Thoughts on Accelerating Revenue in a Down Economy

Part 1

As an interim executive specializing in helping my clients drive revenue, I am often asked how we can expect to help increase revenue when the economy is weak. Reflecting on numerous engagements I’ve had in a variety of industries, I find myself reminded of Pogo’s famous dictum: “We have met the enemy and he is us!”

Many of the hurdles that slow growth, and arguably most business failures, can be traced to decisions made by the organization, a result of a company’s own actions. Which is why the barriers to meeting revenue objectives can be found and eliminated, replaced by processes and disciplines that leave a company able to meet their objectives predictably and consistently now and well into the future.

There are some major themes we see often. Among the most common is presuming that constant improvement will suffice when transformation is required. The failure to anticipate and transform is a critical failure that stunts growth. An example many of us have heard is that if Henry Ford had desired to incrementally improve the transportation system of the day, and if he had simply listened to what his customers asked for, he would’ve bred a faster horse. He didn’t, and the innovation he brought forth transformed transportation as we knew it forever.
A more current example might be Hewlett-Packard. It was studying how children responded to the web that caused them to re-think their digital and printing businesses. The kids seemed to take “ownership” of a page of data only after they printed it. As long as it was on the web, it was just available data, but not “theirs.” It was this realization that allowed them to connect the dots and the digital camera was invented. Not as result of photographers asking for a new way to take, store, and transfer photographs. The market didn’t know what it didn’t know, and therefore couldn’t ask for it. But some innovative minds under the direction of leadership willing to transform the company saw an opportunity that could be exploited. Who would have dared to bet on an idea that would take on a company that had been dominate for 100 years—Kodak? But they did, and now a vast percentage of all photographs taken are taken digitally with a cell phone! They transformed the very way we take, store and transfer photos, creating a whole new market that has relegated earlier technology largely to obsolescence. And in the process changed the very way we think about taking photographs.

These examples are indicators of not only the vision it took to recognize and create the product, with little help from customers or other sources of traditional input, but more importantly, they are examples of transformation. In neither case did management believe they could succeed by making incremental improvements, they needed radical transformation, and they had the courage to attempt it. Many don’t!

A hurdle we also often see that impedes growth is the insistence on maintaining a traditional hierarchical management structure. Copied from the great Roman and Prussian armies, they served us well when we needed structure to facilitate communication and control quality. The ability to successfully replicate processes while driving out cost and scaling the business was a natural for this proven approach. But technology has rendered the discipline and oversight an immediate manager brings largely unnecessary. Peers will recognize and correct deficiencies long before a remote manger sees it, and long before the rules personnel has imposed on us can be successfully implemented. Organizations that recognize that the systems and technology we now have available allows them to monitor, train, and lead with a much flatter organization structure, will find themselves more responsive, adaptable and successful. The removal of layers of management also serves to reduce cost, and facilitates broader decision making and innovation.