Written by: John Christie, Executive Contributor
Executive Contributors at Brainz Magazine are handpicked and invited to contribute because of their knowledge and valuable insight within their area of expertise.
We’re living through a very odd time. First was the COVID pandemic and lockdowns, then supply chain shortages, followed by the “Great Resignation,” and now, a looming recession and economic uncertainty. It can be challenging to have all the answers, but that’s not the trick. The real trick comes in the form of a question. As in, are you asking the right questions?
Asking the right questions isn’t as easy as it appears, but there are some fundamental ones every business leader should be asking that are vital to the firm’s survival. Here are my top five questions to ask and get the answers to (in no order of importance).
Why Do Customers Choose Us?
Do customers choose you because of price, value, service, convenience, or something else? Do they go elsewhere for a different reason? Understanding these questions is equally important, but far too many business leaders don’t have a firm grasp of them.
Fortunately, these are simple remedies you can implement almost immediately. For starters, talk to your customers, and ask what made them choose your business and what you’re doing right. Make a habit of calling just one customer per day for the next 30 days, and in the end, you’ll have a pretty good idea of what you’re doing right.
Obviously, you can’t do that with non-customers, so turn to social media. Check out what people are saying about your business on Google, Yelp, Facebook, etc. You may not want to hear it, but it can be invaluable information! As a bonus, this doesn’t cost anything more than a bit of time and energy.
How Are We Viewed Compared to The Competition?
It seems like you can answer this one when you figure out why customers chose you in the first place. But it only seems that way. The truth is, understanding what customers think of your competition is also critical knowledge.
Fortunately, it’s pretty simple to gather high-level information through their website, but you need to dig down a few more layers. Want to find out what their customers are saying? Read every single customer review you can find online. Take a hard look at how the competitor responds to customer reviews. And make a special note when they don’t respond; that’s often more telling about what they truly value.
What do their employees think of the company and operation? There is an absolute wealth of additional information available if you know where to look. Websites like Glassdoor highlight both the good and bad comments from current and former employees and can provide invaluable insight into how those firms work from the inside. Other websites like Indeed and Zip Recruiter can tell a story from a prospective employee’s viewpoint and give you insight into their hiring practices.
Finally, there’s the good, old-fashioned way of gathering information. Call or visit your competitor’s location and shop them. It’s simple, easy, and it works!
What is Constraining Our Business?
Every business, big or small, new or old, faces constraints of some kind. Think about it – companies are subject to a multitude of internal and external forces, market dynamics, world events, and emerging threats, to name a few. Business expansion, contraction, or obsolescence are eventualities that could occur at one point or another.
On top of all that, the pace of change in today’s environment is a blur compared to just a few years ago, and a lack of adaptability can kill a business in a hurry. One of the most significant constraints impacting business leaders today is organizational culture, particularly the resistance to and acceptance of the change. This reluctance may be due to leadership, the status quo, lack of communication, or other factors. You’ll be fine if you’re aware of it and actively working to change the trajectory. On the other hand, you’re in for a rough ride if you are not.
How can you figure out your constraints? For starters, what are employees and managers complaining about? An easy way to find that out is through an anonymous poll or simply talking to your team. Is your turnover within an acceptable range? Is there fighting between departments or business units? Start asking these questions, and you can start figuring out where your constraints lie.
What is Our Competency Inventory?
That’s a fancy way of asking if our skills and knowledge are keeping up with the pace of change in the industry. A lack of understanding about the vital skill sets needed for the future is a sure way to lose out. For example – business leaders who do not care to upgrade their skills in data analytics will lag behind the competition in keeping up with their customer’s needs.
The first step is to understand better where your team’s skillset currently is, then determine what gaps exist. To close them may be a simple matter of training, education, or execution. But it could also require recruiting and hiring individuals with a different skillset. Or perhaps it’s a matter of the culture within the organization, most likely an absence of a culture that promotes continuous learning and development.
Whatever the case may be, it’s your job as a leader to be aware of the trends in your industry, what your competitors are offering, and how your customers’ needs and expectations are changing. Then complete a brutally honest assessment of how well your organization’s competencies match current and future trends. And if you need to make changes, the time to do it is now.
How Long Will Our Cash Last?
Let’s say starting tomorrow, revenues received from every current customer dropped to zero. How long will you be able to pay the bills at your current burn rate? A shocking number of business leaders I’ve run across don’t have the answer to this and are figuratively flying blind.
Poor cash flow planning and management are the single biggest reasons companies turn to lending institutions or alternative financing sources, often at the last possible moment. If you don’t have a cash buffer of three to six months’ operating expenses, it’s time to dig deeply into your cash flow management!
Next Steps for You as a Leader
These are five simple questions to get you started, and there may be many more depending on your industry, how long you’ve been in business, and the customers you are serving. But you must start asking the questions, digging for answers, and be prepared to make swift changes as the situation dictates. Being a leader is tough, but not having insight into these critical issues makes it even tougher.
Michael Dell, the founder of Dell Computers, once said,
“By questioning all aspects of our business, we continuously inject improvement and innovation into our culture.” And that’s the truth!
John Christie, Executive Contributor Brainz Magazine
John is a highly accomplished, enterprising, and strategic leader with more than 25 years of experience with Fortune 100 companies. John brings a stellar record of driving revenue and boosting profits through the development of customer experience initiatives, business development strategies, and operational excellence for his clients. He is President of TAB Eastern Kansas and Sunflower Advisory Group where he provides strategic planning, fractional leadership, advisory services, and executive coaching. His mission: help clients understand "if opportunity doesn't knock, build a door"!
