Dr Don Harradine – Money Talk’s 14:12:20 ~ Dr Don talks about Damage Limitation: This is an immensely important podcast and one which will help anyone who is revising an ailing business. There is a tendency to struggle too long without making or taking difficult choices when one’s business is stagnating. Sometimes the need is to step back and think with great care about the ways hard choices can turn the situation around.
Points to Follow:
Damage limitation goes beyond day to day running of a business. There is an absolute need to reassess the progress of the business and deal with problems early. Micheal Porter’s Five Forces model will help when considering ongoing business issues.
When reviewing an ailing business consider the following:
Which or what of these forces will Change?
Suppliers
Purchases
New Entrants (competition)
Substitutions – How much will it cost to change?
Dr Harradine has formulated a simplified symbol which can be used for considering problems with an ailing business. It is important to remember the facets have no formal order. Consider the phrases and formulate or expand them within a business plan or strategy. Dr Harradine talks about these strategies in his podcast presentation. One can use the questions ‘What Are?’ or ‘What Is?’ or ‘Do I know?’ or ‘Do I?’ as prefixes to the points below:
Other aspects to consider when analysing a stagnate or failing business:
Debtor and Creditor lists
Relevant costs
Stock used as a ‘Break Out’ strategy
Understanding Costs
Indications of problems ahead in time
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A very good piece.