When design or environmental firms face problems, the first course they usually pursue is one of cost cutting. Obviously, there’s merit to it. I have recommended cost cuts to clients many times over the years, and judging by the sales of our recent video release, 20 Ways to Cut Costs, there’s a lot of interest in it right now. But it concerns me when that’s all a firm does to turn things around or boost its profits.I liken it to being in a fort under siege. The enemy has you surrounded. They can come and go as they please, getting more supplies or bringing in reinforcements at any time. Meanwhile, you can hunker down and barricade yourself in, but your food is only going to hold out for so long. If you wait long enough, you’ll starve, or they’ll burn you out. The end won’t be pleasant in either case. Maybe a better plan would be to shoot your way out of the problem. Maybe instead of cutting back and digging in, you ought to be planning your escape. Maybe it’s time for a little Butch Cassidy and The Sundance Kid action. Who wants to simply exist and eventually starve to death? What kind of a life is that?By shooting your way out, I am talking about spending money and making the investments that will make you more competitive and more successful. It’s the opposite of getting fearful and pulling the plug on everything that costs money. These investments are the acquisitions you have been talking about or the key hires that will get you into a new area or bolster a weak internal capability. Or the checks you have to write for new software so you can do webcasting to help land new clients. Or the investments in greater bandwidth so information flows between all of your offices more freely. Or the major marketing initiatives you’ve talked about at your planning retreats for each of the past three years but somehow haven’t yet gotten done. Firms that want to shoot their way out of their problems have a lot going for them. Here are three good reasons to try this approach:Surprise. I’m talking about surprising the competition and surprising your clients and potential clients. Everyone likes a surprise (except your competitors). What kind of effect do you think it has on them when they see you tripling your marketing expenditures at the precise moment they and all of the other firms in your area are cutting back? They can’t understand it. And this surprise gives you a real advantage with clients too. Just when the noise from the other guys fades out, you turn up the volume. I’m telling you, folks, just before a downturn is the time to really increase your marketing expenditures and activities. The other companies will be cutting back, and you will stand alone. Your message will be heard! Motivation. Everyone loves being part of a gutsy effort. Being the company that is investing when the others are cutting costs can be inspirational for your staff. This can lead to more confidence and better performance from everyone. All the troops feel better when they are part of a team that has one goal— domination of the market, however your particular firm defines it. And with all of the sectors, segments, and sub-segments that exist, there’s plenty of room for firms to dominate their own area! Being a winner, being noteworthy, being the firm that every one of your competitors talks about (even if they hate you) is the position to be in. It sure beats being a firm that no one talks about! It helps you sell work, and it helps you recruit people. Greater long-term viability. Investments in people, new services or markets, information technology, and marketing are the things that make your life easier and make you more successful over time. Who says the best is in the past? Not if you don’t accept that fate. That kind of thinking is for losers! You aren’t a loser. Another way to look at unsatisfactory firm performance is that it’s like being overweight. You can go on a severe diet and lose some pounds. But you might end up even less healthy than you were before. You need to eat right and exercise too. That’s your investment in the future. Agree or disagree? Call or write me anytime.Originally published 3/12/2001
About Zweig Group
Zweig Group, three times on the Inc. 500/5000 list, is the industry leader and premiere authority in AEC firm management and marketing, the go-to source for data and research, and the leading provider of customized learning and training. Zweig Group exists to help AEC firms succeed in a complicated and challenging marketplace through services that include: Mergers & Acquisitions, Strategic Planning, Valuation, Executive Search, Board of Director Services, Ownership Transition, Marketing & Branding, and Business Development Training. The firm has offices in Dallas and Fayetteville, Arkansas.
Choosing a selection results in a full page refresh.