How much time are you spending working IN your business rather than ON your business?
Over the past few years whilst helping small and medium sized businesses run smarter and more efficiently, trying to increase their cash flow positively and understand their margins, the same thing has cropped up over and over in every company: All the owners of these companies work long hours and are dedicated to making their venture a success, but lack doing one vital thing; working ON their business rather than IN it.
By this, I mean the owner runs the operation and is constantly fighting fires but never takes time to step out of his office environment and look at the business objectively analysing what he can do to improve where he is taking his business and how is going to get there.
In my opinion it is essential to take time out and re-evaluate what is happening from ‘inside’ the company at least every 90 days. With almost 90% of new businesses failing in the first 5 years, it is clear that the basics of understanding a business are lacking.
The obvious mistake most start-up business owners make is think that because they have the technical skills of making a product or delivering a service, they assume that he/she can make a success out of running an organisation that delivers this product or service. The technical work of a business and a business that does the technical work is vastly different.
Being “just” an entrepreneur is not enough. The entrepreneur needs to be a salesman, the product technician, the general manager, the accountant and the visionary leader. Without wearing all these hats in the beginning stages, the company will more than likely fail.
While working ON your business you should create a working manual that would in theory allow you to sell or franchise your business without you, the owner having to remain involved. This would then cover every aspect of your business, allowing the systems and procedures to make up for any skills lacking in the business and “fool-proofing” poor service and product delivery.