In these days of sound bites and quick fixes, one-size-fits-most solutions seem to be as prevalent as the common cold and as hard to treat and cure. Most people probably have had the experience of someone from their organization reading a book or attending a conference and coming back with the “best, new way” to run the business.

It is good to be learning continuously. It is also good business to try new things. It is better business to make sure the things you try are tailored to your organization – its needs, issues, resources, culture, and opportunities.

There are no miracle cures for the business cold. The business cold is a condition that ranges from lack of direction, too many options, undefined roles and priorities, “ad hoc” action, and a multitude of other symptoms.

Like the common cold, the business cold has no miracle cure. Instead, it takes time to work through the symptoms and get to the root of the problem. Also, like the common cold, businesses get a wide range of advice on whether to starve a cold, feed a fever or feed a cold, starve a fever. For each business the treatment depends upon the nature of the cold and its host.

Too few resources (starving the cold) or too many (feeding the cold)? The right prescription is as valuable as the wrong approach is costly. If the business cold is a lack of revenue, many times the presumed prescription is to scale back operations. That may be the right answer, but it could also be one that results in lowering revenues even further.

Here’s a real life example, a manufacturer acquires a customer’s manufacturing facility. The acquired facility had operated as a cost center since it had opened. Now it was expected to operate as a profit center – accountable for revenues and expenses. That facility needed to be incorporated into the existing operations – people, processes, and systems. The site needed to implement an enterprise resource planning system – everything from production to human resources to finance and accounting needed to be put in place.

A one-size-fits-most implementation was undertaken with a system that had not been previously implemented any where else not fully tested for accuracy and functionality. In addition it was not integrated into current operational processes; there was limited training and no effort to match actual operations.

Can you spell d-i-s-a-s-t-e-r? The failed implementation magnified the revenue issues – lack of them. A focus on fixing the failed ERP system was not the first step taken. The first step was to cut costs – employees. The very resources the organization needed to get back on track with systems and sales were cut, again and again.

The cold was definitely contagious because other sites began the same process – failed implementation, layoffs.

Analysis actually showed that even if every employee and contractor were let go, the sites would not:

  • hit profitability targets (reducing cost in place of producing more revenue)
  • be able to correct the systems or process problems
  • sell goods
  • provide customer service
  • develop new customer base
  • develop new products

The “traditional” solution of laying off employees as the first action in addressing revenue shortfalls and rising costs was the wrong prescription. Ultimately, the site (and subsequently six others) was closed down.

Addressing business issues is about proper diagnosis of the underlying causes. It is also about developing treatment programs that take into consideration the underlying health of the organization and its long term viability. Some business events require reduction in resources; others require spending additional dollars wisely. Some require hunkering down and keeping the patient well-rested and gathering strength for when the problem has run its course (like a recession).

A miracle cure for business ills…wouldn’t that be fantastic!

Copyright © 2004 Lea A. Strickland, F.O.C.U.S. Resource, Inc.

 

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