Running a business is a steep learning curve for any entrepreneur.
Making the switch from a self-employed to sole trader to a managing director isn’t always easy, particularly if you’re used to working alone.
Whether you’re expanding an existing enterprise or launching a new firm, you can avoid the usual pitfalls by learning the tricks of the trade from other business managers. To increase your chances of commercial success, take a look at the top 5 things every business owner should know.
Businesses invest heavily in branding but allocate far fewer resources to shaping the company’s corporate culture. In many cases, companys simply hire workers and let the in-house culture evolve naturally. Unfortunately, this isn’t always a recipe for success.
Imagine the type of workplace you want to work. What does it look like? How do you feel walking in every day? Do you socialize with colleagues out of hours? Is management accessible to workers or is there a strict vertical communication protocol? Is there a supportive environment? Do staff collaborate with one another or is the office a highly competitive place?
Shaping your company’s culture is essential for long-term success. With a supportive, enriching and motivating culture, employees are more productive and more loyal to their employers. Furthermore, a strong workplace culture enables you to maintain your core brand message in-house, as well as externally.
If you’re making the leap from entrepreneur to employer, you need to get used to delegating. Small business owners are used to doing everything themselves. From answering phone calls and ordering suppliers to pitching for investments and fixing the printer; the small business owner becomes a master of multi-tasking.
As your business grows, however, you’re going to need to rely on other people to carry some of the load. This can be a difficult transition for hands-on business owners but it’s one you need to get right. Inadvertently micro-managing your staff stems creativity and displays a lack of confidence in their abilities.
In contrast, delegating tasks and letting your staff run with the shows your colleagues that you trust their judgment. While it’s perfectly acceptable to have well-established lines of authority, ensure workers have the freedom to undertake the tasks they’ve been given.
One of the first things you learn as a business owner is that things go wrong; often when you least expect it and without any warning. That’s why contingency planning is essential. Unexpected issues can result in unnecessary downtime, which is disastrous for any commercial organization.
To ensure your business remains operational at all times, you need to have a range of contingencies in place. From back-up servers to keep your website up and running to business loan protection to ensure your company’s financial obligations are always met; every aspect of your business needs to be safeguarded. It’s important to remember, however, that equipment and processes aren’t the only things that are fallible.
As business owners are used to doing everything themselves, they store a lot of vital information in their heads. When only one person can execute critical processes or operate certain equipment, the whole business is in jeopardy. If you are injured or unwell, for example, the entire organization could grind to a halt.
When you’re formulating your contingency plans, be sure to include a back-up plan for how the business will operate if you’re unavailable. As well as ensuring the company can continue generating profits if you’re unable to be at the helm, this approach will enable you to take some much-deserved vacation time too!
As your business grows, you’ll need more people around to cope with the increasing workload. However, hiring staff isn’t simply about finding people with the right qualifications and skills. It’s important to have a good mix of personalities in the workplace, particularly in small businesses where staff are working alongside each other every day.
Even when you can find the right people, there is a lot of regulation when it comes to hiring staff. With varying regulations from state to state and different legislation depending on the number of staff you employ; it can be difficult to determine what your legal obligations are.
To avoid unnecessary legal complications, seek professional advice before you begin recruiting any staff. Furthermore, working with freelancers and subcontractors can enable you to gauge how much support your business needs and, to an extent, avoid the strict employment regulations associated with recruiting staff.
Putting all your eggs in one basket is always risky, particularly when it comes to business. If you’re reliant on selling just one product or service, you could go out of business if it becomes obsolete or overshadowed by a competitor.
Diversifying your business may involve expanding your product line, expanding into a new market or even targeting a different demographic. By widening the scope of your business, you can generate numerous different revenue streams. If one is affected by external factors, you will still be producing turnover and making a profit.
Even temporary glitches can cause major cash flow issues, especially for small businesses and new enterprises. With diversification, however, you can minimize the risk of income disruptions, reduce the need for external investment and build a more robust business model.
When you’re managing a successful enterprise, you should always be operating strategically. While it’s easy for owners to get caught up in the day-to-day demands of running a business, this can detract from your role as captain of the ship.
As a business owner, it’s up to you to grow the business. By having access to a reliable, talented workforce and a strong professional network, you can ensure that your business can operate without your hands-on involvement. This frees up your time and enables you to focus on attracting investment, increasing profits and growing your business.