Picture this: a business that was once the soul of the industry is reaching its peak. Sales start to fall, customers are no longer enthused, competitors find a way in and the entrepreneur has second thoughts about the whole thing. Sounds familiar? Yes, it does, and that is because this trajectory is so common. In fact, the academics have labelled it the lifecycle of a business. You rise, prosper and fall. This article explains some of the things that you ought to do in order to give your business a new lease on life after the slump.
Don’t bother recapturing lost glories.
Every business idea has its time. If you are constantly looking for ways to go back to what you once were, then you will most definitely not make it in the new world. It is far better to explore the new reality and adjust your business ideas accordingly. There are opportunities at every turn and the fact that the industry has changed does not mean that you are dead in the water.
For example; when PayPal realized that its cryptography model was riddled with expensive user fraud, they turned to e-Payments to great success.
Keep your old customers and add to them.
The one constant for your business is your customers. They may be loyal, but you have to give them something to hang on, particularly when the business is getting into trouble. The biggest problem for entrepreneurs is that they are so caught up in finding new customers that they end up neglecting their most faithful fans out there. This is a recipe for long term failure because there is absolutely no guarantee that the new customers will be anywhere as loyal as the old ones.
Google is a good example of this because they were able to use some of their old search appliance customers in order to launch their AdWords program.
Create excitement and expectation.
There is a reason why celebrities are always relaunching their careers. We all love a good party and the newness of innovation. This is exactly the kind of buzz that must surround your business, particularly when it is flagging. However, you need to be wary of the story of the boy who cried wolf. Too many launches can start to grate. When you really want to highlight a new invention, the brand fans may already have decided that you are old news.
Mark Zuckerberg of Facebook is an absolute genius at creating buzz for a social media tool whose demise has been prematurely predicted on countless occasions.
Welcome fresh blood and clean out the house.
One of the most painful experiences for an employer is to get rid of perfectly friendly employees who are just not up to the job. Being nice is good for social relations but it must be supported by competence in a work setting. You have to be very realistic and honest about who does what. Even you the entrepreneur, may turn out to be the weak link. If that is the case, you must not hesitate to make a gracious exit. That is what executive teams and boards of directors were made for. You can own an enterprise without operating it.
When YouTube launched its Partner Program; a brutal cleanout of content took place meaning that people began to take the website a lot more seriously than before.
Downsize and upscale your business.
Large, unwieldy companies are a nightmare to revamp because they have so much that can potentially go wrong. It is much easier to focus on a few departments or product strands. Therefore, if you are facing a slump then it might be a good idea to reduce quantity and increase quality. The branches or units that remain operational must raise their game in order to compensate for the loss of capacity that inevitably arises when you downsize.
Napster is an example of a good clean out following bankruptcy and scandal, only to re-emerge as a leading voice in commercial music downloads.
Remember: The slump is inevitable but not always fatal.
Above all, you should recognize the fact that all businesses (no matter how successful) will face challenges at some point. If you know what is coming, it is possible to cushion the blow by making some early preparations and pre-emptive strikes. That is what a good makeover can achieve, both in your personal and business life.
