When my extended family comes over for dinner, it’s a loud and lively event. There’s plenty of food, conversation and laughter. Our goal is simple: polish off generous helpings of Italian food and wine and have a great time.
With this goal in mind, I hosted a holiday dinner for 20 guests that didn’t quite play out as planned.
After inhaling the meal, we played games, shared some laughs and settled in to watch a movie. The film was barely half over when my nephew glanced out the window. The dry streets and clear night had turned into a raging blizzard, with six inches of snow on the ground.
His weather alert sent the room into a massive goal shift. Our simple objective of enjoying an evening had instantly morphed into a new goal: getting home safely. Faster than you could say, “Pass the cannolis,” the entire crowd had yanked on coats, exchanged hugs and headed out. The evening was quickly over and, no, it wasn’t something I said.
As was the case with my family gathering, a change in conditions can stimulate a shift in goals. The sudden deterioration in the weather had understandably altered priorities and shortened our evening.
What about changes in conditions surrounding your business? How do you shift gears and alter goals to maintain a healthy bottom line? Even more important, what goals have you set in the first place?
With economic challenges that may persist through 2009, setting goals is a must. If you already have done so, that’s good. But don’t feel too smug; in a tight market, goal reassessment is also wise. Let’s consider what forward-thinking practices must come into play.
When things get tough, it’s time to hunker down and look at core priorities. What are the top three priorities for your business? How about these mainstays for starters: reduce costs, make money and grow the business. As a manager, all your goals should contribute to one of these core priorities.
This is particularly critical when economic conditions require every dollar to stretch like spandex. That includes outgoing dollars (think cost-cutting, labor and inventory management) as well as incoming dollars (think targeted, aggressive, strategic marketing).
Reduce costs: In lucrative times, your goal for cutting costs may have been to hire one salesperson instead of two. Today, those goals must be more pervasive and collaborative.
Hold a brainstorming session with your team leaders and ask yourselves: What do we really need to keep the business running? Where can we shift gears?
Look at costs line by line on your budget — particularly the big costs. Consider options that may include reduced head count or switching to part-time workers, tighter inventory, better deals with suppliers, more economical telephone and Internet access, foregoing the coffee service for making it yourself, negotiating better office cleaning rates, reducing employee perks and cutting utility costs by powering down at night.
While you’re doing this, don’t be a “Lone Ranger.” Share your decisions with your team leaders; get their buy-in to build support before you put cost-cutting measures into place. Look at least six to 12 months down the road. This means you shouldn’t start your measures too late and risk losing bottom-line impact when you need it. Look ahead and be adaptive so you can gear back up quickly when conditions improve.
Set marketing goals: Next is your core priority for making money and the goals that go with it. You’re already improving your odds for black ink on the bottom line by keeping costs in check. Now, how are you going to keep making money in tough times?
Targeted marketing and contact goals for your customer base are key. Instead of letting market share get squishy, make it stronger. While you’re at it, look at expanding your reach. This means shifting your business model and how you approach customer needs you may have overlooked in the past.
The smaller deals you blew off before may now be worth grabbing. Where can you afford to trim margins and still earn a reasonable profit? Are you too heavily dependent on one customer segment? Diversify. Aggressively maintain essential supplier and business relationships that keep revenue flowing as you ride out the tight market. Query supplier and business partner plans, too. In short, dump your complacency and pump up your marketing and relationship management. Talk to your current customers and actively seek new ones; find out what all of them want today and next year.
Grow your business: Our third priority is growing the business. You might ask: How can I do that when sales opportunities are shrinking? That’s exactly the point. While others may be crying in their beer about the poor economy, you’re the manager making the most of it by looking ahead now.
Growth goals should include refreshing your marketing efforts, taking advantage of all skills and contacts your employees have and collaboratively building your ideas and actions to position yourself for business gains. Also, think about markets you may have previously ignored that show growth potential. Do this now, and when dollars start to loosen, your company will be front and center.
Check out demographics for new, innovative products and determine where pent-up demand is waiting for the economy to improve. Evaluate these products now for potential inclusion in your list of offerings. Don’t wait. Think about what makes your customers want to buy, and adjust your product line with suppliers who are doing exactly what you are — looking and managing ahead.
Whether you’re hosting a dinner party and shifting gears as the weather changes or driving a car and shifting gears to navigate snowy streets, changing conditions require a resilient and flexible approach to how you manage your business.
As you set or revisit your goals, make sure all your decisions contribute to reducing costs, making money and growing your business, and you’ll be punching in a program for future success.
Put muscle into your goals as well. This means you should write them down to strengthen commitment.
Quantify your timing and the results you are shooting for and measure your results on prescribed dates. When goals are achieved, celebrate and keep pursuing newly updated goals.
Shifting gears and goals doesn’t have to be difficult, but it does have to be done. Make sure it’s you and not the other guy who makes smart goal shifts now. Those who shift will be those who win.
This article originally appeared in the February 2009 issue.