Why the Past Success of Your Business Might Be Killing Its Future
One of the foundational rules in small business is what made you good up to today might be the same thing keeping you from being a great company tomorrow.
Every leadership team, at some point, runs to the end of their skill set, meaning they knew enough to get us here, but they do not have the skills to get us past today.
They either realize what they know is no longer enough, and seek the changes resulting in growth, or they retreat to the past, clinging to the threads of a business that achieved a level of success, then flatlined.
A single, flimsy thread can’t do much harm to you. Threads are just little cotton strands a child can snap with her little fingers. Thousands of threads, especially those keeping us tied to a past success we can no longer emulate, combine over time into a force choking the life out of any business trying to stay alive, or evolve past its former success.
Every business with any age to it has threads binding that business to its history. Threads represent how we always did things in that business, but seldom are strong enough to give the business a future.
Threads might be employees from the old days promoted due to longevity, not contribution. Threads could also be a glorified past where the business was known, and successful, but today has an ownership trapped trying to restore a fading concept, rather than letting the business evolve to its current potential.
Threads are nothing more than life preservers we scramble for when our skill set ends; the skills, technology and methods of operation that were part of our success, but all became ineffective tools today, and are the things we cling to when we do not know what else to do.
Small businesses fail because they don’t evolve, forcing that business to lose the ability to react to a changing market. Keep doing what you have always been doing, and the world offers up someone doing it faster, better, cheaper, nicer, or just different.
Doing what you have always done, especially when it is proven not to work any longer, guarantees failure, since you have already validated there simply isn’t enough clients out there who want to buy your old method of business.
Sure, there are fans of desktop computers, K-Mart, film cameras, CD music, and old school aerobic classes; but not enough of those fans to keep any of these concepts viable going forward in time.
Sometimes destroying it is the only way to save a stagnant business
The only way to save most struggling small businesses with a history of success, but one that is currently struggling, is to cut all those threads binding it to history and let the business evolve.
You have to sit down and reinvent the concept for the market as it exists today, not try to maintain it for the ever-fading pack of fans who still believe in what you are selling, but don’t represent enough people as group to support your efforts any longer.
The problem is we never recognize the threads binding us to the past. These threads are insidious in nature, much like the proverbial frog sitting in slowly heating water that gets boiled rather than leaps.
For example, the employee left over from the old days who fights to restore the way the business was when everything was perfect, and only he knew how to get it done: “It is our employees that are killing us today,” he screams, “If we just go back and train them as we did when we were making money we can fix it all.”
This might be the old sales guy who believes the business just needs more closers, rather than questioning if what the business is selling today is what people want to buy?
This isn’t a sales problem; this is a conceptual problem. It is not how you are doing it that is killing you; it is why are you still doing it the same way you did a decade ago?
When the business environment all around you changes, using techniques that made you successful 20 years ago will have little bearing on fixing a struggling business today.
Businesses plateau at some point, meaning if we keep using the techniques and people we currently have, we cannot grow the revenue of this company any higher. We peaked with what we had, but what we have is usually not enough to drive through to the next level.
The thread here is we refuse to change because we are so afraid of pissing off current clients. “If we change, we will lose all (your employees always go for worst case to validate their points) of our clients that love the way we do things.”
The big question, especially if the business is stalled, or in decline is, “If we don’t change, we might lose the whole business instead of a few old customers.”
Old customers, who fight change to their service, or product, and then threaten us with their willingness to go elsewhere, hold us hostage and prevent us from doing what is the best for the business, which is cutting that thread to the past.
For example, you own a gym and your staff tells you if you get rid of old equipment that has been used for 20 years, we will lose too many members, and hurt the business, but reality is that ancient equipment array isn’t attracting enough new members to sustain the business and is a roadblock to future sales.
If you are held hostage by the old staff, yet again, and some of the old members in this example threaten to quit if anything changes, then you won’t even paint the walls in fear of making some old client mad enough to go somewhere else. The equipment or dated programming keeping those old clients from leaving you is what may be keeping a lot of new clients from joining you.
The answer is to do what is necessary to give the business a chance to attract a new generation of clients, in big enough numbers, to replace the old client who might leave, but is preventing the business from growing.
There is no way you could ever survey this in a business
Ask any old client what happens if you change anything they know, replacing the known with an unknown, and no one will ever let go of what they have, but remember, for every client who clings to the past there is another old client who hates that you haven’t reinvested in your business in 20 years.
Having equipment, or programming, or a service that hasn’t changed in a decade, is not a badge of honor to many clients; it simply means to them you are cheap and won’t reinvest in your business.
