Renee’s Rule™- There is no subsitute for common senseMarch 4, 2009
It seems like every minute a new book with the “latest” business “secrets” hits the market. In reality, however, running a business profitably and well boils down to taking care of the basics; i.e., having a well-conceived plan, having a capable leader, and implementing a carefully crafted management control system. It is astounding to me that so many companies lack these basics—not just family-owned, but also publicly and private equity-owned (You know some of their names.)
Much of the information in this blog may sometimes sound like nothing more than common sense, but common sense and an attention to the basics are too often missing-in-action.
An example from my personal experience: In 2007, a private equity firm interviewed me for a turnaround project. The company had been losing money for three years; there was no business plan; the president was clearly not qualified; and there was no effective management control system in place. After I mentioned that the company needed these basics, the managing director said, “We know that.” (As in, “do you think we are idiots?”) So…if they knew all of that, then where had they been, and what had they been doing for the past three years? And these were people with MBA’s from prestigious institutions, who, presumably, have a fiduciary duty to their investors and definitely know better.
Find a way to step back from your business, to take a cold, hard look at where you are and what your real prospects are…Are you making money or losing money?