3 Hurdles Most Businesses Fear

by Leo Pound on March 16, 2015

Pound Consulting | Leo Pound | TurnaroundEvery business has it’s own set of hurdles. Some are industry specific, or resulting from regional variables, seasonal fluctuations, technology developments and product centric issues. For those of you running a business in Boston, for example, you certainly have had your own set of challenges this winter. How has the snow and ice delayed your manufacturing, deliveries, factory efficiency, employee sick and personal days, fuel costs, maintenance cost to clear snow… While these variables can’t be controlled, there needs to be a plan to deal with unusual situations. They are hurdles, just like the ones listed below. If not dealt with, they can result in declining business. Make a plan for success and these three business hurdles that must be faced head on. There can be no wavering, no waiting for later – they must be dealt with immediately to ensure your businesses’ success. You must take action, or action could be taken for you. It’s time to make a plan and implement it. Consider these three hurdles;

Declining business

Is the air leaking out of the balloon or is it flying around the room with no direction? A sales decline can manifest itself in many ways; changing consumer or customer patterns, technology change (not keeping pace), regulatory (think carbon emissions), commodity (gold goes up, buying goes down)… Each one of these changes can be managed. It’s imperative to notice the decline ASAP. Ask yourself these questions;

  • How quickly can you see the change?
  • How vigilant are you with markets and customers you serve?
  • How responsive are you to change?
  • Be aware of governmental changes. How do new regulatory laws affect your business?

All revolve around people being aware. Your management team can be organized like a SWAT team, each charged with watching key performance indicators (KPI) which can give early warnings of changes to come.

No business should be in that position. Each team should work out contingency plans now. I learned a long time ago, from my time in the Boy Scouts to be prepared.

Change in Industry

In the early 19th century coal was king and oil was not even on the scene. Know of any big coal companies today? Remember instant pictures, for those of you old enough, think Polaroid camera. Kodak had a lock on film. They eventually invested in digital media solutions. Although slow to embrace the change, each of these companies or industries have gone through seismic changes and survived. Yet each industry could have been the leader in change had the culture of these businesses been focused on innovation instead of ever-higher share price and earnings. Reinvestment of profits for the future is something every company should consider. Those with long views, like Amazon, will likely be here in fifty years and will still be a solid business evolving with the times. Will Microsoft?

High Employee Turnover

What is your turnover? What’s the price for every new hire? What does it cost to train a new hire? And what is the time necessary before that new employee pays back their own acquisition and training cost? I routinely see turnover in mid-to-high double digits. Companies seek ways to be efficient in searches, and training, but often miss the big point. Why are they leaving in the first place and how can we change that dynamic? Do you do exit interviews? Do you mentor employees on the job? Do you create work teams, or a buddy system to bring new hires into the workplace? Think about it. Human capital is often the most expensive line item in your income statement when you add turnover costs to payroll dollars! For more information about retaining key employees during a business transition, read this.

What hurdles are you facing in your business right now? Have you found any out-of-the-box solutions? Share them in the comments below. And, as always, if you liked this blog, please use the share buttons above to share with your friends and colleagues.

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Leo Pound

As Pound Consulting Inc.’s founder and principal, Leo Pound is responsible for day-to-day operations, as well as building partnerships, maintaining relationships and providing value to all clients. Born and raised in Philadelphia, Leo has spent most of his career helping companies around the world.  He has worked with many multi-national companies – including ones based or operating in China, Australia, Canada, England, Germany, Japan and more. He has in- depth knowledge of operational and strategic planning, M&A, forecasting and budgeting and cost containment. Leo is a hands-on professional who is sensitive to the pressures and challenges facing a troubled or rapidly growing company and their management team.

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