Business Management

Issues Facing Small Business Today

Starting a business is a big achievement for many entrepreneurs, but maintaining one is the larger challenge. There are many standard challenges every business faces and these include things like hiring the right people, building a brand and so on. However, there are some that are unique to small businesses, ones most large companies have grown out of long ago. Here are a few thoughts:





1. Client Dependence
If a single client makes up more than half of your income, you are more of an independent contractor than a business owner. Diversifying your client base is vital to growing a business.

2. Cash
Finding it and managing the cash flow. Cash is hard to get and there is never enough. If you are a fast-growing company you can rapidly outgrow your available resources, if you are an under performing company you can’t get enough cash. Many companies do not manage cash well.

3. Fatigue
The hours, the work and the constant pressure to perform wears on even the most passionate individuals. Many business owners, even successful ones, get stuck working much longer hours than their employees. Moreover, they fear their business will stall in their absence, so they avoid taking any time away from work to recharge. Fatigue can lead to rash decisions about the business, including the desire to abandon it completely. Finding a pace that keeps the business humming without grinding down the owner is a challenge that comes early (and often) in the evolution of a small business.

4. Lack of a Clear Plan
Many businesses don’t know how to plan. Lack of a plan worsens the cash problem by wasting cash chasing tempting diversions, and throwing money at problems. Equally important is updating your plan according to changing economic and business conditions and to ensure your survival in weaker economies.

5. Ineffective Leadership
This issue takes many forms. It is frequently in the form of depth of leadership. The founder of the company is too much hands-on and a) does not concentrate enough on his primary role as a leader rather than a manager; and b) fails to enlist support of competent managers and staff behind him or her either through recruitment or by outsourcing. This eventually causes the company to stop growing and eventually could lead to failure. Directors should always remember their core role and responsibilities.

I trust these ideas provide thoughts to resolving some issues faced daily by many businesses as they strive to develop and grow.
Please share your thoughts. gerry@polarisgroupmc.com

Managing Change

Businesses face change all the time, driven both by internal or external influences. Growth, innovation, redundancy, outsourcing, relocation, diversification and competition all can force change in a business.
In is important to make the necessary changes before they are forced upon you – minimising change that can impact on profitability and maximising change that creates opportunities. Most people, in particular employees, are uncomfortable with change because it interferes with their routine and exposes them to the unfamiliar.

Drive Change
It’s better to drive change than let change control your business. It’s also important to identify any need for change early on. Think ahead to where your business needs to be in one, three and five years’ time. What do you need to do to get there?

Prioritize
Decide which changes are most important and focus on the changes with the biggest potential benefits – not the easiest ones to implement.
Aim for continual smaller changes rather than a few large ones. Large changes are harder to digest and can interfere with one another, while small-scale changes are easier to manage.

Network
Change usually involves going into unknown territory, but others will have been there before you, so seek their input and advice. Talk to business associates and learn from the experience of people who have made similar changes.

Communicate
Whatever the area of change, you will need the co-operation of your employees. However, resistance from employees is often the biggest stumbling block to successful.  The key to managing change successfully is to keep staff informed. Start communicating the change as early as possible, so people have time to come to terms with it.


Even small changes can backfire if they’re not handled sensitively. Consult with those affected before implementing any changes. Those involved may be able to suggest alternatives that deliver the same results more effectively or more efficiently.

Remember life in Business is about change. Growth is optional. Choose wisely.

I hope these thoughts are of value as you move your organization ahead through change.

Please let me know your thoughts. gerry@polarisgroupmc.com