Is one of the goals of your business to make money? I don’t necessarily mean to make enough to be filthy rich, but enough to be comfortable in your lifestyle, enough not to have to worry about money when you retire. Retirement looms for all of us.
From another perspective, suppose you wanted to set up a new operation, launch a new product or enter a new market. What would success look like, what do you hope to achieve, and by when.
Both the first example, making sufficient money, and the second, succeeding in a new operation are goals.
I’m sure you have such goals in your business!
What is holding you back, constraining you from achieving that goal? Are there impediments, roadblocks, restraining your progress?
To achieve goals, there are always a number of Critical Success Factors, things that MUST happen for you to achieve that goal. In effect, if you were able to successfully control these factors, remove the impediment, then your goal would be achieved.
You must clearly articulate your goal. If you are not clear about what you want to achieve and you don't know what is necessary to achieve it, then obviously it's going to be very difficult to get there
Those Critical Success Factors then need to be pinned down. They are not likely to be many, perhaps five or six for any one goal.
Clients sometimes struggle with this when we’re doing business planning, but it is very important and well worth thinking through.
Once you have established these you are looking for the roadblocks, the main impediments to your success.
Get out a piece of paper, do a mind map if you like, and set up a series of columns with each of those Critical Success Factors at the top of each column.
Under each factor, brainstorm and list all the obstacles, road blocks, barriers and impediments that are preventing that Critical Success Factor working properly for you.
The main impediment will be in that list. There are a number of ways to determine which it is. You could use:
Now you know the principal impediment to clear for your Critical Success Factors to work.
Next you need to determine the root cause of that impediment. Use the “5 Whys”; keep digging down to the root cause of the problem by asking “Why is it so” for each answer generated for that impediment. Do this five times. When you know it, then you can fix it, properly.
But of course, that is not the end of the story. Now is not the time to allow complacency or inertia to step in.
Return to the second most critical impediment, and determine its root cause. Remove it.
Rinse and repeat until the road to your goal is clear, and the travelling smooth and comfortable.
When clients find themselves in this situation, finding it difficult to achieve their goals, it often comes down to a lack of clarity of what is happening in their business, and not being able to identify their Critical Success Factors. If they could, they would have removed them, and achieved their goals.
You need to know what is happening in your business, and that means more than acting on PHOGY thinking. The road to success is paved with good information, so you can see where you have been, and where you are going, and not be fog-bound.
For more than 30 years I’ve been helping small business owners use the right tactics to plug the profit leaks in their business and restoring their cash flows by assisting them determine their Critical Success Factors, and free them up so their goals are achieved.
If you would like to discuss with me how you might do that, book a Strategy Consult here. There is no cost.
© Copyright 2019 Adam Gordon, Profits Leak Detective
Some profit losses are pretty obvious - so you fix them.
BUT, what if you don't know profits are leaking, cash out the door?
Possible leaks could be anywhere.
Are there some clues or symptoms that are tell-tales?