Facing the Harsh Facts


Many companies that have lost profits or market share have managers who are still waiting patiently for their business to “get back to normal.” Others are looking for government help for their declining market and profit positions. Neither of these approaches is a viable situation. What is needed is less wishful thinking and rhetoric and greater willingness to squarely face the true facts about their markets and competitive positions. The demand changes that have occurred in many markets are structural, not cyclical, and it is unrealistic to expect any kind of a dramatic recovery or turnaround that will restore demand to former levels.

It is extremely difficult for managers who have built their entire careers around specific products and technology to accept the fact that their former business base has now leveled out from prior peaks, or worse yet, become obsolete or irretrievably lost to new competitors or technology. Obviously, many old-line steel managers could not imagine today’s world of aluminum cans, plastic auto parts and bodies, or Japanese, Korean, and small regional producers who constantly “beat their pants off.” Nor could managers in the high flying semiconductor business foresee the situation where their markets have not only ceased to gallop ahead, but decline dramatically, and where foreign sources, including Brazil, Korea, and Taiwan, have captured the bulk of the remaining business. Unfortunately, these are the facts, and an equally discouraging set of forces applies in many other markets.

It is understandable that managers who have grown up and lived through the growth years in any of these industries find today’s conditions difficult to accept. But they must change their myopic or unrealistic views of their business so they can tackle the hard work required to regain a profitable competitive footing. Otherwise, their situations will not improve and will most likely deteriorate further.

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, Line of Sight

Facing up to Deficiencies


Many companies fail to objectively evaluate their products against competitive offerings in a rigorous manner. If they do go through some kind of an evaluation process, it is often superficial or biased, leading to a continuation of “business as usual” rather than dramatic cost or performance improvements. In some cases, management is not presented with the real facts because it is easier not to “rock the boat.” In other cases, management may see the facts but not accept or face them squarely, since it is not easy to admit that a product is no longer competitive. As a result, a surprising number of companies continue to try to get by with products that are not competitive and they fail to make the fundamental, essential changes in design or cost.

There are two important points that successful companies always follow. First, it is essential to ensure that products are designed for efficient manufacturing and assembly. Second, “me too” parity is never a solid basis for gaining or regaining position. Technical programs should always be designed to leapfrog the competition rather than play “catch up” against moving competitive targets.

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, Line of Sight