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3 Steps to Build Your Business Up by Tearing it Down

Sometimes the best way to keep your business growing is to analyze what would bring it to an end.
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Judge Smails (aka Ted Knight) once famously quipped in the iconic Caddyshack, "It's easy to grin when your ship comes in and you've got the stock market beat. But the man worthwhile is the man who can smile when his shorts are too tight in the seat."

There is a great deal of truth in the movies, even in zany comedies, if you really listen to what they have to say.

In the end, Judge Smails was right. It’s easy to sit back, relax, and congratulate yourself on a job well-done when everything is going right. Sales are up? Great. Marketing is driving business to you? Fantastic. Things have never been better. Wonderful. However, when your company’s ship comes in don’t just sit there and take it all in. Sure, enjoy it. But while you are enjoying it it is imperative to take some initiative, prepare for the future, and make your business better by trying to envision ways it could be torn down. In short, prepare for when your pants are too tight in the seat.

Many businesses have now adopted what they call a Legion of Doom: a division within the company that looks for ways to take down the business from within. Those selected then report their findings so that the company may determine what, if any, of the forces could actually manifest themselves realistically thus leading to the demise of the business as they know it. Once this real-life role playing is in effect, it can truly help you to insulate your business by creating systems to address these potential threats well in advance of when they may occur.

Yet you don’t have to be a Fortune 500 company to institute such a plan. Even small to medium-sized businesses can utilize this form of preemptive strike planning. Depending upon the size of your organization, the role of the company slayer can either be played by one individual or teams of persons tasked with various challenges that could possibly bring the company down. Heck, for a little extra fun incentivize the same. For instance, whoever can come up with the most plausible doomsday scenario wins a prize.

Then, when you are ready, use these general guides to begin your quest of taking your company down:

1. Competition If you were your own best competitor, what would you do to steal all of your business? Dramatic price war? Advertising blitz touting better quality goods or services? Figure out what you, as a business, would be most fearful of your chief competitor doing to drive you out of business.

2. Technology and Infrastructure – What would happen if your primary database got hacked tonight and all of your client lists were stolen? Or perhaps a massive computer virus shuts down your entire network for weeks. Could your phone system suddenly stop working? If you are an Internet-based business what would happen if your web site went down? Suppose your internet host suddenly goes out of business? Also, let’s not forget about the disasters that could occur before the dot com era. What if your building flooded? How about a massive fire that takes out your primary office. What would you do?

3. Wild Cards – Of course let’s not forget about the wild cards. For every business these will differ widely. But how about a rogue employee pilfering trade secret information and passing it on to a competitor. If you rely on venders, what would happen if your primary line of credit or business credit cards were shut down? How about if the bank that you use shut down tomorrow… how would you make payroll? What is your contingency plan of action?

Once you have assembled a list of all the ways your business could be adversely affected by these doomsday scenarios, rank them in order of importance and/or possibility that they could actually occur. Thereafter, set out to address and develop contingency plans for every threat. Along the way you may see better ways to run your business and, most certainly, you will see ways to insulate against disaster.

So take the time to make your company better while its ship is coming in. Make Judge Smails proud and, as the old naval aviator’s saying goes, hope for the best but prepare for the worst.

IMAGE: Shutterstock
Last updated: Feb 8, 2012

MATTHEW SWYERS | Columnist | Founder, The Trademark Company

Matthew Swyers is the founder of The Trademark Company, a Web-based law firm specializing in protecting the trademark rights of small to medium-size businesses. The company is ranked No. 138 on the 2011 Inc. 500.

The opinions expressed here by Inc.com columnists are their own, not those of Inc.com.



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