No one likes to think of their company as being tired or old, but with time many if not most do become so, its sort of like entropy where things just go down hill over time. The air seems to have just gone out of the balloon unless you keep on pumping fresh air back into it. So how does one go about revitalizing a company and breathing life back into it and seems to be out of fresh ideas?

To start with nothing lasts forever. Unless one is monitoring the company performance over time it can miss the fact that the company is no longer energetic but has become tired, with declining sales, loosing customers, its competitive edge, its brightest employees, etc. The prescription for a tired company is to first figure out what the problem is and then go about fixing it; otherwise it may fold.

Most companies become tired as they stay with the same concepts and people who got them to where they were successful past the point of diminishing returns and follow the axiom of “don’t break what is not broken”. Something doesn’t need to be broken to be fixed. Your old car may still work, but may be getting 15 miles per gallon and is a clunker. A new hybrid may get you 45 MPG, GPS won’t get you lost; air bags and ABS will make your trip a whole lot safer, etc. And just think how many companies and industries have been put out of business by just one new concept, the smart phone. Their product or service was not broken, just made obsolete in almost the blink of an eye.

Here are a few things needed to breathe life back into your company. 1. Find out honestly where things are and how much they have changed over time. 2. What were your sales and profits when it was at its peak vs. where you are now? 3. Do you know what your market expects and your competitor’s have been doing during this same timeframe? 4. Have you been adding new bright and innovative people to your company? 5. Have you made investments in new technologies to be relevant (refer the old car analogy)? 6. What have you learned from the above diagnosis and do you have the staff, capital resources, time and the commitment to make the changes that are needed? If you have done all of these things you are now in a position to create and implement a game plan to convert a tired company into a vital one. It may take a substantial change in the way you have done business to make this happen but the longer one waits the harder this becomes. A good place to start is to come up with 10 new ideas for your company; from how to implement a price increase to creating innovative new services or products and selecting the 3 best and implementing them. Avoid being that company where so much time has passed since making changes that their proverbial car has now rusted away.

To see all articles in this series please go to http://optimal-mgt.com/blog.

Did you ever consider when it might be time to hand over the keys to your company so to speak? Some owners have no exit plan and want to run the company indefinitely and have given no real thought to doing anything else but staying in business. Others have an objective they want to achieve and then merging, being acquired, or cashing out after some objective is achieved. Have you given any thought as to which of these two scenarios might fit you.

During the initial phase of a new company the first option is usually all one wants to focus on, how do they succeed, serve a need, make money, grow and survive. But after some period of time they start to think do they want to do this indefinitely or have some exit plan and essentially hand over the keys in one form or another to someone else. There is nothing to compel anyone from just running their business and making enough of a profit to run the business for as long as they are able. Indeed most entrepreneurs do exactly that, earn a living from their business and when they can no longer do that, turn the key and lock the doors. But there is a better way

That is to capitalize on the value of the company that you created. To do this you can either sell the business outright which works best if it is profitable and growing, or do an internal buyout with your management team. This is easier to do if you have a reasonable mature staff that with a bit of business mentoring can run the business on their own and pay you out of the internal cash flow of this business what the company is worth. They can be your family members, people already working for you or bringing people in who would welcome this opportunity. It is equivalent to handing the key to the store over to them and gifting them the company. They pay you nothing and after a few years the company is theirs. There are many ways to structure this, including receiving continued dividends, but the deal works like a mortgage on a house, until the last payment to the property is made the bank (you) still owns title to the business which helps to insure that the new owner/management team keeps their eyes on the ball and there is little incentive to siphon money funds from your repayment. The sooner that payment in full is made the sooner the business is theirs.

To see all articles in this series please go to http://optimal-mgt.com/blog.