But lil' homie, in my hood, when it rains it pours...

Your phone is ringing off the hook. People are coming into your office, asking difficult questions to which you have absolutely no answers. The best employees are leaving, and angry customers are wondering what the hell is going on.

Fires are breaking out constantly, and with the last of your strength, you're trying to put them out. You attempt to mitigate internal conflicts by applying quick band-aids, but these quickly peel off.

The ship is clearly sinking, even though you can still hear the music playing.

The thing is, you don’t know which way is up. There’s no crystal ball that will magically tell you which path you should follow.

I won't pretend I know either.

Clearly, I'm not familiar with your situation and the specific challenges you have to face. I am also far from being a sales guru who, with full confidence, will talk about how he can solve every existing problem.

But the following perspectives might help to some extent. Even if not in solving the problem, then at least in providing you with additional lenses through which to look.

WHEN BUSINESS GETS TOUGH

If you look at what companies say or think of when they talk about their problems, it’s usually mostly related to money.

So, putting it simply - a company usually has problems if its balance is negative - meaning they spend more cash than they earn.

That usually means a given company does not create enough value, given the resources it has.

Looking at the big picture, every company can be treated like a sort of machine that takes certain resources and, using internal procedures, creates value.

That value is later placed on a given marketplace which says: 'I’m willing to pay a certain number of bucks for it.' If that number is lower than what it cost to create it, we have a problem.

What is causing such a problem?

That's always a difficult question, to which the answer is rarely binary, as it involves many different factors.

But from my experience, it usually boils down to a problem with your value on the marketplace side (let's call it a strategy problem) or culture problems (how you interact or behave internally).

Let’s tackle the first one.

STRATEGY PROBLEMS

The value created by a company is placed on a marketplace. Once there, it’s compared and priced according to other available options:

If the value you create is “not good enough” - it may happen for two reasons:

Market is shrinking

Everything is changing. Life abhors a vacuum. Once dinosaurs walked the earth, and today we can only learn about their lives from museums. There was a time when we had to walk everywhere, but today we have many modes of transportation to choose from, starting from bicycles, through trains, and ending with airplanes.

The same applies to markets. Once, analog photography drove many companies; today, it is only a market for enthusiasts who treat it as their hobby.

Therefore, looking at the situation of our company, the first question we should ask is:

What does the overall market perspective look like in the field we operate in?

Is it an emerging, mature, or perhaps a declining market?

Does my financial situation stem from the fact that we have less and less money in the market (clients are leaving the market)?

Do we now have to divide a smaller amount of money among ourselves?

If the market is shrinking, the basic question you need to ask yourself is whether what is 'left on the table' is still of interest to you?

Perhaps it is worth staying in it for a certain period of time to monetize the competencies you possess, and then withdraw completely?

Your value is not competitive enough

Another reason could be that the market is mature or growing, but the value you provide is not competitive enough in relation to other available options.

As a result, you are left with an increasingly smaller piece of the pie, while your competition takes your previous share.

If that's the case, you need to understand why your customers are moving to your competition.

Is it the price? Better product quality? Better service?

Is it additional value that you’re not able to provide? New regulations that are being introduced?

Unless you get to the core of the problem, you won't be able to work on what's really important.

Distribution challenge

Now, it may happen that your market is growing (or mature at least), but you struggle to put your value in front of your customers.