By: Gordon McWilliam
There are consequences…
In 1986 Michael Gerber wrote about the need for business owners to “Work on their business, not in their business” if they wanted to be successful.
How right he was. Over the years Chris Steely and I have worked with hundreds of businesses and a common denominator is that business owners get overwhelmed by their businesses. What we mean by that is that they spend every waking moment just trying to stay above the water line.
Management and staff are focused on the day-to-day operation of the business and think about the business in a tactical way rather than in a strategic one. If one tactic isn’t working, let’s switch to another. Often they cannot see the answers to their most pressing issues, even when the answer is right in front of them.
Why? Because when the business begins we are interested in two things: our product and revenue. How do we bring revenue into the company? If we can just figure out a way to create revenue, everything else will take care of itself. No question, we need revenue; that’s a given.
But often growth is accompanied by chaos and diminished focus – more hats to wear, more problems to solve, more people to manage, and a growing business can get mired down in these issues. And on and on it goes until we become starved for clients, revenue, profits and, most of all, cash.
I recognize this clearly now because it happened to me; this was the case with my first business.
When I was in my twenties, I started a business with two partners in the early stages of the technology boom. It was the right time and we were in the right place. We were in revenue very early on, we were smart, we knew how to sell and we hit the ground running. Our SBA loan was paid back within the first year and we had even managed to make a little profit, at least on paper.
As our business flourished, we opened more offices and we hired more people. As we grew, it became more and more difficult to keep all of the balls in the air. This went on for five years. Then we sold the business.
So what happened? Why after five years were we willing to sell the business at a small profit and move on? We seemed to have so much going for us. To put it simply, we never took time out to work on the business and think strategically. All of our time was spent paying attention to the day-to-day operation: What were we selling? How much were we selling? How do we train our customers? We spent our time thinking about tactics, not strategies. We never came up for air.
The fact is we thought we had all the answers. We had no interest in looking outside of our very tight circle of managers to look for opportunities to take advantage of a rapidly-growing technology market. We were myopic and believed our way was the right way; after all, look how successful we were!
We never took the best that we knew and combined it with the best that others knew. We began to plateau and suddenly it wasn’t fun anymore. We just got frustrated with not achieving our goals. We never got to the place where we had a real business, but rather a job just like any other job. We were operators, not business owners and we got tired.
So, how do we find more time to work on the business? Ironically, you do it by working in the business, creating the conditions that give you time, energy and emotional freedom to think creatively about the future.
Take these steps for starters:
- Assemble a trusted senior team of advisors, giving them the authority and criteria to make good decisions.
- Organize your company around a culture of collaboration so nothing gets lost, everyone is inspired to think and ideas circulate to the highest levels.
- Establish an unwavering process for getting things done right. There is no substitute for excellence.
- Determine where you can add the most value and let others bring their value to the organization.
- Hire the highest quality people.
- Hold your team accountable.
- Goals matter.
- The marketplace will tell you what it wants – listen!
- Think strategically – tactics come after strategy.
- Culture matters – pay attention to it. Work to actively create the culture you want for your business.
Business operators get tired; business owners get rich.
“My biggest motivation? Just to keep challenging myself. I see life almost like one long University education that I never had — everyday I’m learning something new.” – Richard Branson