Family Business Advisor Provides Insight on Surviving a Severe Downturn
Family business advisor, Joe Schmieder of the Family Business Consulting Group, discusses highlights from 100 Action Thought Starters for Surviving a Severe Downturn.
Marietta, GA (PRWEB) May 24, 2009 -- The Family Business Consulting Group (efamilybusiness.com), announced today that Joe Schmieder, family business advisor of FBCG and author of 100 Action Thought Starters for Surviving a Severe Downturn, summarizes highlights from his article.
"In 2000, I found myself and the family company I was running, in the midst of a sudden and profound downturn," says Schmieder. "Many non-competitive family businesses started to compare notes. We were all reading the same business articles and management guru books. But we could not get from 40,000 feet to the grass roots level of what actions to take."
"We knew we had to strengthen our balance sheets and improve cash flow, but we did not know what actions would work best." Thus, the list was born. The list began as an itemization of actions to trim costs, stay competitive, and still be prepared for the next uptick. "Most of us brought our leadership teams together and worked the list for our specific situation. We would now all agree that it helped us weather that storm. Many of those same companies made record profits once the turn-around began."
Eight years later, that storm has turned into a category five hurricane. As a result, the list has resurfaced. This time, with more social and business networks in place, the list began to grow and actions were categorized. This list is now referred to as 100 Action Thought Starters for Surviving a Severe Downturn.
Below is a summary from each category of 100 Action Thought Starters for Surviving a Severe Downturn.
General:
| | - Continuously estimate the depth (degree of severity) and length (timeline projection) of the downturn in your specific markets.
- Make your calendar one of your most strategic documents by not only scheduling meetings, but also scheduling time for working on key issues impacting your performance in the downturn.
|
Family Leadership:
| | - Tap into the wisdom and experience of senior generation leaders who have likely experienced two or three downturns in their career.
- Accelerate the range of responsibility for the younger generation, keeping in mind that some young people will rise to the occasion when tested.
|
People:
| | - List every benefit provided and quantify the amount the company provides each employee (healthcare insurance, vacation days, sick days, FICA, 401k match, etc.).
- Lure your competitor's best talent.
|
Financial:
| | - Strengthen banker relationships - Meet with banker(s) and discuss current arrangements/covenants, and other possible changes.
- Improve order-to-cash cycle by sending out invoices as soon as possible, not waiting for end of week or other set time for batching.
|
Purchases:
| | - Audit inventory and reduce slow moving, obsolete items with special sale, return to vendor or dispose.
- Defer capital expenditures. Purchase essentials (repair & maintenance) and invest in selective developments for new services, products, channels.
|
Manufacturing:
| | - Review Shingo Award assessment list (shingoprize.org) for areas of improvement to world-class status.
- Eliminate the 8 wastes of Lean: overproduction, motion, inventory, waiting, transportation, defects, underutilized people, extra processing.
|
Facilities:
| | - Consolidate plants.
- Increase use of energy efficient practices (e.g. replace expensive lighting).
|
Marketing:
| | - Use the digital world more for promotions--e-mail blasts, website e-commerce.
- Do not stop marketing and selling efforts, but adjust approach.
|
Sales:
| | - Visit all major customers--thank for business, seek input on outlook, discuss needs of your products, services and any opportunities.
- Ask customers where your company can save their company money.
|
Pricing:
| | - Increase pricing if in niche markets with limited competition.
- Implement an environmental surcharge (for trash, recycling, hazardous waste handling, green material usage, etc.).
|
Business Development:
| | - Analyze sales and profitability of each product offering and prune non-strategic, low profit products.
- Seek lower-priced, fire-sale acquisition opportunities, particularly those where the seller may provide the financing or take an earn-out.
|
Office/Admin:
| | - Increase use of technology--move quicker to on-line ordering, tracking, and shipping.
- Reduce the number of computer hardware and software license fees.
|
About the Leading Family Business Advisor Firm, The Family Business Consulting Group, Inc.:
Located in Marietta, GA, The Family Business Consulting Group consists of world renowned consultants committed to helping family businesses prosper across generations. Their experienced consultants and advisors have founded several family business programs at university and non-profit organizations, won awards for their educational, consultative and research activities and, combined, are the most prolific authors in the field.
For more information about The Family Business Consulting Group and its services, contact Ken Bosshart at 770.421.0110 or visit efamilybusiness.com
The copyright on this article is held by The Family Business Consulting Group, Inc. All rights reserved. All forms of reproduction are prohibited. For reprint permission, contact 770.421.0110.
Sources for the list come mostly from family business leaders who run mid-size companies and are close to the operations. However, it also includes the more actionable concepts from management experts, like Tom Peters and Jack Welch.
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