The Overworked Owner in Boom Times
Life sciences services companies are experiencing an unprecedented boom. Revenues during 2020 were up 15-20% during a pandemic, and more is expected in 2021.
Covid-19 directly contributed to some companies who were directly supplying research, manufacturing, or supply chain needs. But the pandemic had an even greater indirect contribution: it validated the critical importance of the distributed R&D ecosystem that has developed in the last 35-40 years.
If you participate in this industry, you’re experiencing sales growth and it’s stressing operations. As an owner, if you were overworked before, things are so much worse now. Seeing cash coming in will only make you feel good for a short while when faced with staff turnover, an inadequate hiring pool, and high costs and long timelines if you need to add infrastructure.
You must deal with growth by building a better company. You, and your team, can’t just keep working harder and harder.
There is a way to do this, even when things are booming. Here are some steps you can take right now.
- Recognize that retaining good employees is about making them feel included in something big. It’s not benefits or even raises, it’s cultural. Share growth challenges and let new ideas in. Support younger employees who want to lead on their ideas. Make people feel valued by being transparent about their impact. Don’t reprimand, instead adjust and coach if they can’t meet their targets.
- Execute your strategy, don’t just chase your goals. Michael Porter said “Strategy is about what you say No to.” Set a specific, realistic, measurable, time-bounded goal. Give leaders responsibility for quarterly objectives. Support them if they need help. Meet the metrics or adjust the plan. But don’t change strategy just because a new idea seems attractive, like a shiny object. Anything is possible, but everything is not possible.
- Manage cash to put yourself in a better position for the future. There will be a downturn. Something will happen that will cause all your customers to put work on hold; a recession, a war, a pandemic. Make sure that you are in a better position for the next one, and you’ll not only survive, you’ll be able to jump on the next opportunity first.
- Use this growth to hire more strategically. Instead of increasing productivity by hiring workers, increase it by hiring better managers for workers. This is especially necessary if you’re doing the managing now – you are the owner, and there’s too much going on for you to do this job well. You will have to pay more to find the right person, but right now you have more revenue and can afford it.
- Build a sales process that works. To work more efficiently (get more with less) in a boom, nothing is more important than working with the right customers. If you are accepting all interested warm bodies as customers now, it’s likely that 20% of them are providing 80% of your profit. Fire the rest, and find more like the 20%. You can only do this by developing a system, a process that identifies, qualifies, attracts, and closes a relationship with those magical ideal clients. They are easier to work with, your staff will be happier, they produce more revenue because they know your value, they don’t create drama, and they will refer and recommend you.
This is the time – when things are good, and you’re so busy – to make positive change. Build a better business, and get more with greater satisfaction.
Want a little help clarifying your ideas, deciding what to tackle first? Let's set up a call. Talking is easy, fun and free. Here's my calendar link: https://calendly.com/jeffreypkiplinger/30min
