Monday, June 11, 2012

Letting go

"It is not the strongest species that survive, nor the most intelligent, but the ones most responsive to change."  — Charles Darwin

A number of discussions over the past few weeks involved business owners in the midst of managing change.

Some notes from the field:
  • A professional services CEO has just promoted a staffer into the #2 position, over some longer-tenured employees.  The staffer, great at his former job, is struggling, to the consternation of his boss.  Why? There's no job description for the new position, nor any plan for coaching the employee to succeed in his new role.
  • A retailer whose recent multi-quarter run of increasing sales has suddenly stopped.  Her sales and marketing people can't tell  why...they don't have the data on what's changed. Why? They don't have access to the data, which includes the company financials.
  • A business owner is in the process of selling his business to an employee/relation. He's agreed to a generous discount from the valuation and to hold a note for part of the price, because "it's family."  But the buyer hasn't spent even one day managing the business ever...never managed a project, never met a customer, never sold a piece of business. Why? "My father just gave [the business] to me, so I figured I do the same."

Smoking "hopium" is not a sound business strategy.  Why? Several reasons come to mind:

a)  The world around you is in a constant state of change.  Your odds of driving change successfully are greatly diminished without a business plan.  Even iconic business leaders become laggards with amazing frequency. Planning improves your odds.
b)  If you are running a business and expect it to survive your exit,  it absolutely, positively cannot be all about you.  Don't have a contingency and/or succession plan? Get one, STAT.
c) With the business succession engine stalled, and the demographics not in your favor,  you must create an organization that is built to last.  There is less value in "an army of one" business. Simply put, you are not going to be compensated for selling a job. 

As one of these CEOs commented ruefully: "I guess, I feel that if you've managed to be successful in business it's because you've found the right formula. So I figured, why would I want to change that?"

The answer is found not in Darwinism, but Pasteurization:  "Chance favors the prepared mind."

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