What Makes a Company Successful?
What makes a business successful? While success might seem confusing or random at times, there is a path to achieving it. While hard work is a major component of success, this factor tends to be exaggerated. Having success in business is as much about strategy as it is keeping your nose to the grindstone and working hard. As the old saying goes “Work smarter not harder.”
Getting Started with What Makes a Company Successful
In our many years of coaching clients, we’ve seen diligent, smart, and resourceful business owners on the edge of burnout because what they’ve been told about success revolves around keeping up with “the grind.” Business leaders feel they must keep an impossible work schedule. They cram work into each moment of their day to generate new ideas for their company. They keep pushing and striving and ignore real needs for rest and recovery. This is a recipe for feeling worn down, irritable, and unhealthy.
Running a business this way makes leaders expect others to sacrifice in the same ways for their business, which inevitably translates to low morale within the company and team members leaving for more balanced work environments. At a time when employees, more than ever, expect better working conditions, it is the responsibility of leadership to set the tone for what good work and good rest looks like.
A leader (or employee) should not need to sacrifice everything about their lives to enjoy success. This should come as welcome news to any business leader wanting to achieve a more sustainable level of success.
How to Focus on Long Term Success for your Business
Leading a balanced life is one major contributor to having long-term success as a business owner. Profit is another, but making money is a metric that too many business owners mistake for success. Profit keeps the business engine running but is short-sighted. Simply having gas in the engine is not enough to get you to your destination. You must have a strategy, roadmap, and a good sense of direction.
Short-term, focusing on profitability is good. However, so long as we are discussing long-term success, we need to focus on what contributes to a business’ staying power.
Longevity factors are things that make some businesses stick around for longer than others. Is it workplace satisfaction? Top talent? Empowered leaders? Or some combination of these? Let’s take a look together.
Signs of a Successful Company
As we see it, companies that understand the following ten things are the most likely to survive the next decade of business, and beyond! These are tips for longevity, not quick fixes or hacks to make more profit in the next six months. We believe that the holistic, long-game types of change yield the most dramatic results. But you must be patient while change comes in! It is not immediate but once it arrives, it is lasting.
11 Business Tips for Success
1. Achieve leadership alignment
Leadership tends to attract similar types of personalities: proactive, driven, and persuasive. This helps generate the energy necessary to get an enterprise off the ground. But navigating these personalities in the context of a leadership team can result in some friction. Especially if you have more than one leader that is highly opinionated. While conflict is natural and in many cases unavoidable on your leadership team, it is crucial to have this energy be more constructive than damaging. Infighting and power struggles will damage the company from within and trickle down to those at every level with its impact.
If your leadership team is not on the same page or is wasting energy pulling in two different directions, commit to achieving a workable solution. Practice active listening with your team and its leaders. Bring in a third party if necessary to get some clarity on what’s tripping you up. The goal is to achieve alignment. A professional consultant can help in this process, or simply pay attention to where disharmony is coming from on your staff or team. Letting go of a wrong fit is as important as making the right hires for the future of your company. Don’t let the temporary hurdle of having a hard conversation stop you from releasing a person to find a role elsewhere that is better suited if that is necessary for your business to enjoy higher levels of success.
2. Focus on your people (and listen to them)
A business owner who listens and responds to their team is one who is investing in the future of their company. A responsive leader is the backbone of a thriving business. Staff who feel heard are more likely to contribute at higher levels because they feel appreciated. And they are more likely to offer greater returns to their company. IBM’s study on employee engagement found that there is a positive correlation between employee experience and return on investment in the form of sales:
“Organizations that score in the top 25 percent on employee experience report nearly three times the return on assets compared to organizations in the bottom quartile.”
Helping employees find their sense of belonging, purpose, and a sense of achievement goes a long way for companies and their owners.
3. Know the present-day value of your business
Many business owners want to sell in the future but have no idea what their company is worth today. When they discover their company’s valuation too late, or it does not match what they expected to get from a sale, this often leads to regret. In business, present action informs future strategy. If you don’t know where you are headed to become more profitable or how to attract the right buyer, chances are, you won’t get there by the time you need to sell.
Don’t get so focused on the daily grind that you miss out on the larger opportunity to assess your market position and opportunities to become more profitable in the next five to ten years. Completing a business assessment with an accountant or business growth specialist can provide a lot of clarity in your exit strategy and the timeline of selling your business. It can also help you to improve your work culture and team engagement as you address roadblocks to growth collectively.
4. Step back from assuming too much ownership
What gives your company a competitive advantage over competitors? Creating a company that runs without the owner’s daily involvement. Buyers often look to this as a metric of how stable a company is without the founder running operations behind the scenes. A key question to address in this section is: are you able to step back without everything falling apart? Another way of saying it is—have you made yourself replaceable, as an owner?
The benefit is obvious for several reasons: owners can’t sustain running every aspect of a business over the long term. Burnout happens and even the best CEO in the world is only a specialist in a few areas. Overloading a business owner with too many priorities sinks productivity and causes frustration at every level of the business.
An increase in business value is correlated to how quickly and easily another owner (or future buyer) can step into the shoes of your operation and run it without disruption. Also, if you have created an environment of trust and interdependence within your organization, you will notice how stepping away for a family vacation or a long weekend will not cause the business to fall apart. This peace of mind alone is worth considering a move toward downgrading your involvement in day-to-day tasks as owner.
