Other experts may tell you how to grow your business and increase profits and here I am encouraging you to think about how to murder your business.
Have I gone out of my mind?
I want to introduce you to the idea of defensive strategy.
Think of a football game.
One team attacks, the other defends.
It’s the same in business.
Those nasty competitors may provide you with an opportunity to lure away their customers but they also want to steal yours.
You need a defensive strategy to stop that happening or at least to make it very difficult for anyone to tempt away your best customers.
I want you to think about how to murder your business.
And as in a real murder, we need to think about the risks that comes from our friends and family (employees, suppliers, even customers) and strangers (competitors). You should even think about accidental suicide, where you yourself do things which terminally damage your business.
Murder By Your Employees
Get yourself a pen and paper and write at the top “How can our employees kill our business?”
Well they could be rude to customers.
Have you ever seen that?
Or disinterested, for example happy to chat to each other about what happened in last night’s episode of their favourite soap while your customers wait for service.
I bet you’ve experienced something similar in the last two weeks.
You lose business one customer at a time – think of it as death by a thousand cuts.
Or the delivery errors which stop the customer getting what they want when they want it.
I’m sure you get the idea but it’s an exercise that’s well worth doing. Then see what customers and suppliers can do to kill your business (e.g. ordering stuff and then cancelling after you’re committed but you’re too frightened of spoiling the relationship to insist they pay).
Sometimes doing the basic things right can be a powerful competitive advantage because we all hanker for an easy, hassle free life.
How Can Your Competitors Kill Your Business?
Where is your business vulnerable to attack by competitors?
Perhaps your best and biggest customers are not getting the best prices and deals and can be tempted away, especially if competitors show you evidence that they’ve been taken advantage of.
Or perhaps a new technology may appear which transforms your market.
As an example, look at the problem that CD music stores have had with the Internet. They’d seen technology change from vinyl to cassettes and then to CDs and not been affected. But then along cam Amazon.com, offering a huge range, next day delivery and user reviews to help tempt you into buying something new. Then the iPod and iTunes which replaced the need for CDs and gave you instant delivery.
Hopefully you won’t face such a radical transformation but what if a new technology appeared which gave customers the same benefits for half the price?
The last category to look at is how you can kill your own business yourself, accidentally.
You don’t mean to do it but perhaps it’s a refusal to accept new technology. You know it’s coming but you don’t want to go there.
Or you don’t have a strategy for your business.
You just assume that today will be the same as yesterday. And so will tomorrow.
But as the boiled frog found out, slow incremental change creeps up on you.
Or you have a strategy but you don’t share it with your staff because it’s secret.
They are the people who have to implement but why should that matter.
Protecting Yourself Against the Risks
When you’ve gone through the exercise, you should have a long list of ways that your business can die – some sudden and quick, some slow.
When thinking about risk management, there are two aspects to consider:
- The likelihood of it happening
- The damage that can be done
Building your defence strategy takes time and money, neither of which should wasted.
Some risks you’ve identified (like your competitor creating an alliance with Superman and having him destroy your premises) can be ignored. Strange things can happen. Just look at Japan with the earthquake, tsunami and nuclear disaster but it’s only with hindsight that the vulnerability is clear.
Others are more predictable and need action.
Sometimes the risk can be prevented. Other times you can pass the risk onto someone else through some kind of insurance. Other risks just need to be carefully monitored so that if things do start to happen, you have your contingency plan ready to go when you need it.
The bigger the probability that they can happen and their impact, the higher up they are in your list of priorities.
The more forward steps you make compared to the steps back, the more progress you make.
If you’re working hard but standing still, it’s tie to get out a pen and paper and think about how to murder your business.
Paul Simister is a business strategy coach who helps small business owners to profit from differentiating their businesses, being distinctive in the eyes of their customers and standing out in a crowded marketplace.