Five keys to Small Business Success
At CEO Focus we have had the privilege of working with thousands of CEOs over the last ten years. Our founder, Jim Muehlhausen has even written a great book, the 51 Fatal Business Errors, that captures the essence of mistakes business owners frequently make. It’s a great book and a quick read. While simple in its application of management theory he does nail the mistakes we make over and over.
Well, I too have been working with small business owners over the last 10 years as investment banker, marketing and sales consultant and now as owner of the Philadelphia franchise of CEO Focus. I’ve created my own list of top errors I see small business owners making.
Sitting at your desk all day, spending evenings working on accounting, paperwork, taxes, proposals, even spending 10 hours a day working with clients and customers, mediating every employee disagreement, these things can all lead to isolation. And by that I mean isolating yourself from the next big idea. Isolating yourself from creative destruction. I have a client who loves to tell the frog in boiling water story. That is; a frog will hop into a pot of water and stay there as long as the heat rises slowly. Eventually it will get too hot and he’ll die. If you raise the temperature quickly he’ll notice and jump out. So are you the frog? Isolation leads you into compliancy which leads you to failure. My number 1 rule is to make time to work on your business (not in your business) and make sure you are exposed to a variety of ideas and viewpoints.
2 Not enough cash
Small businesses never have enough cash. Almost by definition can never have enough cash. Cash is king and right now with savings rates so low and the stock market so volatile, this is a great time to sit on your idle cash. The golden rule of lending is no one wants to lend you money when you need it and everyone wants to lend you money when you don’t need it. So save when you are making cash and spend that cash when others are losing money. Soon you will be the one doing the lending!
3. Ineffective marketing
A great business is worthless without customers. And how in the world are these people going to find you? Marketing matters and in some ways perhaps even more than sales (save that thought for another blog). Today the opportunities to get your message out are greater than ever but a consistent message along with a solid and repeatable marketing plan are key. Leverage technology to broaden your sales funnel by attracting the attention of LOTS more potential customers and then use EFFECTIVE sales people to turn quality prospects into customers. But it all starts with marketing.
4. Lousy Customer Service
See the CEO Quiz in our resources page. 70% of customers leave due to poor customer service. I sure do. I’m sure you do too. Is it really a surprise? We all want a good deal, a bargain, but what cements any business relationship is the feeling that someone is there for YOU. Good customer service does not have to be expensive by the way. A well run business with employees who know what they are supposed to do are the keys to good customer service.
5. Hiring Quickly and Firing Slowly
I’ve saved the best for last because I am as guilty of this as the next guy. Hiring is hard, interviewing is a pain in the butt, and training is arduous. Wouldn’t it be great if I could just slide cousin Suzie into that vacant slot and be done with it. DON’T DO IT. See # 4 above. If you want great customer service you have to hire great people. Take the time to find them, make sure you have a process to bring them in and up to speed quickly. Know what success looks like for that position. And fire ruthlessly. I’m not a huge Donald Trump fan but he got one thing right. Your Fired. Bad employees ruin companies and you will end up firing them later anyway. Save yourself time, aggravation and money and don’t hesitate. Fire fast and hire slow.
Today we have launched our new web site and this is my inaugural blog. Much more to come and I wish you all a success filled October.