The other day I updated my facebook/twitter, rejoycing about how well we’re doing:

ExchangeDefender – seven months ahead of goals for 2009 & competitors employees sending over resumes.

Jose, a Microsoft PAL from Slovenia asked if this was a sign of success. My response:

Kind of sort of – it puts us in a position where we have to expand much faster than we had planned to and since virtually all issues over the years can be chalked up to growth…. It rocks for the company, it sucks for me.

Jose responded again:

Exactly! That…  Read More’s why I made the comment. If this crisis is teaching something to me and my company is that “growth” doesn’t have to go forever and ever… but increasing profitability should be the goal.
In my case growth is synonym of more employees, therefore high expenses. At the end, before the new employees get in sync with the new job profitability drops; revenue expands together with the level of stress.
We have decided then to limit growth, improve customer satisfaction and increase profitability. At the end we work for better life and more professional development.

Now… this is so totally, humangously, inescapably wrong… That I couldn’t be even more sure of it unless I actually made the same mistake.

Except I did. And it hurt cleaning it up, took me nearly the past two years of cleanup which will finally be done this weekend.

What I have learned from my mistake is that there is no such thing as stepping on a brake when it comes to business. The moment you take your eye off going forward and up you have nowhere to go by down.

Now sure – in the short term the profitability does go up – but only so at the cost of acquiring new business. This is why so many companies downsize when going gets tough – it makes them look good in the books. But in the long term it costs them creativity, skill, fierce competitiveness which leads to complacency. Eventually death.

I was lucky enough to start thinking about the way out of our “we’re big enough” problem early enough, to bring around new product lines and to be kicked in the balls, mercilessly and repeatedly, until the things turned around at a great pain to me and many of the people @OWN. Was it worth it? Yes, we’re still around and more profitable than we’ve ever been.

Had we continued to push in the single direction – that of SMB – we’d be either dead or dying at this point like much of our SMB-centric competition. Those guys are out there burning cash and favors for numbers, losing money with each new client.

What I, and my small troop in Central Florida, did for OWN was an enhancement of diversification. We took a very, very small part of OWN revenue-wise and we decided to innovate just for it, completely outside of OWN’s direction. This in turn allowed us to sure up our base without sacrificing the growth and portfolio. It allowed us to expand without the traditional problems that expansion brings along.

It taught us how to build lines of business without building a business around a solution. In IT that happens to be the only way to survive.

…

Having said all that, I would not recommend it. The past two years, regardless of money and accomplishments, have definitely been the toughest I have had.

So why do it? Because thousands of people depend on people @OWN not giving up on them. And if you tell people that you’re not really looking to work for them anymore and instead just want to focus on your own happiness and profitability, why should they continue to do business with you? All companies have it in their best interest to make one another successful – if and when you no longer match up on those goals, you are no longer traveling in the same direction and it’s just a matter of time till you’re gone from that account.

If there is one thing we’ve all learned from the economic downturn is that lack of focus/discipline are fatal when people think twice about what they are doing. In good times the biggest crooks and the smallest charlatans make well off thanks to the infinite supply of idiots with money and incredibly poor judgment. The second people get a moment to take a second look, at times like the ones we are in now, those folks are gone. Everyone from big time vapor brokers to small time trusted advisors – you are either in business or not and in business you only have one goal

What should you always be doing?

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