Strategy considerations for business owners - Seek external input
Advisors can be extremely helpful to your organisation as it moves along the path by helping you plan, manage, and implement your initiatives. They can:
- Help you ask the right questions.
- Provide you with the wisdom that comes from their past experiences and help you avoid some mistakes.
- Offer valuable external perspectives. An outside party often supplies a perspective on the industry, or even on an organisation's dynamics that can be difficult to see or understand from the inside.
- Help negotiate differences of opinion between shareholders and/or executives.
- Help bring out the voices of people with less authority within the organisation. These individuals may have valuable opinions that are not easily heard by the senior management or shareholders.
There are key moments when an external advisor is likely to add the most value to a business.
Developing your strategy
Unless you’re running a lifestyle business, at some point you’ll need to develop a structured and coherent strategy for growing and developing your business.
You’re likely to know the industry very well, but having an external advisor with broader experience in expansion, international operations, different sectors, different services, and larger businesses can help you plan more effectively, avoid common pitfalls and set aggressive but realistic targets.
Your business is a series of processes, most of which have probably developed organically as the business has grown. They could probably all be more efficient – marketing and sales process management, recruitment delivery, and back office are typical areas where you could save money or increase revenues (or both).
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In smaller businesses where there may not be very experienced people running these areas, or where a couple of people are running all of them, it can be beneficial to have an external advisor identify areas where the business could be more efficient. Hiring department heads may be well outside of budget, but having an advisor review your business and deliver recommendations could pay for itself in no time at all.
Expanding into new markets
As your business grows, you’ll almost certainly want to provide a broader range of products or services, or expand your existing proposition into new markets. These are both times when it can be costly to make poor decisions; there are risks from the cost of entering new markets, and from taking focus away from the areas that currently sustain the business.
External advisors can help you identify the most attractive markets to go into, if changes would be required to your existing product or service, and identify the key players and competitors that you’ll be going up against. Best of all, they can do this without any preconceived ideas that might exist within the business, and provide you with an objective assessment of the opportunities.
If you are buying, selling, merging or even bringing new shareholders in then you need to receive unemotional, professional advice about that activity. There is so much more to this than planning the outcome. From a financial perspective there are current and future tax obligations to consider. From a legal perspective there are a range of decisions about current and future obligations and risks. And of course there is much to consider about the value, structure and future issues of an equity transaction. Few companies have this expertise in-house.
There are many times when an external perspective, a specific type of expertise or a wealth of industry experience can help you to develop your business. Today the services of external advisors are not just for large corporate organisations but are available on-demand in affordable portions.
HHMC Global provides advisory services to the recruitment and staffing industry and is best known for its work on M&A transactions. HHMC is based in Australia and works with clients globally. To discuss your business future contact Rod Hore or Richard Hayward.