In a business environment “Survival for the Fittest” can be considered a natural cause for the failure of any business. In order to survive in the organizational ecology, the company needs to be fit for the current environment and it must be able to innovate according, to the modifications of the environment, otherwise, it would be weeded out naturally.
Every business faces the declining phase now or then. It’s nothing surprising but the survivors are those who figure out the causes and fight back to retrieve their position. There could be various factors that lead a business towards failure such as poor management, aggressive competitors, and lack of finances, lack of passion, ineffective planning, and market saturation and so on.
Half of the new businesses in the U.S fail within the first five years, according to the Gallup survey. But, experts say that no business dies overnight; there are always signs of the failing of the business. Therefore, fresh strategic planning is needed to reignite the dying business. These strategies include the findings of the root causes of the decline and planning to overcome the falling indexes of business.
8 Powerful Strategies to Revive a Dying Business
The strategic measure to revive a dying business may include:
1. Identification of the Root Cause
Determination of the factors and elements which are responsible for the failure of achieving desired business success is the first and most important step to be taken for the survival of a dying business.
According to statistics, 89% of business failures are due to management mistakes, one cannot overlook the researches and surveys to get acquainted with the reasons that may cause a downfall to the business if nothing is in evidence.
Experts further emphasize that the signs are sometimes ignored by the entrepreneur since they consider a decrease in sales and a temporary market fluctuation. Structuring a sound strategic plan is indispensable to identify which sector of the organization is causing the damage, and needs amendments. Once the root cause is identified, half of the problem is solved.
2. Analyze Your Planning Critically
After spotting the area where the problem lays, it’s time to focus immediately. Recall your plans about that specific area of activity, analyze your strategies and evaluate plans that did not turn out in the company’s favor and which functions were not executed properly.
Re-evaluate and re-define the methods that are not on par with the standards. In an entrepreneur’s journey, business’s turning up and down is nothing uncommon. Plans are made according to the capabilities and strengths of the business as well as based on management’s perceptions, but no one can assure that the results would be as per calculations.
As soon as the signs show up, the business must re-decor the planning structure to survive and revive. After taking certain salvage actions immediately, plan upfront and also consider other areas to collaborate with the affected part.
3. Cash Management Policies
The most crucial aspect of any business is to manage its cash flow. Cash flow is like running blood in a business’s body. Cash funding not only secures your business but is also helpful in the growth and expansion process. While making strategies to revive a dying business due to the shortage of finances first take a tour of your revenue and expenditure comparison. Cash is mainly needed in the business for raw materials, supplies, product development, salaries, utilities, and other facilities. Inadequate cash is a huge hurdle in the production process, execution of business plans, and the business growth suffers.
Many options can be obtained to dive out the recession phase caused by a shortage of financial resources
- First, you need to re-evaluate your financial breakdown.
- Apply cost-cutting where possible, such as lucrative facilities and incentives, as an internal tool.
- External sources can also provide levelheaded support in the form of bank loans, crowdfunding, strategic partnerships, etc.
4. Innovate and Evolve
Facing less revenue generation caused by dwindled sales? Time to re-consider product plans ad strategize it again. Sales show a shrinking trend, sometimes, not because your products are sub-standards but owing to the fact of changes in customer’s tastes and requirements. The companies that restrict themselves to the traditional methods of production and old designs may suffer the regression.
The world is changing quickly and so are customers’ demands as there are scores of choices available. One has to be responsive to the stipulations rather than sticking to their desires to produce. That is where the intervention of innovation cures a dying business to revive.
Innovation can be in the form of
- Improved product
- Chasing a new market or developing new supply store
Innovation is crucial for any business to revive and survive.
5. Replace the Top Management
The yearning to save a dying business demands the authorities to make drastic changes in the managerial hierarchy. Changing top management brings new life to the business. This action may not be the remonstration because of the “bad” managers, but because sometimes managers are not in the state of the mind to adapt changes to their traditional methodologies.
Experts asserted that most of the successful turnarounds involve changing one or two top managers.
6. Performance Monitoring
Once you have successfully contrived to revive the dying business. There is a pivotal need for critical monitoring of the performance.
“Performance monitoring is the set of processes and tools to be able to determine how well the workforce is performing and how well the plans are executed”.
It is very important for organizational growth especially in case of a turnaround phase of a dying business. This monitoring process basically involves
- Reviewing the services regularly
- Being reactive to the competitors
- Defining your value proposition
- Gathering all the relevant data
This evaluation process should be repeated constantly to ensure that the business is moving towards its goals.
7. Promotional Strategies
Each business is started with the desire to earn and grow. You produce commodities to satisfy customer’s needs. But after production another momentous phase is the marketing and promotion. Today is the era of digital technology. You need to reach to the fingertips of the buyer.
In the dying phase to revive and survive, a business needs to strategize its promotional planning way far appealing than the normal. Combative marketing plans of the product, and lucrative promotions for the dying business to breathe again.
“Focus on the right message for the right people at the right time” – Russell Glass
8. Smart Back-Up Plan
Unless you have a contingency plan, you are not in a position to manage the unmanageable. Strategize a sensible rather practical ploy to face any unpredicted, adverse situation without fear.
In the current situation when the business is struggling to resuscitate, it is quite visible that the business lack adequate back-up plan.
How can you not consider the importance of the strategies to build a strong back-up for the future? It not only minimizes the impact of damage in any uncontrollable situation but is essential to revive a dying business.
Here’s a quick recap of 8 Powerful Strategies to Revive a Dying Business:
- Identification of the Root Cause
- Analyze Your Planning Critically
- Cash Management Policies
- Innovate and Evolve
- Replace the Top Management
- Performance Monitoring
- Promotional Strategies
- Smart Back-Up Plan