First Person: Think Like a Consultant, Make a Profit

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John Aberle created this work flow block diagram from consulting experience with small business owners and managers. This flow is the structure for recommendations, whether to make a profit or to get some other improvement for your small business.
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John Aberle created this work flow block diagram from consulting experience with small business owners …

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Ideas are incredibly cheap. If you don't think so, try learning contemplation or meditation. It is a major challenge to still the mind, even for a minute. The flow of ideas and observations is never ending.

The problem comes with evaluating ideas to see if they are valuable. When you are in a situation with a problem that is hurting profits, it's time to seriously take action. I find that using a consulting structured approach is a powerful tool to evaluate the best changes to take so as to make a profit in your small business.

When I was on the road consulting for small businesses in the United States and western Canada, my employer had a set formula for writing recommendations. I called it the scientific approach because it reminded me of the analysis we did in science classes. I loved it because it made so much sense to me the way it flowed. Done right, the need for change and the benefits should be obvious.

Consulting Structured Approach is the scientific approach

Observations - What you found during your discovery process?

Conclusions - Analyze your observations. What effect they have on your company?

Solution - What approach, procedure, or product will fix the problems you observed? Are they all part of one big issue or are they multiple different challenges?

Cost - What are the costs to implement your solution?

Benefits - From the viewpoint of your company, ask "What's in it for me?" (WIIFM) Benefits can be cost savings, reduced expenses, increases in profits, smoother operations, better morale, improved quality or anything else that has to a significant, positive impact on your company

Caution - Your Recommendation Must Be Used to Have Value

Having the greatest recommendations in the world is meaningless if you refuse to implement them. One of my frustrations as a consultant was going into a small business client and seeing a binder sitting on a shelf from a consulting project two years ago. Many times, we made similar recommendations to what was wrong before. Nothing changed.

Tips to Make the Changes to Make a Profit

Whether you bring in an outside consultant, which I normally recommend, or act as your own internal consultant for your small business, you need to think like one to make this work. The following are some tips to make it easier:

- Get your client involved

- Listen, ask questions, dig deeper, get the views of others in the company besides the owner

- Employees often have the answers

- Monetize the costs - use burdened labor to get your true cost of labor when calculating the impact of what you discovered

You absolutely must have buy-in from the owner(s) or someone high enough up and respected well enough in the company to ensure the changes get made. Typically If your client, being one of those people I just mentioned, is not involved in the process, he or she will lack the emotional commitment to stick with the recommendations long enough for them to have an impact.

Don't forget too, you need buy-in from the employees. That's why I love using brainstorming sessions with a cross section of employees. People are more inclined to commit to a change if they were part of the whole process.

Implementing Changes in a Company Takes Longer than Changing a Personal Habit

There's a rule of thumb that it takes 21 days to develop a new habit, such as when you want to replace a bad habit with something better. I was delighted when I read The Power of Focus by Jack L. Canfield, Mark Victor Hansen, and Les Hewitt because they commented that it can take a lot longer to change a habit if the old one is well engrained. It can take even longer when you are trying to change the way a company has been doing things because of the number of people involved.

When something is hurting your small business' profits, it's time to take action. I find it helpful to use a consulting structured approach to decide what you need to do to make a profit. It's a disciplined process that leads you through recording observations of possible sources of your challenge, analyzing and evaluating what you discovered, and then reaching a conclusion. From there, you decide on a solution, figure out its costs, then determine the benefits. Be sure they are worth the costs of the change.

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