You can’t have business growth without personal growth. That’s because both come from finding unity between you, your life and your business.
This article is the third of a series of seven. Here’s the model that this series of articles builds on:
Developing your business requires looking at your business’s environment and your existing business model, before helping you fit your model to the environment.
Understanding Your Environment
Perhaps it’s ‘Business 101,’ but it’s something that businesses typically aren’t very good at or don’t do well. Environmental scanning is something that may be infrequent. It also commonly happens irregularly or in response to a threat. You need to be aware of key trends, economic forces, industry forces, and market forces.
Regularly scanning your environment provides the foundation for critical decisions.
It sounds easy, but it depends on a set of skills you need to acquire and practice regularly. Having an independent voice in the conversation is proven to help.
Want to accelerate? Understand your environment. Ask:
- What are the key trends in my industry?
- What’s going on in the economy that affects my business?
- Who are my main competitors? What’s their point of distinction?
- What are customers looking for?
Understanding Your Business Model
The foundational levers in business are revenue and costs. Understanding your business’s revenue dynamics and the cost drivers are vital if you’re not to stall. Escaping stunted growth means understanding which levers to pull and push, and when.
On the revenue side, businesses accelerate by better understanding:
- Customer segments,
- Their product and service bundles,
- How they communicate and reach our customer segments,
- Customer relationships, and
- Revenue streams.
On the costs side, they accelerate by developing an improved appreciation of
- The most important assets required to make their business function,
- The most important things we do to make their business work,
- The network of suppliers and partners that make their business flow effectively, and
- The costs incurred in operations.
When businesses understand this, they have a clearer picture of how they create value for customers. When customers get value, enterprises get growth.
Want to accelerate? Understand how you create value through your business model.
Redesigning Your Business Model
No business model is perfect. Few ever become perfect and shouldn’t be. If you think your business is, you’ve almost certainly got a problem. Like tuning a high-performance car, accelerating your business through redesigning the revenue-to-cost balance will improve value creation.
Redesigning the business model means getting the facts on it and then pulling or pushing the revenue dynamics and costs drivers. It’s a process best facilitated by someone who understands business model design.
Want to accelerate? Redesign your business model. It’s (probably) not broken, but you should fix it regardless.
Creating Your Systems
When you have your redesigned business model, it’s time to create standard operating systems (or adapt existing ones). It’s time to find the six honest servants that support your business’s revenue dynamics and costs drivers: what, why, when, how, where, and who?
These need to be coupled to another keyword: value. Why? Every process must align with how the business creates value, either for its customers or for the enterprise.
Want to accelerate? Develop your systems around value creation.
Refining Your Systems
The words ’continuous improvement’ are a universal ‘turn-off’ for some people. However, in the world of excellent systems, they’reGOLD. Let’s reframe what they mean in this context. Typically, they’re all about process efficiency, precisely as they should be. However, as an accelerator, they’re actually about how we drive more value yet through excellent systems.
Refining systems means we tie another word to our six honest servants: why? For each process, ask: what-why, why-why (yes go on, ask it), when-why, how-why, where-why, and who-why?
Want to accelerate? Look at refining your systems.
With the business model and systems in place, it’s time for relentless tactical execution. Businesses need to plan operations, plan sales, develop resource capacity plans, and dynamic budgeting. It’s how businesses devolve strategy through processes into tasks. It’s how enterprises manage the risk of achieving (or not) tasks. Execution is mapping strategy onto actions and following the details as processes work through.
Want to accelerate? Be relentless.
In work as much as in life, it’s common to feel that people have let us down. However, if they don’t know the standard expected of them, they’re ever likely to disappoint. Alternatively, if people understand what is required, there is a higher chance that they will deliver. So, setting high expectations is a better way to go if you need high performance. Further, if you’re expecting people to produce, it’s best to ensure that they can do so.
Want to accelerate? Set the standard.
Communicating in business should operate on the same principle as voting: “early and often.” It is complex, but not complicated, and entails sharing information through multiple means, with the emphasis on sharing. Characteristically, High-performance cultures feature accurate and timely communication of information and ideas by their members. This trait applies to receipt as much as transmission, and a further feature of high-performance culture is their members’ ability to listen and listen deeply, being highly aware.
Want to accelerate? Communicate. Speak. Listen.
Learning from Moments of Truth
‘Moments of truth’ are those ‘ah-ha’ or particularly those ‘oh no’ moments we have in business life. Often as not we don’t learn from them or if we do, it’s usually tinkering to fix up the symptoms. We rarely take a detailed look at what we can learn and what we can need to change. That’s because we often don’t have the skill set or set aside the time to take a hard look, learn, and make the necessary change.
Learning is crucial in high-performance cultures. It’s how they advance and is a foundation for growth. Cultures that learn out-perform those that don’t.
Want to accelerate? Learn from moments of truth.
My next article will look at how you develop in life through weaving your life’s braid.