Having invested 25 years into 3,000 businesses and watched them achieve in excess of $2 billion in additional income, I now realise how important it is to spell out what they were not doing and what I assisted them to do differently, once mandated to assist.
In Fortune 500 and Top 100 Australian Companies it was easy to make a positive impact on the company’s overall performance because their resources allow them to capitalise on opportunities presented.
However, in small to medium enterprises and start-ups, you don’t have these resources and understanding what it really takes to be successful in a start-up or small business is not to be taken lightly.
There are 8 Key Success Factors every small business / start up needs in order to have a real crack at reaching its full potential. When I say full potential, I mean the potential for the business to work for the business owner as an investment rather than requiring the business owner to have to work for the business as an employee.
1. Philosophy.
Problem:
Business Owners don’t understand how to use the power of philosophy to create a powerful small business / start up with real momentum and potential to make it big.
Every business needs a guiding philosophy on all things that are important and this must come from the business owner. Talent won’t be attracted to any company that lacks vision or is unable to clearly state the philosophy and values of the business. If they don’t know what you believe in, how can they possibly make a passionate commitment to helping you take your business where it needs to go?
Solution:
Learn how to apply your own philosophy to your business to get amazing results through the power of your philosophy, well clarified for all to see and understand.
2. Discipline.
Problem:
~Business Game Changer Special Promotion~
Business Owners lack discipline and don’t know how to effectively set goals and achieve them, or know precisely what to do each day to achieve their objectives.
This may sound harsh. However, business owners are far more ego-driven and far less disciplined than they care to admit. After all, you went into business to be your own boss, right? Let’s be clear, the more you ARE your own boss, the less likely your business is going to make it big. Building a great business from a small business or start-up takes an enormous amount of discipline to stay focused and apply maximum passion and energy into every single minute of every day.
Solution:
Learn the daily, weekly and monthly disciplines that make you and your business culture uber-effective and deliver better results as a business owner.
3. Planning.
Problem:
Business Owners lack clarity on what success will look like. They don’t maintain a current business plan or create / maintain a road map for their entire business journey to success.
What this means is that the business lacks the ability to constantly sharpen its axe before heading back into the forest. A one-time business plan may initially inspire you or make you feel proud to have done some planning. However, it’s after the initial phase that ongoing planning is going to become a really important contributor to your businesses success. Being able to stop and check your oil and tyre pressure, analyse the road conditions, and reassess if there’s a better way ahead are mission critical in creating a successful business. After all, what do the letters “GE” mean to “GE” these days compared to the actual products and services that built that company in the first place? = NOTHING!
Solution:
In this ever-changing information age / business landscape, learn the ongoing business planning tools that provide you with the logical and natural signals when your business needs to make transformational changes (and it will) because, if you don’t, it will leave you delivering something the market no longer wants.
4. Measurement.
Problem:
Business owners don’t measure the right things and don’t know if they’re on/off track to achieving their goals and objectives.
It’s easy to identify some KPIs and pat yourself on the back when you achieve these. However, I have seen global, national, regional, large, medium and small businesses all measure the WRONG things and go broke whilst still patting themselves on the back. For example, you can measure profit and yet have nothing left at the end of the year to pay your taxes or, even worse, yourself!
You can also measure efficiencies only to stock pile a large amount of stock/stuff you can’t sell because it was half the price to make twice as much as your one client needed when the original order was placed. Now you lost money on the one sale you made and the one sale you didn’t end up making.
Solution:
Learn about the power of cash flow management and other more effective key performance indicators that deliver sustainable results and how they can assist you to achieve your goals and objectives.
5. Time Management.
Problem:
Business Owners and Entrepreneurs are time poor, working too hard and too long with not enough quality time away from work.
When you first start out, it’s so darn exciting that you don’t really care about working 60-90 hours a week. However, if you haven’t gone broke in your first three years (like the other 50% of all start-ups), then you may find working 75 hours a week is wearing a bit thin in your fourth year if you’re not making a substantial amount of money as legitimate compensation.
