Blog

SCARY SIGNS YOUR COMPANY IS IN TROUBLE

Preferably, every business’s success would be so simple that anyone could run it – even an untalented person. Unfortunately, though, many businesses cannot withstand the leadership of an unqualified or untalented person, and, if a business is lucky enough to achieve longevity, odds are that someone unqualified or untalented will run it eventually. But, how can you, as an investor, identify when a business is being run by one of those untalented people? More importantly, how can you spot when a business is being run by an untrustworthy person?  You can’t safety-proof your job. But be careful if you witness some or most of these things at your company they could be signals that it’s time to escape a sinking ship.

You Don’t Understand Your Company’s Strategy; great companies have a game plan for winning. A plan that is clear and simple to understand. They can show you their strategy on one piece of paper and can explain it in about thirty seconds. Poorly run companies either don’t have or can’t articulate their strategy. If you can’t explain what your company does, why you matter, and what makes you different, it’s mostly likely because your company does not have a strategy or your executives can not communicate it. Either way, it is a sign that you may be going over the handle bars.

Growing Slower than Your Industry; Successful companies grow faster than their market does. This means they are expanding sales while taking market-share from competitors. For instance if your industry is growing at seven   percentage and your company is growing at three percent you are losing market-share. Over time, this will catch up with you sending you flying into the unemployment line.

Frequently Missed Targets; most companies, especially in tough economies miss their targets from time-to-time. It signals bad planning, bad forecasting, bad sales management, bad expense controls, or a company being badly beaten by competitors. No matter what the cause, this is a sign of weak executive management. And weak executives can destroy a strong company quickly. So if this is happening at your company, make sure you solve it out.

Running Out Of Cash; Cash is the life blood of every company. The cash a company generates tells you a lot about its health. A company’s cash position is also one of the purest metrics to track. It’s not subject to interpretation the way revenue, expenses, and earnings are. So pay close attention to it. If there is more cash going out than coming in every quarter, the bike ride ends badly for employees.

Poor or No Communication from Executives; if your executives are not communicating effectively with you and your co-workers it’s a warning sign. In tough times incompetent executives go into hiding. If and when they do communicate they do it in dumb ways.

Great People Are Leaving & Dumb People Are Staying; great people build great companies. When you start to notice that more than a few great people are leaving, something is wrong. When a company’s best people start leaving, it sets off a chain reaction.

Repeated Layoffs; Many companies have done layoffs in this economy, but if your company is doing it regularly it is another sign of poor management. Most executive teams underestimate how much trouble they are in when things start going sideways. So when it comes time to cut expenses and people, they have often don’t go deep enough. Then, three to six months later they are forced to do another layoff. If this turns into a vicious cycle, you have incompetent management and probably an out of touch board of directors. Their ineptitude will cause more and more jobs losses. This will continue until your board-of-directors wakes up. So if your company is showing some of all of these seven signs it is time to get proactive.

Speak to us at Korsell Corporate Consult; let us assist you with your business planning and other custom service. Call now 055 391 9618 or Email: info@korsellcorporateconsult.com

Leave a Reply

Your email address will not be published. Required fields are marked *