Often it is the employee who fights so hard to keep the same old, same old. Employees demand leadership, and if you want change, you have to replace the vision of, “We have always done it this way, and this is all I know” with a tighter vision of happens if we let go of the past and embrace your clearly described vision of the future.
Your history is just that, something that happened in the past, and has no bearing whatsoever on what you can be tomorrow.
The question to ask framing this issue for employees is, “If we started the business today, would we be doing the same things we are doing now?”
The answer to this is seldom “yes.” If we started the business today, you wouldn’t have the old physical plants or business systems; the old, already ruined employees, and you would be able to start today fresh correcting all of your past mistakes by focusing on a vision of what the business has to be today to compete.
This is how you should learn to run your small business. If you want to go forward, you often need to cut the threads to the past, and even the tech and skills you used just a few years ago might be already working against the evolution of your business.
If your business is flat, getting buried by competition, and you are fading, or what you own is simply not performing, ask yourself these questions:
Are the employees that have been with me so long part of the solution, or are they really part of the problem that keeps this business from growing?
Long-term employees seldom change when times get tough. Yes, there are a few who have been around for a long time and who can change, but not many. Often the very people you are counting on for help to evolve are the same ones who secretly fight every new idea by hanging on to the way you have always done it.
Long term employees often nest and build empires, and even the ones who have been with you just a few years will often cling to what they know, not embrace what you want them to do.
Big change requires big change; often the only way to do that is to start fresh with people not afraid of your new vision.
What made you successful will not keep you that way. Markets evolve; competitors steal best practices, and the expectations of the consumer changes too.
Sometimes you have to admit you were brilliant in 1995, but not even in the game today. Change is often harder than death, as almost any smoker will tell you. Sometimes letting go of a concept, and replacing it with, “What is next,” is enough to save a flat lined business that is fading year after year.
If what you are doing, such as a string of negative numbers, has lasted more than three quarters, you don’t have a trend that may change back in your favor, you have a new reality, and that reality is that you are denying the inevitable.
The numbers will not change if you do not change them, but if what you are doing isn’t working, defined by shrinking numbers, failing physical plants, dated processes and a staff that won’t let go of who you used to be, then you have to break it if you want to save it.
Patching means you are using short term sales, desperate marketing concepts, emergency staff realignment and other gimmicks to prop up your failing concept.
Old and tired with a few new props is still old and tired. Patching is what you do when you really don’t want to change but want to pretend to yourself and team that you are.
You are embarrassed to attend workshops or ask for help because you are afraid someone will think you don’t know all the answers. You are afraid to ask for help because you are afraid to admit what you are doing isn’t working and you can’t fix it.
People are managers simply because they have hung around the longest in your system, not because they add new ideas. You are trapped rewarding loyalty instead of effectiveness in the business.
First of all, is it you blocking all change and evolution, because you cling to past success no longer achievable in your current situation?
Sometimes the best way to attract new clients is by getting rid of that handful of old clients blocking all change. If what you has provides a paycheck instead of a profitable business, then what you have isn’t enough to last into the future and the only way forward is to let go of what you have and embrace what you are missing, which is the new clients you need to grow.
Fire them now; cemeteries are full of irreplaceable people. You will get past it and will probably do better with fresh blood hired at a lower rate of pay.
Bad pay systems, staff working offsite that isn’t productive, or bonuses you still give, but haven’t made sense in years, are all things you created, and are systems and issues you can recreate to save what you own.
Again, you are held hostage by a few clients you let run your business rather than making the decisions you need to make in order to grow the business. Fire the clients and make the changes.
Admit you can’t fix it, ask for help, and move on. When you avoid and do nothing, you did make a decision, and that was to avoid making the changes you need to save what you own.
If you aren’t making the money you want, stop obsessing about small changes that mean nothing and commit to major change that could save your business. Set a date, get your entire staff together, train them up and commit. You cannot fix doing nothing; you can fix something that is moving ahead.
There is always the one guy on staff that fights everything, argues in every meeting about how we tried that, the clients will kill us, we will lose everything if we change, all the clients would leave us, and offers a hundred arguments against every single new idea. Cut his thread first.
Sometimes the only way to save a business is to destroy it
Sometimes the only way forward is cutting the threads from the past
Sometimes the right thing to do to save a business is just to start over
And if you will not change now; then when?
How long will you take the beating before you admit what you are doing is working? Are you willing to ride it down rather than admit you can’t fix it?
Are you so afraid of change you would rather lose everything?
If not now, then when will you give yourself a chance to survive?
Why the Past Success of Your Business Might Be Killing Its Future
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