It astounds me to see people stuck in old, bad habits. We all know a few: Cindy who smokes three packs a day even though she knows it’s not a healthy choice, or Jack who can’t give up his fast food for even a day. But have you ever run into a business or a business owner who absolutely refuses to budge from their hard and fast-set ways?
Do you see opening your wallet as an investment in yourself – or money forever lost?
Are you one of them?
Here’s a good way to test if you’re a Cindy or Jack in the business side of your life. Ask yourself this: how do you feel about changing systems or programs? When was the last time you upgraded some piece of key software – switched the old out for something better? When looking for a solution to a business problem, what do you fixate on: the line items, the solution quality, the prospects for the future, or money?
I’ve found that, over my course of years interacting with customers and prospects (and even being a prospect a few times in my life), it’s easy to separate out businesses into two very basic categories based on that last point alone – money. If I’m holding the key solution to the problem your business is grappling with and the discussion keeps coming back to how much the solution is going to cost, you’re stuck in your old ways. Chances are that 9/10 times, the price tag is going to be the excuse you’ll use to talk yourself out of what is usually an awesome solution.
Sure, they’re still smart about how they spend their hard-earned capital, but they see this expenditure as an investment.
And then you have the polar opposite: the well-informed business who knows that spending money strategically in the right ways for the right solutions can lead to strategic advantages for the business down the line. Something along the lines of “invest in yourself” is the main motivation behind this latter group. Sure, they’re still smart about how they spend their hard-earned capital, but they see this expenditure as an investment. The former group, in contrast, sees any expenditure on solutions as money burnt, never to be seen again.
Let’s illustrate this dichotomy with an example.
Bob owns Company A. Bob has problem A. A solution is presented to Bob that will cost him $50,000 over the course of a year that will effectively eliminate problem A. Bob chokes on the price tag and instead goes back to doing things the way he’s always done them.
Bob is effectively deciding to live with problem A and all it’s effects.
Now, here’s Jane. Jane owns Company B, with problem B. Jane is presented a $50,000 solution to be implemented over the course of a year that will eliminate problem B. Jane sees that problem B is costing her $100,000 over the course of a year through errors and corrections. Jane also sees that to solve problem B internally would cost her $150,000 in staffing. Jane wisely invests in her business’ future by going with the $50,000 solution.
What does this mean for my business?
Who do you think will be thriving in 10 years – Bob or Jane? Who do you think will be able to grow their business more effectively – Bob or Jane? Who’s making the better business decision now for a more prosperous future later?
I think we all know it’s Jane. Good on you, Jane.
This scenario is something I see playing out in countless retail situations across North America. Look at any struggling retailer, and dig into why they’re struggling. They’re struggling because they chosen to ignore a key business problem like Bob, deciding instead to try to mitigate the problem internally without investing in a solution. Sometimes, that’s not being online in the right way, sometimes that’s customer experience, sometimes that’s data management, sometimes that’s something else.
I encourage businesses who are running up against deep seated problems in their businesses to step back and look at the bigger picture. In other words, what this problem could mean for your business over the next five, 10, or 20 years. Is it really worth it to bolt your wallet shut?