Characteristics of Successful Companies
About face is a familiar sound in the military. Turn around and get it right. Sometimes an start-up business should turn around and check. There are many reasons a business goes under, but the most popular is to blame the economy. Somewhat true, but start-up companies are not the only ones failing. Established businesses find themselves falling into the same ills of going under.
Some businesses have lasted a long time doing things a certain way. Leadership roles change, the old is done away and replaced by the new. Change is good, but too often the mistake made is new leadership fails to see how and who worked to make the company succeed. There are loyal employees who invested in the vision. New leadership knows the direction they want the company to go but fails to communicate the visionary plan effectively. It’s good to have a vision, but a strategic plan is needed to be successful. Let’s look at some reasons why a company stumbles or doesn’t succeed.
Strategic or business plan – This is probably the most important factor of all. If you don’t know how the vision will be successful, it is bound to fail. There are several steps in planning. Analyze and research for the right time. What or who is the target market? Who will I need to help with the vision to get it accomplished? How much capital will I need to make the changes and sustain the operation? These are things to consider before action can be taken.
Effective communication – Everything in life operates successfully with effective communication. You may have a vision, but if it is not communicated effectively it is just a words on paper. Maintain open communication at all levels. Good communication is not just talking but listening as well. Everyone needs to know who, what, when, where and why.
Human assets – Know who you need. Hire people who are experts in their field and can do the job they are assigned. Established companies understands that they need new talent to get them to their new destination. Sometimes, who got you here won’t take you there, therefore its important to either bring new talent into the business or ensure that the current talent you have are constantly honing their skill-set to keep up with the changing demands of the marketplace. Reassign if necessary to place people in the right niche. This will promote strong staff morale. Develop and encourage a team-like atmosphere.
Strong management – Visionaries are not always good managers. A good manager understands the vision and mission, and knows how to communicate to staff to get productive results. They observe and listen before making decisions. Good managers need to know how every aspect of the business operates. They delegate, they train and they trust their people to do their jobs effectively.
Sound finances – Know how much is needed for start-up and maintain operations. Have a stable cash flow, not just steady revenue and sales. Don’t depend on credit or promissory notes. Under capitalization is one of the root causes of why businesses fail. Some companies that struggle with cash flow failed to realize that one of the main reasons that they still continue to experience cash flow issues is because they were under capitalized in the from the start.
Know the market – Understanding what is needed is important. Know your vendors supply and customers’ demand. If the product or service is not needed or the market is already saturated then their is little reason for your business to exist unless you can create new demand. Constantly be researching and evaluate market changes.
Pitfalls and mistakes – Everyone makes mistakes. This should not be construed as failure; they are just stumbling blocks or learning tools that teach valuable lessons. The key is to recognize these mistakes and take action promptly, if the pink elephant is in the room, acknowledge it and do something . Re-evaluate, correct and build on those mistakes.
The bottom line for a vision to be seen by everyone and become successful is careful and strategic planning. Put systems in place and focus on continuously improvements. Communicate effectively by listening. Build a strong team that focuses on your customers needs. Build a strong relationship with your vendors.
By: Shirley Tan
