101: Finding business threats
Between management issues, property matters, sales, profit-and-loss statements and meetings upon meetings, there isn't much time for downtime when it comes to running a business. But how much time do you take to identify potential threats to your business? Here are three things you should regularly assess:
Examine if your firm is guilty of reckless hiring. “It is imperative as a business leader to look closely at your employees to identify and retain your A-level talent,” says an article by Scott Makinson of Express Employment Professionals of East Indianapolis, Ind., at www.isbdc.org. He cites studies that show that if firms only hired top performers, they'd cut payroll expenses by as much as 25 percent. Some ways to keep good workers on board? Enacting employee incentive plans and reinstating benefits cut during the recession, he says.
List threats and set about addressing them. “Consider the impact of shrinking markets, altered consumer tastes and purchase tendencies, raw-material shortages, economic downturns, new regulations, changes that affect access to your business,” advises Business Plan Kits for Dummies (4th edition). And don't forget: Your competitors' strengths are your potential threats.
Invite an outsider to step in. To make the threat-analysis process valuable, of course, demands being honest and candid. Hiring an outside consultant to give their view is money well spent. You may strongly believe your years of experience in a sector reflect your business' thorough grounding and knowledge … Your customers, on the other hand, may perceive this wealth of experience as an old-fashioned approach,” writes Janice Hui of CBS' MoneyWatch. Bring someone in who is unbiased and can help you see the situation clearly and objectively.
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