Friday, May 9, 2008

Rotting From The Inside Out

The recession is upon us. The economists are debating the issues and given the political climate, the facts are being spun to make political gain. The truth is that many, many businesses and Americans are hurting.

We see it in the consulting world as companies are cutting back and becoming very defensive in their spending. Cost cutting is rampant and often without a solid plan that will protect the business for the future.

As we are working with our new clients, we are providing analysis of the current state of their business and the opportunities that exist for them. Often we see that while their business appears to be healthy on the outside, in fact it is very unhealthy underneath.

A local rancher shared some pictures with me of trees that illustrated this point. The first is a relatively healthy tree. You can see how solid it is.

The second picture is of a tree that is rotting from the inside out and will, in time, cause the death and collapse of the total tree.

What does this mean for you?

In its simplest terms, it means that you must find the “dry rot” and cut it out now. You can save the company by taking the right action. The “rot” could be in your product lines where you have allowed some to become vulnerable to competition or even unprofitable when expenses are allocated properly. It could be with your customers, as some of them no longer justify the expense to keep them. It could be with your processes that have become outdated and are nor efficient any longer. It could be with your organization where the development, care and nurturing of your managers has not taken place and you no longer have the appropriate succession plans or bench strength.

What can you do about this? Unfortunately, most senior executives have grown so accustomed and comfortable with the status quo that they are unable to see the issues clearly and the possible solutions appear to be so distasteful.

The rancher called in a consultant tree surgeon to identify the rotting trees that needed removal and to thin out the trees that needed thinning, even though they were currently healthy. The result was a much more productive environment and one that would thrive in the future.

Are you going to be ready when the recession ends to come out of it much healthier, or will you be weaker from the cost cutting and short term measures? Do you have a “tree surgeon” that you are using in your business?

Let us know if we can help.


John Maver
Maver Management Group
(925) 648-7561
Maver Management

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