What Small Businesses Can Learn From General Motors

Can you summarize, in 130 words, the dilemma every small business in America is facing during this economy?

 

Guess what?  You don’t have to.  General Motors and their advertising campaign did it for us.

 

The hottest word in General Motors new vocabulary is officially “Reinvention”.  You can listen to the new 60 second GM ad called GM Reinvention, by clicking on: GM Reinvention

 

Or you can read it below:

 

“Let’s be completely honest: No company wants to go through this.

But we’re not witnessing the end of the American car.  We’re witnessing the rebirth of the American car.

General Motors needs to start over, in order to get stronger.

There was a time when eight different brands made sense.

Not anymore.

There was a time when our cost structure could compete worldwide.

Not anymore.

Reinvention is the only way we can fix this.

And fix it we will.

So here’s what the new GM is going to be:

Fewer, stronger brands.

Fewer, stronger models.

Greater efficiencies.  better fuel economy and new technologies. 

Leaner, greener, faster, smarter.

GM is not going out of business.

GM is getting down to business.

Because the only Chapter we’re focused on is Chapter One.”

 

Let’s be even more honest than this ad’s slick 60 second presentation:  GM told hundreds of independent car dealers that their business dealership model was the way to go.  Hundreds of independent owners trusted in GM’s way of doing business, if they supported their Big Brother car company.   And guess what?  GM’s business model didn’t work, and the company itself would have ceased to be, if we as taxpayers hadn’t sent them cash to stay alive. 

 

The truth is:  GM’s Reinvention is much less painful than what small business owners nationwide are experiencing.

 

Some small businesses are figuring out that Reinvention is more than just tweaking a few tactics here and there.  But many are operating just as they did last year, but complaining a lot more.

 

As one owner told me when she couldn’t get fellow business owners to attend a workshop I conducted in her city:  “I cannot understand our local businesses.  When I pitched your presentation to them, they say things like: “I already know all that” or “I employ a marketing firm and don’t need that” or “I’m too busy”.  These are the same folks that say “How come you’re successful in this town?” or “I’ve tried everything & I can’t get people in my store”… We see lots of envy, frustration, excuses, and so little effort from them.”

 

Business Reinvention means that you as a business owner must admit that the business model you have been using in the past no longer works.  It also means that you must admit that the answers currently in your head, and the experiences you have gathered over the years of running your business, are not currently fixing the decline in sales and customer traffic you are experiencing.

 

Here are six lessons in Business Reinvention that every small business owner should recognize from GM and its failure as a major company:

 

#1:  There is NO franchise in the world that guarantees success!  NOT ONE!  And if you are a business owner in a franchise who blindly trusts and follows the company guidelines verbatim, you do it at your own risk.  All of the independent car dealers who are now out of business because of GM are the living proof of this.  They trusted the business model GM had set up for them, and it no longer works.

 

#2:  Brand uniformity is not all it’s cracked up to be.  There is no safety in brand uniformity and doing everything exactly the same as other businesses in your industry.  It feels safe, until everyone goes over the cliff at the same time.

 

#3:  I’ve been telling small business owners for the last 14 years that reinventing your business into a Destination is the most profitable way to operate your business. But in this economy, Reinventing into a Destination and being one-of-a-kind are no longer options.

 

#4:  It’s time for every small business owner to start learning what you’ve avoided learning.  All business owners know what they aren’t good at doing.  It’s time to address your weaknesses and correct them.  It’s time to quit doing the same things in your business today that didn’t work in your business last month.  Doing the same things only puts off your business reinvention for another day, and frankly, some of you are running out of days.

 

#5:  No one is going to be coming with any cash to save you and your business IF you don’t reinvent yourself.  Free cash is only for companies like GM.  You are on your own. 

 

#6:  And remember the words of the GM ad:  “No company wants to go through this.  Reinvention is the only way we can fix this.”

 

Listen to those words every time that advertisement pops up on your television screen.

 

Will you learn from GM’s experience and hear it as your wake-up call?

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