Nick Powills: Don’t Incorrectly Diagnose Your Issues as Financial vs. Engagement

When businesses are going through stressful times, leaders point toward sales as the solution. Sales, they say, cure all sins.

But, when I evaluate businesses, I often see financial stress as a false diagnosis. I find engagement is the true issue, which ultimately creates the false positive of financial issues.

Take Blockbuster, for instance. Did financial reasons cause its demise? Yes, in the end – but what about earlier on? What about at that meeting where they had a chance to buy Netflix? What about at that other meeting where someone said Netflix would never work? What about slightly after the Netflix decision when the sky started to slowly fall? Was the issue a financial one at that point? I would say no. Could an engaged team that was listened to have solved the collapse? Perhaps.

Now, take franchise systems across the board. Oftentimes, franchisees are put into three buckets – high, average and low performers. Makes sense, but generally, how is it determined which bucket to place them in? Financially, of course. Franchisors will dismiss the bottom third as financially challenged – which they are – but why? Why are those franchisees not performing financially? They have most of the same tools that the high performers do: Same operations style, access to product, national advertising fund, what have you. Why does someone initially thought to be a rockstar fail?

Engagement.

At some point along the way, disengagement happened. It may have not even been anything you did as a franchisor; it could have been a bad sales week or month that triggered a loss of motivation. It could have been a lack of understanding a specific aspect of running a business. It could have been a lack of direction from a business coach.

A million things can create disengagement, yet, just a few can help solve it.

Those few are often dismissed, though, because disengagement creates dismissal by those who are designed to help mitigate and solve.

To get engagement going in the right direction, you first have to listen. Listen to what the issues are. You have to diagnose other potential causes – sure, a franchisee could certainly be struggling due to a lack of financial resources, but most likely, it’s a lack of communication or understanding causing the disconnect. Clarity and baby-step accountably can help create a pathway toward recovery.

The same is true for employee engagement. Very few people take a job hating it on day one – there is a cause. It could be another person in the organization who is negative; a lack of understanding of the job at hand; or it could be a mismanagement of accountability. I promise you, though, something is the cause. The aftermath is an engagement issue, which typically doesn’t just involve a pay-me-more moment.

So, if you are trying to figure out the answer to a problem in your business, don’t just look at the obvious issue – look beyond. People, their engagement, and their ability to problem solve could help you diagnose what to do next.