There are so many different strands to growing your business that I could write a book on this subject alone, so which are the top tips to keep your business growing in the right direction? I have listed below the top tips that will at least help but the key tip is to keep on revisiting your business model on a regular and frequent basis. Here are today’s top tips:
1. Keep your business model fresh – Most people understand the story of the frog in slowly boiling pan of water and in some ways this similar to what happens with business owners. Change is continuous and often undetectable in the heat of business battle and it is only when something crops up that brings a change to your attention that you take notice. The danger is most business people shrug off the change as something that does not affect them. Unfortunately a lot of the time these changes act like a dripping tap and in isolation probably don’t amount to much but over time most likely will.
To avoid being caught out check your business model on a regular and frequent basis and as a rule of thumb you should check, say every six months at least so you can keep abreast of changes. Sit down with key staff and let them tell you what is happening in your market place especially around services/product pricing, purchasing, cost base and sales trends. Once you have the information revisit your existing model and see how if at all, the feedback has affected the model and make the necessary changes and review these going forward for effectiveness.
2. Direct staff development – If you are a SME then by definition you are employing up to 49 people and a recent FSB report suggest that 25% of SMEs are looking to invest in the training and development of staff. As far as I am concerned development is all about getting the correct ‘performance’ from the staff. External training can vary and mostly expensive so make sure you are getting the most ‘bang for your buck’ by understanding what you want to achieve from the training in the first place. This is all the more important as the same research revealed 21% of SMEs are looking to take on additional staff in the next twelve months.
There is clear evidence that training staff makes them more content and productive but this only happens when you have clear objectives of what you want from the training. Any professional trainer knows this so beware if you are not absolutely clear on the ‘outcomes’ of the training before committing yourself. Get a clear proposal or better yet get three before deciding.
Obtaining the optimum ‘performance’ from staff is an art form in itself and revolves around understanding and developing three key areas. Any employee will have weaknesses or strengths in any of three areas: Attitude, Skill or Knowledge. Once the training identifies where the weaknesses are you can strengthen these and capitalise on the strengths.
3. Staff incentives – I have always believed ‘what gets paid gets done’ and this simply means make sure you get the incentives right for the role. The right incentive can often make or break a company so take the time to accurately describe what the job role is and what you want the employee to achieve from the role. 33% of businesses have increased salaries in the twelve months as the economic climate improves. Rather than just giving an across the board rise why not align pay increases with productivity and possibly offer more but based on hitting targets. The incentives should be applied to key roles to the business which directly affect the bottom line. This where you need a good job description which clearly outlines the key tasks you want achieving before paying an incentive. If there are several key tasks then apportion the incentive payment directly to the importance to the business.
4. Make sure you get paid – This may sound obvious but 5% of business owners do not chase overdue invoices for at least a week and in some cases months. This totally unacceptable and if you have completed the work or supplied the goods then you should get paid on time. Make sure you have clear payment terms set out and your staff understand them and chase up overdue invoices as per your invoice management process. If you do not have an invoice management process then get one in place as soon as possible. The larger the company the more likely they are to pay late so beware if they adopt bully boy tactics – do not put all your faith in this one debtor. Spread your risk of bad debt by assessing B2C as well as B2B and if B2B then diversify with size and sector as much as you can.
If you have the staff them make sure they are managing the invoice collection effectively as this is the critical life blood of your business. Make sure you give your business the best possible chance and it may mean you need to assess the benefits of invoice finance and or trading invoices for your business to keep the cash-flow right.
Image courtesy of twobee / FreeDigitalPhotos.net
Written by: Mike Smith