Out-Thinking Your Grinch

Factoid #1: According to the U.S. Census Bureau, as of 2006, there were about 13.6 million companies nationwide, employing almost 120 million Americans.

Factoid #2: More than five million of those companies have fewer than 20 workers each and -- all told -- these five million firms employ 21 million people.

If you work for one of those 5 million small companies, the bad news is it's been a difficult 18 months, and not everyone has made it. The good news is if you have made it, you're probably stronger, leaner and smarter than you were. The better news is the downhill slide seems to have slowed and it feels like we're at the cusp of a recovery period.

In fact, the current vibe reminds me of the scene in "How the Grinch Stole Christmas" when the Grinch and his dog Max are trying to keep a ridiculously over-packed sleigh from plunging into the valley below and destroying all the Whos' Christmas paraphernalia.

Do you remember what kept the sleigh from going over…? What gave the Grinch the strength not only to save the Christmas trappings, but also to return everything to his Who neighbors?

It was the fact that the Grinch's heart grew three sizes that day. When he heard the Whos singing and saw that "he hadn't stopped Christmas from coming," the Grinch realized that Christmas was more than material things.

In the same way, we couldn't stop the recession from coming (it came, just the same…), so the question now is, what can we do to grow our own hearts three sizes to give us super-strength and keep our own sleighs from plunging into the abyss?

We've identified three basic steps, which we'll explore in the next three installments of this column:

  1. Identify both the strengths and opportunities you have to grow your business.
  2. Create a game plan that builds on those strengths and takes advantage of those opportunities.
  3. Execute and evolve that plan, and continue to build momentum.

Step 1. Identify both the strengths and opportunities you have to grow your business.
You may not realize it, but as a small business you have several strengths that can work for you. For instance…

  • Nimbleness: With your small size and flat hierarchy, your business can respond at light speed to meet changing market demands and conditions. Need an example? Look at social media. A small PR entrepreneur with a laptop and a great idea can launch a social media campaign in the morning, collect daily (or even hourly) stats to see if it's working, then adapt it if needed.
  • Minimal Fluff: Your leaner management structure and reduced middle management give you the ability to price more aggressively. Need an example? Pick any Wall Street firm.
  • Keen Motivation: In this economy, you have a strong incentive (read, "people you sit next to") to build and maintain a stable client base with good cash flow and on-time payments, so you take extra pains to pay attention to them and are careful not to take them for granted.
  • On the other hand, there are a few unique challenges that are inherent to small businesses. These objections are not insurmountable, but it's helpful to anticipate them so you can address them easily when they appear. For instance…
  • Insufficient Staffing: Some prospects assume that a "small staff" means "limited ability." That is patently false. A small staff simply means that you have enough people to do the work you bring in…no more, no less. In fact, when you have more work, you can quickly hire extra staff without having to get approval from a top-heavy management structure. And you can do so without losing sight of the client relationship.
  • Limited Resources: Some small businesses aren't in a position to offer a wide variety of services in-house, so they make a point of seeking out and creating partnerships with other small businesses to fill their gaps, meaning that a prospect who hires your firm can get access to a consortium of specialists. And when you are ready to grow your small business, you can do so organically by hiring exactly the people you need to suit your clients.
  • Staying Power: Though it's not mentioned in polite society, prospects can sometimes be hesitant about working with small firms because they've not been proven. And in this economy, who can blame them? No one wants to create a relationship with a vendor, grow to trust and rely on them, then get the phone call/letter/email/visit announcing that the circus is leaving town.

Addressing this objection is probably the most difficult. It requires time and persistence to convince a prospect to take a chance. One idea that can work well is to start working with a local nonprofit to build your reputation. Be sure that whatever services you donate can be easily promoted, and attend events so prospects know that your volunteer work comes from a personal commitment.

What other strengths and opportunities do you find in your travels? I'd love to hear about them…email me at adamatgladworks.com.

Next month, we'll look at how to create a game plan that makes the most of your strengths and opportunities.