We have assessed your business overdraft extension application and on this occasion are unable to increase your existing line of credit.
We would also like to remind you of your obligations in respect to our terms and conditions.
We value your business and look forward to working with you.
Have a nice day
Your banking partner in business”
This wasn’t the first letter Andre had received from the bank. He had similar ones from other banks as well.
Today, things were not looking good compared to twelve months ago when Andre was really excited about starting his business.
It’s not that Andre’s business is not viable, or Andre is a poor manager. In fact, he has some really good ideas and built some products which have had some loyal customers who were really happy about them. However recently there were signs that some of these loyal customers were becoming frustrated with the deteriorating service they are now receiving from Andre.
A few of these “loyal” customers had even closed their accounts.
You see, what was really going on was that Andre’s business had grown to a level where it was now overwhelming him – he had not stepped up, as his business had grown.
It is now make or break time for Andre and his business.
If anyone was to observe Andre today, you would think he continually changes his mind on what he is working on. It is as though he has no focus and it appears that his business has become his boss. On a typical day, Andre could be developing marketing campaigns and then he gets distracted on his social media. This then leads to him browsing on the internet where hours go by.
You would also observe, that there is an apparent lack of structure in his business today. No distinction between sales, operations and administration. Even though Andre does most things himself, he bounces around randomly and is easily distracted.
When Andre started his business a year ago, money was coming in and the volume of transactions were manageable, but today this is no longer feasible for him to continue in this same way.
“What can I do” Andre asks Laurie, an old friend from university days.
“Andre, I think you need to do things differently, I am not sure exactly what that is for you, but I got a great insight out of Michael Gerber’s book the eMyth where he said you have to work on your business rather than in it”.
“Well I certainly feel that it’s not working at the moment” Andre replies dispassionately.
“Possibly you need to look at how your business is structured. Think about it as if you had a lot of people working for you today and they had to be placed into teams performing similar activities – but you cannot have less than three teams or more than five teams” Laurie explains.
“You see Andre, by looking at your business this way, it starts to focus your mind away from you doing everything, to you stepping back, while introducing order and structure”.
At this point of the conversation with Laurie, Andre is starting to realise he does need to step out of the day to day and spend more time thinking about this concept of structure.
While this is just a small step, like a door just opening enough to let some light in, it had the necessary impact on Andre and he said to Laurie…
“Laurie, yes thanks for that and you have reminded me of a similar quote about the definition of madness and that is to do the same thing over and over but expect a different result, I am not mad you know Laurie, passionate yes but not mad!” Andre says with a huge grin.
But of course while this is the first step for Andre, there are likely to be other things he needs to do as well.
So what advice would you provide Andre to help him with his business?
What would you do now if you were Andre? What steps would you take? Who would you reach out to? How would you ensure your current customers are being retained and you can meet your financial responsibilities?