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Less is not always more. Among other compelling topics, Part III of our chat with Susan Trivers works to debunk a particularly insidious misconception that has caused many an entrepreneur to stumble: that cutting expenses automatically saves a company money. While entrepreneurs may see some short term benefits with a cost-cutting strategy, in the end it results in reduced flexibility and the potential opportunity costs can dwarf the investment. 

[1:46] Pump Up the Volume

If a company’s most valuable attribute is their output—the ability to deliver the best version of their products and services to each client—then the most profitable thing a company can do is invest in their ability to increase their output. Of course, this requires a substantial commitment of resources, and so the first step that Trivers advises companies looking to rise above an early plateau take is to examine their financials to free up cash for investment in the business, such as additional executive-level staff and specialized personnel to handle technical tasks.

[5:43] Cutting Expenses: Fools’ Gold

Though it might seem like intuitively correct, reducing the expenses for a business is often one of the worst possible decisions a company leader can make. She speaks at length about her experience with cash-conscious companies that came to her eager to slash expenditure by cutting payroll, typically to disastrous effect. An organization’s human resources, its talent, lies at the heart of every potential success, and cutting staff essentially means cutting innovation.

[6:33] The Human Element

The individual people that power a company can be underrated in their effect on its overall culture. Trevor highlights the oft-belittled role of customer service in the overall perception of a company; something as simple as being available to answer an email in a timely fashion can drastically affect the end user’s experience and create customer loyalty. Any investment you make in ensuring the people that turn to your business are met with competent, helpful human beings will typically come back tenfold in customer perception.

[8:36] Same Approach, Same Results

A common response to the proactive approach Susan Trivers endorses centers around that old chestnut: “if it ain’t broke, don’t fix it.” While sound advice in some scenarios, businesses who want to make the great leap forward will never be able to do it by applying the same old approach year after year. The previous year’s revenue should be easy to attain for a sound business…the true test of innovation is the ability to grow and adapt each year in the face of more and more capable competitors as well as a constantly changing marketplace.

[12:45] “Tinker” or Tank?

In her book “Tinker,” Trivers delves into the creative process of successful, growth-oriented organizations. Rather than relying on sudden, radical changes, she advises company leadership to view development as a constant process, to identify issues each day that may prevent the company from performing at its absolute best. She tells the story of how a series of experiments helped her minimize waste and maximize profits at a restaurant she owned by employing a strategic soup serving schedule…small changes can make a big difference.

[19:23] Engineering Exponential Expectations

Many companies are able to maintain their foothold or even make meager gains of 1 or 2 percentage points annually, but the most ambitious entrepreneurs set their sights much higher. Transcending your plateau could mean multiplying your yearly revenue, but will require an unwavering commitment to establishing momentum and maximizing growth. If you’re fairly satisfied with your pace, small changes will serve you well…advancing to an appreciable extent is a full time project involving the full talents of your team….and following a hunch or two!

About Susan Trivers, President, Trivers Consulting Group

Susan Trivers has been providing strategic business consulting to low mid-market and small services companies since 1999. Trivers Consulting Group has helped 500 client companies to increase profitable revenue by more than 2 billion dollars. When asked what her one piece of advice to business owners is, she immediately says: “Accumulate more cash.” Cash enables the company to achieve its biggest goals and helps the owner grow their personal wealth. Susan offers a wealth of insightful strategic and tactical information on her website.

“Helping business owners have wealth and a life, not just a job.” -Susan Trivers

Connect with Susan

Website: http://susantrivers.com/

Trivers Consulting Group Phone: 703-801-0345

About: https://www.susantrivers.com/about-susan/meet-susan/

Book: Author of Tinker: How Smart Business Owners Develop Creative Ideas for True Growth. Available on Amazon