Understanding the drivers behind superb time management is a critical skill all business owners must master in order to have a genuine “shot at the title.” Knowing how to constantly reprioritise “first things first and second things not at all,” even on an hourly basis will most likely be essential as your company grows and you become increasingly busier ongoing.
Solution:
Learn what to do with your time each day as a Business Owner so that, as your business grows, you don’t become overwhelmed and less effective under stress. Done properly you’ll be able to earn more whilst, at the same time, working less.
6. Leadership.
Problem:
Business Owners are very often frustrated, even disillusioned, at the poor quality and under-performance of employees and often don’t know how to improve this.
Leadership is not only a critical skill for founders / business owners to learn initially, but even more critical as the business grows. Small businesses only require a “small” leader in their skill level. Medium businesses require a medium sized leader and large businesses require an excellent leader. Businesses that hit a glass ceiling tend to be run by leaders who have stopped learning. If you stop learning how to become a more effective leader, then your business will one day soon stop growing as well. Furthermore, it’s important to develop emerging leaders underneath you who can take the business to the next level because, after all, Richard Branson doesn’t fly his own planes, taste all the wines, set the credit card limits with wholesalers, or drive his trains across Europe. Why not? Because there are plenty of leaders and other employees who he has empowered to run those important parts of his 600+ companies and take care of his 100,000+ employees.
Solution:
Learn the power of building a high performance team and how to attract and retain a team of A Class Employees.
7. Cash Flow.
Problem:
Business Owners start out, grow up, and remain stuck on the cash flow cliff edge all their business lives and don’t know how to move away from the edge until they either go broke or quit in frustration.
The single biggest issue that keeps entrepreneurs and business owners awake at night is cash flow. When you know you’re out, or about to run out, of money and are facing mission critical payments such as employee wages at the end of the week, there’s literally no white space in your head. There’s nothing else you can (or should) possibly think about. However, this doesn’t mean you have the perfect excuse to live your business life in crisis for ever more thereafter. In fact it’s entirely the opposite. You and your business must grow in financial literacy and all things relating to cash flow, to the point where your financial competencies create cash buffers and prosperous trading as early in your business life cycle as possible. Failure to do this will assist you in contributing to the maintenance of the current small business failure rates across the globe, i.e. more than 90% of businesses that fail before their 11th anniversary.
Solution:
Learn simple, yet highly effective, cash flow management techniques that will lead you slowly and steadily away from the cash flow cliff edge and, at the same time, come to appreciate why 92% of businesses fail and what to do differently so that you don’t become another tragic statistic.
8. Marketing.
Problem:
Business Owners don’t understand how to create an effective marketing plan and, therefore, find themselves having to “win the business” the hard way by relying on themselves and their own energy, drive and sales ability. This leads to a business that’s undervalued because of its reliance on the founder, pushing the business owner into the category of “self-employed.”
A company that has great marketing not only attracts healthy new business and is able to grow, but it also attracts outstanding employees because the marketing inspires them to want to work for your company as well. Amazingly, companies with great marketing also have less difficulty in creating their own internal succession plans because the great talent also want to stay long term and take on increasingly more important roles, growing with the company, even wanting a piece of the action if/when offered.
Solution:
Learn how to target your ideal customer and ensure they’re willing to pay you what you want to earn / charge for your products and services. Like everything in business, marketing is nothing more than a recipe that works. Understanding why less than 10% of Business Owners have a genuine marketing plan that delivers results is also helpful in knowing what to avoid in your own marketing endeavours.
Conclusion.
When you first start out, the primary objective is logical; to build up your business to the point where it’s able to sustain your own salary. However, as the business grows, the logical evolution is then to move from self-employed status to “business owner” status, whereby the business pays you a generous salary and a tidy annual profit bonus as well. Even better still is when you then progress to the status of “business investor,” whereby your business pays you huge annual profits but you no longer require a day-to-day salary because the profits are substantial and the business can afford to pay other people to do the day-to-day work for you.
If you would like to learn more about my experiences with 3,000 clients and how they have so far achieved an additional $2 billion in earnings, then why not check out my book currently on sale at Amazon.com for the crazy price of $0.99.
Read more on www.entrepreneursguidetomastery.com or buy now at Amazon.com.
