‘I will ask an initial question. How many people have a business plan or strategy in place now? Simple answer, in my experience as a Business Coach, is very few or none at all.’
Short term gain seems to be the way many businesses function. We are looking for the short-term fix, or next project that will keep us going, but don’t look at our business strategy for the next year, two years or longer. We have no end goal to work towards!
There are many aspects of how we run a business that decides those who are going to grow significantly or businesses that will stagnate and one of those aspects that produces stagnation is undoubtedly down to a lack of long-term planning. One of the industries I know very well, because of my background in food manufacturing, is the multiples retail sector (many of whom were my customers), specifically supermarket chains. These well-known household names stretch their business goals and plans way beyond even a three-year plan. They land bank sites for potential construction of a new store sometimes decades before they even present planning applications. They also study food trends and changes in dietary desires, looking to be first and take advantage of new opportunities around the food and groceries they stock. They are constantly reviewing the food supply chain to remain innovative and competitive, securing their profits in the future.
Why take the short-term view when there is a much better picture in front of you?
The SME sector more than often takes a short-term view to planning, only looking weeks or months ahead, or at the next project that will help to pay the bills for a few months. Many businesses stay afloat for years with this strategy but really lose out on opportunities through lack of planning or insight. A business of this nature will experience a roller coaster ride, which could present itself as feast or famine where income and cash flow is concerned.
The benchmark for a business that wants to experience high-growth is to look for that long-term plan, explore their market(s) in relation to innovation and diversification and build a strategy that is continually measured against performance. They will look to set down benchmarks or key performance indicators to continually prove their model or strategy, reviewing regularly the direction they are taking to make sure they are on track. Their performance may be measured by the strength of their residual incomes, contract acquisitions or indeed, in the case of the multiples, buying power. They will have gained considerable knowledge around their income including a complete understanding of costs, margins and profits. They will have a detailed marketing strategy which is measured and re-evaluated regularly. They most certainly will have a branding strategy, looking to continually build reputation and credibility within the market sectors they trade in. All of these facets are indicative of a business that plans long-term and has a vision or end goal.
Apart from the obvious and aforementioned, why build a long-term plan?
When we enter into the unique world of becoming a business owner, we dream about what our businesses will become, we have a vision of the end goal or imagine what becoming a business owner will provide for us in the future. So, why do we not take that vision into tangible business processes, planning and adopting methods of measuring our performance? As business owners we owe it to ourselves to detail out a path towards our ultimate goals! We had the vision, so why not create a tangible solid path towards that vision?
Infrastructure and mentality
High growth and achieving that end goal isn’t solely gained through hard work and certainly not acquired through short-term fixes. If it was, many businesses in the UK would be a great deal more successful than they currently are. It is created by putting an infrastructure in place that continually measures performance but details meticulously the long-term path to the end goal. It is about understanding how you are going to achieve that vision you had when you first opened the doors to your business career.
My work with business owners to set a clear path
I currently work with over 20 businesses and have just been appointed to an incredibly exciting new position with an organisation, based in London, that is looking to fast track over 85 businesses (something I will be announcing very soon).
The developmental plans I create with business owners is based on detailed analysis of their finances, operations, team requirements, processes, market research, marketing, sales and ultimately building profit. It is a proven coaching model I have been ‘working on and perfecting myself’ for the past five years, making incremental improvements in my methods and bespoke training materials, in how I support businesses along this path. Providing an abundance of necessary tools is a crucial injection into the fabric of the businesses strategy, but also changing the mind-set of the business owner, which creates an understanding of how the business needs to function to achieve those long-term rewards.
The reality is, business is complex in regards to the individual functions within the business, or the markets a particular business trades in, but the basis of understanding costs, margins and profits never changes. It is identical for all businesses, whether a service industry or manufacturer, and this is the very first place I start when analysing the potential of a business and formulating plans.
My last article covered this starting point quite extensively and, if you would like to explore an initial consultation to establish your high growth opportunities, please do get in touch!