, some will be great survivors. What is it they have that you don’t, what are they doing differently or better?
You can you embrace Innovation by changing products to add improvements, “Channel Enhancement” by leveraging your existing customer relationships, “Complementary Products” by fulfilling the entire customer needs or by adding Accessories to platform products you have already sold.
There are huge opportunities available if you are systematic and strategic in your search.
Further, do you have a systematic opportunity search mechanism? An opportunity is simply and “An Observed fortunate set of Circumstances”. Do you know how to position yourself to find this set of circumstances?
Is it all doom and Gloom?
Most definitely not, embrace innovation and opportunity capture and remember only the fit survive the bad times, after that, good time always follow. If you are a survivor the way ahead will soon be clear for you to prosper like never before.
**** END ****
Roger La Salle, is the creator of the “Matrix Thinking”™ technique and is widely sought after as an international speaker on Innovation, Opportunity and business development. He is the author of four books, Director and former CEO of the Innovation Centre of Victoria (INNOVIC) as well as a number of companies both in Australian and overseas. He has been responsible for a number of successful technology start-ups and in 2004 was a regular panellist on the ABC New Inventors TV program. In 2005 he was appointed to the “Chair of Innovation” at “The Queens University” in Belfast. Roger also chairs two Syndicates of the National organisation, “The CEO Institute”. Matrix Thinking is now used in more than 26 countries and licensed to Deloitte, one of the world’s largest consulting firms. www.matrixthinking.com