Our experiences mold our views and decisions in the future. For example, if the first time you ate raw sushi it wasn’t prepared correctly or the fish was bad, then you could very well develop an opinion that you don’t like sushi. On the same track, if you have tried something for your business and it didn’t work, do you just give up because it’ll never work, or do you change your strategy a little and try again? I would venture to say that the majority of small business owners do the former, but they should be doing the latter. Just like the sushi – I don’t always get the best sushi when I try a new place, but then I move on to the next restaurant and try their sushi until I find a place where I like how it tastes.
Maintaining an open mind, especially when doing things for your business, is critical to learning from your mistakes to help grow your company.
Have you looked back to last year yet to see what worked and what didn’t? If you haven’t yet, I highly recommend doing this now. If you launched a new product line, entered a new marketing space, targeted a new demographic, changed your business structure, changed vendors, or even changed your business hours – look at it and determine if your business increased, decreased, or stayed the same around that change.
If you didn’t see any change in the business, then that specific change may not have impacted your bottom line. If it didn’t it may not have been a large enough change to make a difference. Maybe it wasn’t a change that was meant to change the business. If it wasn’t, then no change is a good thing.
If the profits dropped at all directly after the change, then the change may not have been good for the business. Another explanation is that more funds went out than came in due to the change, which happens a lot, especially when a new product is introduced. Account for ramp up time if this is the case and then reevaluate the change in profits. If no ramp up time is required and you determine that the profits dropped, look at how you can learn from that change and do it better this year.
If the profits increased, then you certainly did something right! Look at what that change was, when you made that change, what else was going on in your business and the industry. Plan for similar changes this year to continue growing your business and increasing the profits.
Remember to keep an open mind with the things that didn’t work the way you had hoped the first time. Maybe the timing wasn’t right, maybe the industry wasn’t stable enough at the time, maybe it wasn’t peak buying time for your specific product…there are tons of maybes for every situation. Look at the big picture, what exactly was happening in the industry, with your customers, and with your businesses. You have surely made other changes to your business since then. Look at it from a different approach and try again, possibly changing a few details (small or large) of your plan.
Of the businesses I have worked with that do look back at what they did yesterday to help guide their decisions for tomorrow, most do this at least once a year. Looking back more frequently may not give you the big picture you need to make informed decisions about why something did or did not work.