All credit to Rita Gunther McGrath on this blog. She’s the author of – The end of competitive advantage. She says that: ‘organisations need to forge a new path to winning: capturing opportunities fast, exploiting them decisively, and moving on even before they are exhausted. With this book she explains a new set of practices based on the notion of transient competitive advantage. She shows how some of the world’s most successful companies use this method to compete and win today.’
Here are five steps, I have drawn from her, if your business is unprofitable:
1. Assign the responsibility to a person. That could be you if you are a small or micro business or another director. It has to be someone with authority. Their role is to monitor and look at the facts.
2. Stop defending a declining business. If the facts and the signs are there, then stop defending the undefendable. Remember Kodak.
3. Use a system to exit. Take control of decline rather than allow it take control of the business. Exit systematically, it reduces loss, is less painful and is a sign of strong leadership.
4. Focus on early warning signs – poor innovation, customers purchasing cheaper products, declining growth rates, competitive advantage completely eroded.
5. Redeploy resources – Easier said than done, but if done systematically you can do this in a more controlled manner, rather than losing valuable knowledge in an uncontrolled manner.
If your business is suffering and you need some good business advice, call RBSS Consulting. There’s no need help thinking it through alone. Let us help you find the solutions. Contact us today on 0333 355 1696.