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In building a solid business I have always found it pertinent to analyze the businesses within the community that haven’t made it. Hearing from business owners who have previously failed, there is a large portion of the blame given to the failure to identify key early indicators that might tell them their business has fundamental issues.
From years of podcasts, business mentoring sessions and leadership forums, I have compiled six red flags that suggest your business is not operating the way it should be.
1. You are spending your time focusing on tasks that are not growing your business.
Spend time each month analyzing your daily/weekly routine. Almost every business owner comes to a junction where they have strayed from focussing on activities and functions that grow their business over operating within the business. Farm out the tasks that keep you in business by outsourcing them, and developing technology or systems to take over those functions.
2. The systems and processes you have put in place for your team are no longer efficient.
As your business grows, so do the needs of the business. A sure-fire red flag within your business operations is when menial tasks are frustrating the daily operation of your business. This could include delays in getting properties to market or a lower-than-expected success rate with buyers. It may even be a breakdown in client communication.
Quite often this will indicate a system or process that was formerly working is now not coping under the strain of growth.
3. Team culture and morale are in free fall.
There is no greater indicator of an off-track business than a failing team culture and morale among your staff. There are many ways in which this is shown including:
- staff not showing up for meetings
- petty conflicts
- a disconnect among staff members
- office gossip and negativity within the workspace.
Good staff are worth their weight in gold; take measures to protect the integrity of their focus and direction within the business.
4. You’re experiencing a stagnant or negative bottom line.
With the subtlety of a sledgehammer, nothing tells you your business is off track better than a stagnant or downward spiral in revenue. Right now we are watching large companies react immediately to this type of signaling with layoffs.
While the solution in smaller or medium-sized teams is not necessarily layoffs, an immediate business intervention and assessment of direction should be the appropriate response to avoid more difficult consequences.
5. The business’ reputation is taking a hit.
One should never base business decisions solely on negative reviews that might hit social media or search engines. Having said that, reviews can be excellent red flags for failing areas of your business that you are not seeing yet.
Reviews will generally be aimed directly at the area that is failing and should be investigated. Especially in an instance where there are multiple negative reviews directed at the same target in quick succession.
6. Your job satisfaction is waning.
Nobody likes to admit it, but, as business owners we will go through peaks and troughs. I have found that every single time this is happening to me, it is a red flag telling me that I need to change something about my behavior to safeguard my business, mental health, and well-being.
Your business does not need a distracted or broken version of yourself at the helm. Take some time, a break, change your routine, and find the salve needed to get you back on track. And most importantly, recognize the triggers or causes that got you to this place to prevent it from happening again.
Businesses can be complex mechanisms. Make sure you are measuring yours against the standards that will keep the business operational with forward momentum in the new year.
James Becker has been in real estate, mortgage and business development for over 25 years. Currently, he is the founder and CEO of Fusion Growth Partners. Connect with him on Facebook or Linkedin.
