ImageBusiness is a fickle game full of uncertainty, external conditions that influences change in direction and the ever begging question…. should we throw in the cards.

Let’s start out with talking about new fledgling enterprises.  These are companies that may have loads of long term operative issues to address but for the moment they are doing ok.  They are able to fulfill daily operating needs and business opportunities are not so bad.  They do however sit at a point in which decisions have to be made in two areas, long term outlook and owner investment recovery.  All too often the original team is convinced that they good fortune has not been fully realized and that there are better times ahead.  This may be true to a limited extent but every company must realize that to take that business the next step forward, whether in size, diversification of service, or expansion of revenue growth it requires change that often can only be achieve from outside.  Whether this is an infusion of talent, the acquisition or merger of business or the induction of new products and services.  Holding on too long to the original formula creates a “hitting the wall” condition.  If unattended to or an appropriate response is delayed the results are often times catastrophic.  How does a company know when this is about to take place or is already taking place?  The truth is held inside one simple question, “what is next?”.  The fact that if your discussions focus around what you have been doing, or predict the future based on what has happened you are stuck in tactics and operations, and have not though about the future.  Thus a strategic gap exists and often the pride and personal self-interest are such that change becomes an impossibility.  Loss of market, loss of excitement and loss of growth dominance are at risk and are apt to be the final chapter for companies who are unable to see that we always have to be operating a couple of steps beyond where we are at.

Larger organizations have the decisive advantage of a capitalization base.  Size, formality and diversification are the elements that lull us into a false sense of security.  We believe that our dominance, or should I say control over our destiny, will result in us always being in control.  This unintentional arrogance can and will cripple us.  We then become the target, because of our prominence, for others to harvest our business.  Whether through friendly take over or by hostile acquisition we have abdicated our position of control and don’t even realize it.   The global economic downturn has forced a wake-up call to be amplified.  Companies who operated from a sense of control are now going back to the play books to see what can be done to bring life back into the business.  It seems that many of those game changing plans aren’t working and they won’t work as long as we fail to understand that it requires step 1 thinking.  It is, as I have said on numerous occasions  not a commodity solution game.  While service providers role out all sorts of miracle elixirs the problem rest much deeper than superficial generic purported solutions.  It resides with the need for a transformation, and to do so on a regular ongoing basis.  Customers, whether buying consumer goods or crafted solutions need variety.  No matter how good your product healthy change, with leadership, is a necessity.

As a company leader and/or lead investor one has to make hard decisions.  The reason why you are in business, doing what  you are doing, is out of love and the promise of many good things to come.  Of course there are those special side benefits, such as helping the community, improving society and solving major issues that cannot be overlooked as well.  But deep in every leaders play book is the question of when it is right for change?  When is it right to close up shop?  When is it right to seek fresh talent?  When is it right to change the complexion of the business.  Foremost is the need to recognize and start acting upon it before the Grimm Reaper is knocking on the door.  As is often the case the best time to start the balls in motion is when you are at, what you might perceive to be, at the top of your game.  Despite the euphoria every pinnacle has its down slope.  Even if there is a little bit more upside that can be achieved, the wiggle room in making the pre-decision will prove to be invaluable to get the best deal, the best match or the biggest return on investment that has been made up to that point.  Casting aside the child may be painful but for the betterment of all a renewal is essential.  It opens up new possibilities and perspectives, serving as a catalyst for a transformation of the business.

Some of you may be on the unfortunate downside slide, especially with the protracted duration and uncertainty in the global markets.  Expect that if an achievable suitor or acquisition can be attained, or a rapid transformation can take place and that innovation is nothing more than a word the question then become about timing.  When is the best time?  It is less a matter of date and more a matter of a graceful exit, whether to protect the relationship with customers and suppliers or to coincide possibly the next pursuit that you may be putting together.

ImageAs a CEO, in title or in aspiration, each day should be started with the question… is it time to change?  Is the timing right, what will the ramifications be, and who can I rely upon to give me an honest and solid professional opinion on the next steps for  our business.  Pride, personal self-interest and hidden agendas plague those that should be asking those questions.  The fallout can often be heard in the Board Rooms that are ousting leadership and exercising the costly replacement process (to which the cycle is most apt to continue).  Those that are held in high leadership regard are those set change and transformation as a top priority and place themselves as a servant to the betterment of a continued business enterprise.