Stop, revive, survive

Stop_revive_surviveWhen driving in Australia you frequently see signs encouraging drivers to “stop, revive, survive”. It is part of a road safety campaign aimed at reducing the number of crashes caused by driver fatigue. The campaign highlights the early signs of fatigue and advises drivers on what to do as soon as they spot them. It’s very good advice for businesses as well.

I was reminded of this phrase whilst on a recent holiday in France. I was staying in a gîte in Brittany which was one of six that had been created from old barns and farm buildings. The owners had turned rundown and disused wrecks into a thriving business around 20 years ago. The gîtes shared a swimming pool and were set in beautiful countryside only 1 mile from the nearest beach. Sounds idyllic, doesn’t it?

But the place was very tired; no refurbishment or updating had been carried out since the initial restoration had taken place and business was dropping off as a result. The owners’ response to the decline in bookings and hence revenue was to cut-back, reducing some of the services and extras they were offering in an attempt to reduce costs. But their prices were still at the high-end for the area. Not surprisingly their occupancy levels had continued to slide and they were being forced into offering significant discounts for last minute bookings.

The gîte owners had clearly lost their way. They had no vision for their business, where it sat in the market, what it was offering or what made it stand out from the competition. Instead of taking a step back and restating or redefining their vision they were stuck in a downward cycle of cost reduction and falling demand. They were heading for a crash. Meanwhile their competitors, who have a clear vision and proposition, were thriving.

This is not uncommon; it happens in many businesses where the leadership team lacks a clear vision and direction for their organisation. This leads to confused market positioning and/or inferior products and services. Customers move to competitors and market share falls. Faced with falling revenue the leadership team impose cost cutting measures, offer discounts, make cosmetic changes to the products or services, etc. Whilst these measures may bring some temporary relief from the decline they do not address the underlying issues and are likely to further confuse the brand’s key messages and compromise quality, until eventually the business crashes.

Stop, revive, survive in a business context is about spotting the early signs that the business may be losing its direction and then taking a step back, lifting yourself out of the day-to-day operations so that you can clarify or update the organisation’s mission, vision and strategy and identify the changes necessary to put things back on track.

That’s not to say that this is an easy thing to do. Some CEOs or boards can’t always see what really needs to be done to address a dip in performance; they are either too close or in some cases just don’t want to see or deal with the real issues. This is often a problem in organisations with very low staff turnover or where most, if not all, of the senior managers have been worked their way up the organisation over many years. Some turnover at senior levels is healthy in any organisation and can guard against this cycle by providing a different perspective, fresh thinking and new ideas.

Ensuring the leadership team continue to develop themselves and keep up-to-date with trends and new developments across different industries is also important regardless of how long they have been with the organisation. Time spent on personal development tends to reduce with seniority yet it is no less important. Networking with peers in other companies, coaching and the use of critical friends and advisers will all help senior managers and the business to stay on track.

A well-run business with a strong senior team will proactively review, refocus and refine its vision and strategy and make the necessary changes to ensure it remains relevant before the signs of fatigue set in. Some will go further and seek to disrupt their business model to create market leading positions even though things are going well. But those businesses that don’t take time to stop, revive and survive will eventually crash.

Comment

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: