At a time when many of us are feeling resolute and making promises to adopt habits and practices that will promote positive emotional and financial growth in 2020, it is important to recognize that setting goals should not always be the first focus. The primary focus should be on establishing and maintaining an infrastructure or support system for your business that minimizes risk while supports sustainable, profitable growth. Often times when setting goals we forget to set the smaller goals and objectives that will lead us to the big-ticket goals of the year. The latest U.S. News and World Report back this up by stating that nearly 80% of people who have resolutions, break them, with most often losing their resolve by Mid-February.
The image of a ladder with only one step, the top rung comes to mind. Would you buy a ladder with only a top step? No, that is silly. This is equivalent to setting big top-line resolutions or goals. Could you climb a ladder with one big step, perhaps, but it would be a lot easier by taking several small steps on the way up. There are plentiful psychology and research behind the science of positive habit formation and shaping positive behavior.
In an effort to give you a boost in setting and achieving your yearly goals for 2020, I will share with you 5 key areas to focus on first, which will help lay the foundation to set your business on a long term, sustainable and profitable path.
Don’t fall in love with the wrong numbers. Win the race to the bank, not interconnections and topline revenue. When extending credit, banks are not interested in how much money you generated they care about how much money you made. Having a multi-million dollar business is only good if it makes multi-million dollars in profit. Business schools and entrepreneurs have love affairs with business plans, sales, and marketing plans, financial plans. The most important plan is a pricing plan. Einstein’s 8th wonder of the world, compound interest should be a principal focus of any business. When businesses having a specific plan and process that manages their margins, good things happen. Operating income and contribution margins grow exponentially. Businesses that have taken this seriously, have re-ranked their sales leaders boards by profit generated per job. This has a profound impact on culture and sets the boundaries for all team conversations.
Balancing your mix of strategic partners. There is a fine line between the cutting edge and bleeding edge of technology. In the boom or go bust business of solar, there is a graveyard full of many optimistic and game-changing companies that never made it. Unfortunately, good nature and ideas are not enough to make a business profitable. See a really good deal or price in the market? Question if it is sustainable, oftentimes your gut is correct and the lowest price per watt does come with inherent risks. When picking your suppliers it is important to manage that risk. Understand the size, scope, and financial standing of the suppliers you are partnering with. Stay away from niche products without a solid back up plan. When market volatility isn’t coming from a state capital or twitter handle, it often comes from picking the wrong strategic partners. Constantly chasing the latest and greatest is a recipe that often causes more harm than good to the P & L. Also it’s key that these new partners aren’t trying to offer everything to everyone. Pick strategic partners that do a few of these very, very well. It is important to take risks, however, when looking at the manufacturers, suppliers, and financial institutions you are partnered with, make sure they are on stable financial footing and have a sustainable, viable plan to make the warranty or RMA plan worth the paper it is printed on.
Make politics part of the playbook. Even though there is increased polarization in politics today, good clean renewable energy is an issue that both sides of the political aisle agree on. This doesn’t mean it’s ok to be less involved locally, it actually means the opposite. With an increased interest in renewables, policymakers are looking for solutions to solve many issues leading up to the full-scale mass-market adoption of solar and storage. Topics like interconnection, tax credits, local rebates, property tax abatement incentives, and archaic zoning/permitting laws are mostly matters that are decided and implemented on the grassroots level. Your voices matter the most here and so does your participation. Through SEIA and many local affiliates, much work has been accomplished due to businesses driving policy and decision making in their own back yards. Solar and storage is still a nascent industry in many parts of the country. Participating in the local policy arena allows businesses to shape policies that are best for their customers and keep them ahead of pitfalls that could prove to be costly to their business.
Next wo/man up. Depth and efficiency are key drivers to any business's bottom line. Having fewer specialists and more well-rounded utility players is key. Recruiting is a year-round job and seeing record low unemployment isn’t making this entrepreneurial task any easier. In 2020 make sure to cultivate diverse applicant pools that send a mix of younger and more experienced workers to your office for interviews. If you come across a well-rounded, smart person, hire them. Smarter, personable folks outperform their specialized colleagues, even more so in a market nicknamed the “solar coaster.” Jobs and titles change as much as the obsolescent technology in this industry. It also helps to drop the highfalutin title and exchange it for a blue-collar and lunch pail work ethic. You will no longer have to manage egos or sacrifice professionalism and it will transform your culture, improve your teamwork, and focus your workers to give it their all to improve the bottom line.
Smile, it is solar. Kindness kills in 2020. Never lose sight of what we are so privileged to do. Every day we get to take part in shaping the future of renewable energy in our communities through our work. We are bringing savings, return on investment, clean energy to our communities all while creating new jobs and leading a generation that will grow up with the expectation that every home will be powered by green energy and storage. Much like “iceboxes/freezers” and HVAC, there was a time where every home in America did not have these “extra” amenities. Now over 95% of homes in America have it. This only means the best is yet to come for solar. This should make you and your team smile for the bright future ahead.
Building a core business that is deeply rooted in its community, while picking the right partners and team members that embrace the passion and love for what they do are critical to achieving the goals that will deliver the longevity and profit you deserve in 2020!