Partner Article

Chase stability before profits

This may seem a simple piece of common sense, but it is one which, when ignored, can cause pain and heartache for business owners and those they employ. It is not only during times of economic downturn or recession when this simple little ethos makes good business sense; it should be at the heart of good practice.

Such influences as shareholder pressure in PLC companies do not always make it an easy rule to follow, but it can mean the difference between a healthy business and one in trouble. For owner-managed businesses, where any such pressures are self-inflicted, it is in everybody’s interest to prioritise stability ahead of increasing profits.

A successful strategy for growth comes only with that stability and room for increased productivity. In the service sector, the companies which thrive tend to do so on the back of great customer relationships.

Those businesses which overstretch themselves risk tainting those relationships through reduced quality standards.

There is nothing wrong with growing a business offering more products to a greater number of customers. However, such increased activity conducted without the capacity to deliver to a high standard the extra work, and that to which the business is already committed, can be the cause of many problems.

The workforce must be in place to deliver each new contract won, or the business must be able to quickly source the personnel. Also, the individuals must be sufficiently skilled to carry out their assigned tasks. Therefore, training, as well as recruitment, must be built into growth plans. Being behind the competition when it comes to knowledge and skills can be as damaging as failing to deliver on a retained contract.

Whether it is Odyssey Systems delivering telecommunications, or a law firm, accountant or any other service provider, the customer needs to feel their supplier has the capacity to deliver and the knowledge to advise. To intentionally misquote a well-known saying, look after the clients and the profits will take care of themselves.

This was posted in Bdaily's Members' News section by Mike Odysseas .