“Feast or Famine” is a phrase that nearly every business owner has heard—and even said to others—many times.
Indeed, it seems to be true and the reality, quite honestly, is that it is true.
The question is why?
Before I tell you my opinion as to the reason why, I want to share a quick personal story that might illustrate and bring home the reality of this frustration:
Many years ago, my beautiful wife was pregnant with our first child. The experience was for us, like any young, first-time pregnant couple, was a bit stressful. We were being careful about my wife’s diet and routines and we were reading every book on the shelf about how to be great parents—I think the word now-a-days is woke parents.
One long weekend, when my wife was about six months through her pregnancy, we decided to venture on a little getaway. We drove up to Yellowstone National Park. On the car ride up to the park, my wife was relentlessly complaining that the baby in her womb would not stop moving. Sitting in the car and enduring a long ride was uncomfortable, apparently, for both my wife and the unborn child.
After arriving, we spent the weekend doing fun things and had a great time until it was time to return home.
Somewhere in the middle of our journey back home, my wife started to notice that the baby was not moving whatsoever in her womb. It was the complete opposite of our trip up and although she was only slightly concerned at first, as the ride home progressed, my wife became more and more nervous.
Now, all the sudden, she was worried and complaining about the fact that the baby was not moving.
Like an idiot, I got a bit frustrated and made a horrible comment which my wife can repeat verbatim some twenty years later. I said back then, “Honey, honestly, you can complain about the baby wiggling and moving-all-about in your stomach or you can complain about the baby not moving at all, but I am not going to listen to you complain about both.”
What an idiot…not a good move gents. I won’t go into the details of the rest of the car ride but suffice it to say it was not pretty.
Fast forward a year or so from the time of the story, and I was complaining to my wife about work, “We are so busy; we are so, so busy; we are never going to get all this work done! I am so stressed out. What am I going to do?”
My wife patiently listened and offered her general and oft-repeated counsel, “Don’t worry honey, it will be okay. Keep working hard and I know things will work out.”
A few more months passed by and you may be able to guess my new predicament—all the sudden my company started getting slow, then really slow. I was frustrated and a little panicked. I began to complain to my wife, “Honey, we are slow; we are so, so slow; we are going out of business I swear!”
Her immortal words to me on one of those complaining days, and words that I shall never forget, “Rich, I will listen to you complain if the company is overly busy, or I will listen to you if the company is overly slow, but I won’t listen to you complain about both!”
Well, I learned a good lesson that day and, gladly, also learned, soon thereafter, the reason why my business was suffering from feast or famine frustrations.
I, in fact, learned about this common cause-and-effect loop from a seasoned businessman—I would guess his age at around 65—who was, at the time, serving on my company’s Advisory Board (You should, by-the-way, have your own Advisory Board).
He explained it to me like this: most small businesses use an overall business system that causes and perpetuates the feast or famine cycle.
The main player, or players, in small businesses each manage their own business sales-solution-service-billing cycle. Cycles vary but most look like this (See if this might apply to you):
1) Prospecting for sales
2) Estimating or developing sales proposals
3) Closing the sale
4) Managing the project once the job is sold
a. Ordering Materials
b. Following-up and answering customer questions during the fulfilment portion of the work.
c. Making sure product, parts or services deliver right and on time
5) Managing quality issues
6) Making sure the customer is happy
7) Gathering job costing information
8) Billing
9) Helping, at times, to collect the billing
In this little scenario—and you consider your own—the first three items are all about selling or getting in the work.
The last items, four through nine, are all about managing the job once it is sold.
Consider, then, this little loop—your company needs work. You might say, “Crap, we are slow, we need to get some work in here!” What do you do? You go out and prospect like crazy; you make phone calls, send emails, do sight visits. You do what you do to get work.
What then happens normally? You get work!
Now, all the sudden as it seems, what are you saying? “Crap, we are super busy, I gotta’ take care of my customers and get this work done…I gotta’ make sure materials are ordered. I gotta’ make sure the project is tracking…I gotta’ have me some happy customers!”
The problem, if you cannot see it already, is that when you are selling you are getting a bunch of work—feast! Once the feast starts, you are forced to stop selling and now all your time is dedicated to fulfilling the work—famine is soon coming!
The reality is that we cause our own “Feast or Famine” cycles because we have a poor system in place. Small business owners and family business owners are notoriously plagued by this issue.
The solution—small businesses, even with their limited resources, need to find ways to rationalize their company’s overall value stream or income generating system which means the work-through-the-system process needs hand-off points where people work as specialists in an assembly line of sorts, verses generalists that handle the work from tip to tail.
This can be extremely hard for small business owners to do for a few reasons.
For starters, small businesses are very often strapped down by limited resources. Small overhead, bootstrap mentality and years of fighting for survival are all very real conditions. Reckless spending or unnecessary overhead, rightly so, are viewed worse than the forbidden fruit.
