For many small-business owners, the start of a new year means making resolutions about getting better organized, becoming more efficient, being more productive. Unfortunately, statistics show that more than 75% of those who make resolutions fail to see them through. The new year is still an ideal time for thoughts of cooking up something big for your business, but instead of making resolutions, try writing down your recipe for business success in 2006. The Small Business Administration estimates that about 60% of businesses fail during their first five years of operation. But I think a lot of remodelers could beat those odds if they simply had a better recipe. The cooking metaphor is deliberate. I call it “frog soup.” It comes from my personal experience as a remodeler and from years of speaking with and listening to other remodelers around the U.S. Time and again, I would hear the same story from remodelers whose businesses, to my mind, were like pots on top of a stove. All the frogs in the company get cooked, it's just a matter of how it happens. For potentially good hires, the pot is full of boiling water. The strongest, most capable frogs who jump in immediately jump out to save themselves. No good hires are going to stay with this kind of team too long.
At the same time, the company owners are being “cooked” by their businesses. They're talented individuals who used their many personal talents to build good reputations. As they added employees and larger jobs, their businesses became more complex, but they found themselves trying to juggle everything. Rather than focusing on management and organization, they got bogged down doing the work instead of delegating it. Every time a good “frog” jumps clear of this festering business, the owner finds himself having to hunt down a new frog for the pot.
For the owners of such companies, the pot is full of tepid water at the start. Eventually, however, they run the risk of becoming frogs themselves, slowly “stewing” in all the problems thrown at them every day. Before long, they either go out of business or their businesses are served up and eaten by the competition.
Deadly Ingredient For remodeling businesses, frog soup is a slow-acting poison. The acronym I created for the ingredient that sours this recipe is “CADD,” which stands for Contractor Attention Deficit Disorder. Countless business owners have demonstrated the symptoms to me over the years — a tendency to become completely reactive, to work on immediate problems (the effects) instead of fixing the system (the cause). Everything becomes a Band-Aid, and even though they work hard, they're still short on money. They are by-the-minute managers. They'll say, “I have no idea how I'm going to meet payroll, but I'm going to be a framer today because that's what I know how to do, and I'll get a check.” Like the frog placed in a pot of tepid water, by the time they realize the heat's been turned up, the water's boiling and they're soup.
If you can identify with this situation, then your solution is to revisit your cookbook. If you see steam rising from the pot, check the ingredients. A new recipe — a.k.a. a business plan —is the key to turning things around. It begins with recognizing that you must take the time to institute change. Whether you've been doing things the same way for years or you've just launched the company, there's no time like the present to bring order to the chaos. Not only will it give you time to focus on the big picture of growth and profitability, it will also help you attract and keep some of the best frogs in the pond. With a good team in place, you can reward top performers with tasks that they can take ownership of.
Make your New Year's resolution a recipe for success. Then, as with any good recipe, follow each step if you really want to cook up something great.
—Shawn McCadden, CR, CLC, recently sold his Arlington, Mass.-based design/build remodeling business to its employee-managers. In his second career, he is Director of Education for DreamMaker Bath & Kitchen by Worldwide. Send e-mail to email@example.com.