Welcome to ASK ROCK, a monthly advice column where industry expert Rock LaManna will answer your questions on topics such as: key financials for every business, and how it can lead to profitable organic growth, M&As, strategic alliances, succession plans, and exit strategies. He will also talk about leadership and present family business case studies.
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Dear Rock,
Should I focus on growth or internal operations?
It’s the eternal question that confronts printers. The answer depends largely on what stage your company is at in its lifespan.
Emerging companies should focus entirely on marketing and business development. You’re building the framework for your business and trying to add new customers. Without a steady stream of business, there simply are no processes to tweak, right?
That’s not say you can’t take a “Quality Built-in” approach, in which you design your processes and systems to be as lean and quality-laden as possible. However, the more systematic breakdown of lean processes should wait until you’re more established.
When exactly does that occur? I like to think of it as an organization’s tipping point. Here’s the scenario: Your business has grown to the point where you’re either going to grow exponentially, or you’re going to lose complete control of processes and your quality will suffer.
If you don’t have established organizational metrics in place, this may be somewhat difficult to see. But here are just a few of the telltale signs:
- One production shift may be outperforming another
- Your people are overselling your capacity to produce
- You’re driving higher revenues, but your net profit remains the same
In these cases, you need to turn the focus internally, and begin to implement lean operating principles to your organization. If this requires redirecting resources from growth to internal mechanisms, I’d recommend it. In the long run, the shift will definitely pay off.
Rock LaManna is the President and CEO of the LaManna Alliance, a business advisory and consulting firm that helps printing owners and CEOs use their company financials to create successful strategies. He blogs regularly on lean operations for printing companies.
