September 27th, 2009
Tip # 3: Understand your strengths – and manage your weaknesses
Reports in the media say that the economy is improving, and some forecasts point to recovery in the next quarter – but are you ready to take advantage of the added business and consumer confidence?
Did you know: Research points to the fact that those businesses that fair best after a downturn are those that actively plan their future and not just “let it happen”.
How well do you understand your business? Do you know what your strategy looks like post recession?
In this issue of Strategy and Growth you’ll learn more tips on how to develop a better understanding of your business that will allow you to dramatically increase your chances of standing out from the crowd in the eyes of your customers.
Many people have heard the term SWOT analysis. Many business schools talk about it; coaches and personal development professionals rave about using it – but what’s the point of it and when should you use it.
The point is this – a SWOT (Strengths, Weaknesses, Opportunities and Threats) analysis helps you look at your business and understand:
- Your strengths – these are the things that make you successful. They are part of the reason people buy from you.
- Your Weaknesses – are just that – areas where you’re not as competent as you would like to be.
- The Opportunities - these are the “elements” that are out there that might help you drive the business forwards
- The Threats – these are the things that will / may stop you / your business growth in your tracks!
So, it’s pretty simple really isn’t it? Well, Yes and No actually! It’s simple to review who you are – your strengths and weaknesses but then making sense of the information and doing something useful with it can be the hard bit. And what of the Opportunities and Threats? How do you know what these might be?
The answer: ‘brainstorm’ all the factors in each category with your team (or alone if you need). Get all your thoughts on paper – don’t worry if they are wrong or right at this stage.
There’s a template to help you with this process available for download from www.malabarconsulting.co.uk/downloads.
You could even ask your customers and suppliers what they think are your strengths and weaknesses – you might be (pleasantly) surprised.
Once you’ve identified your strengths try and narrow them down (assuming you’ve got many) to the 5 to 10 items that you think are your top strengths – these are your core competences – the things you and your business is excellent at. (We’ll look into more of how these can help you form your strategy in a later newsletter.)
To identify the Opportunities and Threats you need to understand what’s happening in the world around you and your business. Listen, see and sense the changes that are happening – what will help you in the future – what will hinder you? The next issue of this newsletter will provide more information about understanding your market place using a tool we call STEEPLED analysis – the factors that this analysis generates will help you understand the key Opportunities – and the threats for your business – (although beware – an engineer I once worked with at Rolls-Royce when talking about Threats and Risk analysis said that it was the issues that you don’t consider that are the ones that will cause the problems – and we know from recent experience we can’t predict the future – so this analysis won’t provide you a perfect crystal ball!)
Once you start to really understand your strengths and the opportunities you can start to form a clear picture of how you can move your business forwards and to help you stand out from the crowd.
We used to worry a lot about our weaknesses – remember those corporate personal development plans that sent you on courses to brush up on your time management?* My view now is to think differently – how can you find ways around those weaknesses? Can you outsource these things? Can you eliminate them? – you might even need someone to come in and specifically review that area of your business and put actions in place to put things right.
The key is to put actions in place that will maximise your strengths and manage your weaknesses.
By now you should be forming a great picture of what your business is, how it works, makes money and satisfies your clients needs. Remember everyone is driven by a need to move towards a benefit or avoid a loss – you job is to work out what you do for each of your customers!
Here you will find all the information you need to build your business -simply download the template you need.
Templates Available:
- Strengths and Weaknesses analysis
- Marketing, Operations and Finance Review
- Strategic Review Checklist
- Vision, Value and Purpose
- Strategic Direction Template
- STEEPLED Analysis Template
September 1st, 2009
Tip # 2: Take Steps to Review your Business
I hope you put time in your diary to focus on growing your business in the last month. This month I want to give you some thoughts and tips on reviewing where you are today.
To understand the journey you need to take with your business and to help you get where you want to go you first need to understand where you are today.
Many people use that analogy that business planning and strategy is just like setting out on a journey. However it’s not as simple as driving a car to a known destination and asking for directions or reading the map, it’s actually very different.
Chart the course now…
You cannot just step into the business, think about where you want to go and make it happen. Charting a course for the success of your business is not that simple. There are no laid out roads to follow for certain success.
