The Six Business Success Factors
Last year, I woke up one morning in November and realised that I had been working with small business owners for over 40 years!
It did cause me to give thanks for the opportunity to learn about the concerns and struggles of small business owners because the last 40 years have been an excellent school to learn about what works and what does not. It’s been the living research program where I’ve learned about theoretical principles and models from Business Schools in that period, but what I’ve seen at the coalface has translated all that academic learning into some practical understanding.
All that experience has helped me to identify the six success factors that every small business needs to develop in order to become successful, so I decided to write a free Guide to share these success factors.
Most of the small business owners I have worked with have been owners who started their business with a purpose in mind.
Some times, this was to create an incredible product that would make the world better, or they wanted to build a business that they could be proud of in the years ahead and become their legacy.
Even those who just “wanted to make money” had a strong purpose behind them, to create a lifestyle for themselves and their loved ones, or to see money as the measure of being successful.
I can honestly say that everyone in that position finds themselves sooner or later in a position where they have got caught up working in their business and caught up in the tactical problems and issues. They lost their sense of purpose and their hard work turns from building a life for themselves into hard work over technical issues that didn’t help them to get to their desires.
You see, the problem is that all small business owners start their businesses as technical experts.
They had that sense of purpose, but they were experts in being mechanics, or lawyers, or carpenters, or bakers.
So when asked to roll their sleeves up and make their business a success, they naturally focused on working hard on what they knew. They opened their doors and became the busy mechanic, lawyer, carpenter and baker. Their hard work alone – and because of the quality of their experience – created customers.
So they grew by hiring more technicians, hoping that would lessen their workload and that they could then look at the strategic things their business needed.
But technicians need technicians to guide and supervise them. They make technical mistakes that an experienced, better technician needs to correct.
The small business owner gets “caught up”.
In time – perhaps no more than within 5 years of a startup – they feel the weight of frustration that they are working so hard every day, but not getting anywhere near building the business they envisioned or achieving their purpose. The sense of purpose that drove them and motivated them is a distant memory.
If you are in this situation, you need to realise it and do something about it because this weight will destroy you.
It’s bad enough working in a dead-end job, but working within your business where you feel you are spinning your wheels, and bearing the responsibility of ownership and investor is soul-destroying.
Once you understand you are in this position you can work on making sure your business is structured and implements systems that will help you to identify exactly what you need to do and then to work on these things.
Your solution is to work on what I have identified as the Six Business Success Factors.
In my 40 years’ experience of working with small business owners, I have seen that those who work on getting these six things right get to grow their business the way they intended.
All the hundreds of tips and advice and things that people tell you that you need to do fits into these Six Business Success Factors. Working on them one at a time will allow you to work on all the seemingly unrelated things you were told to get right.
The Six Business Success Factors is a model that simplifies your business building efforts.
The Six Business Success Factors are: –
- The Act of Leadership
- The Practice of Planning
- The Logic of Marketing
- The Pursuit of Customer Fulfilment
- The Attainment of Operational Efficiency
- The Mastery of Finance
Once you understand what they mean, you can identify what they are made up of and decide what aspects are most critical to you at this time.
You work on those few aspects, then you review what to work on next.
Let’s look at what these Six Business Success Factors are.
#1 The Act of Leadership
Your small business needs both management and leadership.
Management is the task of ensuring that resources are in place when they are needed and that things get done when they should be done.
Leadership is about inspiration and motivation so that people know why things need to get done and what it means to them.
In order to build a successful business, you need to free yourself from working in the business and create opportunities for you to work on your business. Leadership (involving powerful, effective delegation) creates the time for you to work on your business.
Make sure that you understand your Purpose. What is it that you are creating in your business?
Understand that you are not manufacturing a better mousetrap; you are helping families live healthier, happier lives at home.
Understanding your purpose will change the way you and your staff do things in your business.
People don’t work to manufacture things – they work for a desirable purpose; customers don’t buy a mechanism, they buy an idea.
Leading with purpose and vision will find you the time to strategically look over the balcony while at the same time, dancing on the dance floor below.
#2 The Practice of Planning
Lack of planning causes chaos and overwhelm.
Lack of planning is the most common cause of small business owners feeling frustrated because they keep getting caught up in emergencies and too many unprioritised things to do.
It bears repeating: businesses that don’t plan are planning to fail.
The Practice of Planning is just that – creating a culture where planning is practiced in all aspects of the business.
