Here's our guide to reinventing your business, one smart step at a time.
1. Know When to Make a Change
The first step is deciding if it's the right time for a change. Karyn Greenstreet, a Philadelphia-area small-business coach specializing in self-employment and business reinvention, says she sees a pattern with small-business owners. "Most people who come to me have been running their businesses for about seven years," she says. "They spend the first three years absorbed in getting things started. Then they're in a growth phase for three or four years. Then they hit a glass ceiling, or don't find the work challenging anymore and want to try something different."
The first step is deciding if it's the right time for a change. Karyn Greenstreet, a Philadelphia-area small-business coach specializing in self-employment and business reinvention, says she sees a pattern with small-business owners. "Most people who come to me have been running their businesses for about seven years," she says. "They spend the first three years absorbed in getting things started. Then they're in a growth phase for three or four years. Then they hit a glass ceiling, or don't find the work challenging anymore and want to try something different."
Many factors can push a small-business owner toward reinvention--it
may be a need to spend more time with family. The market may have
changed. The economy may have reshuffled your customer base. You may be
bored. All are legitimate reasons for change.
But you need to be practical, too. Any change involves risk. If
you're paying for kids in college and have a steady cashflow, you may
have to suck it up a few more years.
2. Decide What You Want
After the decision is made to change, you need to decide what type of change is necessary to meet your goals. "Once you decide there's something you can do better, you need to decide whether to make a little tweak or a major overhaul," Strauss says. "You have to decide what's best for your brand.
After the decision is made to change, you need to decide what type of change is necessary to meet your goals. "Once you decide there's something you can do better, you need to decide whether to make a little tweak or a major overhaul," Strauss says. "You have to decide what's best for your brand.
It's a matter of looking at your core competencies and sticking with what you're best at."
Greenstreet agrees. "Entrepreneurs have more ideas than they have
time for. The absolute first stage is deciding to cut off all those
other ideas and focus on one. Making a decision to make a decision is
the hardest thing for entrepreneurs to do."
The easiest way to figure out what to change--and at what
magnitude--is to work backward. Are you chiefly interested in reducing
the hours you spend in the office? Are you sick of selling office
supplies and think running a dog bakery is your destiny? "Once you have
clarity on your goals and values," Greenstreet says, "you have a compass
to guide you and help you decide which ideas are good and which are
brilliant."
3. Follow the Plan
The next step is something every business owner should be experienced at--making and following a business plan. "You need to act as if you're starting from scratch," Strauss says. "You need to think it through thoroughly, figure out who the competition is, how you are going to beat them and what the costs are."
The next step is something every business owner should be experienced at--making and following a business plan. "You need to act as if you're starting from scratch," Strauss says. "You need to think it through thoroughly, figure out who the competition is, how you are going to beat them and what the costs are."
Strauss and Greenstreet suggest sharing your plans with other
business owners or a mastermind group. "Entrepreneurs tend to rely on
intuition a lot, but you need to make sure other people think your plan
is a good idea," Strauss says.
4. Make the Switch
During the transition, you'll likely be running two businesses at once as you phase out the old business model and ramp up the new one. "Sometimes reinvention means running two businesses simultaneously for almost a year," Greenstreet warns. "It's overwhelming, and business owners are often so excited about the new model, they want to let go of the old model. It's like going through a long divorce before committing to a new relationship. It's not fun."
During the transition, you'll likely be running two businesses at once as you phase out the old business model and ramp up the new one. "Sometimes reinvention means running two businesses simultaneously for almost a year," Greenstreet warns. "It's overwhelming, and business owners are often so excited about the new model, they want to let go of the old model. It's like going through a long divorce before committing to a new relationship. It's not fun."
The solution is to create a detailed exit strategy. Allow time to
negotiate new leases, bring on new employees or train current employees.
Be transparent through the whole process with vendors, customers,
employees and, most important, your family. Give everyone notice that
changes are coming, when they will happen and what it means for them.
Pamela Wilson, a marketing consultant in Lehigh Valley, Pa., is in
the midst of the process. After running a marketing and design firm for
20 years, she decided to scale back her one-on-one clients and reach a
broader audience. In 2010 she created a do-it-yourself marketing course
for small businesses called Big Brand System. "It's been difficult
juggling two businesses," she says. "But I'm at 50/50 right now. By the
end of next year I plan for the new business to generate 75 percent of
my income."
5. Mentor and Manage
Even those committed to sticking to their business plans can start to deviate. Greenstreet suggests bringing in outside help. "Business owners sometimes need people to bounce things off of to keep them from going off in crazy directions," she says. "Some people go through a grieving process. They're letting go of a piece of something they've built and need to process that. There's a lot of stuff to deal with, but if you don't, it will come back and bite you hard."
Even those committed to sticking to their business plans can start to deviate. Greenstreet suggests bringing in outside help. "Business owners sometimes need people to bounce things off of to keep them from going off in crazy directions," she says. "Some people go through a grieving process. They're letting go of a piece of something they've built and need to process that. There's a lot of stuff to deal with, but if you don't, it will come back and bite you hard."
Although the process can be rough, reinventing your business can be a
rush. "It's an exciting place to be," Greenstreet says. "A business
owner gets to reinvent themselves with capital and 10 or 20 years of
experience--without making mistakes. They have an ace in the hole.