Sharing my story that led to the writing of this post …
I remembered the pain of damaging my new car the night I was travelling to France the next day. On the plane, I lost my appetite and did not eat my meal on the five-hour flight. I then had another pain- the pain of hunger.
Remembering that I was fortunate not to have bruises and being able to fly was my thought of gratitude. My intangible painful bleeding disappeared. This event brought my attention to organizations that suffer from the tangible and intangible pain of bleeding.
How organization suffer from tangible bleeding?
Cash flow is the lifeblood of any business. When a company suffers from negative cash flow, it loses its lifeblood and may go bankrupt. This is true for individuals who suffer from negative cash flow. They feel the burden of debt. They fall into despair and even a few of them may commit suicide. A company with negative cash flow because it failed to manage its inflow and outflow cash bleed and phase out.
How organization suffer from intangible bleeding?
Companies may also suffer from intangible bleeding that leads eventually to losing their lifeblood.
There are a variety of reasons such as a high turnover rate. It is very costly for organizations because a high turnover rate disrupts work. It is also very expensive to replace the departing workforce. It takes a minimum of six months for new employees to reorient themselves with the new work environment. The disturbance of work caused by a high turnover rate may negatively affect the cash flow.
It is the same with talents leaving an organization. This can seriously damage its cash flow.
Like a speeding car stopping suddenly and leading to external and/or internal bleeding so are organizations. The high rate of laying off means the organization suddenly applies the break on its activities.
External bleeding we can all notice and apply pressure to stop it. The internal bleeding is invisible and may lead to serious damages.
Humans who suffer from internal bleeding may feel lightheadedness and dizziness. Mismanagement of organizations and businesses may suffer from the same. The loss of the lifeblood –the cash– may result in dizzy organizations that soon may disappear.
Those dizzy organizations lose sight of their vision and mission. They go astray.
A change in mental status such as confusion is a sign that a lot of blood has been lost. Organizations that show confusion and keep changing policies may suffer from internal bleeding.
Businesses need to manage not only their cash flow properly but also the tangible and intangible factors that lead to poverty of cash flows.
Management is not only managing the tangibles; it is also managing the intangibles.
