My 30+ years of working with small businesses and their owners has taught me that the key reason for business failure is the inexperience and lack of business knowledge by the owner. The good news is that you can learn how to avoid all of these reasons for failure.
But while avoiding failure is obviously important, it won’t guarantee that you will make massive profits and build a business that has value once you decide to sell it.
So what is it that the very best business owners do that makes them successful?
The answer can be found in Moya K. Mason’s paper “What Causes Small Businesses to Prosper?” (http://www.moyak.com/papers/small-business-success.html). In it, she writes,
“What does matter, it turns out, is having a strong grasp of business basics. Without exception, companies that outperformed their industry peers excelled at what we call the four primary management practices – strategy, execution, culture and structure.”
My own observation of small business owners who prosper agrees with her findings. But communicating to them that they need to increase their strategy, execution, culture and structure usually is met with blank stares or comments like, “No kidding, but how do I start?”
Because of that, I have developed a formula for obtaining massive profits and detailed action steps for improving each part of the profit formula. But when I explain it in total most business owners start to get overwhelmed. They see so many things that they need to work on that they just freeze up and do nothing. What they don’t understand is that successful business owners didn’t get that way in one big flash of inspiration.
They actually made small, consistent improvements to their business every week. This requires them to set aside some time every week to work on improving their business. They refuse to let the day-to-day fires of running their business stop them from working to improve their business in some small way every single week. They understand:
GOOD IDEAS + ACTION = MASSIVE PROFITS
So where should you start?
Simply decide to work on the one thing that, if improved, would have the most impact on your business. My experience is that most business owners know exactly what that “one thing” is. If you are not sure, ask your banker, your employees, your spouse, your CPA, or your coach.
Imagine how different your business would be if you invested four hours every week in improving your business! This would be over 200 hours by the end of the year. How many of your competitors do you think actually will make this kind of commitment to excellence?
What to do once you decide what to improve?
Educate yourself! You can do this by researching online, reading business books and magazines, following business blogs, reading articles, purchasing coaching programs, and hiring a personal business coach. Consider calling a business owner in your industry just to trade ideas. If you are worried about sharing with the competition, reach out to a business owner in a different city or region.
Take some action every month! Too many business owners get stuck in the research phase and never get anything done. The trick isn’t to become an expert on the subject. As the Nike commercial famously says—JUST DO IT! Get started! Take some action! Even if it is only a very small improvement in the first month, it is better than no improvement at all. Remember: Excellence is achieved one small improvement at a time.