Small businesses are running lean these days, but that doesn't necessarily mean they are in good shape. No doubt the coming year will be challenging for many. Making it over the finish line will require being in tip top shape. Here are some tips to get your small business in fighting condition:
Strengthen your strategy. A strong business strategy, combined with alignment and discipline, can yield impressive results for small business owners. Small businesses have the advantage of being nimble. They can respond more quickly to market conditions than larger businesses can. This can be both a blessing and a curse. If your organization is waffling every time the wind shifts, then it's time to take a closer look at your strategy. Ask yourself the following:
- Does our business plan still make sense given today's market conditions?
- What products and services can we add that will make our profitable customers even more profitable for our business?
- When is the last time we communicated our strategy to those responsible for implementation?
Trim the fat. You may be wondering how you can trim the fat when you are running so lean. Let's not kid ourselves. Many small business owners have a difficult time separating their business relationships from their personal relationships. You may have an employee who has been with you since you started the business, and whose performance has deteriorated over the years. You keep thinking things will get better. Alas, they never do. Or, you may have hired someone to do a particular job that no longer exists. The employee is doing a great job in their newly assigned role, but do you really need the added expense of paying a PhD to do a job that only requires a high school diploma?
Be honest with yourself and ask the following question: If I were to hire someone to fill this role today, would this be the person I would hire? If the answer is no, then you know what you have to do in order to cut back on excess fat in the organization.
Building human capital. A business is only as good as its people. How would you rate your people? When it comes to building human capital, there really are only two choices. Dump what you've got, or work towards improving existing human capital. Dumping what you've got isn't necessarily a bad strategy given the abundant pool of talent waiting in the wings. However, building on what you've got and strengthening employee loyalty may be a better route to go, especially if you are concerned about the potential loss of institutional knowledge.
In years past, the strategy has been to cut out funding for employee development. It's no wonder that we have teams of people drowning under poor leadership. It's time to strengthen both the management team and those interacting with clients and customers. With your people, select one or two development opportunities and begin building bench strength. Support this learning with coaching and it won't be long before your people are teaching you a thing or two.
Alignment. World-class athletes know the importance of keeping their bodies in alignment so they can compete with the best. The same holds true for small businesses. A well-tuned strategy, along with the hiring of the right people in the right positions, can only take you so far.
People, programs, and processes must be aligned in order for businesses to optimize the resources on hand. Only then will you be able to achieve high levels of business success. The best people in the world will not be able to move the organization forward with faulty programs and processes, especially if they are not empowered to make changes. Alignment is best achieved through strong communication and the removal of barriers that are preventing people from doing what you've hired them to do. Invest the time necessary for alignment and reap the results associated with world-class organizations.
Increase trust. Small business owners are often trapped by their own success. They subscribe to the belief that if you want something done right, you have to do it yourself. In the end, these micromanagers crash and burn.
It's impossible to grow the business while doing all the work. Small business owners must surround themselves with people they trust, so they are freed up to work on the business rather than in the business. The key to building trust is credibility. Do you do what you say you will do? Do your employees follow through on their commitments? Do you have the capacity to apologize when you make a mistake? It takes time and effort to build trust, but the rewards are bountiful. What will you do today to increase trust in your organization?
Do something every day to get your small business into tip top shape and you'll be well positioned for growth in the coming years.
© 2012 Matuson Consulting. All rights reserved.
Roberta Chinsky Matuson is the President of Human Resource Solutions (www.yourhrexperts.com) and author of the highly acclaimed book Suddenly in Charge: Managing Up, Managing Down, Succeeding All Around, Sign up to receive a complimentary subscription to Roberta's monthly newsletter, HR Matters.