Change Is Here To Stay
Among them is Coldwater Creek a large women’s apparel chain of stores that filed for Chapter XI liquidation a few weeks ago.
A recent article notes that the company plans to close 350 locations and as a result 5,500 jobs will be lost.
Just Another Victim …
The article goes on to state that: “Coldwater Creek is just another victim of what was once a successful business model that management didn’t move fast enough to change. That story will repeat itself several more times in the months and years ahead.”
Management not moving fast enough to deal with change, in our experience, is unfortunately a common occurrence. The corporate landscape is littered with companies that were unable or unwilling to anticipate and proactively make the changes required to continue to be a viable business.
Anticipating and reacting to a challenging business climate …
Anticipating and reacting to a challenging business climate is an important imperative of CEO’s or business owner of any size business. Particularly in private businesses where a small group of shareholders or family members are dependent on the business as their primary source of income.
We often ask ourselves …
A significant portion of our practice is focused on helping companies deal with the impact of rapid change. We often ask ourselves; “How did they not see this coming?” . Many owners have learned the hard way that “Hope is not a strategy” and wished they had developed a contingency plan to deal with difficult issues and are prepared when they occur.
In our experience there are a number of significant events that can negatively impact a business. The key challenge in successfully managing a business is to continue to ask the question; What are the vulnerable areas of my business and what is the contingency plan if something negative impacts us?
Questions that should be regularly asked …
Business owners must continually be assessing these vulnerabilities and taking action prior to being negatively impacted. Examples of questions that should be regularly asked are:
- What is my plan if a competitor starts to undercut our selling price to gain market share?
- What is the impact if the minimum wage in my city/state substantially increases next year and what are my options to deal with it?
- Can I afford my debt if interest rates increase dramatically?
- What if a key executive decides to leave the business? What are the options in replacing key executives and how will I manage the business until I can find a replacement?
- What if the price of raw materials suddenly increases? What is my plan to mitigate the increase and maximize gross profits?
If necessary, find help from…
These are just a few examples of questions that every business owner should be asking themselves on a regular basis. While the answers may not be immediately available it is important that the questions are asked and options for dealing with the issues are developed. And if necessary, find help from outside resources that can assist with developing a plan to find solutions before the problems occur.
Dealing with these questions on a regular basis is an imperative for every CEO or business owner. The consequence of not doing so puts the future of the company at risk. The mindset of “Change is here to stay” must be the foundation of every business!