Why
Small Businesses Stay Small
By Barri Carian
At one time or another, many of you probably have tried and failed to take your business to the next level of profitability. Why is it so difficult to make that leap and what does it take to succeed?
Financial
While most business owners will cite lack of financial resources as the
reason for their failure to grow, it is often a result of poor financial
management. Most owners lack experience in maximizing the value of their
assets, receivables and cash flow. Sometimes you need to spend money to
make more money and open up new possibilities for growth.
Planning
Managing from crisis to crisis is common among small business owners.
Lack of time can cause owners to manage their business on a reactive rather
than proactive basis and many small businesses have no plan for future
growth. Making the time to balance the day-to-day demands with a broader,
more strategic view is critical to achieving significant growth. Growing
a company requires a clearly articulated vision and a practical game plan---not
a two-pound document that sits on the bookshelf. A good game plan clarifies
goals, focuses energy, gives direction to work efforts and provides gauges
for progress.
Utilize Resources
Even successful CEOs may lack all of the appropriate talent or specific
skill-set to take their company to the next level. Businesses require
a myriad of skills and seldom are they all found in one individual. Small
business owners in particular have difficulty transitioning out of the
"founder mind-set" in which they micromanage others and do everything
themselves, thus limiting the growth of their company to their personal
capacity for work. Learning how to utilize resources - internal and external
- is a critical element in growing a business. Know what skills and experiences
are required to significantly grow your company and know the skills of
your management team. This way, you will be able to use everyone's potential
and be able to identify gaps to fill.
Market Driven
Entrepreneurs often hit a roadblock when they fail to move their company
from a product-focused business to a market-focused business, leaving
alternative distribution channels or market segments unexplored. They
miss opportunities by not regularly asking their customers to share their
anticipated needs, future challenges and industry trends. If a company's
focus is directed inward and new products or product enhancements are
driven by internal needs, market share will ultimately shrink. Successful
businesses continue to expand by actively listening to their market and
staying ahead of the competition.
Employee Communication
Another common problem for small business owners is the failure to communicate
with employees. Sharing information with employees and educating them
on how they fit into the big picture will enroll them in the company's
success.
Implementation
With all their creativity and inventiveness, entrepreneurs often cannot
execute their vision. They find it difficult to stay focused, jumping
from one great idea or opportunity to the next. The thrill is in the "new,"
so good ideas or opportunities often go unfulfilled as excitement and
energy is shifted elsewhere. Focus on the things that will grow the company
and make sure they are successfully implemented
Lonely at the Top
Top performers in almost all fields, whether it's sports, acting or business,
have a coach to help them perfect their skills and enhance their success.
Because it can be lonely at the top, business owners who regularly meet
with an adviser, coach or other entrepreneurs, benefit from a powerful
tool for gaining useful insights and an independent perspective.
Barri Carian with Carian Consulting helps small business owners reach their potential with practical solutions for bottom line results. Find out about her "Business Advisory Services On-Demand." Barri can be reached at (949) 640-2141.