Change is a sneaky fox. Mostly we only see change after the fact.
My client Karl (name changed to protect the innocent) took over his father’s business. While the business was (and still is) a specialty supplier to residential and commercial construction contractors, the nature of the business is not particularly important to this story. What is important is that his father grew the business based on long-nurtured personal relationships with a plethora of small contractors. Dad was well known and highly respected, as was his company.
When Karl took over, he continued to do business as Dad had done it, relying on the firm’s large base of contacts and prior customers to bring new business to the company.
That worked, especially at first.
Eroding revenue
But after a few years. Karl realized his phone was ringing less and the base of contacts Dad had developed was eroding. The more tenuous relationships that my client had with his father’s connections were yielding less business. Contractors who knew my client’s company were retiring or leaving the business.
Awareness of my client’s business ebbed and so did his top-line revenue.
Sneaky change was at work: The industry’s structure changed. Generational turnover brought changes in ownership and leadership. Some established contractors retired or closed their businesses, while other contractors transitioned to new owners or management.
Now what?
That’s when Karl reached out to me for help. He was down and discouraged, looking for an answer.
My answer? I did not have one. But I did have a process to find one.
We built the company a strategic plan.
In the research we did to develop the plan, we did a deep dive on what had depleted the company’s revenue and what to do about it. That’s when we recognized that sneaky change was also offering new opportunities for my client.
Leverage change
The answer? Recognize the benefits to be had by leveraging the results of that sneaky change.
Manufacturers and suppliers serving the same contractors my client serves had consolidated and professionalized, changing product availability, distribution relationships, pricing, and purchasing decisions. Karl recognized that his products could enable these manufacturers and suppliers to offer cost-conscious builders attractive alternatives, both by using and reselling Karl’s products and by bringing in Karl’s company on significant jobs that the manufacturers and suppliers were part of.
While still serving the smaller contractors that his Dad had served, Karl leveraged existing contacts and engaged with his industry association and participated in its international trade show. His intentional initiative to connect with, cultivate, and develop formal business relationships with key decision makers at larger manufacturers and suppliers worked.
After several years of effort, the company’s top-line is again growing with new business and larger orders coming through the company’s new-found manufacturer and supplier relationships. He has expanded his shop and added to his workforce. The smile on his face is great to behold!
Spot the fox!
Karl’s initial plight is all too typical. As we old Boomers say, “keeping on keeping on,” whether unconsciously or intentionally, is most often a business strategy that leads to bad results and even failure.
That likely decline is caused by the sneaky fox, who quietly attacks the premises of past success, changes the rules of the game, blocks old roads, and opens new ones.
The answer: Plan, process, KPIs
Karl did not have a prior strategic plan that he was implementing nor a regular process for assessing direction and results. He did not have formal KPIs in place that would have given him earlier and more complete awareness of the decline in his business and the causes of that decline.
Luckily for Karl, he reacted to the loss of revenue quickly enough that we were able to find the new strategy, and build a plan and an implementation process around the strategy.
By pursing the plan, Karl was able to turn his business around. And start smiling again.
