A tremendous amount of time, effort, money, and organizational energy goes into solving problems within your business. Too often the wrong problems get all the attention. Or worse, solutions aren’t focused on the underlying problem at all; rather, efforts are aimed only at the symptoms caused by a bigger issue. Some common issues when trying to address static or declining revenue are:

 

• Cutting too deep to reduce costs. This may address the issue for a quarter or two which is a fine temporary fix. But unless you figure out the underlying revenue problem and address it, you’ll be trying to cut costs again soon. Don’t fall into a cut and shrink death spiral; remember, you can only cut a cost or a job once.
• Discounting. Reducing your prices to win business may help at the end of the month or quarter, and it may be necessary on occasion. But unless you figure out how to create more value for clients, constant discounts will erode your margins and reduce your competitive position to low-cost suppliers.
• Turning up the heat on Sales. Applying intense pressure on your sales team to perform can be extremely useful in the short term to meet a specific objective. But unless you develop your team’s capability and grow their talent, continued pressure will only create burnout and weaken company performance. I’ve observed instances where it was “the most important month/quarter” for so long it became a joke and performance declined.

Addressing the symptoms of your problem by cutting a few costs, providing discounts to win business, or simply pushing your team harder may seem like an easy fix. The symptoms may disappear temporarily, however, the real problem will remain (and often gets worse).

The actions you can take to truly address the problem are not easy and require focus and discipline to execute. They also require leaders who will understand and commit to the time horizon required to build strength in their business. Ultimately, solving those problems creates value that is exponentially more powerful than simply improving your bottom line for a month or a quarter. Put your focus on identifying and solving the right issues that will fuel your growth.

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Last month my Harvard Business Review article about how to get the strongest performance and ROI from your CRM technology was among the most read on HBR.org . The focus of the article is using your CRM system to improve sales performance, not just simply inspect sales performance. If you are trying to increase revenue and use your technology to enable growth, you may find this article valuable.