• Team Business-360°

Kickstarting your stagnant business

Updated: Jun 16, 2021

Stagnation is the death knell for businesses. Its the single most dreaded word among business owners and can strike anyone down, irrespective of how long they have been around or how big they are. Imagine the flatline on a heart monitor, that's what stagnation feels like to a business. You know a business is stagnating not only when their revenue remains the same year after year but also when they repeatedly expand and shrink without any real growth. You could either avoid it by putting in place alerts for timely warnings and a contingency plan before stagnation sets in. Or fix it after the event.

Mitigating stagnation would require certain fundamentals being in place which you will not deviate from. The first is a commitment to grow by providing value to your customers rather than price reduction. Apple is the perfect example of such a commitment. Secondly, focus on increasing revenue rather than cutting costs. Optimising costs rarely drives profitability, instead it could have the contra effect of depleting the value offered to customers impacting revenues adversely. And third is the commitment to innovation irrespective of the state of the economy. This not only ensures relevance in a dynamic marketplace but also discovering new revenue streams.

A post facto fix of stagnation requires a different set of tools. It needs to start with a thorough and honest evaluation of your current practice. An internal audit which covers all areas - product, operations, cashflow, sales, marketing, employees and customers - to uncover where the blockages are.

Once you know the problem the solution will appear, however in most cases the solution is usually a rethink. A rewiring of the business dictated by where and how the revenue stream is flowing and where and how its not. When Apple was 3 months away from being shut down it did a complete rethink to finally emerge as a trillion dollar company.

The most critical factor in any plan to overcome stagnation is the people who run your business. Steve Jobs had a Bozo alert and Mark Zuckerberg hires on attitude rather than a diploma. You will need to be ruthless in your assessment of who is hurting the business and who is not and take measures to ensure productivity.

At the end of the day, stagnation is usually a result of more of the same. Constant innovation is actually the prevention and the cure.

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