I agree with that mentality and lived in it for years. There comes a point, however, and it can be very difficult to perceive, when your worry about overhead and overspending can become a bottleneck to your company’s growth. To our original point, you are often the cause of your own feast and famine cycles.
The time eventually comes when you must re-invest, or re-risk, if you will, an outlay of cash or extra manpower to prime the pump for the next growth phase of your company.
A quick story from my own personal business is very applicable. I was caught in the loop of feast and famine and stuck at a revenue plateau. Finally, after some encouragement from my board, as I mentioned earlier, and a lot of faith after enduring a grueling start-up phase, I decided to hire a dedicated Purchasing person.
Up until that decision, I estimated, sold, managed, billed and collected all my own work. My dad did the same. He had his customers and I had my customer so-to-speak.
Again, with fear and pain we reluctantly decided to hire a full-time Purchasing person. I still remember writing a job description and adding bullet-point-after-bullet-point of job responsibilities because I thought he would not have nearly enough to do throughout the day.
We created a job listing and eventually hired, luckily, a great person.
He started his job and we started giving him the purchasing responsibilities. With his past experience, he added new skills that I had never considered. One I remember well was measuring vendor performance like on time delivery, quality and lead times.
In addition, with the dedicated time to do his job, he started collecting more competitive quotes. He started tracking inventory better. He started reducing our inventory costs with better control of what was selling and what was sitting. He started doing all sorts of things that I sorta’ knew would be helpful but never had time to do.
Within a small period of time, I would say less than four months, I easily noticed that we were doing more business, we had less inventory, we were spending less on our material purchases percentage-wise and we were less stressed.
Frankly, I was overwhelmed with how much better work was because we made one simple hire that a few months earlier I could hardly do as I was worried about overhead expenses.
In the end, I increased overhead but also increased sales and increased my sales margins—we were creating more sales because I had the time to focus on that work and we were making more money on our sales because our new Purchasing person had time to focus on getting materials at a better price.
In retrospect, that seems like such a no brainer—even my teenage son’s snarky “No-Da’” might be appropriate. Certainly, for any reader, this might seem like such an obvious choice, but I invite you to consider your own family or small business situation. Are there some snags in your system? Is there a reason to think about making a new hire or some changes to relieve the bottlenecks? Perhaps you are facing your own “No-Da’” decision but are too afraid to pull the trigger?
Seriously consider if your process or system is stopping you from reaching a smooth and growing sales curve?
The second worry that stops many business owners from rationalizing their business processes, and probably much bigger issue then any of us would care to admit, is that they are too afraid to hand things off, fearing that the job will not get done well. The old adage, “It’s easier if I just do it myself,” holds many of us warmongering businessmen exactly where we don’t want to be—stressed, frustrated, tired, overworked and dying for help.
Here is the truth—you probably are better than anyone else at doing your job. Why is that? Frankly, you care more and you work harder, but you also have limited bandwidth. There are only twenty-four hours in each day and no more. Some of you have incredible bandwidth. You work tirelessly and courageously and do more with your time than any employee could ever imagine, but you will, no matter who you are, eventually hit a limit switch and once you are there it ain’t gonna’ matter much what you do. You have hit your limit.
Business owners must find the second-in-command types that, although not you, will work hard for you. Remember that their respective efforts, focused and energized into specific tasks will still be better than your staggered, on-again-off-again, work.
Again, we are talking about eliminating “Feast and Famine” curves in your business cycle. By yourself, without a brigade of fire fighters passing the water pale down the line, you will always be limited in what you can do.
That brigade might be as small as one other person, as I illustrated above with my Purchasing specialist, or it could be a few people—or even many people depending on your business type, but you need to think like this in order to get past yourself.
Let me repeat this one more time:
If your business is suffering through feast and famine cycles, then there is a good chance you are the very cause. It is a real problem.
Consider, for example, how much you are either paying in OT for long hours or having good people scrub floors when there is nothing to do—both of those scenarios is costing you and your company money!
If that were not enough, it is causing you enormous amount of stress!
I have suggested that you take a serious look at your overall business process. For many small business owners this is not as simple as it may sound. We are an unusual breed of people. We are grinders, workers, never-giver-uppers and many of us have endured extremely hard situations where failure was standing at the door ready to devour us.
Working like this and overcoming adversities that most will never understand creates a sort of thick skin that is good for weathering adversity but sucks at letting new ideas filter into our minds and hearts.
I honestly think that most of us fear making change because we do not want to go back to the dark abyss of survival.
Standing back and looking however may be the very ticket you need to take your business from where it is to something much, much better. I would counsel you to breath for a second and consider what you might be doing to hurt you.
Feast or Famine is today’s topic but there are many others.
To be fair, all of this is complicated and risky and every story and situation is different but do yourself a favor since you are used to wearing so many hats and put on your hat that says, “I am new to the business…what would I do to make it better.”
Do not do what you have always done. Get better, grow and find a way to improve your small business or small family business.