Hypnotized by Top Line

September 19, 2016

rn-blog-03

May 2016

See the Forest, Not the Trees

You have succeeded in business because you have goals. Goals are a fantastic motivator. They are what keep you hungry; what keep your business growing and expanding. But what about when those goals you set are a bit too high; a little too unrealistic? Think of the runner who is trying to drop his lap time to under a minute. He’s never been below a minute, ten seconds. He pushes himself and pushes himself and pushes himself. He gets incredibly close. But then what happens? He fails. He’s exhausted. He’s possibly even injured. Maybe he even quits running.

This same thing happens in business. I’ve seen it many times. A business owner sets a top line goal that is a little too ambitious. He pushes himself and his employees too hard. He then fails. His employees are disgruntled and unproductive. His business is stagnated, fragmented, broken. Maybe it even fails.

I spoke recently with a former student of mine, Brenda W., and put her on the spot. I asked her, “have you ever set your goal too high and suffered because of it? Have you lost sight of the forest for the trees?” Brenda runs a highly­-efficient services company that is very sales orientated. When asked this question, she shook her head and responded, “who hasn’t?”

A few years ago, Brenda and her company had an expense base of USD $150,000 per month with a need to generate sales of USD $200,000 each month to balance cash inflow and outflow. Brenda’s top line, her revenues, showed a healthy year growth. However, her company continued to miss their sales targets, quarter after quarter. “All I could think to do was push, push, push,” Brenda says. “I was convinced that we would achieve our goals eventually.”

However this wasn’t the case. Brenda and her employees were risking complete burnout and frustration. “I can’t count the number of times we worked late, slept at the office. It wasn’t healthy. It was very unsustainable.”

When all seemed lost, Brenda decided to sit down with her leadership team and assess their goals. They decided that their desired sales target was shackling them and they all felt trapped. They made the difficult decision to reduce their sales target to match what they could achieve with little effort, reducing their cost base from USD $150,000 to USD $100,000. They left that meeting feeling uneasy, but a little more comfortable.

Three months later, there was a euphoric turnaround. “We all of the sudden had money in the bank,” Brenda says with a smile, “stress levels reduced dramatically. Work­-life balance improved. The company was even making money again.”

Time, fresh perspective, and space allowed Brenda and her team to step back and focus on innovation. Instead of focusing on the trees, Brenda and her company were again looking at the forest.

And she noticed that the forest was the same color as money.

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