The threads of our past may be killing our future

(Four minute read)

Sometimes the only way to save a business is to destroy it.

A single, flimsy thread can’t do much harm to you. Threads are usually just little cotton strands that a child can snap with her little fingers. Thousands of threads, especially those that keep us tied to a failed past can, however, combine into a force that chokes the life out of any business trying to stay alive or evolve.

Every business with any age to it has threads that bind that business to its history. Threads are the history of that business, but seldom its future. Employees from the old days, aged physical plants, old procedure manuals, a glorified past where the business was known and successful, and an ownership trapped trying to restore a fading concept rather than letting the business evolve to its current potential, are all threads binding you to something that may no longer exist and may no longer be viable into today’s business environment.

Businesses fail because they don’t evolve, forcing it to lose the ability to react to a changing market. Keep doing what you are doing and the world offers up someone doing it faster, better, cheaper, nicer or just different. Doing what you have always done, especially when it is proven not to work, guarantees failure, since you have already validated there simply isn’t enough clients out there who want to buy your old method of business. Sure, there are fans of desktop computers, K-Mart, film cameras, CD music, circuit training and old school aerobic classes; but not enough of those fans to keep any of these concepts viable going forward in time.

Sometimes, the only way to save or grow a stagnant business is to destroy it. Sometimes the only way to save a business is to cut all those threads that bind you to your history and let the business evolve. Sometimes you have to sit down and reinvent the concept for the market that exists today, not try to maintain it for the ever fading pack of fans that still believe in what you are selling, but isn’t big enough as group to support your efforts any longer.

The problem of course is that we never recognize the threads that bind us to the past. These threads are insidious in nature, much like the proverbial frog sitting in slowly heating water that gets boiled rather than leaps. In our case, the very things we are so proud of in our businesses are often the very things that are causing the most damage.

For example, the employee left over from the old days who fights to restore the way it was when everything was perfect and only he knew how to get it done: “It is our employees that are killing us today,” he says, “If we just go back and train them as we did when were making money we can fix it all.” Usually this is the old sales guy who believes we just need more closers, rather than questioning if what we are selling is what people want to buy today. This isn’t a sales problem, it is a concept problem.

When the business environment all around you changes, using techniques that made you successful 20 years ago will have little bearing on fixing a struggling business today. For example, you might have been the world’s greatest pager salesman, ran the greatest team, and were the company star, but no matter how good you were then has no value on competing in a world of smart phone fanatics. The market changed, the business changed, the needed techniques have changed; everything has changed except for this employee who can’t let go of the company’s past, or his own. The solution? Cut his thread.

Forgetting that what made you famous will not keep your famous is the real problem here. Businesses will plateau at some point, meaning that if we keep using the techniques and people we currently have, we cannot grow the revenue of this company any higher. We peaked with what we had, but what we have is usually not enough to drive through to the next level.

The thread here is that we refuse to change because we are so afraid of pissing off current clients. “If we change, we will lose all (your employees always go for worst case to validate their points) of our clients that love the way we do things.” The big question, especially if the business is stalled or in decline is, “If we don’t change, we might lose the whole business instead of a few old customers.” Old customers, who fight change to their service, product or even something as simple as a change in their gym equipment who then threaten us with their willingness to go elsewhere, hold us hostage to doing what is the best for the business, which is cutting that thread to the past.

Our staffs tell us that if we get rid of that old equipment, we will lose too many members and hurt the business, but the reality is that the current equipment array isn’t attracting enough new members to sustain the business. If you are held hostage by the old staff, yet again, and some of the old members threaten to quit if anything changes, then you won’t even paint the walls in fear of making some old client mad enough to go somewhere else. Put more simply, the very equipment or dated programming that is keeping that old guy from leaving you is what may be keeping a lot of new clients from joining you.

The answer here is to do what is necessary to give the business a chance to attract a new generation of clients, in big enough numbers, to replace the old client who might leave, but are preventing the business from growing.

There is no way you could ever survey this in a business. Ask any old client what happens if you change anything they know, replacing the known with an unknown, and no one will ever let go of what they have, but remember, for every client who clings to the past there is another old client who hates the fact that you haven’t reinvested in that business in 20 years. Having equipment, or programming, or a service that hasn’t changed in a decade is not a badge of honor to many clients; it simply means you are cheap and won’t reinvest in your business.

As a side note here, are we sure it is the old clients who refuse to change? Many times it is the employee who fights so hard to keep the same old, same old. Employees demand leadership and if you want change you have to replace the vision of, “We have always done it this way and this is all I know” with a tighter vision of what can happen if we let go of the past and embrace your clearly described vision of the future.

Your history is just that, something that happened in the past, and has no bearing whatsoever on what you can be tomorrow. A big question to ask here that frames this issue more clearly for most employees is, “If we just started the business today, would we be doing the same things we are doing now?”

The answer to this is seldom yes. If we started the business today, you wouldn’t have the old physical plants; the old, already ruined employees, and you would be able to start today fresh correcting all of your past mistakes by focusing on a vision of what the business has to be today to compete.

And this is how you should learn to run your business. If you want to go forward, you often need to cut the threads to the past. What are we going to do today to compete is for more sustainable over time than clinging to a past identity that is not sustainable going forward.

If your business is flat, getting surrounded by competition and you are fading, or it is simply not performing, ask yourself these questions:

• Are the employees that have been with me so long part of the solution, or are they really part of the problem that keeps this business from growing? Long-term employees seldom change when times get tough. Yes, there are a few who have been around for a long time and who can change, but not many. Often the very people you are counting on for help to evolve are the same ones who secretly fight every new idea by hanging on to the way you have always done it. Long term employees often nest and build empires and even the ones who have been with you just a few years will often cling to what they know, not embrace what you want them to do. Big change requires big change; often the only way to do that is to start fresh with people not afraid of your new vision.

• Is this concept even competitive today? What made you successful will not keep you that way. Markets evolve; competitors steal best practices and the expectations of the consumer changes too. Sometimes you have to admit you were brilliant in 1995, but not even in the game today. Change is often harder than death, as almost any smoker will tell you. Sometimes letting go of a concept and replacing it with, “What is next” is enough to save a flat lined business that is fading year after year.

• If I look back the last 18 months, can I predict success or failure during the next 18 months? If what you are doing, such as a string of negative numbers, has lasted more than three quarters, you don’t have a trend, you have a new reality, and that reality is that you are denying the inevitable. The numbers will not change if you do not change them, but if what you are doing isn’t working, defined by shrinking numbers, failing physical plants, dated processes and a staff that won’t let go of who you used to be, then you have to break it if you want to save it.

• Do I know the difference between a patch and a fresh concept? Putting little turf areas into the back room of a mainstream gym doesn’t make it a training gym. Signing up for a new group exercise license won’t save a business from three decades ago. Adding a few pieces of the newest, latest and greatest equipment doesn’t change the situation enough to attract a huge number of new clients. Patching means you are using programming and other gimmicks to prop up your failing concept. Most of you do not have a programming problem; you have a concept problem. Old, tired streetwalkers with fresh makeup and new clothes are still old, tired streetwalkers. Old, tired gyms with a little paint, 200 feet of turf and a few treads are still old tired gyms three decades past their prime.

Sometimes the only way to save a business is to destroy it. Sometimes the only way to go forward is to cut all the threads from the past. Sometimes the right thing to do to save a business is just to start over.