The Next Great Thing?

We’ve all seen them. New companies that appear seemingly out of nowhere. Often they have fancy marketing material, a snazzy logo, a few fast-talking sales people, and an energetic and keen staff working behind the scenes. The company gets attention, makes some sales, and everything ticks along nicely. The board is happy, the staff are confident, and the team focus is on growth and new opportunities. This company looks like it is going to succeed – put a checkmark in the win column for fast money!

But then, as quickly as the company appeared on our radar, it disappeared. Even though the website is still up, no emails go out, the sales group doesn’t answer their phones, and the energetic staff don’t appear so energetic anymore. Hmm, strange that such a successful company that was making money and a name for itself simply closed its doors and shut down. You chalk this up to the current economic situation or even perhaps to bad management.

So what if this company isn’t really dead? Look at the signs – no one answering the phones, emails not being answered – but the website is still live. Strange that if the company has closed its doors, the website is still live…After some investigating by some curious business watchers, it turns out that, quite simply, this company wasn’t prepared.

Why Did Things Go so Horribly Wrong?

On paper and in person, this hot young company appeared to be doing everything right. But they didn’t pay attention to one key component of good business: preparation. Confidence and success convinced the IT manager, the board of directors, and the management team that they were doing everything right. Unfortunately they forgot to consider a couple of key things:

  • What if our servers go down? How will we keep hosting the software that our customers rely on?
  • What if the power goes out? How will we guarantee that our 24/7 support is available?
  • What if essential personnel can’t perform functions that must be done onsite? How does the work get done?

This company simply did not consider the things that could go wrong. All too often when business is good and the bank account is growing, no one takes the time to think about the “bad stuff.” Unfortunately for this company, this is exactly what happened. Call it overconfidence if you want, but it comes down to poor management and decision making. Hence the reason why a power outage, a tough winter including an ice storm, and unstable servers all forced the company to close its doors.

All it took was three separate incidents that perhaps alone aren’t serious. But when those three incidents hit in one year, it simply became too much. Sales started to drop, productivity was behind, and the board became frustrated. That is why investors pulled out and the company quietly closed its doors.

If only this company had followed advice and initiated Business Continuity planning. The three incidents would have been just that – incidents. They wouldn’t have turned into threats that eventually forced this company to close. Staff would have been prepared and equipped to work from home, back-up power generators would have been purchased, and the pesky and unstable server software issues would have been addressed. It turns out the only reason the website is still live is because it is hosted off-site.

Don’t Make the Same Mistakes.

What does this mean for you? Take a hard look at your business – are you ready to respond in the event of a threat or disaster? Remember the disaster doesn’t need to be “huge;” it simply impedes your ability to finish the job. How many of these interruptions can your bottom line sustain? Do you have a Business Continuity and Disaster Recovery Plan in place? Perhaps it is time to stop operating by the seat of your pants.

About KingsBridge

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