It is not easy to run a company, especially in a dynamic business world. We see Founders and CEOs strugglingto face challenges during their course of business, it also their responsibility to find a solution ensuring to providea sustainable value in their companies.
Let’s talk about the challenges they face:
1. Making Consistently Good Decisions –
Past management decisions affect the whole performance of a company. Owners should not make decisions either too quickly or too slowly. This leads to making critical failures which is also a result of poor strategic planning.The management therefore cannot afford to lose the sight of their aspirations as they have to act as role models and demonstrate the conduct that will make their company profitable and productive.Decisions are to be made with clear view of their impact on future value.
2. Fighting for Survival –
It is very important for a company to survive in a competitive environment. And for that leaders need to start working in the business, i.e., keep up with the following survival challenges:
a. External challenges- economic changes, change in government policies, competitor’s actions, marketplace dynamics and pricing challenges.
b. Internal challenges- high employee turnover, weak teams, inadequate systems, lack of financial resources and poor decisions.
c. People challenges- hiring, firing, retaining the management team and improving workforce efficiency.
d. System challenges- change in technology and designing a knowledge-based infrastructure.
e. Financial challenges- shrinking margins, deteriorating balance sheets and an inability to generate working capital.
3. Developing a Viable Exit Strategy –
It is often said that it is easier to get into business than to get out of business. No owner would choose to exit a business but he should be prepared with a plan for building sustainable value that can be measured, managed and executed. Few of the important factors he should consider while designing an attractive exit strategy is scalability, brand equity, management terms and recurring revenues.
And if the exit strategy leads to sale of the business, owners must decide the acceptable price and terms.
These challenges are shown as a progression from low value to a high value plan. They are considered ongoing challenges, the owners and CEOs cannot avoid during their whole course of business.