Without planning, the small business owner is up against it when he has to make decisions. Decisions become overwhelming because of the “new” choices that pop up, and running the business starts to feel like always bouncing from pillar to post.
Planning need not be complex. Any type of planning involves thinking over a simple process: –
- What is your objective?
- What resources do you have?
- How do you use your resources to achieve your objective?
Or, simply put, define your goals, know what your strengths and weaknesses are, and create the strategies to get you what you want.
Strategic and business plans need not be hundreds of pages long – they can just be a few pages of dot-points that clarify your business roadmap so that you know where you want to go and what to do to get there on a day to day basis.
The Practice of Planning also means creating the culture where you’re always thinking through tasks and you enact simple action plans so that everyone always knows what to do, what task is a priority, and then what to do next.
#3 The Logic of Marketing
Without revenue, you cannot grow your business. Businesses grow around growing revenue and ensuring profitable growth.
In order to sustainably grow your revenue from year to year requires consistent marketing. You cannot grow your revenue by simply making the best product and then hoping for the best. History is littered with great business ideas that fell by the wayside or got taken over by another business that was able to market the product better.
Marketing is not a crazy art – it is a science with simple, logical steps.
Define who is your ideal customer – your target; understand how your product benefits them; offer up the right message to press their hot buttons.
Marketing is a process where you make your target customers aware of their need, then aware of you and how you can fulfil their need. In order to do that you need a series of offers that get them to know you, then get them to like you, then get them to trust you.
All successful businesses maintain a marketing plan with clear marketing strategies that are consistently applied to find leads and warm their interest until they wish to buy.
#4 The Pursuit of Customer Fulfilment
Marketing gets you the sale, but customer fulfilment gets the customer coming back for more.
In order to grow your revenue, you need to support the business won through marketing by looking after customers. A new customer costs 10 times more to find and attract than it takes an existing customer to come back and buy more.
Customer fulfilment is a system that provides a complete customer experience that consistently provides them with more than they expect. Customer fulfilment is not just about delivery or customer support and it is not as simple as customer satisfaction although it includes all of these.
You need to delight rather than satisfy. There are hundreds of your competitors out there satisfying their customers – you need to stand out by delighting yours.
The mechanics of your customer fulfilment system will depend on your product and your brand. But the common characteristic is that your customer fulfilment system must be about organising all aspects of your business – even those not customer-facing – so that everything is aligned with customer fulfilment.
Customer fulfilment is about consistency. Your customers must get the same product and the same service and the same added value every time. This means that you need to create step-by-step procedures rather than rely on memory.
#5 The Attainment of Operational Efficiency
Operational efficiency is the “management” of the tactics of your business.
It is about how you organise all the moving parts of your business so that they operate in the most efficient way possible.
Two important aspects of operational efficiency are having the right people in your business, and having the systems to help them do their work efficiently.
Having the right people is not only about skill and experience, but it is also about attracting the right people who will subscribe to your purpose and vision. A skilled technician who will not follow your strategy will cause friction and inefficiency. So recruitment must be about finding people who can do the job and who will do the job.
Then you need to organise them into a structure that makes sense for the business, in such a way that they are clear on their tasks and responsibilities and how they work with others.
Your people will need written systems and procedures around them so that they can learn to follow these in order to provide consistent results. Systems will ensure consistency, accuracy, and make the business scalable. Clear, efficient systems also make people responsible for themselves so that you don’t have to spend time micro-managing.
#6 The Mastery of Finance
Just as you cannot grow your business without growing your revenue, clearly the success of your business will be reflected by your profit.
Implementing the Six Business Success Factors will all lead to business clarity, business efficiency, and to business growth.
But at the same time, you also need to measure that growth. You need to understand and manage your financial resources so that you can see how the implementation of strategies affect your progress.
At the most basic, you need to have reliable and timely records and reports.
You will also need to understand what are your Key Financial Indicators – what financial results drive your success in following your plans.
You will then need to manage the controls and decisions to work on those results by using budgets and comparing the actual results against them, and by implementing an appropriate cash management system.
I have written a free Guide called The Six Business Success Factors – The Small Business Growth Guide and you can download it by going to this link – https://teikoh.com/Guide
The Guide takes you through and explains what is involved in each of these Six Business Success Factors, and also includes a Self-Audit to determine which of the Success Factors you need to work on now, as well as a Roadmap that you can follow in order to implement each of these Success Factors.
Stop feeling tired and overwhelmed. Stop feeling frustrated that your daily hard work is not driving your business to where you want it to go.
Make a change by learning how to implement these Six Business Success Factors.
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