The Right Advice – The Challenge of the Middle Market

When we split the economy into its layers, the bigger end of town are often happy to seek the advice of others, and hopefully for the right reasons. Certainly some of you can point to circumstances where there is an unnecessary preponderance to get advice because the decision maker is seeking to ‘pass the buck’ but that’s a story for another day.

Predominantly these companies are checking their strategy against what they agreed their objectives would be, looking for new channels to market, and investigating new ways to become efficient. They recognise that they don’t have all the answers and thus seek an external view on a regular basis to keep them on track.  In the case of the big end of town, this is generally sought from of top tier firms such as the Big Four and other consultants in this cohort.

So why is big business happy to seek advice while the middle and lower segment businesses generally do not?

There are various reasons but the most significant appears to stem from the basis that small business sees the advice as too expensive, not necessary, or they are unaware of the right place to go to receive such information.  Is it because the senior managers or family members running these businesses may not want to alter a strategy that has worked well (or they perceive works well) for them in the past, or maybe such advice will create so much upheaval that’s not really welcome while they are trying to run a business. Regardless of the reason the fundamentals are they simply don’t get decent advice.

In all cases, businesses need to regularly keep an eye on the shifting sands; both internal and external factors may change the landscape so quickly that it may one day render them uncompetitive or worse, unsustainable.  Adjusting ones course is normal for bigger businesses, but not so much for everyone else. However that is a fallacy, all operate in the same market!  During the current tough economic conditions the SME sector would do well to take note from their bigger brothers and sisters.

A word of caution though; before you head out and start paying for an advisor there are a few tips you can really benefit from.  The reason for this is that names like the Big Four already come with some level of credibility, even if it is only perceived.  In the middle space this is not always so clear, and there is a plethora of folk that call themselves advisors, mentors, coaches and so on that can really add value and an equal or greater number that will destroy you.

So don’t be scared to check the advisor first, ask for credentials and references and be prepared ask yourself and your potential advisor the following questions.

  1. What do you want from the advice?
    • Make sure you can articulate a problem or set of circumstances that will provide a clear brief.  A loose brief will cost money with no outcome.
    • Ensure the advisor explains back to you the goals and that they are not simply telling you want you already know or what you want to hear.
  2. Be open minded to the advice.
    • Often the answer you may receive may not be the one you may have been expecting, so be ready to think outside what normally may have worked for you in the past.
  3. Follow through
    • The real action happens after you receive the advice. Advice without action is an expensive report.
  4. Seek help to implement
    • You cannot afford implantation teams like the big guys, so an impartial and pragmatic implementer will be able to give you the space be able see through what is best for your business. While this may seem an unnecessary extravagance, you will probably waste more time, money and be less effective if you try and squeeze this change program in when you get a spare hour in amongst your day job.
    • Make sure you have set timeframes and costings so you don’t receive unexpected surprises and an unfinished project.

Whichever way you decide to go and no matter how big or small you are, a fresh set of eyes and a genuine impartial point of view will be refreshing and hopefully stimulate your business into the next phase of growth and profitability.

 

 

Richard is a Director at Condon Associates Group leading the Forensic and Business Turnaround Services . For more information call us on1300 939 129.