Earlier this month, I presented a webinar on Managing a Sustainable Business. As you look to grow your business and ensure your company’s longevity, it’s important to remember regardless of size, businesses exist for two main reasons:
Provide a product or service that meets an unmet need
Generate an acceptable return on invested resources.
If your product or service isn’t meeting a need, then the business most likely will not be able to generate an adequate customer base, and in turn not be able to generate a return on invested resources. The four factors important for a business to be sustainable include:
Market Positioning – A business needs to be in a market that is large enough to support growth regardless of the percentage of market share your company serves. There are two methods you can use to grow market share:
generate new customers for your existing products or services
generate new products and services for your existing customers
Sometimes a business is not ready for the market due to limiting factors, or the market is not mature enough to purchase the products and services being offered. Having a clear understanding of the market is key to managing a sustainable business.
Leadership – A business needs to promote learning for everyone involved in the process of operating the organization. This includes:
learning about how the business functions
learning about the products and services the business offers
learning how to collaborate
learning how to be customer focused.
Mentoring and coaching employees for succession and growth can have a significant impact on organizational culture. Keep in mind that open and authentic communication should also be part of the culture.
Operations – Having systems in place so that the business can operate effectively and efficiently are also important. One of the most important factors in operations is to make sure that internal resources are aligned with external demands. If you own a seasonal business, there may be times where inventories are lower than others, as well as staffing needs and resources. Addressing the ups and downs of the business cycle should include a review of how work is being considered, and make sure that the right tasks are being incentivized.
Planning – While many businesses don’t work from both a strategic plan and an operating plan, a sustainable business knows the value of both. It’s important to understand the difference between a strategic plan and an operating plan:
A strategic plan maps the way
An operating plan works the day
Planning creates a map of how the business will address short and long-term goals, and should be structured enough to provide stability to the business and flexible enough to allow for contingencies.
I hope these highlights have been valuable, and please check out my upcoming webinars. If you have any questions or would like help managing a sustainable business please email me at email@example.com.