Extraordinary Business

I recently read the article in Inc. Magazine called "The Success Gene" by Adam Bluestein. The article highlighted the following businesses for having existed for over five generations: Hussey Seating Company, C.F. Martin & Company, Iwan Reis & Company, Harden Furniture Company, A. E. Schmidt Company, and NP Dodge.

First I want to congratulate each company for surviving so long through good times and bad. It's impressive to see that many generations keeping business in the family. One thing that can be said for each business is the similarity in their beliefs.

Each business lives by the belief that they are the best in their industry. Being the best separates those who want to be number one in their industry from those who are just trying to compete. Also, each company mentioned their willingness to change. Change is an important factor in business, and many businesses, family or otherwise, fail because they are unwilling to change. While there aren't a lot of secrets to how they have survived the times, it is still and interesting and inspirational read. If you have the April copy of Inc., please check it out.

I recently read an article in Inc. magazine called Paradise Lost by Bo Burlingham. What caught my attention was the story was about Reell Precision Manufacturing. This company had been recognized for its culture and now was struggling for its life.

Reell was a successful company with a strong employee focus. In fact, all decisions were made in the best interests of the employees. For more than 30 years, the company had worked through good times and bad. When times got tough, the leaders took pay cuts to avoid reducing staff. The company was ran by three CEO's that made decisions based on consensus. The formula worked. The company experienced unflagging loyalty while having turnover well below the industry average. So what caused the dramatic turnaround in performance?

Reell's industry was changing. Responsible for making laptop hinges, they found their markets moving overseas. While they were able to make changes and compete for a while, they became burdened by keeping up with increasing sales. Those sales forced capital investments that forced the company to focus on generating more sales to pay for the equipment. Reell became forced to compete on price and reduced margins. In the short term, Reell's decision to globalize their laptop hinge product prevented layoffs. In the long term it nearly destroyed the company because of its failure to balance out the needs of the employees and the needs of the business.

The moral of this story is looking at all aspects of your business no matter how well you are doing. Too much emphasis in any one area can be disastrous.

Article:
Paradise Lost
By Bo Burlingham
Photographs by Mike McGregor
Magazine: Inc.
Issue: February 2008

Labels: Business, Business Coaching, Change Management, Coaching, Leadership, Management, Planning, Sales, Strategy

Recently I was reviewing a Businessweek article by Jack and Suzy Welch that was titled "Trim the Fat, Not the Service." The title alone brings up a good point. If you make your customers suffer through the tough times with you, they won't be there when those times are over... and you might not either.

The moment the word recession is tossed around, many companies begin preparing for the worst. They do everything to maximize their cash and eliminate services. Unfortunately the customers take the hit in many cases. The focus is on cutting costs instead of gaining market share. So, ironically, when you have your best chance to gain new customers from your competitors, you fail to take advantage of it because you are in your basement riding out the storm.

What if your business was prepared for this. What if instead of cutting costs, you had already managed your business to work efficiently while still exceeding your customer's expectations. What if all the people in your organization understood your strategy and were passionately living it each day. What would that look like? How would it change your business when you are growing while everybody else is cutting back?

Right now you are at the crossroads. Either baton down the hatches or take market share from your competitor. If you can't afford to grow your business, how much can you afford to lose?

Labels: Business Coaching, Coaching, Economy, Leadership, marketing, Planning, Strategy, Vision