5. Adhere to your vision and make decisions around it
It’s easy to forget the reason why you started, especially if you are knee-deep in the daily problem-solving mode of running your business. Business owners can get too deep into task chasing and buried in stacks of things to do that they forget the thing that got them into business in the first place. For many, it is people or making an exceptional product that they use and love to tell others about. There is more data than ever before on what customers want, to a degree that is overwhelming. Pivoting around what the data says is a good idea for any industry, however, adhering to stated values and the company ethos will make sure you are moving in a direction that’s true to your company mission.
The data is there to help us but it isn’t always human. It can’t make value judgments that business leaders can for the health and overall direction of their enterprise. For example, it might make sense to use automation in a certain aspect of your business, but if a signature offering of your business is to provide a high-touch personalized service then the data on automation might clash with the overall intent of what you want to do as an employer. Respect data as far as it serves you but rely the most heavily on common sense. If you are leading with the heart as well as the head, this will make your business a natural stand out over and above others.
6. Write down your goals
Take some time to revisit where you were before you started building your product or hired your first employee. Imagine that space and think back to the feeling you had when you thought about what “could be.” Now in that headspace of where you were when you first started, is there anything different that you would like to change about how you are doing business today? Did a new passion develop or an old vision for what you wanted fade out? Did certain strategies you had at the beginning change? How can you update and modernize your goals to match where you are today?
Strategic goals should change over time. It’s natural to need more flexibility to accommodate for unforeseen circumstances that life brings. Experts agree that the number one thing that is important as it relates to making goals successful is to write them down. Scientists call this the “generation effect.” It happens when we achieve more with goals that we create for ourselves (and visualize in our minds) and we invest in that goal a second time when we write it down on paper. Since goals are likely to change over time, it's important not to get hung up on the timeline if we need to delay it slightly. The important thing is to revisit and return to our goals often, keeping the vision front and center in our lives. So round-up some of that excitement and deploy it toward your goals for this year and for moving forward.
7. Get some outside insight
There will be a lot of advice headed your way from different directions if you are a business owner. Outside counsel can provide a crucial level of insight both into your company and others they’ve served. One of the main problems business owners face is a lack of peer group of other business leaders heading in the same direction. It’s one thing to rely on staff, or spouses, or friends for advice, but quite another to lay down the roadmap to where your business is headed and have a dedicated mentor to offer strategic insights.
One good opinion is worth its weight in gold. Someone with the singular focus of objectively witnessing problems and catalyzing solutions is a smart plan to help you to reach your goals. It saves you from making costly mistakes in the trial and error period of figuring things out and helps you to see a path forward to the next week, month, or year.
Business advisors have various specialties and styles of connecting with clients. It is important to understand what your goal is with hiring an advisor, whether it's strategic like launching growth in a particular area of the business, finding out what your business is worth, or if it’s related to personal goals like getting more rest or learning how to step back and train the right people.
8. Get the word out in a timely manner
Two words have the power to make anything you are doing in business today more effective: sales and marketing. Business by referral is effective but limited to how far word of mouth can take your business. Your local area where clients know you best is a helpful but limited strategy for sourcing new business. If you want to break out of your immediate geographic area and sustain a more predictable rate of new leads, you will need to enlist a dedicated salesperson and or marketing professional to help you expand your reach. Business owners often hesitate with this one because they are not sure it will pay off. This is in large part because they are used to the status quo or the ways things are usually done. In our experience, businesses that are doing something in terms of marketing are far better off than businesses that are late to the game with their efforts and starting from scratch. Sales and marketing support your business’ profitability and competitive edge in the market. If you don’t have that machine running yet for your business, it is far better late than never.
9. Communicate better internally
There is no better way of caring for your business and its future than maintaining a high level of communication between staff and the rest of your organization. Effective and frequent communication means fewer misunderstandings between team members and a higher level of clarity in driving toward your goals. You will actually do less work if you communicate better from the top-down. This can be achieved in various ways, but probably the most important thing is frequency over method.
Frequency allows staff to ask questions, resolve issues, problem solve, and assume ownership over new problems since the last team meeting. Make it a point to communicate more often, especially in times of change, and if at all possible, in person. Digital forms of communication offer ease but sometimes introduce a buffer to expediency where in-person styles of relating ensure you have people’s full attention. It’s easy to reach Zoom burnout, (many of us are already there) so when it comes to communication, face-to-face is still king.
10. Keep your books/records in order
The earlier you can start this habit, the better. A vast number of businesses are flying blind when it comes to the numbers. They have so much passion, but no visuals on how much money is coming in or going out at any given month. Meeting with your accountant once a year for taxes is the bare minimum a lot of businesses do for themselves. If numbers aren’t really your strong suit, we recommend preparing for that shortcoming by hiring a business manager to ensure you have a strategic view of how your business is performing. A lack of financial strategy can get out of hand quickly. Keeping organized and orderly records and books ensures every aspect of your business runs more smoothly. Consider doing this as a restart button to your fiscal year! It will mean less stress all-around, more of an idea of where you can afford to spend, and will offer many likely positive and surprising insights on where your business has the potential to expand.
Growing Your Business with Coachwell
By focusing on the right things, more and more business owners are learning how to step back from the hub of operations to let the business take off with the people they’ve trusted to run it. It all starts with an integral vision of what company success looks like for you and finding someone to support that vision. If your goals include getting more intentional about your growth or creating a healthier work environment for your staff or yourself, consider getting a business growth consultant to help you!
