Q.I am forced to consider business expense triage. My basic question is: how to balance short and long term priorities? My issues are software maintenance expenses now (needed for present clients) vs patent fee expenses which would allow for future greater gains.
Lauren: You’re interested in learning how to balance short and long term priorities, specifically as it relates to maintaining your assets. I’m wondering if there are other areas of your life and/or business where short and long term objectives are proving to be a challenge. In addition, you position this as an either/or proposition, so I must assume that business has been down and that you are either in the red or close to it, otherwise you would choose to pay both. Let’s start with these assumptions and see where it takes us:
In general, what priority do you give to short term vs long term planning?
What will you be giving up if you do not pay the software maintenance?
What benefit do you offer your customers without it?
How important is it to your customers for you to be up to date on your maintenance?
Where will they go to get their needs met if not through your company?
What do you gain if you hold onto the software license?
What are you doing now to monetize your patents?
How would not paying the patents impact any existing agreements/contracts with current customers?
How much time do you have to make the most of the market opportunity with the patents?
What will your company look like in 5 years if you choose to focus on paying for the short term, current needs?
What will your company look like in 5 years if you choose to focus on paying only the patent fees?
A consultant or accountant might offer you advice on what to do. For instance, they might suggest you take out a loan, look for investors or direct you to choose paying one over the other. These could be perfectly reasonable solutions. But it seems to me that the real problem may be a slump in revenues. Therefore, after you’ve written down the answers to the above questions and gotten some clarity on how you might want to handle the immediate crisis, I’d like you to think about these questions: What are you doing to improve your company’s performance over last year? What specific steps are you willing to take to change the trajectory of your company? If you don’t change anything, where will your business be two years from now? My suggestion is that you begin to think about the bigger picture and consider what you’re going to do to avoid this problem in the future.