08/ 01/ 2008
by Shannon McRae
How one moment can revolutionize your business
Seventeen years ago, Karla Krueger made a risky decision and invested more than $20,000 in new computers for her graphic design business. At the time, Krueger didn’t know anything about computers--or anyone who used them. But she felt that if she didn’t make the switch, her business would slowly suffer.
"My intuition told me there was a strong chance I wouldn’t be in business down the road if I didn’t make the jump," says Krueger, owner of Janesville, Wis.-based Krueger Graphics. "And I knew I couldn’t wait too long to do it."
None of Krueger’s former training prepared her for the electronic world. "When I was in college, the only place you could find a computer was the business department," she says. "I had no experience with them. We always said a computer would never do the work of a creative person."
But as Krueger researched the new technology further, she learned it definitely could do the work of a designer--a much faster designer. "Before we switched to computers, we were still using pen and ink and a typesetter," she says. "What used to take us two weeks now takes one person 10 minutes--that’s not an exaggeration."
Relying on her gut feeling that computers would soon infiltrate the business world, Krueger traveled to nearby Madison, Wis., to meet with hardware retailers. After seeing examples of how computers could change her business, she knew she had to make the investment. Since none of her colleagues had made the switch yet, she didn’t have anyone she could consult about the decision.
"It was 1991, and I didn’t know of anyone who was using computers in their business," she says. "Some of the businesspeople I respected the most didn’t make the jump."
But Krueger jumped--with both feet. She bought top-of-the-line equipment, spending as much as $5,000 on a black-and-white laser printer. "It added up very fast," she says. "It was a big decision, a big chunk of money and a big direction."
With all her expensive new equipment in place, Krueger decided to transition paper-based projects to computers as soon as possible. "I put a date on the calendar and decided that after that, no new job would be done the old way," she says. Looking back, Krueger thinks it was the best method, and she recommends being tough on yourself about a technology transition.
As with any new technology, learning how to use it was Krueger’s biggest challenge, she says. She spent long hours teaching herself as much as possible. With limited resources in her hometown, she relied a lot on trial and error. "I took some courses, but like lots of business owners, I was really busy," she says. "It’s not like I could take off a year of work just to learn how to use my computer. I had to balance it all."
Upsetting the balance was Krueger’s greatest fear. Though her old process of design and production wasn’t as efficient as that of her new computers, she was more confident in her results. "My biggest fear was that my work wouldn’t be as good during the learning process," she says. "To learn about my computer, I had to use my analytical skills, but that killed my creativity. It was definitely hard."
After a few scary months, Krueger trusted her computer more and felt relief as she noticed an increase in new jobs for her company. "Making the transition definitely helped me get more business," she says. "I was the only one around who was using a computer."
Almost two decades later, the rest of her industry has long caught up. Krueger might not have the technology advantage today that she enjoyed then, but her willingness to wing it in any situation makes her business successful.
"I’m not scared to change direction or take on something new," she says. "If you know successful people, you know that they often make a decision and fail. But that doesn’t make them a loser."
For other small business owners facing turning points in their companies, Krueger’s best advice is to get going: "Do all your research, but don’t wait too long," she says. "Make your decision and stick with it. If it fails, then you go on to the next decision."
The process of starting over
Shane Reeves will never forget the time a brilliant opportunity presented itself as a complete catastrophe. In 1999, with his wife due to give birth to his first child at any moment, Reeves suddenly found himself without three key employees at his Murfreesboro, Tenn.-based pharmacy.
"Within 60 days we lost three key staff members--each for a different reason," says Reeves, who owns Reeves-Sain Pharmacy with his business partner, Rick Sain. "We had no process in place to run the operations or train new employees."
Instead of panicking that his business was falling apart during such an important time in his family’s life, Reeves stepped back and focused on the positive. "I told myself, ‘Never again,’ " he says. "I knew if we ever got it cleaned up, we’d never let ourselves get into that situation again."
To begin the process of finding, replacing and training three key staff members, Reeves and Sain turned to the most valuable resource they knew: business books.
"I’m a pharmacist by trade, but during the mid- to late-90s, Rick and I started intentionally investing time in reading lots of business books," says Reeves, who jokes about his "backstreet MBA." "We read everything we can get our hands on, so when this happened, we immediately went to the well and tried to find books on developing processes."
Applying what they learned in The Next Level: Essential Strategies for Achieving Breakthrough Growth (Perseus, 1999), the two slowly began developing company-wide procedures and recruiting new employees. "We really took it to heart," Reeves says. "At some point, every business owner has to give up their mom-and-pop ways and embrace processes. There’s no point in growing if you’re not willing to share the reins of your operations."
Part of sharing the reins included hiring people Reeves felt like they couldn’t afford at the time. But by investing in a talented staff (trained by owner-developed principles) they knew their business would grow the right way.
Looking back, Reeves says he counts those long and stressful months as one of the most productive times for their company. That turning point forced them to develop a new direction that has proven to be more efficient and profitable, he says.
"I don’t think you ever welcome difficulties," Reeves says. "But you get to a certain point where you realize that it’s simply part of the process. Life is full of bumps and blessings--you have to embrace them for what they are."
NFIB.com
For more tips on facing small business challenges, look in the "Growth and Planning" section at www.NFIB.com/toolsandtips.
Which Way?
Choosing the right direction in the midst of a turning point
Are you facing a crucial decision in your business? If so, you’re probably nervous and stressed. But fear not, says business owner Shane Reeves. He recommends asking yourself three key questions to find the path to profitability:
1. Do I have a sufficient line of credit to weather the storm of growth? Major changes in your business often involve a substantial financial investment. Karla Krueger shelled out $20,000 in 1991 for technology no one else she knew used. But taking the financial risk paid off greatly in the end. The key is making sure you have enough credit to get through the tough early stages. "There’s no point in going out in the ocean if you don’t have a sail to get home," Reeves says.
2. Do I have the necessary processes in place to grow my business? Reeves and his business partner, Rick Sain, quickly realized they needed more structure when three key employees left abruptly. Turning points often force you to closely examine the way you run your business. If you don’t have systems in place, hard times can easily derail your growth.
3. Am I willing to hire the best staff possible? You’ve heard it 100 times: Behind every great business is a great staff. When you face a turning point, you want to be able to depend on star employees to help your business reach the next set of goals. "You have to be willing to hire people who are more talented than you are--and you have to pay them well," Reeves says.
This article is from the August/September 2008 issue of MyBusiness.
