Be aware of your own habits

by Adina Luca, July 9, 2016

If you’re a small business owner and you find yourself stuck in a no-growth path, it might not be the market that’s to blame. If your costs are too high or your team isn’t delivering as expected, doing what you do best could actually be your downfall.

Marketing people who start a marketing consulting business tend to spend too much time and money on… marketing. They know how to create a good website and use social media, and hope to pull the market towards them. It doesn’t matter to them if the service they’re selling isn’t being bought via online marketing channels, or at conferences and events. They’ll still spend months on that website, tweeting and uploading photos. And then waiting by the phone.

Sales people who start a business will chase after clients. “Grow fast or die,” they think – even if now is really the time they should be sitting down and keeping an eye on the expenses, or spending time with the team to help them deliver the service. Costs are boring, and keep them from running after the next deal; other members of the team should be left to deal with that kind of thing. Sales people sell and sell at breakneck speed – then get angry if there’s nothing left in the end, or if suddenly they realise there’s no solid team behind them to actually deliver what they’re trying to sell.

Consultants who start a business will offer their best analysis and advice at any price. Usually for free – because after all, they’d do it anyway. The fact they need to charge for it is a nuisance. So they under-price and under-sell themselves and their team.

IT professionals start businesses and develop systems to automate processes – regardless of whether they have clients to pay for what they develop, or whether their company even needs it. When they’re unable to grow the business further, they start thinking about developing another platform to sell. Or perfecting an existing one.

(A former finance director will not start a business. They know better.)

So, do you fit any of the above descriptions? Look at your habits: what’s your default solution when things go wrong? A new website? More sales? Work more, deliver more, and hope for the best?

(Who are we – the clue is in this posting…)

Here are some measures that can help you understand your own habits:

How much you spend out of your marketing budget as a percentage of revenue: did you invest in a new website when your sales were down? On marketing, do you tend to spend at the upper limit, the lower limit, or not at all? For most professional service companies, the upper limit is 5% of your revenue; the lower limit is under 1%. Or are you in the top echelon spending 10 to 15% of your revenue, joining the club of chronic sales-avoiding business owners?

Number of promotional consulting days: how many days a year to do your work for free, delivering your service to companies because, well, the projects are too interesting? Do you expect your team members to do the same? Do you work in the hope that clients will eventually pay at some point, but for the time being you’re happy just being of help?

Number of days you spend out of the office: when things don’t go well internally, do you think “there’s no problem that a new contract won’t solve”? Where are you when your team needs you? Meeting a prospective client or at a networking event? How many meetings a day do you boast about being capable of holding? If it’s more than six, join the club of business owners whose teams are wondering whether they still have a manager.
Number of days you spend in the back of your office: when your clients complain and cancel the deal, and the team needs you, where do you hide? In the back office, thinking through another product to launch?

Bad times in business are a given. They happened before, they will happen again. How you responded to a crisis last time is your likely response next time.

Repetition compulsion (according to Wikipedia) is a psychological phenomenon in which a person repeats a traumatic event or its circumstances over and over again. This includes re-enacting the event or putting yourself in situations where the event is likely to happen again.

Translation: as the owner of a small business, you will revert to your abilities and habits, especially when stuck in financial difficulties. That’s how you’re sucked into a vicious cycle, with the same old problems swirling around your business and your team.

If you recognised yourself in any of the profiles above, check to see whether your current situation might actually be of your own making. If so, it’s unlikely you’re going to be able to change overnight. Imagine turning a lone-ranger sales person into a business manager who nurtures others. Or a brilliant IT developer into an enthusiastic sales person. If you can, go for it: try it and see how you do.

If you can’t, how about associating with someone who’s your opposite? But in that case, will you be able to listen to someone who doesn’t agree with past solutions for present challenges?