Are You and Your Business Ready for the ‘Precovery’
GUEST AUTHOR BLOG: Five Ways to Build a Predictable Business in an Unpredictable Environment by Les McKeown author of "The Synergist: How to Lead Your Team to Predictable Success."
Many business leaders are beginning 2012 with a voice echoing in their head. It's a voice that says "Here we go again. Another year of uncertainty and little growth".
Others - many of them weary from years of layoffs, belt-tightening and declining market share - are talking back. For the first time since 2008, I'm hearing business leaders talk positively, in some cases even confidently, about the year ahead.
What's going on?
Have the second group of leaders uncovered some secret that the first group of leaders missed? Or are they simply Pollyannas who have grown tired of facing reality?
The answer, it seems, is neither.
What appears to be happening is that many of those organizations who have weathered the last four years are moving into what might be termed 'precovery' mode. 'Precovery' accepts that while the current economic environment is still bleak, some companies will still out-perform the average - and it may as well be you.
Managing this feat - essentially, being in the top quartile of performers in your industry or geographical location irrespective of how the overall economy performs - isn't for everyone. It requires focus, regimentation and some investment, but for those who adopt it, the rewards can be high: higher returns, higher predictability, and increased market share.
The other piece of good news about adopting a 'precovery' strategy is that it isn't only for the big boys. Managed correctly, a local coffee shop can outperform the nearby Starbucks; a three-location chain of muffler shops can outperform their regional competitor, and the four-people-in-an-attic social media consulting firm can out-perform the national PR firm.
Here are the five defining characteristics of organizations in 'precovery':
1. They regularly review trusted metrics.
You can't out-perform the market if you don't have solid information about how you are doing. The leadership teams in organizations that are ahead of the economic curve don't bury their collective heads in the sand - the meet regularly to review trusted performance data.
It might be a simple profit-and-loss statement or a highly complex trading statement, but whatever the key data is you need to manage your business, you need to have access to it, and review it regularly.
"The single largest competitive advantage precovery organizations have is the vibrancy of their people."
2. They accept the data for what it is.
Rather than second-guessing, massaging, re-interpreting, filtering, disguising, best-case-ing, optimizing, projecting, top-slicing, averaging or blurring the numbers, organizations in precovery accept that the data is what the data is. Period.
Leaders in precovery organizations make decisions based on what the data actually tells them, not what their instincts (or their budgets) tell them it should be.
3. They understand and respond to changes in the trading landscape.
Most businesses have seen two or three radical, material changes in their trading landscape in the past three years. Whether it‚Äôs the need for new pricing strategies, distribution methods, sourcing techniques or workforce configuration, organizations in precovery have identified them and responded accordingly. Those who haven't will continue to lag behind the economic curve.
Look around: is your business fundamentally different in how it goes to market compared to what you did three or four years ago? If not, you're probably not in precovery.
4. They have a balanced, effective team at the top.
Whether it's a two-person mom-and-pop or a 130,000-employee multi-national, market leaders share one characteristic: there's no room at the top for incompetence or dysfunction. The last four years have thinned middle and upper management levels, leaving little room for the under-performer to hide. Even family businesses have had to bite the bullet and oust family members who weren't contributing as they should.
The touchstone is this: how good are you at making and implementing good quality decisions? If it's a slow and cumbersome process (whatever size the business), there's something dysfunctional in your senior team.
5. They have energized people.
The single largest competitive advantage precovery organizations have is the vibrancy of their people. Alignment - a shared understanding that we are in charge of our own destiny and know where we're headed - gives precovery organizations an energy and a level of employee engagement that's lacking in their competitors.
Walk around all parts of your business - are people (at least relatively) happy, engaged and taking ownership? Or are they disengaged and failing to show initiative? If the former, you're probably in precovery. If the latter, you're definitely not.
Bottom line: There's no need to accept that your business has to track the economy, or even the industry you're in for the indefinite future. Take the five steps above to regain control of your own destiny - put you business in 'precovery'.
Les McKeown is the president and CEO of Predictable Success, a consulting firm with clients that include T-Mobile, Microsoft, The US Army, Harvard University, Bose, British Aerospace and many more. He's the author of "The Synergist: How to Lead Your Team to Predictable Success" and of "Predictable Success." You can learn more at www.predictablesuccess.com