Rethinking a Small Business Strategy
Business strategies that work for a $10 million company don't work for a $25 million company.
That's one of the messages that seemed to hit home with the audience at a leadership session during last week's Inc. 500 conference in Maryland. The talk was led by Keith McFarland of McFarland Strategy Partners.
He told the audience of about 100 at the Gaylord Convention Center that "strategy" is a "collection of ideas about how we're going to win" and urged business owners to make sure they know exactly what strategy means, saying that most executives think of strategy too rarely.
McFarland, who has successfully started up some firms and failed some as well, said he'd rather "take my pain a little each day" when it comes to starting a venture, rather than have everything run smoothly up until the inevitable blow up and subsequent meltdown.
Part of taking that pain is shaking up routines in order to grow. "Routines helps us, but hurt us" when it comes to growing a company, he said. McFarland recommended that top executives do quarterly reviews of their company's three most important accomplishments, three biggest shortcomings and three most important strategic lessons learned during the previous 90 days.
McFarland said the process of coming up with these ideas isn't easy and if "you get one or two ideas from a group of 30 people" on the first try "you're doing great."
He added that strategic accomplishments don't include things like "we hit our sales goal." A true accomplishment should show how you changed the field of play.
McFarland believes that it's possible to create a strategy for a business in 48 hours, saying that a strategy built in two days is about 90 percent as good as one built in three months. Working in haste prevents you from losing ground to competitors or having to continually update your strategy as the business landscape changes, he said.
As for personnel, McFarland said of course an executive should look for quality hires but "there's no such thing as the right person, but you can coach them...Take the emphasis off just hiring the right people. The people will be made right."
Personnel issues also can be a problem for startups because in the early stages startups rely heavily on "the people who put out fires." These troubleshooting heroes become pillars of the organization, but must be taught to help build the company by becoming "bricklayers," not just problem-solvers.
McFarland also suggested that firms find mentors. For example, the CEO of a $10 million firm asked him if he knew of a vice president of marketing for a $50 million firm. When McFarland asked him why, the CEO said he wanted a mentor for his V.P. so that she would be prepared to run a $50 million firm.
He also advised companies to ask employees of all levels for new ideas. Top executives and co-founders are likely to think alike. If they keep making all the decisions, the company will never discover new ways to grow and adapt, McFarland said.
By Sharon McLoone |
September 23, 2008; 2:26 PM ET
Tools and Tips
Previous: Small Business Report Paints Grim Economic Picture | Next: Female Lawmakers Object to Proposed Women's Procurement Rule
Please email us to report offensive comments.
The comments to this entry are closed.