Peter, the owner and President of a local moving company, had an issue. New sales were steady and customer retention was good but the company’s bottom line was slowly declining. Month after month. Everyone in the company appeared to be working hard. The team was focused on looking after their customers. So why were profits in decline?
In meeting Fred, it was apparent that he cared about the company. His stated focus was on looking after his customers and making sure everyone was happy. While these were noble goals, they were only part of his overall responsibility. The reality was that operations were loose. Specifically, labour force costs were not being well managed. The real issue? Fred was unaware of the impact that he could have on the company’s financial performance.
This wasn’t Fred’s fault though – he was focusing on what he knew and what was important to him. He had never been trained on why it was necessary to keep tight controls on his labour costs and more importantly, how to do so.
This scenario is not unique and happens every day. Regretfully, it can kill a company quickly if it’s not identified and fixed. Fortunately, the missing skills in this case are all teachable skills. Proper coaching together with regular, structured follow up was ultimately the successful solution for Fred and Peter.