Sunday, June 8, 2014

Forecasting Change

Occasionally, one might find his or her self at a crossroads in business. Businesses change, markets change, people change. How you handle change is the key factor in success in my opinion. Many business people, and I will pick on the tenured store owner or 20+ year veteran of ownership in any business, find themselves hanging on to old ways and old habits, thinking that continuing on the path the same way will deliver a different result even though their market has changed. Failure to identify the impending changes coming and lack of a proactive approach may result in businesses faltering or contracting rapidly.

We recently installed new automation equipment in our cutting department. This machine is a wholesale change from the past. We have moved from archaic, old methods of fabrication to seamless transition in process, allowing for a greater throughput and more efficient use of time and resources. The difficulty with this is that it affects all the processes surrounding it, and those processes must change, too. When we made the decision to automate, did we thoroughly think through how it might affect the rest of the business processes, and were we prepared for the changes to those that must be made? Time will tell, however, I might suggest we always underestimate how simple insertions into our lives often create larger, more complicated ripples of influence that must be addressed.

Last year, we moved to a new ERP system so we could allow for better tracking of production and digest internal data more easily, and more visibly. This seemingly reasonable change to our business process has created massive amounts of work in addition to the already heavy workload we all carried. There were mistakes made initially that have caused us to revisit the entire system, however, with a concerted effort and a can-do approach it is getting done and we are making progress. This does not come without pain. Tempers flare, exhaustion ensues, and hope is sometimes dismissed as a fantasy. Personally, I have been through two ERP transitions prior to this one, and neither looked any different than what we are experiencing. Having a reasonable expectation and knowing the process will be a long one can mitigate so much of the frustration that walks along side.

When your market changes, how do you react? Did you see the writing on the wall or were you complacent that things would always stay the same? I am guilty of not acting fast enough in some cases where one or more of our markets is changing and we need to be proactive about how we handle it. The alternative is to wait around and react to the change when it is too late. In those cases where we are reactive, you typically exhaust more resources trying to catch back up, lose market share, and generally fall behind the innovation curve. Being proactive, and even creating those 'Blue Ocean' markets prior to an immediate need, make sailing the seas of business a slight bit riskier, but much more in your own control overall.

Change comes. When it does, are you prepared to meet it head on, or were you anticipating that change prior to? In order to meet change, sometimes we have to change the way we think about change itself...

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