Case of Business Threats, Part 2

Regardless of the technology we use, many business threats remain the same over time. How can you assess threats to your business? Last month I covered the measure of a threat: a known deficiency that will cause the business turbulence over time if not corrected. The first area was finance: lack of cash, lack of good information, accounts receivable, and/or a projection (budget) resulting in a lack of cash. This month we look at organization.

What does a business need to do each and every day? Essentially we need to get jobs out, get jobs in, and get paid. This isn’t glamorous, but it is necessary to assure the business’s health.

Management at the Front

I put “getting jobs out” first because my experience is that, usually, we can’t get out what we have in now, so we can’t increase sales even if we could. Specifically, I’m talking about production management, also known as operations management. In short, it’s doing what we do. If we were an airline, it would be everything from selling tickets to flying airplanes.

In printing, it’s taking orders, estimating, and delivering, whether the product is a sign, a printed piece, or a website. Then one more step: making it happen as promised. That’s the role of the production manager. His job is to make and meet all customer commitments.

The general manager doesn’t do this in a vacuum, of course. People who assist him, whether CSR, graphic artist, or digital production people, all report to the production manager, who directs their work in order to meet commitments.

Other roles are important as well. For instance, one person—and one person only—can run the total business. This is the general manager. His job is to make and meet all budgets. That means plan what is going to happen (budget) and make it so. Then provide oversight and discipline. That means making sure everyone else is doing their job as prescribed in the way that’s desired.

So Many Hats

Of course, our shops are small, so we can’t “general manage” all day. So we wear multiple hats. The general manager can also fulfill the function of production manager, for instance, which gets into time management, which is a separate topic. It is important that we understand what each hat requires so we can assign others to “hat” responsibilities as we grow, as well as to have the major functions done each and every day, whether we have 100 employees or it’s just us.

The third major function is finance (bookkeeping). This is most often done by a trusted clerk who is in charge of cash management at the general manager’s direction. It’s not important that the general manager open the mail and post payments. It is important that the general manager sees that it is done.

The fourth and final major function is selling or “creating demand for existing capacity.” We need a system for identifying and processing suspects. This includes using a database, sending out direct mail, and getting in front of them asking for business. Today, it also can include email broadcasting and social media. The point is we must be in front of folks who regularly buy what we do, in one form or another.

Then add a method of converting “suspects” to “prospects” as fellow columnist Dave Fellman notes. This involves using a selling funnel method, resulting in adding accounts rather than jobs.

Assessing the Organizational Threat

As for threats, the question is, “Are the functions being done each day?” If not, you can expect turbulence at some point. Other important issues include protecting your employment-at-will rights and assuring the production manager uses appropriate tools to complete jobs on time.

Even in a one-person business, all functions need to be performed. This leads to a tricky time management issue, but is eminently doable. But that’s a different article.