Communicate and collaborate

This post is the fourth in a series of four that started with The ride's not over (so get busy). We've talked about embracing the current business climate as an opportunity to build a stronger business. We've talked about the need to develop new products and services. Last time we addressed costs and making them sustainable so that your business is profitable EVEN THOUGH revenues may be down. Today I will talk about the missing ingredient that keeps small businesses from becoming medium sized businesses and medium size business from becoming larger companies. You must communicate and collaborate.

When times were good companies could afford to be stingy with information. Sales were good and profit margins thick. Ample cash allowed companies to ignore blind spots and leave problems unsolved. Today those blind spots create cash flow emergencies. Those problems are keeping you from breaking even. Now is the time to ask for help and get more heads around the table than just your own. What do you have to lose? Nothing. What do you have to gain? Potentially everything.

There are three areas I think you should seek communication and collaboration. 

1. Employees. Study Open Book Management and start to implement it in your business.  OBM is a simple, straightforward, common sense way to manage your company. It says that the best companies are those where employees pay attention to the financial statements, understand how they are created and how their particular job function affects those financial statements. Small businesses have a unique opportunity here. It is much easier to communicate and collaborate with 5, 50 or 100 employees than it is with 500 or 5,000.
2. Customers. Eighty percent of your revenues come from 20% of your customers. You should be talking to those 20%, asking them what they think about your business, where it is going, how competent your staff is, why they choose to do business with you. You should also get your customers to talk to each other. Getting your best customers in the same room is powerful. We've done it a few times but we need to do it more often. I'm always surprised at the unexpected but productive outcome.
3. Advisors. Ask your banker, your lawyer, your CPA and your financial planner to donate an hour of their time to listen to your story and offer help. If they won't do it fire them. This happens all the time with our clients and the results are amazing. There is always more than one option; there is always a connection you don't have and an introduction you need; and yes there are always opportunities for those donating time to get something back besides money. Think outside the box.

There is a lot you can do to build a much stronger company than the one you had three years ago. Start by addressing your products and services. Are they relevant? Is there an untapped market among your existing customer base? Are there products that can lure new customers to your business and build them into ideal customers? Next, make sure your spending is in line with revenues. Can you break even given your current level of spending and current level of income? Finally, leverage the power of numbers by getting more heads around the table than just yours.