Chevy Tharp

“We cannot wait until tomorrow. Tomorrow is now.” – Eleanor Roosevelt

Talk of a recession has gone from an “if” to a “how long” and “how bad” conversation. Battered by credit issues, housing mortgages and gasoline prices, you can’t open a newspaper or turn on the television here in Maui, without hearing about how organizations and consumers are tightening their belts her and in the rest of the state.

There’s more to the story than survival, however. In fact, companies that focus on incremental cost reductions such as cutting travel, deferring expenses and reducing headcount, are likely to experience only marginal savings—and find themselves continually treading water, according to Deloitte & Touche, a Big 5 Consulting Firm. Through cyclical ups and downs, we can learn how organizations can turn the challenge of a downturn into an opportunity to implement transformational, sustainable changes.

Creating sustainable improvements to a company’s cost structure requires three elements: choosing the right business model, determining how decisions will be made and putting the decisions into action. When improving cost structure, many companies jump directly to action; however, the results are generally disappointing and usually hard to sustain.

Deloitte & Touche offers “Three Steps to Sustainable and Scalable Change,” to produce cost structure improvements that can withstand the test of time:

1. Rethinking a Company’s Business Model offers fresh and practical advice to help companies choose the right model. This provides a blueprint to guide the overall effort.
2. Aligning Operational Governance with the Business Model presents a framework for improving the way decisions are made and executed. This provides the framework for lasting improvement.
3. Aligning Organization Design and the Service Delivery Model will explain how companies can deploy their resources to create efficient cost structure improvements that satisfy the unique needs of business.

As I viewed the Hawai‘i Small Business Development Center’s Website to educate myself further on small business success, coupled with sustainability, I noticed that their Vision Statement reads as follows:

 “The Hawai‘i SBDC Network brings sustainable economic development to Hawai‘i. By 2011, we will have become a key force in building Hawai‘i’s economy, and will have become a recognized, collaborative leader within the small business, higher education and economic development communities, as evidenced by an increasing trend line in survey responses.”

Sustainability reaches far beyond the environment and deep into the core of our businesses. There are companies—too many to mention, both large and small—that have made tremendous efforts to incorporate sustainability into their mission statement. Whether here in Maui or elsewhere in Hawai‘i, we must look at what it takes to sustain our business over the duration of time. Here lies a key to long-term success and it is wise business.

Chevy Tharp is regional vice president, Hawaiian Islands and Western U.S., for Meridian Business Brokers & Meridian Group Hawai‘i. Tharp is an international business consultant and business broker who specializes in helping people buy, sell and improve businesses. He welcomes you to contact him at chevy@mghawaii.com or (808) 268-6131.