Saturday, December 14, 2013

11 Ways To Position Your Business To Last

How do you build a business that will stick around for the long haul?  With very few exceptions, the answer is the same for almost any business, whether you’re looking at it from a near or long term perspective. There is a common saying; "don't let the tail wag the dog."  Take control of your company's future health and direction by establishing a sound business operating structure.  

I've seen many public companies operate shortsightedly, pumping up their quarterly numbers to boost their stock prices, with sometimes disastrous long-term results. A business with an owner who measures growth and progress over the long haul and not simply month to month or quarter to quarter is a much easier ship to steer.

There are basic elements to increasing your chance for achieving durability in the years to come--assuming, of course, there's a demand for the products or services you're offering.
  • Establish financial controls. This may sound obvious but having a grasp of the numbers provides insight into reducing your risk of theft or fraud. Put simply, until you have a firm handle on knowing how your dollars are being spent, your business is missing a solid foundation.
  • Minimize distractions. As a business owner and an outside observer, I've seen firsthand how an owner, mired in the minutia, suffers from the inability to effectively chart an effective course toward success.
  • Hire good people or outsource those distractions that alter your ability to steer the ship.
  • Increase the top line. While apparent, increased sales creates wiggle room and reduces risks associated with a lack of scale.
  • Diversify. Providing additional products or services and establishing new customers and geographies minimizes the impact of a significant loss while opening new channels for potential growth.
  • Streamline and document processes. The distinguishing feature of strong companies is the ability to repeat operating processes. Once the processes are simplified, successful and repeatable, the fun journey of growing the business can flourish. If your dream is to become a bigger company, start acting like one.
  • Improve efficiencies. Companies that waste money bleed profitability.  Becoming more efficient typically leads to improved EBITDA, thereby increasing the value of your company to its owner or a prospective buyer.
  • Define what makes you different. The ability to separate yourself from the herd is where margin opportunities live.
  • Maintain and improve assets. Maintain liquidity that can be used to take advantage of technological improvements, expand operations and keep everything in running order.  Idle assets equals idle cash.
  • Build a stable workforce. Investing in your most important assets (your employees), while demonstrating respect, fairness and inclusion pays off.
  • Compete on value instead of price. Competing simply on price can lead toward a vicious death spiral.  Help your customers to buy from you because of your value and differentiation from the herd.
Creating sustainability requires effort but the results can be rewarding not only to you but also future generations.
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    Kevin Minton
    Chief Executive Boards International

    Chief Executive Boards International: Freedom for business owners & CEOs -- Less Work, More Money, More Freedom to enjoy it

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