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Definition of Abasia Point™
In the Medical world, the definition of Abasia is
the inability to walk or loss of control due to impaired muscular
coordination. In the business world, Abasia refers to the inability
to move forward or loss of control. The Abasia Point™ is a trend
indicator determining the ability to control a business in order to
move forward. To establish the Abasia Point™ trend indicator, you need
to analyze a minimum of 3, preferably 4 years of Profit & Loss
Statements and Balance Sheets. The Abasia Point™ trend indicator
identifies the areas of the business that are out of control. If these
areas continue to grow out of control, the business will become
uncontrollable. This leads to constant firefighting, leaving limited
time to get planning or organization completed. To receive a free
Z-Score please click here.
Why do you need an Abasia Point™ Analysis
In an economy where more and more people are being
employed by privately owned businesses, the survival rate is still
very low. Less than 10% of new businesses make it to their 10th year
anniversary. Only 43 % of business owners have a business plan. The
problem with most business plans are that they are used for applying
for a business loan, not for running a business.
In order to create a successful business an owner
must wear three hats: The Expert, The Manager, The President. The hat
of the expert is initially the primary hat. This could be an engineer,
a mechanic, a painter or any other professional that becomes a
business owner. The other two hats, manager and president of the
company present the most difficulties. Devoting the majority of the
workday to the role of expert limits the time left over to wear the
hat of manager or president. At best these hats are tried on at night
or on the weekends.
Issues like, “I can’t grow past x dollars a year”,”
I can’t find good people”, “I have had to skip paying myself”,
“accounts receivable are out of control”, “Operational Performance is
inconsistent”, “not enough time”, etc. are all very common and tell
tale signs of the Abasia Point. Very often the owner also pays
him/herself far below what can be considered fair market salary.
Most business owners start out the same way. Being
very good at what they do, they one day decide to venture off on their
own thinking they will be able to make more money by themselves. The
start is usually modest, starting from their garage or home. Business
starts to pick up and sales start to grow. At that point everything is
in the owners head or on a couple sheets of paper. At first the sales
growth is great, but then Net Profits begin to shrink with an increase
in sales. This is the leading indicator of the Abasia Point™, an
inverse relationship between Revenue from operation and Net Profit.
See the online
presentation.
The first reaction when hitting the Abasia Point is
often; fire everybody and start working out of my garage again,
because that is when I was making money. This reaction brings the
volume of operation back into their scope of control. The second
option business owners often choose is just to keep going until the
business comes to a grinding halt.
The right option would be to implement systems and
controls that allow continued grow and profitability. Unfortunately a
lot of business owners have the feeling they are like Robinson Crusoe,
the only ones with these problems and the only ones that can solve
them on that island they call their business. For some reason it seems
that asking for outside help from a professional is the last resort.
When a business owner can not successfully leave
the company for 4 weeks without any contact with their company, you
don’t have a company you are the company!
Abasia Point™ Process
Working as Executive Counsellors, the core problems
encountered with business owners are surprisingly similar, regardless
of business type. The solution however is always different simply
because every business is as unique as the owner. This is exactly why
a comparison of your company to market average or what others in this
area are doing is not a solution. It is nice to know but it won’t tell
you where the problems are in your business. The only way to discover
the Abasia Point™ issues at hand is to compare your company operation
over a period of time. This is where the Business Physical based on
the Abasia Point gives the answers.
Business owners in general look at consultants with
high hopes for an all-encompassing solution, a new method, technology,
theory, or system. The first issue with this is that everybody is
unique. Therefore a new method, technology, theory, or system based on
someone else’s experience has no meaning at all. Functional
transferability of experience is not possible. Think back to when your
parents told you not to do something; you had to do it anyway to have
your own experience. This is why we have developed a process that
facilitates the business owner to have his or her own experiences
along with techniques to improve their business with. The problem lies
in the fact that it is the business owner that needs to adjust not
just change the environment. Until the moment that the business owner
accepts responsibility for what is happening in his or her business
all outside help is futile.
Approximately 70% of business owners that had
previous consultant experience were unhappy with that experience.
There will be no positive results without a properly conducted
analysis like the Business Physical to create actual deliverables and
the ability to measure the results. Part of the issue is communication
and setting expectations. The other part is that most consulting firms
rather create a dependency than fixing the issues at hand. We prefer
to teach you “how to fish vs. being willing to come fish for you.”
Using the Abasia Point Business Physical process ensures that both
Business owner(s) and Counsellor become fully aware of the issues at
hand in order to facilitate the Custom Corrections Session Plan and
allow that business owner to have their own experience.
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