Running a Small Business- The Unfortunate Truth
If you are a small business owner, you probably started running a small business because you loved being a doctor, a lawyer, a craft brewer, or whatever your passion is. However, the unfortunate truth about running a small business is that you need to have the business skills in order to be successful. That doesn’t mean you, the owner, need to have those skills, but you need to have people on your team who do. Let’s face it, no one is an expert in everything that is needed to run a successful business. If there were those people, there would be a millionaire on every block.
What should you do to manage this unfortunate truth about running a small business?
Our firm, ProStrategix Consulting, was founded to help small businesses bridge this skills gap they have when running a small business. Based on our experience, there are a couple of key hacks to follow so you can avoid this problem.
Having a CEO mindset
What does having a CEO mindset mean? A CEO has shared control of the business and relies on others to manage the details of the business. When running a small business, he or she understands that delegation is a way of life. To make delegation easier and more effective, business systems & processes are much more formalized and optimized. This might sound like a mouth full, but it doesn’t have to be as hard as it sounds. Simple things can help. For example, a weekly staff meeting where key staff report on the past week and align on goals for coming week, can help free you up from managing them day-to-day.
Have a detailed understanding of the business model
A detailed understanding of the business model doesn’t mean having piles of spreadsheets. It requires you to know four key areas when running a small business. It is important to know how and why you delight your customers. Are there any who are more valuable than others? Second, how you create value for them. What makes you special? Third, it’s also important to know how you deliver that value. What does it cost you? Lastly and less sexy, it’s important to know how you realize your profits. This is numbers part. Sorry, but there’s no way around that.
Having a business plan
Did you know that 1/2 of small business don’t have one? Having a business plan is very important when running a small business. Having a business plan is a great way to document your business model. It’s also critically important for loan applications and funding. It’s often overlooked, but having one makes you twice as likely to be successful than not having one.