GM recently took out an ad in the Automotive News apologizing to the public and admitting to a series of strategic errors that have led to their current state of affairs. What are some of the lessons small business could learn from GM?
GM slogans rang hollow as they continued to allow their product quality to dip below industry standards. Quality is the common denominator – if you are in business, quality is not an option…you always need to deliver on that inherent promise to your customers.
Maintaining diligent standards is hard work, but you can’t build trust otherwise. Avoid the temptation to cut corners – you may get away with it in the short term, but eventually is will catch up with you, severely damaging your small business brand in the process.
2. Focus on Your Business
GM was a powerhouse in the 70’s and may have lost focus when agreeing to expensive union contracts in an attempt to bury their competitors.
It’s always good to understand your competition, the products they sell, their strengths and weaknesses, etc. But don’t become so focused on your competitors that you lose sight of your own small businesses vision, strategies and objectives.
3. Understand Your Market
GM lost touch with the market and continued to build more and more gas guzzling SUVs while consumers began to embrace fuel efficiency and started looking to more compact vehicles.
As a small business owner, it’s critical to learn about (and stay connected with) your target market:
- Use the internet i.e. blogs; social networks, etc. to stay up to date on trends in your industry
- Get out of the office and connect with customers and prospects in your market
- Invite clients into your feedback loop by forming “user groups”
4. Flexible Culture
A former executive suggested that “handling multiple problems simultaneously was foreign to the culture” at General Motors. One of the many benefits of being a small business is the ability to make decisions and react to situations quickly. As your organization grows, it’s important to retain your flexibility by developing a mechanism to recognize and address challenges.
One effective way to build a flexible, responsive culture is to give your employees a voice i.e. promoting open discussion, the questioning of convention, etc. and the power to make certain types of decisions. A culture that facilitates independent thought and empowerment can help build grassroots problem solving.
Example: By encouraging a customer service representative to recognize and solve problems during micro-interactions, your business simultaneously engages staff; builds brand equity; quells issues at their root; creates brand stories, etc.
Image: Thanks to Cameron Cardow for use of his editorial cartoon