This post assumes you have a business that is already making money selling products or services to customers who know they need what you are selling, and who have the financial resources to pay you.
A lot of entrepreneurs will tell you that when you start out in business things take twice as long and cost twice as much to get off the ground. A lot of that cost is paid in the currency of time. More specifically the Principle’s (MD/CEO) time.
At first there are business cards, phone and computer systems to buy and set up. There are templates, email addresses and a website to be set up. There are supporting services like an accountant, a lawyer and staff who need to be appointed.
And all of that before the ink has dried on the first “deal” the company closes.
Most companies get through this all consuming early start up period and charge headlong into the next phase of their existence: growth.
Now it’s time to hire more staff, initially to deliver the work created by the growth in sales from zero to a monthly sales target that grows each month. A lot of business owners at this point neglect some or all of the 3 essential things that every business needs in order to successfully transition in and out of the early growth stage.
It’s understandable that it happens when there already feels like there aren’t enough hours in the day to get the work done. However continuing to develop these 3 key areas is critical to success at this point.
Critical Element #1: Cashflow
Understanding the definition of the word cash flow and even how important it is to a business is a solid first step. For the purposes of compliance all legitimate businesses track revenue versus spend/income versus out-goings on an annual/quarterly basis.
However, significantly less track it in a live, up to the minute way that allows the business owner to make very quick decisions when it comes to making big purchases. Sometimes a business’s cash flow will allow a purchase to be made immediately. Sometimes waiting is required.
Having this business intelligence around cash flow will allow a business to make very healthy (for the business) decisions consistently.
How healthy is your cash flow management?
Critical Element #2: Great people
Any company is only as good as the least productive employee. Hiring great people by consequence is essential. Our advice is to hire slowly and fire quickly. In other words, create a fairly exhaustive hiring process and make sure everyone is on a trial period, from which only candidates you are certain will be excellent should be allowed to progress.
Have your candidates complete a questionnaire. Undertake numerous interviews with different people. Perhaps use an automated video interview as part of the process using a tool like this one ( http://www.sonru.com/ ).
Is there a piece of work you could give them to do immediately upon being hired that would give them a chance to really illustrate, not just their existing knowledge, but also their heart, commitment, work ethic and initiative?
Critical Element #3: Great Systems
If you take yourself out of your business, what is left? People, technology, branded stationary, a corporate legal structure. Without you, will everything else continue to work? If yes, will it survive and thrive, or will the company limp along like a 3 legged donkey?
Great systems make a business, but what are great systems?
Please don’t misunderstand, we’re not talking about software or business tools here. A great system is where you’ve tried something a number of times, found the best way to do it and then documented that process into a step by step system.
There are only 4 types of system in any/every business.
(we cover these extensively in our Systems Day Training Course)
McDonalds is a great example of systems implemented in every aspect of the business. It’s how they are able to employ thousands of young people with no experience or training and get them working profitably from day 1. Everything every new member of staff needs to know how to do has been broken down into a step by step system.
These three elements make up the foundation for a strong business but all three take significant investment of time. How is your business in these three areas? Do you need any advice/assistance with any of them?
Visit www.mcmahonosborne.com.au to find out more about our exciting Systems Training Day for small business.