Diagnosing Your Business

August 29, 2014 3:02 am Published by

Diagnosing the health of your business is critical no matter where you are in the stage of operating your business!

New businesses, mature businesses, businesses under new leadership, businesses with leaders who’ve been in place for decades – it doesn’t matter.  If you don’t have a clear view of how healthy your business is, it’s time to discover that.

Business owners have tendencies to presume either ‘everything’s great’ or ‘everything’s falling apart’ – and living in an assumptive state isn’t healthy.  Move beyond assumptions to knowing reality and addressing it!  If you don’t, then you just float along doing the best you can, hoping things get better, and that’s a recipe for disaster.

Let’s pause for a moment and think about our physical health.  Almost everyone I know is guilty of having a minor health issue of one kind or another, and not going to the doctor.  Of course, you don’t have to rush off to the GP for a minor scratch. But if you don’t get a checkup once in a while, you could have a life threatening disease and not know it!  Wait too long for it to be discovered, and it can be a literal life or death situation.  Don’t do the same thing with your business.

Imagine thinking that you can retire and get a few million pounds for your business.  Your exit strategy and your retirement fund are completely built around this fact.  Now, imagine that you had operated on that assumption, that false assumption in fact, and when you try to exit the business you discover that it’s only worth £750,000.  That would be tragic!  But if you get the diagnosis, you can make accurate changes now, to ensure that it actually IS worth a few million pounds.  No more living in ignorance or unknowns, but living in reality, you can plan your retirement effectively.  (p.s. This is a real example.  I didn’t make this up.)

So how healthy is your business? and how do you know?

Doing a diagnostic on your business is probably not be something you can do on your own.  You want a fresh set of eyes to look at everything!  Someone who isn’t swayed by “the way things have always been done” or personal preferences of the owner, can give you an honest and objective look at the realities your business is facing.  Get someone who knows what they’re doing to take a look for you.  (Ask me if you’re interested, and I’ll help you find the right person.

Once you’ve got someone to help you, strategy consulting requires looking at several factors:

External factors: What’s happening in the industry? What are competitors doing? What’s happening in technology, and how does it affect your industry and your business? What are the shareholder circumstances?

Internal factors: These start with the driving factors at the heart of your organisation, such as vision, strategy, structure, and culture.  And these are also operational areas – products & services, marketing & sales, finance, people, systems & processes.

Risks:  You might be in a position to need to exercise great caution when it comes to risk taking.  Knowing this will help you be strategic in your business development.  But if you happen to be in a position to make greater risks, obviously your strategic development will look totally different.  So a diagnosis isn’t just to tell you “look at you, well done!” or “Oh, that’s a shame.”  It’s about knowing the truth of the situation so you can take action to preserve and grow your business.

Search to Sale:  The “Search to Sale” is a funnel, or pipeline, if you will.  It indicates your leads and upcoming work. If you have a good amount of work to do at present, and work in the funnel or pipeline, and leads following that, you are positioned well to have ongoing income.  If your funnel is empty, you might be in trouble in a few months or years!  This is a critical area for diagnosis, to determine if your business is healthy or not.

A diagnostic, done by someone who knows what they’re doing, will truly give you incredible insight into your business.  Greater understanding of how healthy it is will give you greater peace.  Recognition of sick areas will give you opportunity for targeted efforts to fix it!  Don’t let yourself be surprised by learning that your assumptions were false.

Diagnose your business now, and take your business from survival mode to healthy, or even beyond healthy to a business growing super fast and profitably!

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This post was written by M3evolve