Also you need to remember:
“Success is a journey and not just a destination”
Understand your business…
Think of your business journey as a voyage of discovery. But not a voyage by car, a voyage by ship. The outside elements can easily push you off course. You need knowledge, either personally or among you crew, of how the ship operates, how to set the sails, how to manage the tides and make best use of the winds, and how to navigate your way through uncertain waters.
It’s no good just knowing where you want to get to, you also have to know where you are setting out from and also to understand your current abilities, the abilities of your team and the strengths and weaknesses of each element that make up your ship.
In a car you can follow the signs or your GPS. In a boat, just like in business you need to think further than just the roads you will follow. Following a GPS blindly in business is likely to take you down the wrong path and get you stuck! So, why am I telling you this today?
This issue of the Strategy and Growth newsletter provides more useful tips and tools that you can use to help you fully understand the ship you are sailing and then help you chart your course achieve your goals and ultimately achieve your vision.
Think again…
Dr. Stephen Covey says, “Start with the end in mind.” However, for this issue I am assuming, for now anyway, that you have a vision of where you want to get to. In a later issue we’ll talk again about crystallizing that vision – without it who knows where you’ll end up.
Understanding where you are today…
I have created a series of templates and questionnaires that you can use to guide your thinking to accompany this issue. These worksheets are available for download here – add link to web page or by emailing or calling or create your own.
Give a copy of the worksheet template to each of your team members that you want an opinion from – careful who you choose!
Answer the questions on the template individually – Remember, be honest with your answers.
My suggestion is to review your business in parts according to the key ‘functions’ that you carry out. Below I have suggested a number of points as a starter for you to work with:
Marketing and Selling
- What marketing do you do, how effective is it? What methods do you use – PR, advertising, seminars, email shots, newsletters, exhibitions etc
- How effective are each of your marketing projects. Are you getting the returns you expect? (We’ll be covering some of the methods you can use to communicate with your customers in a later issue – but if you want a list of 101 ways to market your business NOW please go to www.malabarconsulting.co.uk/downloads or email me at downloads@malabarconsulting.co.uk)
- What’s the perception of your brand in the market place? What’s your market position?
- How well do you sell your products and services?
- How many products have you sold this year? How many did you expect to sell? Are you happy with your results?
Operations
- How well organised is your business?
- Does it operate in the most efficient and effective ways?
- Do you have appropriate processes in place?
- Do you follow your processes to the letter?
- Are your staff adequately (well) trained?
- How’s your staff morale?
- Are your machines or people being adequately “utilised”?
- Are you meeting your Quality standards? Always?
Finance
- Are you hitting the numbers you want to be achieving?
- Are you as profitable as you want to be?
- Do you have appropriate performance measures in place?
- Is your Return on Investment what you expect?
- How well managed / organised is your finance team?
- Could you manage with a tax investigation?
- Do you have appropriate controls in place?
- Do you have ‘enough’ working capital?
- Are your invoices paid on time?
- Do you pay your invoices on time?
- Does your accountant understand your business?
As well as these key functions it is also helpful to look at the key areas of your business that support your performance and growth. My suggestion is to score your business against each of these areas:
Resources – Financial Resources; Physical Resources (assets etc); Human Resources – your staff or associates, the management team – what training needs do you have? What gaps exist in your skills?
Experience – experience of running / growing a business of this size; of employing people; in this marketplace; of selling to clients and customers; of introducing new products; in this stage of he economic cycle. Appropriate experience for the future needs of this business
Controls and Systems – related to financial measurement and control, hardware and software systems and quality systems. Does the business collect the appropriate information to make informed decisions? How appropriate is the organisational structure? What quality systems are in place? How relevant are they today and tomorrow?
Ideas and Innovation – ideas that can be turned into profit and for the benefit of the customer (and your business). How innovative is the business? How innovative is the marketing, the service provided, your processes? How do you stay ahead of the competition?Leadership – think about not just the business leader but also the direction of the business – vision, values and purpose. How well is the vision communicated across the business?
While going through this list you’ll find it helpful to make comments on areas that need attention and then to develop actions to do something about it. Knowing there is an issue is one thing – doing something about it is another.
Once you have completed this review you will (hopefully) have a much clearer understanding of where the business is today.
In the next issue we’re going to develop on this enhanced business knowledge to help you understand what makes it the business it is today.
