The availability of Management advice
We have all seen there is an enormous amount of management theory out there.
By definition there are therefore an even larger number of business management consultants, each using one or more of these theories to advise their clients on everything from business strategy to company turnaround. I know because I am one of them.
Right advice in the Right situation
The point I want to make in this article is that we business advisors can’t just overlay our favourite management models and theories into every situation we come across.
My belief is that all management theory is contingent upon the situation that it is being applied to, and that every situation is different. If we accept the premise that you can’t fit a square peg into a round hole, it must follow that it is the same when we come to business management, and that whilst the same as the peg, it might fit with a bit of a push, it is likely to do a lot of damage on the way in!
Businesses develop in different ways
All businesses are made up of a unique set of actions that when pulled together work to make an offering (hopefully attractive and hopefully profitable) to potential customers.
During its life a lot will happen to this business:
- It will probably need to raise some form of business finance
- It will take on some premises
- It will recruit new staff
- It will lose staff
- It will gain customers
- It will lose customers
There will be some good times:
- Winning new contracts
- Sells more product or service
- Having a record month
- Recruiting some good people
- Buying a competitor
There will be some bad times:
- Losing out on a big contract
- Poor sales performance
- Drop in profitability
- Incurring bad debts
- Losing good staff
Multiple directions lead to unique business situations
So as you will see, not only are the way the business operates highly individual, the path the business takes in its life can, and will go in many different directions, and the requirements of each business are therefore entirely dependent upon where they are at any point in time. When advising businesses you can’t work with one checklist and hope it works for everyone.
How do you choose the Right advice for your business?
Any consultant or advisor that is really going to make a difference to your business of course has to possess a deep understanding of all these management theories, but alongside that it is essential that they have the practical experience of running their own business and hopefully having experienced all those good bits, but most importantly have gone through the bad bits as well. It is only then that they can see the bigger picture, take all of the individual issues into consideration, and advise accordingly.
After all we don’t want the person who is cutting our hair to have read about it in a book, I know I don’t because I absolutely can’t afford any mistakes in that particular area!
I say More Practical than Theory……
My belief is that great solutions for business management issues are derived 80% from experience, and having an inbuilt ability to quickly gain a deep understanding for the issues at hand, and 20% about using an appropriate business model. Whilst experience is the dominant factor here, one does not work without the other. You have to understand the theory as well, not only in relation to the business being advised, but also in relation to the wider (external) environment within which it is operating
It is that tacit knowledge of business and the interactions of staff, customers, funders and the business offering itself, that then enable one or more options to be developed, that then lead to the implementation of a successful solution.
If you have any comments on this article or would like to discuss any aspect of it please contact me at john.thompson@transcapital.co.uk or on 0845 689 8750.
John Thompson is Managing Director and founder of Trans Capital Associates
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