This is the sixth and final in a series of blog posts.
Small businesses are often formed because the owner has a good new idea. If the idea has legs, then the business grows to a reasonable but fixed level of revenue, but then begins to flatten out.
According to established data, only half of small businesses survive longer than five years, and further decays continue over time. There are a host of reasons for this, but in general, the reasons are similar as those that cause mid-level and large firms to stagnate. However, the small business has one advantage over its larger counterparts: There are fewer team members to get on the same page, so misalignment becomes noticeable and actionable early.
In this article, I will discuss managing work processes in a small business mindset.
Focus and Simplify
Larger businesses go through a plethora of “next new” approaches to work processes, with the intention of streamlining, eliminating errors, and accelerating excellence. They often bring in outside consultants, who specialize in the “best new approach,” to guide them through desired changes or improvements. Eventually, process improvement takes shape.
However, there are two strategic questions businesses must ask themselves:
Are we more efficient or effective in the way we do work?
Are we growing revenue and earnings as a result?
Small businesses already suffer from the load of work that must be done in their functional areas just to survive. Thus, they don’t have time to think about process improvement the way a larger business does. The real issue they face is what to fix or improve first.
What must you do to better attract and keep customers?
How do you increase your capabilities to grow your business beyond your current state?
Grow or Die!
The answer is to grow or die. The abovementioned processes are the most critical to both profitability and sustainability. Yes, the small business must continue to improve key work processes, but not by losing sight of those critical questions.
Attracting and keeping customers are most critical to small businesses. As such, the work includes
- Understanding why customers buy and recognizing the reasons may be different for different customers
- Identifying and reaching out to other potential customers who may value your offering
- Making it easy for customers to buy by simplifying the buying process and responding quickly to issues
- Pricing to the value you deliver, not to your costs to produce; and, if insufficient, reducing your costs or finding new offerings
- Building off your customers' knowledge with new offerings
Keeping your offering relevant or generating new products is the second most critical activity for a growing business. The work process above can be applied while recognizing that both clarity and specificity will evolve over time. Be willing to flow with your learning process.
How you do this, and how often you need to update, depends on your specific business conditions and go-to-market approach. In most cases, once you have this work defined, keeping it current becomes an ongoing component of your go-to-market process.
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Read the other articles in this series
The Small Business Conundrum: Silo Formation
Most business leaders believe they must organize around functions. In doing so, they create silos that kill market innovation creativity.
The Small Business Conundrum: Ongoing Innovation
Innovating is the hardest of the 5 critical drivers of business success, but it’s also the most crucial. Your business will not continue to grow without innovation.
The Small Business Conundrum: A Growth Plan
It is critical for small businesses to establish an operational growth plan. Identify the factors that lead to growth, the factors that prevent growth, and how potential markets fit into those factors.
