How to monitor your business and keep it safe: Avoiding the problems before they start
Managing and monitoring a business is always a difficult task, from market influences to staffing issues, keeping one’s business on track to succeed and grow is a true balancing act.
Sometimes, however, despite best efforts, things don’t go to plan and the balance tips towards uncertainty for the business. It is essential therefore for early warning signs to be recognised and acted upon.
Usually business owners, especially those that maintain close links to good quality external advisers, will spot the symptoms themselves and take early corrective action. It only becomes a problem when any issues are not noticed or, even worse, ignored and that symptom turns into a potentially fatal illness for the business.
In the last in the series how to monitor your business and keep it safe we look at The “Signs in the Wind” and examine how to Avoid Problems Before They Start.
The “Signs in the Wind”
Certain warning signs of impending problems can be detected before any hard evidence is available. These “signs in the wind” should be seen as a trigger to starting a closer enquiry into the company’s’ current health.
Some key signs are:
- No information flow
- Audited accounts late
- Failures of related businesses
- Competitors are booming
- Customers are declining
- Suppliers chasing payment
- Key staff leaving
- Rumour or media comment in the market
- Directors’ lifestyle excesses:-
– Expensive cars
– Villas abroad
– Race horses
– Infidelities and affaires
Avoiding the Problems before They Start
Anyone who has read this far may by now be wondering if any company can escape all the possible pitfalls and survive for any length of time.
Of course in practice most companies do survive but for those wanting to take some sort of a stake in a business either as a lender, a supplier or even as an employee, here is a quick guide to avoiding the bad ones.Understand the company’s business and the markets in which it operates thoroughly
- Assess the quality and mix of skills of the management team… The right management can see the business safely through most problems
- Assess the quality of financial and market information reaching the management. Even the best managers cannot be effective if they have poor or late information
- Consider the strategic issues facing the company
If you have been affected by or wish to discuss any of the issues raised by this article please contact John White on 01914112468 or at firstname.lastname@example.org