Confidence is something you carry. It is with you at all times and it affects your performance, your verbal and nonverbal communication, and your ability to persevere. Your confidence is contagious to others. A confident person earns your time, attracts your gaze, and makes you feel better. Their confidence is spilling over to you. Confidence is sexy. Low confidence has the opposite effect. It cannot be concealed. It is a virus. People don’t want to be around a person who lacks confidence (or company). We’re not wired that way. We want to be wowed!
No one is immune to swings of confidence. Fortunately, there are ways to get your business confidence back on track. Below, are some common scenarios that you might encounter and solutions for how you can take action to move beyond them:
Many of us in growth mode built a business model that is expensive to maintain. In the busier times, many optimists moved to nicer office space, updated gadgets, borrowed money, justified higher wages, and set the business model to be profitable at a higher sales level than we have today. Most of us have been forced to make cuts here and there — but it may not be enough. Confidence has been compromised because many are questioning what our business will become at this rate of change.
Many of us in growth mode built a business model that is expensive to maintain. In the busier times, many optimists moved to nicer office space, updated gadgets, borrowed money, justified higher wages, and set the business model to be profitable at a higher sales level than we have today. Most of us have been forced to make cuts here and there — but it may not be enough. Confidence has been compromised because many are questioning what our business will become at this rate of change.
Confidence-Building Solution: Throw out pride and design for long-term survival. Structure your expenses to allow you to profit when monthly revenue is only at 80% of average for recent months. The business may look different, but keep in mind that you are designing for the current reality. Survival is more important than size.
Do you think salespeople expect to get the order today? Customers smell blood in the water. Lower confidence has been eroding your pricing power. Which is more important to a commissioned salesperson – sales revenue or profit margin? The temptation to get the deal regardless of price contaminates our sales pipeline with low-profit deals that ultimately lower confidence.
Confidence-Building Solution: Set a minimum profit margin and be content to let competitors slash their own wrists. In my manufacturing business, that gross margin minimum is 20%. It’s just not worth the risk to work for less. Adjust commission plans to index higher when sales are made at higher profit margins. It’s a win-win. These two actions are bookends for confidence in the sales you make.
In an effort to “get more competitive” and be more like the competitor who has grabbed the customer’s attention with a tasty low price, we have not improved the product or service. In fact, we have likely cheapened the experience due to cutting costs. Most companies have slowed development of new products and services. Because your teammates know these facts, confidence in the company is lower. Instead, imagine saying, “We offer the best and if you buy, you will be thrilled you paid the difference in price.” Either you are confident that you have a premium product or you are confident you are the most competitive (yet profitable). Anything in-between is Death Valley.
Confidence Building Solution: Benchmark yourself against all primary competitors. Buy from them and then test their product/service. Evaluate every aspect of quality and experience. Knowing where you stand is a confidence builder.
What result must the business have more than any other by the end of a 7-year recession? Examples: Market share, gross sales level, job security for all, or financial return. Only one can be your top priority. The business that chooses can have confidence in why it acts and be less concerned with how the business changes to achieve that outcome. Choosing why is a relief. Once chosen, all other decisions are more obvious and more meaningful.
Confidence Building Solution: Ask: “What is the most important outcome for us at the end of this recession?” Choose one and don’t look back. Your competitors will wonder how you could be so disciplined.
Action: Re-think how you manage your business confidence. Most people adjust their confidence as a result of what happened to them recently – a reactionary approach. Flip it over and do the opposite. Carry confidence and watch the results reinforce why your “mojo” is working for you.
Mike Whitaker is a CEO, author, and speaker who builds confidence in audiences everywhere on entrepreneurship, sales and marketing strategy, and leadership. To book Mike for your next event, visit www.mikewhitaker.com or call (877-843-4110).