When you run a business the best way to ensure fast growth is to have everyone who works with you constantly and relentlessly looking for, suggesting and making changes towards continual improvement of your processes and efficiencies. This constant focus on developing a culture of continual improvement can really maximise your growth potential in ways you will never manage alone.
Given that I learnt most of what I knew about business by reading from the Business section in WH Smith, I have proven that with the right culture and approach you can go very far. Of course, you can learn a lot from business school about how to run a business and those lessons can be invaluable. Nevertheless there are plenty of things you won’t learn in business school; those which come only from hard won experience.
Here are ten things you need to know about running a business, but you will not learn in business school:
You need people on your side. The pain of ensuring you have a top quality team of A-players can be a constant battle but it is one worth waging. When you have a great team, amazing things can happen in your business. It is not good enough to simply employ someone who your business can afford, or whose availability fits with what you need. You need to find people who believe in what you are doing, and buy into your company ethos. You need team members who are as passionate as you are about achieving great things with your business. Small business is no place for people who just want “a job” and you should not employ them.
Discipline around financial focus can pay massive dividends. Book in diary time for working through finances and ensure you have a firm grip on your cash-flow. Poor cash-flow can cripple a business before it even gets going. A massive order can seem like a blessing, but so often the financial outlay involved in fulfilling the order before payment is received can be a curse. Ensure you always know how your cash-flow stands, and whether you can afford to make that next move. Never allow yourself to be caught short by unexpected outgoings which could see you bankrupt just when you thought things were heading skyward.
In business it is important to reward your team members. But be sure to reward them according to what they want, rather than what you think they want. Ask them what would be a suitable reward; never assume you know the answer! As a small business you can’t offer the big bonuses and rewards of the larger companies, but what you can offer is that personal touch of ensuring your team members feel truly valued. Take the time to find out what makes your team members tick and aim to reward them for hard work with something that will make them feel glad they chose to work for you. Similarly, you need to reward yourself for a job well done from time to time.
You will never be finished with learning, and neither will your team. Internal and external training and education help to build cultural strengths that are priceless. Investing time and money in training for yourself and your team will pay dividends further down the road. This might be something as simple as buying books to help with mindset or key points in sales; there may be online courses or external college courses that can help to develop your team. Investing in your individual team members is an investment in your team as a whole, and therefore in your business.
We all need customers in order to succeed in business. But we don’t need all of the customers. I believe that relentlessly pruning the bottom 20% of your customer base will build business value and allow you to focus on those customers who are of most value to you. Client retention and penetration are powerful assets though, and it is important to avoid leaky bucket syndrome. Aim to please all customers, but focus on that 80% of customers who bring you the most business. The bottom 20% are probably not your ideal customer any way, otherwise they would be spending more with you.
6. Customer Journey.
Mapping your customer touch points and the perfect order process should be a continual system of review. It’s another one of those things that will never be finished. Progressive improvement in the customer journey is an absolute must if you are to continually beat the competition in all areas. Your customers should rave about you so listen to their feedback and use it wisely to ensure they think you’re fantastic. Regularly test out the order process and honestly evaluate every tiny detail to ensure your customers are always surprised and delighted when they order from you.
Focus plays a massive part in business and is vitally important. So often we create reports but don’t follow up on what they show us. Similarly, we often carry on doing something in a particular way for no valid reason. If the people in your business don’t know why they do something, tell them to stop doing it. It probably won’t be missed and they will have more time to focus on the things that really do matter. Avoid being distracted by the things that don’t make a difference to your bottom line. If it’s not making you money and is not a legal requirement, ask yourself why you do it.
Do you know what your vision is for your business? It is worth spending time really thinking about this and coming up with a definitive vision as to where you want your business to be going. Ensure every decision you make is based on a sense check against that vision and prioritise everything according to this. The value of any process, venture or new direction should be measured against its profitability and your vision. Do not even entertain anything that does not fit in with your vision and bring you profit.
9. Time management.
Say “no” a lot more than you have until now. Anything that doesn’t fit with the focus of your business should not be considered. There are 24 hours in a global day, and you should aim to use every one profitably. Maximising the sales hours of your business day will pay massive dividends. It is important to ensure that unimportant, unprofitable tasks are not taking away valuable sales time from you and your team.
10. Building an asset.
Exiting does not mean you have to sell your business. An exit sale is not the only option, but you must develop a fast-growing, profitable business in order to open up choices based around your asset. You may not want to sell right now, but it is important to see your business as an asset which you may one day wish to sell. Treat it as an investment whose value must grow over tim;, share the value with your team; share the purpose and intention for the company to be best in class; set high expectations for anyone you work with and operate to serve and be clear about your ambition. Choices come when you have a repeatable, scalable income stream and a strategy that allows you to be agile, well planned and still paranoid about the fact that everyday someone is trying to beat or out-smart you.