5. A Lack of Planning
The strategic plan for many firms can be described as follows:
a. Bring in as much work as we can
b. Do our best to create a great design and satisfy the client
c. Hope that we make some money
This strategy may keep a company afloat during prosperous times, but when the tide goes out you are left there without a plan for weathering the tough times. With the help of an outside facilitator, the most successful firms take time every year to develop or update a strategic plan that:
a. Assesses their strengths, weaknesses, opportunities and threats
b. Outlines what the company will look like in 3 to 5 years, including markets served, services offered, revenues and profits
c. Prepares an action plan where key members of the firm commit to follow-up on the plan
4. Not Communicating with the Staff
All too often I work with firms where the partners are not communicating with the staff on the plan for transforming the firm into something more than exists today. Given this vacuum of communication, the staff is left to assume there is no plan at all. The most successful firms articulate their plans to the staff, so every employee can be a pro-active participant in helping to achieve the company's goals.
3. You are Locked Into Long-Term Commitments
When times were good, many firms opened branch offices, expanded their existing offices, leased new equipment and so on.. Now that the employees have been laid off and other overhead has been cut to a workable minimum, you may be left with too much office space and equipment. Unfortunately there is no easy solution to this. While it is worth a try, it is unlikely your landlord will reduce your rent or take back space. The best you may be able to do is to sublease space and perhaps sell or donate unused computer equipment.
2. You Are Not Recognized as a Market Leader in Your Design Specialty
Despite all of your fine work your firm is not recognized as the expert. This allows firms that have created a better reputation to reach down and win projects that should be yours. It is unlikely the better reputation firm will best serve the client's needs. However they have created the perception in the clients mind that they will do a better job.
The fact that your competition is recognized as the expert did not happen by accident. Most clients cannot tell the difference between good design and great design. Your competition created the perception of expertise through a well thought out plan that includes a compelling marketing message and interesting website, professional marketing materials and a well executed campaign. There is no reason you cannot do the same. But remember that this is no time to be humble.
1. You Did not Reinvest in the Company
When times were good, many firms did not have a plan to reinvest the profits into the company. Most, if not all, of the profits were taken out of the company for the benefit of the owners, or to avoid double taxation. Now that the good times are nothing but a warm memory, the company is left starved for cash and unable to invest in the needed technology, training and marketing. To make matters even worse, line of credit have been reduced or eliminated during the credit crunch. When times get better, be sure to allocate 1/3 of your profits for reinvestment in the company.