This article was published in WSBA Access, April 2013 Edition. THE formula for running a successful business is the same no matter what industry you’re in; the only thing that changes is the product. The secret is it requires great business skills and the single biggest reason that most business start-ups are gone within the first couple of years, is the lack of business skills. Unfortunately most entrepreneurs are focused on making it to the top as quickly as possible. And in business, “speed” kills, you must have a plan, a purpose, a vision and most importantly you must do your research.
Most people that start a business have a delusion that just because they have great skills in their profession; be it a great chef, a great builder or even a great doctor, that they automatically have the skills to run a business. Being a great doctor doesn’t make you a great businessman or woman. It requires great business skills to run a successful business, just as it requires great medical skills to become a great doctor.
During my 30-plus-years in business, I have seen many businesses fail through lack of business experience and the perceived need to act quickly. This really saddens me, because I believe that small businesses keep countries moving and the reason that most of them go broke is that no one was there to show them how not to go broke. I have seen many entrepreneurs with a belly full of passion go into business only to fall flat on their face because they had no idea how to run a business.
Then you have those that are only interested in earning a quick dollar. And you only have to look at the great insulation debacle that cost Australian tax payers $1bn, let alone all the businesses that went broke because of it. This is a perfect example of entrepreneurs acting quickly. There was no thought of any sort of research; it was merely how to earn a quick dollar off the government. And as a result, hundreds of businesses got caught with tens of thousands of dollars worth of product that no one wanted when the government decided to pull the pin on the rebate. And again some of those that got caught ended up going broke.
Then we have the other side of the equation, where people are happy to buy an established business, spend the money on purchasing the business, but then don’t want to spend the money to learn how to run the business. If it’s a franchise, the franchisor trains them on how to run the franchise, but it is very rare that they train them on how to run a business.
Then we have the businesses that have been doing “ok” for a number of years and have become complacent.They’ve become comfortable and haven’t kept up with modern trends or technology and find that their business starts to go backwards and they blame everything on the economy, or whatever makes the headlines at the time.
Running a successful business is not that difficult. But just like every world-class athlete who is at the top of their game, first and foremost, they all have a coach and secondly, they need to keep training to remain competitive. They rarely become comfortable and the same applies in business. When you’ve reached that point where you’ve become comfortable in your business, you’ve actually become complacent and you’re going backwards.
To become successful in business you need a good coach or mentor. A good coach will always have you playing outside your comfort zone, not so it becomes unbearable, but you do need to be uncomfortable. What that means, is that you are always looking at correcting, refining, making small adjustments to keep you focused and on top of your game. You are being innovative and finding new trends. What worked last year doesn’t automatically mean it’s going to work next year.
Listen to your staff if they are trained correctly and fully understand what your goals and aspirations are for your business; they will become your biggest asset.
Listen to your clients, keep asking if you are meeting their needs, what can you do better for them, what would they like to see change in your business and why.