How to Determine Your Weakest Link and Could You Be Fixing the Wrong Problem?
Businesses have six classic resources. Business performance will be determined more than you may appreciate by how managers deploy these resources. How well you understand and deploy these critical resources for your maximum advantage can be a decisive factor in your business success.
If you view these six resources as a ‘chain-of-resources’ then the concept of a chain is as strong as its weakest link comes into play.
In our experience, many managers find it difficult to identify the weakest link in their chain-of-resources and frequently make the classic management mistake of fixing the wrong problem (link).
When you ‘fix’ a link in a chain that is not the weakest link you do not strengthen the overall system. In fact, you may add to the problem. How do you utilise these resources? What is your weakest link?
Let’s look at each link in the chain-of-resources:
1. THE MONEY RESOURCEThe money resource usually gets great attention in most business. In fact, many businesses are obsessed with financial measures of performance. Despite this, the money resource may suffer from poor cost and cash flow controls, wastage, or margin management. ‘All costs walk on two feet’ and some businesses are bleeding cost. How tight are your financial controls?
2. THE PRODUCT RESOURCEThe delivery of outstanding customer care is often the weak link in the marketing process. Managers and business owners often believe their customers want better quality, convenience, range, design, or low prices. How you deliver your product is often many times more important than what the price is. Are you fixing the wrong problem? Outstanding customer care will not just happen, it must be managed. Spending small fortunes on advertising or design and giving lousy face-to-face customer service is bordering on business lunacy.
3. THE PHYSICAL RESOURCEHow many businesses fail to create business advantage by maximising the use of their physical resources space, machinery, equipment? You may have an excellent location but present your business in a shabby way. If my first impression, largely determined by my visual inspection, is that your premises are shabby, then my mental tendency is to make massive conclusions from even small observations that your service offering will be shabby too. Could this be your weak link?
4. THE TIME RESOURCEOne of the most badly utilised resources that all managers have at their disposal is time. Everyone gets the same amount of time 168 hours per week. The dilemma faced by most managers is How do I optimise this critical resource and how do I get more done in less time with less stress?’ For many, time is a more valuable resource than money. Could the management of time be your own personal weak link? A classic time management mistake is doing the wrong thing very well.
5. THE INTANGIBLE RESOURCEToday, your most valuable resource is intangible. It’s your collective learning, trade ‘secrets’, brands, culture, know-how and bank of experience which you may have taken for granted until now. Monetary, financial and physical assets may have been the asset measures of the past, but in the age of information and consumer choice, increasingly it’s the wisdom and brainpower the goodwill that you deploy to create business advantage. Maybe it’s time to stop working so much in your business and work more on your business?
6. THE PEOPLE RESOURCEThe other five resources make things possible. People make things happen. Businesses may have different products and services but, ultimately, every business is in the ‘people business’ where the weak link is usually psychological and cultural rather than technical or physical. A physical choke point can be physically removed or re-engineered whereas emotional, psychological and cultural choke points are far more difficult to identify and eliminate. Time and money are lost at an incredible rate in most businesses. There are people implications at all levels. Could this be the critical weak link in your business? For example, in most small businesses the recruitment, development and retention of a general manager or right hand man/woman can be the key.
THE MANAGEMENT CHALLENGE
Why not use the six resources model to do an analysis of your business?Is there an obvious weak link?A critically important lesson is strengthening a link in your chain of resources that is not your weakest link does not strengthen your overall system.
In fact, fixing the wrong problem by investing money, or hiring people, or acquiring extra space, or increasing the advertising budget, or spending more time may just exacerbate the problem.
Be careful how you deploy these six resources to create business advantage!
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