When you’re driving at 100+mph and concentrating on the road ahead it is tough to see the warning signs, let alone do anything about the impending issues.
I found this out to my peril when all of a sudden the world exploded.
Ok, it wasn’t the world exploding, nor was there an explosion, moreover just a gentle fizzing and lots of smoke.
Well, not smoke, steam.
A big puff of steam in fact as I rounded Druids having decelerated from Hailwoods Hill.
Yes, I was racing, well testing actually ahead of Round 3 of the Caterham Roadsport Championship and yes I bleat on about this a lot.
I don’t do it to brag, but racing is so similar to running my business and the business of those I advise that I enjoy to ‘dot the dots’ and create the similarities.
What am I talking about here?
My engine blew up, that’s what.
And I limped back to the pits, only to be told that it was terminal and I’d need a new engine.
The trouble is, I could have prevented that terminal, costly replacement.
That’s if I’d heeded the warning signs.
And had a working temperature gauge.
The issue was that after a trip through the gravel at Paddock Hill, I’d picked up some of this nasty stuff and it became lodged in my engine pulley underdrive.
Now I know, you’re wondering what this is…..?
It’s a pulley that’s driven by a belt and that belt drives the water pump.
And that water pump drives the engine coolant around the engine.
And that engine coolant, well, it keeps the engine cool.
And without a cool engine, it will overheat.
And if it overheats too much, it bends the cylinder head.
And then you lose compression.
And then your engine is dead.
And that is exactly what happened to me, thanks to a crash, one little piece of gravel and the failure of a £30 part.
A simple belt snapped and that caused £4,400 of damage….36 hours before race qualifying.
Now, what does this have to do with business I hear you ask?
Just like a business, when things start to go wrong there are warning signs.
If you notice the warning signs and do something about them, then you can make decisions and change the outcome.
Just like my car, if the temperature sender was working after my initial excursion through the gravel I would have seen the temperature rising and been able to stop to allow the engine to cool.
But I didn’t see it and the engine blew up.
Just like when a business fails.
There are always warning signs.
Usually in extending debtor days and larger proportions of your debts failing into 60 and 90 day old categories.
Then a dwindling bank balance coupled with increasingly old creditors.
Or then a rising VAT bill then goes unnoticed.
Businesses, like engines, don’t go pop overnight.
There are always warning signs and they’re obvious – if you know where to look.
So do you have the right KPIs in place and do you monitor them regularly?
Because if you don’t then you could face a fatal mistake or are best a costly one.
Just like my engine, well my old one.
I’ve a shiny new one now and it’s taking a while to bed in and get to peak performance.
Just like your business would if the creditors stepped in.
So head the warning signs and do something about them.
Before it is all too late.