If you asked most people when they visited the doctor they would reply, “When I’m sick.” The current trend in medicine is not to wait until you are sick. In addition to normal annual physicals, doctors want to make sure that you establish life habits that keep you healthy and away from serious health issues. This seems like a sound strategy, but people seem to still continue to wait until they are sick to see the doctor.
Doctors are there to help you from getting sick. It is usually less costly to get a preventive check-up so the problems are identified early. It is no different in business. The most successful business owners develop strategic plans that allow them to identify issues early. These plans are developed on an ongoing basis, with regular checkups to make sure that the plan doesn’t need treatment.
Some Business Decisions Create Risks
When business owners don’t have a strategic plan, they sometimes make decisions that affect the long-term prospects of their company. Decisions such as hiring a producer with a book of business and not requiring a non-solicitation do not create value. We have witnessed numerous situations where a new shareholder is brought into the business without having a reasonable method of valuing their shares. They didn’t go to the financial doctor to get a check-up.
A lot of people don’t go to the doctor because they don’t want to know if something is wrong. Business owners can’t afford to treat strategic planning the same way, because business decisions like these always create risk.
Would you take up rock climbing in your fifties without consulting your doctor? Yes, most of us would. Most of us would end up seeing the doctor with bad knees or broken bones. These injuries are better than a heart attack. It would have been great if you would have visited the doctor first. We have daily discussions with agency owners that have great ideas. It is rare that they have assessed all of the risks. They were ready to climb the cliff. They ended up very happy that they talked to the doctor first.
Success Breeds Success, But Overconfidence breeds…
Many of the business owners we speak to are very successful and they have built very successful businesses. However, most of them are successful because they are very good salesman. They see the short-term benefits, but haven’t assessed the long-term risks. They think because they are successful that each new decision will also be successful. If even one of these decisions fails, the business could get really sick.
So what should a business owner do to avoid getting his company sick? First have a long-term strategic plan and stick to it. Understand the financial implications of your decisions. If you are entering into a new area or direction, make sure that you involve someone who has experience with the same plan. There are many resources that will be willing to convey their experiences.
It is easier to get something right in the first place than to have to fix it later.
One of the best pieces of advice we can offer any client is to “Run your Business like you are Selling it Tomorrow“, find out why here.
