Someone close to me kept reminding me of that old saying, but it didn’t always sink in. I guess that’s because I’d been digging for so long, hoping that with more and more and more hard work I’ll finally find the buried treasure. And the more I dug, the more I convinced myself to keep digging because I’d put so much effort into finding the treasure it would be a waste to stop now. After all, I could be one shovelful of dirt away from finding the treasure…
But in February 2013 I finally stopped digging—actually, I was forced to stop digging—and I found nothing but a big empty hole.
That big empty hole was the construction company I had owned and operated for 15 years. Several of my clients failed to pay me, to the tune of half a million dollars, and it severely crippled my business, my livelihood, and the livelihood of my employees. To this day, it still bugs me that those clients got away with not making good on their contractual obligation to pay me. And the dagger in the back was realizing that while I was going through the painful process of closing down my beloved company, my clients—the very source of my financial stress—were having no money problems at all and continued operating their profitable businesses like nothing had happened. They benefited from my hard work and all I was left with was a bigger hole.
That’s when I realized---you don’t dig your way out of a hole, you climb…
So I threw the shovel aside, climbed out of the hole, dusted myself off, and moved on…
There are many examples in business of ever-deepening holes that eat up manpower, time and precious money. Sometimes, the elusive buried treasure is a product that is sputtering along but just can’t quite get going like you had hoped. Other times, it is a person who you know has all the promise in the world but just doesn’t have much to show for it other than a warm chair and a lot of frustration on your part. The “hole” might even be a part of an entire division that is underperforming or a vendor that just isn’t meeting your needs.
Corporate America is littered with decisions that seemed like a great idea at the time but something just didn’t work out. Here’s a great example: “Classic Coca-Cola” is my beverage of choice. If you were to walk into my office you would see at least 2-20 oz bottles of Coke on my desk. Do you remember what happened when they debuted “New Coke”? It was meant to replace the original Coca Cola that everyone loves, but it only lasted 77 days before the classic formula was reintroduced to the market. I think everyone but the Coca-Cola Company saw that coming. They wisely made the tough decision that the reformulation just did not work so they brought back the old formula. The result was that while New Coke may have failed, the overall company retained its top spot. They realized that the hole was getting too deep (money and resources spent on product testing, marketing, product placement, etc) with no return in sight, so they pulled the plug.
I have found after making a similar journey that if you are going to be successful, then you have to make the tough decisions. No matter how close you think you are to that buried treasure, at some point (my ‘point’ was February 2013) you have to break the shovel, climb out of the hole and move on. It is called cutting your losses, and even the most successful people in the world do it. Maybe you have invested a lot of time and money into a product or a person or even a division, but there comes a point where you have to give up and focus your efforts on more productive and profitably areas.
The one thing that I learned--and to some degree am still learning--is that you cannot be afraid to make the tough decisions. It may be easier to justify further expense to keep going but that’s an awful hole to fall in to. For example, many of my trusted friends and colleagues told me to pull the plug on my construction company in mid-2012 but I fought them till December 2012. My fighting them didn’t matter, though: the writing had been on the wall for awhile. The life-support plug needed to be pulled so I pulled it.
What did I learn from my journey, and how can you benefit from this lesson? Ending a project that’s not profitable and bleeding money is an easy decision. Closing an entire company is where the decision for me became extremely difficult. So, you need to set up accountability for projects and more importantly for people so that you can measure how well things are going compared to the standards you have set. If something isn’t measuring up, get rid of it. In today’s business world, profit margins are too thin to waste money on unproductive portions of your business. You cannot afford to have unproductive anything – be it a person, division or product. Do everything you can to help the people affected move on, but make a decision and stick to it.
I understand that these types of decisions are never easy. Believe me I truly understand that last sentence. You never know how they will impact your business or for that matter your personal future. It will always seem easier to keep going after the buried treasure or that return on your investment, but you have to hold yourself accountable, as well. If it is not working, it is time to make a change.
Stop digging before the hole gets so deep that you are unable to climb back out of it. I made the mistake of waiting too long to make the decision but my shovel is gone, and I’ve climbed out of the hole. I have a long road ahead but with perseverance I will make it back on top again with these lessons as my guiding light.
What tough business decisions have you made, and what did you learn from them? Let us know in the comments below.