Giving up when your business is teetering may seem like the lesser of two evils, but putting in the effort to turn things around can ultimately be more rewarding personally as well as financially.
Of course every turnaround situation has its own difficult—sometimes, even nasty—issues. And even though each challenge is unique, there are general steps to, first, immediately remedy the situation, and second, create a working strategy to effectively ensure your business does not sink back to its current unstable state.
Here are seven essential steps to turn around your troubled business:
- Identify the problem(s)
- Devise a recovery plan
- Invest in a team
- Meet with employees
- Meet with customers and business partners
- Contact tax authorities and your bank
- Develop and demonstrate a winning culture
Identify the problem(s)
The first step to solving anything is identifying what makes it problematic. The same is true with your goal to turning around your business’s failing situation.
To figure out what to do next, trace back and identify the root cause of the problem. The caution you take and the pace you set will be the defining premise of your entire plan to turning things around and will also probably be your defining moment as business owner and/or manager.
Devise a recovery plan
Once the problem is identified, make sure the company leadership and employees are prepared for the turnaround. This involves both the immediate plan to remedy the situation and the long-term strategy to keep your business from getting back to its current sorry state.
Your recovery plan should be pragmatic, time-bound, and comprehensive. The problem is real; your solution should be realistic, too. Design a definite time frame to tackle specific issues on time and track your progress. Address specific problems by order of urgency or importance. The most immediate and threatening issue, should, of course, be attended to first.
Invest in a team
You don’t need to do it alone. Sometimes, you just can’t do it alone. You will need to work with people to help you realise your recovery plan.
It is a given that you select the most able team players, but you should also make sure you are consistently compassionate with them.
No matter the level of stress everyone is coping with, respect and professionalism should never be lost in each team member. See to it that you form a fully engaged group that will help you attend to all of your business’s current challenges and contribute to making sustainable progress in your company.
Meet with employees
Call for a company meeting. Your employees must know there is a problem and inform them how you are fixing it. Consult with them and let them know your recovery plan. Let them ask questions, answer as truthfully as you can, and ask for their inputs.
Doing this cannot be overemphasised. You will need your employees’ support and trust to build a real, unified business team that will move your company not only towards recovery but also sustainable success.
Meet with customers and business partners
If your company is failing, your customers and/or business partners have all the reasons to be nervous. It is important that you do not misrepresent what’s really going on but, as truthfully as you can, let them know of your company’s situation and how you are effectively addressing all issues. Be sincere in your reassurance. Let them know you are doing everything in your power to turn things around. Sincerity is in itself reassuring. Couple sincerity with proactive competence and you might even have your customers and/or business partners offer assistance in realising your business recovery plan.
Contact tax authorities and your bank
Duly notify the tax authorities and your bank if you are unable to fulfill your financial responsibilities. Provide them will all the relevant information why you are unable to do so, especially if you cannot pay your taxes and/or attend to your loans or line of credit responsibilities.
Project an image of confidence. Let them see that you are still in charge and are sure you will turn things around. It is of utmost importance that you work with the authorities and your bank when your company is facing difficulties—especially financial difficulties.
Develop and demonstrate a winning culture
An ill-defined company culture is often one of the factors why your business is failing. At the heart of this culture are the core values your business has nurtured and embraced.
It is imperative that while you’re rolling out the specifics of your recovery plan, all team members adopt a unified and defined culture of success. Simply, core values define the health and effectivity of your company’s culture.
In turning things around, you must look into the specifics of these core values and change what needs to be changed. You will need everyone’s involvement. The change might not be readily evident, but keep at it. Remember that businesses with ill-defined cultures usually underperform and fail, but businesses with a healthy set of core values and a strong sense of purpose soar high.