It’s one thing to have ideas about the problems and challenges facing entrepreneurs and another to have a firm grasp of what causes them. We use root cause and other analytical tools to poke around small businesses and to develop a rich understanding of how the business and industry function, how the issues that entrepreneurs raise came to be, and how the causes can be isolated and addressed to prevent the symptoms from appearing again.
Many years ago when we first started growing our expertise in small-business development and growth consulting, we cut our teeth on a nonprofit organization with a large operating deficit. We did all the troubleshooting that could be done to understand the issues the board and executive director faced, and then we did what we thought was the next logical step. We started recommending ways the organization could become more organized, more transparent, and better received among investment, lending, and philanthropic institutions. And that worked for a little while until a lot of the original issues we thought we had stamped out started to return. It was then that we realized that we had missed a crucial step that is now integral to our process: analysis.
Analysis is not only valuable to a business from many perspectives; it is also essential that businesses perform some kind (or several kinds) of analysis periodically for quality assurance, performance evaluation, and growth readiness assessment. We use analysis as the critical next step following troubleshooting, and here’s how it works for businesses we serve.
- After doing some basic troubleshooting to understand the issues and to make first-pass recommendations, we spend time comparing desired results to actual results – financial, social, performance, operational, tactical, and so forth.
- Next, we dig a little deeper to understand why disparity occurs between expected and actual outcomes. We ask “why” many times as part of our root cause analysis process; we build decision and process trees; we use flow charts; and we even interview owners and their employees to develop some qualitative foundation for how and why things work.
- Finally, we summarize our findings in sometimes hard-to-hear reports (not because they’re difficult to hear or read; just because they hit hard for entrepreneurs who are close to the companies they start) in which we share the underlying causes of issues entrepreneurs have raised. At times, our analysis points to things in the business that didn’t occur to the owners or that wouldn’t even have occurred to us without sufficient research and analysis of the business, community, sector and industry in which the company operates.
Let’s talk about how analysis helped JP move from a shopping list of business improvements he wanted to make for his wood trim and cabinetry business to a report that became the building blocks for future improvement and growth. First, we started with challenges and issues raised in our troubleshooting of the business and did a deep dive into who was responsible for each action or inaction that created the problems JP described to us. Next, we used process flow charts and decision trees to understand what drives the actions that led to actual results. Finally, we wrote a full report and met with JP to discuss how he could address – and how we could help him do so – the deeper, underlying issues, some of which had as much to do with his leadership as with the business operations. Fortunately, we were meeting with a client who was open to constructive critiques and who welcomed opportunities to learn and grow personally and professionally.
JP’s willingness to make some minor and other more drastic changes to his operations and administrative functions was helpful in constructing the next part of our TACTful plan with him: streamlining by eliminating wasteful processes and procedures, implementing some best practices designed for businesses in his industry and tailored to his specific situation, and reorganizing aspects of the business that were causing hangups and gaps in other areas. We’re getting ahead of ourselves, though. Read our article about how and why cleanup is such an essential part of our business assistance process.
Before you do, though, ask yourself whether you’ve taken sufficient time to slow down or even stop and take that deep, analytical dive into your business idea or company operation. What’s happening in businesses or with entrepreneurs you admire that’s not quite clicked for you? What do you think is at the root of your challenges or issues? Is it time to get a fresh, outside perspective to refresh your view? Are you letting personal attachment to your company get in the way of progress? Share in comments below or via our Contact page how Master of TACT might be able to provide you with resources, tools, or professional assistance in the critical analysis every business needs periodically. Looking forward to hearing from you.
