There are four basic principles you need to follow in order to have a successful business, writes Roger Harrop
The more I travel the world, and meet and work with companies large and small, the more convinced I am that the economic crisis and its consequences have been a good thing for business. It has forced organisations out of complacency and highlighted the need to get back to the basics of business – for everybody, no matter your size or sector.
PROSPECT FOR CUSTOMERS
Every business has an average conversion rate of leads into business and it must, therefore, be a fact that the more leads you generate the more orders you will have. Equally, over time the reverse must apply. Don’t think potential customers will always find you and that somehow it is a little beneath you to actually go out a try and convince people to buy your services.
There is a simple process that every business needs to address: You need to decide which markets you wish to serve, define who your potential customers are and then generate leads from those customers using as many compelling mechanisms as possible. There is, of course, a whole process involved in addressing those leads and successfully turning them into business, but initial, vital focus has to be the generation of leads and this is where all of us need to spend time addressing, revising and constantly updating.
EXCEPTIONAL AT WHAT YOU DO
No one can be mediocre these days. Frankly, if you’re mediocre in terms of your product or your service – or indeed the way you treat your customers – then you now run the risk of simply disappearing. You do, of course, need to focus on your products or services being exceptional, but increasingly I find the differentiator is more about the service you give to your customers and the way you treat them.
Maybe even more importantly you must hire and retain the very best talent. We simply cannot afford to have B- and C-class people in our organisations if we really want to thrive in this new world.
GREAT PLACE TO WORK
I still come across companies whose culture seems to be one of assuming that they are doing people a favour by employing them.
Employees have a choice – and increasingly, most particularly the latest generation, they are exercising that choice – based upon all kinds of considerations. It is not simply based on their prospects for advancement and remuneration, but rather on evaluating how the organisation is viewed locally and nationally, its ethics, how it treats all stakeholders, the values that define it and whether its leaders are people they admire.
Global forecasts are consistent that between now and 2030 there is going to be a war on talent with demand greater than supply. What this means for all of us, no matter the size or sector of our business, that we have got to get better at recruiting. We’ve got to make our organisations magnets for the best talent.
Many would argue that this should be number one in the list. Whether you are a publicly traded company or a family business, the only way you can grow and prosper and achieve your fundamental purpose is by generating profit and reinvesting into the future growth of the organisation.
There are, of course, many elements to making money, but important among these is charging the right prices, selling to people who have money and with people being the largest single cost for most, maximising productivity.
This means ensuring that each and everyone in the company is enabled to maximise the time they spend utilising the expertise for which they were employed, rather than all the other activities we may seek to get them involved in.
So those are four basics of business – any business. The world of business has changed; ignore the basics at your peril.