Debunked! The real reason why businesses sit on their hands while their assets drain profit from the P&L
If your business has assets that are significant and critical to how you deliver your products and services, there will be substantial cost reductions that can be made, usually in a short period of time. These are usually sustainable year on year, so addressing the underlying issues sooner rather than later will see the benefits compound.
Unchecked, it’s always bad for your business. It’s potentially good for ours since we know how to fix it.
But fix it, and the upside for your business is so significant the ROI makes doing something about it a complete no-brainer.
Yet while it’s a no-brainer, almost free money, most businesses will subconsciously make the choice every day to turn a blind eye to the accumulating losses happening just out of sight.
Most leaders will only act when there is a burning platform. Most of our engagements are within that imperative. There’s urgency and focus to drive down costs rapidly and an energy to get it done. But in all cases, the warning signs were there well before the burning platform emerged. We could have and should have tackled this earlier, got an even better result.
Why delay? Here are some of the common excuses we hear.
It will correct itself - She’ll be right mate…
Is it just a blip? Sometimes, but it’s usually just wishful thinking. Where there are blips, there is an emerging threat. They point to potential problems just over the horizon.
Why not get it checked?
Rely on KPI’s that have been set
This is an interesting one. Are you using KPI’s as a big stick to force the existing team to maintain the motivation and accountability to fix it?
This never works.
Without a proper targeted, coordinated approach that is not left to individuals and instead brings each cog into the larger machine they will fail.
Transaction BAU
Too busy doing BAU to focus on the hard stuff that’s actually going to move the needle?
BAU is one of the biggest distractions from doing the hard, but important stuff. It’s easy to get lost in transacting and hard to step out into strategy execution.
Don’t know where to start
Half the battle is just starting.
Often people wait for the perfect moment rather than take the moment and make it perfect.
When you’re under financial pressure
It feels risky to invest.
But without targeted investment in a dedicated program, you’re likely to lose much more. You have to spend money to make money.
No resources
Don’t have the capability or skills to release from BAU to focus on the problem?
Get help. It’s like any other emergent and immediate business problem. If you don’t have the capability or time to bring it in, then outsource it.
I’ve always been of the mindset that to be successful in business you can’t shy away from the challenges, you have to do the "hard tasks" first before allowing yourself the luxury of the easy stuff.
This takes guts and gusto, but you know what, you will be far more satisfied with the part you played in your business’ success and the business will be in a far better place as a result of you being there.