How to Prevent your Business from Falling into a Crumpled Heap?
Did the stats from our last discussion scare you? Hopefully it was a healthy fear, and not the kind that makes you run from starting your own business. Today, we’ll ensure you don’t make the same mistakes as so many others. So let’s learn from their mistakes and push forward!
I’ve spent a lot of time with small businesses and I’ve seen how incredibly hard some people have worked to build their dream. Over a business life time of over 40 years, I’ve had the opportunity to watch, work in and help a large number of companies. From tiny seeds and saplings, to kings and queens of the forest.
For instance: I once worked with a business owner who started manufacturing in his garage. He has since retired early with 70 million dollars from the sale of that business. But on the other extreme, I’ve known other business owners who thought that simply setting up the business and hiring people to run it was all they needed to do. After contributing nothing further, they were amazed when it all collapsed.
From this we can observe very clear guidelines. Let me share with you. Now I’m not saying that implementing these guidelines are always easy, but they are essential to success. Do them, and it will change your business; and give you a better opportunity to enjoy your life and your goals.
For the time being, let’s look at how your business measures up right now?
Business Success Drivers
In any small business, there are three key drivers of success:
● Vision: Your dream—where you want to be in 5-10 years time
● Resources: Cash, people and tools
● Organization: How effective you are at using your resources to achieve your vision
The first ‘must have’ is a vision for your business; where you see it going mid-and long term. As a leader, you must have a plan that you can sell to your business stakeholders (your customers, staff, suppliers and the bank). You and your stakeholders must understand and commit to this vision in order to make it the key driver of how your resources are utilized.
Your resources include your cash, people, business tools and networks. You need these tools to accomplish your vision. The resources you have invested in must focus on meeting the goals of your vision.
How well do you use your current resources? Any organization consists of stocks and flows. You have stocks of money, people and their various skills, products and information. Then you have flows of money, information and products. A well-organized business has these flows well-coordinated.
Ask yourself the following questions in order to organize your resources better:
– How is your cash flow organized?
– Are you making the best possible use of your funds?
– How are your people organized?
– Are their individual and team efforts focused on delivering value?
– How are your processes organized?
– Are they standardized, measured and effective?
Resources combined with organization provide your business with a set of capabilities. This winning combination will give you a competitive advantage. Without it, you will waste resources, eat through your profits and lose your customers. A business framework gives you a structure and a path to follow. It also gives you an effective way to mobilize your capabilities and achieve your vision. Ultimately, this is what will grow your business.
Are you brilliantly inspired but seeking know-how? Will all your hard efforts result in Grisham’s first novel, or his second?
CEO and Co-Founder
neXtep Business Builder Community Pte Ltd
Singapore ACRA Business Registration Number: 201424522Z
80 Kitchener Road #09-09/10 Singapore 208539