Tuesday, October 2, 2012

No Action is an Action

Remember, people will judge you by your actions, not your intentions. You may have a heart of gold -- but so does a hard-boiled egg.


So often, business owners and managers have problems that they are not addressing because they are either unable or unwilling to deal with them. Many times these entrepreneurs tell me that they do not have the time to deal with these problems because there are more pressing issues requiring their immediate attention. Other times, they are just unsure how to fix it and it is easier to simply ignore it.

What these entrepreneurs are forgetting, however, is that problems do not remain static when ignored. Rather, they escalate over time, and in the end, that unresolved problem can cost them dearly.

Most often, I see entrepreneurs neglecting issues that involve problem employees. The reason is obvious. Having to discipline an employee – or worst case scenario, let them go – is unpleasant and painful.

To avoid having to dealing with these unpleasant situations, managers frequently pretend not to see the problems. But not only does this affect the morale of the entire office, it also undermines the manager’s authority. The rest of the staff will eventually lose respect for the leader because failing to take action against bad behavior is tantamount to accepting it.

I was working with a restaurant that had been in operation for a reasonable length of time but was still not making adequate profits. The owner was not losing money, but he was barely making enough to keep his head above water.

A rough rule of thumb in the restaurant industry is that food costs should be about 32 percent or less of total revenue. Though the owner had been to enough seminars and schools to know how to manage a restaurant, his food costs were hovering above that mark around 38 percent. When I confronted him about this, he simply said that he did not know how to fix this issue as he felt his prices were already pretty high.

He was acting as though the problem would either go away or resolve itself if he just did nothing about it. Of course, that did not happen, and now his economic wellbeing was being threatened. He also did not realize that by taking no action, he was making a deliberate choice and not just passively delaying the decision.

After talking with him, I came to see that he was just unsure of how to fix the problem and lacked confidence in his instincts. When I began tossing out some suggestions, he shared that many were things he had already thought of. He just needed validation from me that these were the right calls. However, until we talked, he was unwilling to act.

When you are faced with a problem that you do not know how to address, you must first identify the underlying cause. Second, you need to come up with at least three possible solutions. And finally, you must pick the solution you feel is best for your business. Ignoring the problem just allows it to grow.

Now go out and see if you have been delaying decisions on problems you need to be addressing. Just remember to gather all the relevant facts before making any critical decisions.

You can do this! 

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