Think Business — Knowing What to Embrace
In a recent interview Warren Buffet said, “Embrace the boring” as smart investment strategy. What Buffet meant was to invest in a sound company with a good stable return
and a modest dividend.
As I reflected on this sage advice I thought about many of my business associates and friends and how they should translate this advice into their businesses and personal mindsets.
Some business owners often chase the shiny objects or look for a secret formula to success when often the returns can be found in focusing on some of the things that are right in front of them. While many of you reading this may not admit that you are one of those looking-for-something- new seekers, I bet there are some people on your team that may see it in you (and be frustrated).
So why embrace the boring? Because oftentimes it can give you a better financial return. Embracing the boring can create a better client experience. Embracing the “right” things can reduce stress and create more predictability.
Are You Focusing on the Right Things?
The following are some areas that you might want to put a spotlight on:
1) Focus on the keys numbers that drive the business. For most businesses things like sales, gross profit, gross profit percentage and overhead, which all affect the profit. By just improving each of these by a percentage point or two you will increase your returns dramatically. While this might not be very exciting like introducing a new product or landing a giant project or customer, it will give you sound returns. Begin by just spending a couple of hours a week on knowing, analyzing and improving these numbers. Make others in your company a part of this process so you are not going it alone.
2)Improve your processes. Again, just grab three to five basic but important processes like your production numbers, shrink and sales processes. Make sure you write down each as a process in a step-by-step fashion. Again involve others in your organization and challenge them to improve these processes. You may want to focus on time by reducing the number of hours or days it takes to do a task or it may be assigning the right accountability to reduce mistakes or even adding new technologies to be more effective. If each process is documented you probably will see some obvious flaws and ways to improve them.
3)Communication. Many problems are often the result of miscommunication. If you focus on the three to five situations that are more common miscommunication issues, it is easier to fix them. They could be internal or external. By identifying them then training everyone involved to better communicate you will reduce miscommunication. Again this may not be as sexy as spending time on a new marketing approach but it will help make the business healthier.
4)Your product. Growers always want to produce the best plant possible and often there is little time spent on adding or developing new products and new growing techniques. Again, by identifying a few key products to focus on and assigning one to different team members you should come up with some improvement. If you tackle just one product a week you will have over 50 checked off the list in a year. This could result in tremendous returns in both efficiencies and customer experience.
5)Your people. I don’t want to imply people are a boring part of your business. People are your greatest assets. However, there are questions and areas of attention that often are not addressed. When is the last time you asked your key people where they would like to be in three years? The good ones will leave if there are not the right opportunities. Or have you proactively done a competitive analysis on compensations programs? While addressing these issues is not always fun, it is important. By making these types of things top of mind on a regular basis you will make sure to stay on course and you will have less people damage control.
For those that find focusing on the “boring” not boring, great keep on it — you will like the results. However, if you are not 100 percent happy with the success and profitability of your business, customer experience and team satisfaction, then spending a few hours a week focusing on these things, you can see dramatic results.