You wouldn’t build a house on quicksand. Before you start digging and laying the foundations for a new house you would check to make sure that the ground was solid, that it could take the weight of the bricks and mortar. Then you lay the first level, the outline of the house, you start to build upwards, adding weight as you go, and building your dream house.
The same principle applies in business. You must lay a solid foundation on which to grow and prosper. Your foundation, set right at the beginning, will give your business longevity. Make sure it is rock solid. So how do you go about laying the right business foundation?
Focus on the basics first. It is easy to get carried away with the enthusiasm and emotion of starting a new business. Your dreams and aspirations are all tied up in your idea and the future. How great it will be and how much you will grow and profit. If start with the basics and get them right, you will realize your ambitions.
Be clear in your objectives. Set out what you want to achieve and by when you want to achieve it. Create a road map for success. Along this road place markers that show that you have arrived. Look at them as ‘distance markers’ that you might find along a highway. Start at point zero and then plan that by a certain point in time you will have travelled ‘x’ miles along the highway. It might be a revenue marker where you plan to increase your revenue. It might be related to your business costs, where you plan to reduce your costs by an amount (seek a cheaper alternative or supplier). It could be that you plan to hire at least three staff within six months of starting your business. Or it could be going International and operating in another country.
Now you have set out some business objectives it is time to share your goals with your staff. If you are on your own, then it’s up to you. If you have employees or partners then they need to buy into your business objectives. So take one objective at a time and understand how other people will support you and help you achieve it. What do they have to do to make themselves and the business successful? For example if your business objective is to make $10,000 per month by the tenth month of operation, how will the staff support this? If the business is in telesales and you have ten agents then each one should be driving towards a revenue target of $1,000 per month. What does this mean to the employees per day? Is it a flat $50 target each per day, or maybe you set a target of $250 per week. Create individual objectives for the staff that they can achieve and at the same time are challenging so they move the business forward.
You have developed your business objectives. Your employees know what is expected of them to support those objectives, now it’s time to make sure they have the right tools and training to deliver results. Create your processes. You cannot run a successful business without processes. Write them down so they come of your head and are recorded. Make sure the employees can follow them. Develop them with the employees so that everyone agrees how the process will work and it is efficient. It is often the case that the best source of advice and know-how comes from the employees who have to follow the process. Your processes will enable you to be efficient. They will produce a consistent output. They record knowledge so it stays in the business and doesn’t leave when an employee leaves. They enable you to improve and change your approach as your business or the market dynamics change.
And lastly in laying out your foundation, decide what you are going to measure and how you are going to measure your success. If you don’t measure it you can’t manage it. Start thinking about the measures that you need to know. Those measures that are the lifeblood of the business. It is easy to consider that revenue and costs are right up there at the top of the ‘important list’. And you would be right, but these are only a byproduct of all the other things you do in a business.
The types of measures that you might consider, (depending on your business model).
Daily workload. How many things do we have to do each day?
Staff productivity. How many things can the employees do each day?
How do we know that at the end of each day, week or month we have been successful or we have failed and need improvement?
How frequently do we measure our results?
How do we share the measurements with the employees to motivate them and keep them informed?
In summary, your rock solid foundation consists of a clear mission for the business, laying out your business objectives. Then sharing those objectives with the employees and developing their individual objectives to support the business. Next, creating the processes to enable the employees and the business to be successful. Finally deciding on what you need to measure. What you must know and by when every day or week to keep your finger on the pulse of the business. Business – individual – process – measure. Foundation.
Source by Rob Lyons
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