Following is the second in the Economic Alliance’s six-part “COVID-19 Pivot” entrepreneurial support series. Read Part 1 here.
By Jesse Erickson
Business strategy can be a very large and overwhelming topic for small businesses. Many believe their pursuit of survival overwrites the need to consider long-term strategy. While this may have been true in the past, it can no longer be true in the ever-changing economic landscape that we are witnessing today.
A great strategy last year may be completely undone by a new technology or model today. This is why you see successful large businesses consistently investing in and testing new ideas.
Small businesses, however, have a tendency to struggle in adapting and innovating in sustainable and propelling ways. Many small businesses work incredibly hard to survive the day-to-day, rarely stepping back to assess their operations comprehensively to avoid pitfalls and exploit opportunities over time.
This is why many small businesses close their doors in just a few short years. The grand opening and rise to popularity in the small downtown setting might not survive the next big thing or the digitization of an industry.
Unless small business evolves with it.
Let’s talk about your strategy: What is it? Try writing it down in a few sentences. If you find yourself fumbling over your words or writing down things like “sell more x” or “open second location,” you are writing down ideas, not a strategy. Strategies are clear, concise and specific.
Here are some examples:
- Sell more product than last year
- Open a second location in another community
- Work more hours
- Hire more people
- Add a new service line
- Match or exceed a sales goal
- Do more social media
- Add an alternate product line to attract an untapped market in your business
- Improve your marketing and sales funnels by creating additional, targeted lead pages and ads
- Utilize a new software that will decrease hours spent on project management
- Analyze whether you need an additional employee or need to optimize processes
- Perform a financial projection analysis to determine a realistic sales metric and determine your margin on that metric
- Create a social media plan, with specific purposes that align with your organizational marketing plan
Strategy changes the conversation from one of a “We should do this!” reaction to market stimuli to considerations like:
- “What are we doing well?”
- “Where are we falling short?”
- “Where do we want to be in one year’s time?”
- “How will we best achieve those strategic goals?”
This simple transition in thought can pivot you from the constant grind to real results.
In the spring of 2020, small business owners’ most pressing question is, “What does the coronavirus, or any economic downturn (short or long term), mean for my business?”
Are you taking that question and saying, “We should do delivery!” or “We should do more social media!”?
Or, are you considering what comes next and asking:
- “Will delivery actually increase our sales?”
- “Will these new model change our profit margin?”
- “Are we a part of the noise on Facebook, or is our audience seeing our content and becoming dedicated customers?”
Infuse strategy into your thinking, and you will reveal how to grow and protect your business for the long haul, not just for next week.
I look forward to our next COVID-19 Pivot installment, when we will discuss some operational shifts that may help to ride out disruption. Join the ongoing conversation at Catalyst’s Facebook page.
JESSE ERICKSON is president and CEO of Catalyst, a Kankakee, Illinois-based business and organizational consultancy. Catalyst leads clients through business and strategic planning, development of new revenue streams and cost-cutting tactics, the implementation of better financial management processes, and the integration of strategic initiatives to improve organizational visibility, data analysis, and overall growth. Jesse is a Quickbooks Certified ProAdvisor, an Asana Certified Pro and a Certified Business Incubation Manager. He holds a Doctorate in Business Administration (Strategy & Innovation concentration), Master of Engineering Management (Technical Entrepreneurship concentration) and a B.S. in Electrical Engineering.