Evaluating Current Reality
I was working on my BBV Program and thought it might be good to share some thoughts and even some questions to ask. Evaluating performance on a regular basis is critical. The key is asking the right questions before taking corrective action in the wrong direction.
There are three categories of conditions to consider. These conditions include:
- A Business Tune-up
- Turnaround situation
- Are you in a crisis?
Tune-up questions should include the following:
- Have earnings deteriorated?
- Are sales leveling off or declining?
- Is your workforce less inspired?
- Are you satisfied with recent product or service introductions?
- Have you developed a plan to maintain your rate of growth in spite of new competitors entering the market?
Now let’s review some turnaround questions:
- Are you starting to lose money after years of profitability?
- Do you have too much inventory that’s not moving?
- Are you able to recruit new employees?
- Do you have too much debt and not enough equity?
- Do you know where you are making your profit?
- Do you know why you sell the products in the markets you are in?
- Have competitors taken business away from you?
Now for some crisis questions:
- Is making payroll a problem?
- Will your bank lend you more money?
- Have you lost any key employees?
- Have any vendors stopped shipping goods to you?
- Have you had time to think about strategy?
- Have customers who are slow pays stopped ordering?
Based on the answers to the above questions you will gain a sense of what action you might need to implement. These questions are the first steps of our Building Business Value methodology. From here we establish the scope of corrective steps a business will need and how to re-orient the business. In these times of uncertain economic conditions we thought these questions were appropriate. Asking the right questions is usually the first step in solving the problem. Don’t panic and take measured action to address the current reality of your business.