All new business owners begin with the intent to grow a great business. The results are painfully different. The SBA reports that only about one third of new businesses survive 10 years or more. Why does this happen? What contributes to the success of the surviving businesses?
Martin Zwilling reported, “Over 25 years ago, Michael E. Gerber wrote a best-selling business book called The E-Myth: Why Most Businesses Don’t Work and What to Do About It. The E-Myth (“Entrepreneurial Myth”) is the mistaken belief that most businesses are started by people with tangible business skills, when in fact most are started by “technicians” who know nothing about running a business. Hence most fail.”
The importance of business management skills isn’t widely appreciated even with the Google Library and You Tube University where all the information you would ever need is available to everybody. Most new business owners don’t realize the need for “tangible business skills”.
Therefore, most businesses are started by professional technicians with great skills and no knowledge of the management skills needed to help the business grow and survive.
With the help of Martin Zwilling, contrasting the mindsets of the professional and the business builder will highlight the change in perspective required for building a strong and enduring business.
The Professional Perspective
- How much work should I do to get the income I need to stay in business? The owner is concentrating on the volume of work that he/she must personally complete to keep the business running.
- What should we offer the customer? Concentration is on the size and scope of the service or product and what is required to please the customers.
- How much should your product/service cost to produce and what should be the cost to the customer? Understanding the financial requirements and results in the business is foremost.
- How will we get the basic materials we need to supply the product? Supply chain requirements are considered and chosen.
- How can I get additional funding? Venture capital or loans are considered for operating costs.
- How can we market this business to get more customers? Marketing options are considered and chosen according to available funding.
- How will I hire people when I need them and how will I pay them? Hiring workers or getting volunteers are contemplated but often avoided.
The focus is on the present and attempting to keep things as they are now. Seeing what has worked in the past and what seems to be working now is the total consideration of the owner. This perspective often fails.
Of course, these tasks must be completed in any business, but with a different perspective, a good amount of stress is removed because you have business skills to design a Vision and plan for handling the required tasks with projected timelines.
Victorious warriors win first and then go to war, while defeated warriors go to war first and then seek to win. Sun Tzu
The Business Builders’ Perspective
- How should my business work in today’s environment? This perspective takes into account the changing environment of the business and research is completed to help design how the business will work today and in the future.
- What are my competitors doing that I should know about? A careful analysis of existing successful, related businesses is completed to determine the state of the art in the chosen discipline. Internet searches make this task easily accomplished.
- What meaning can we bring to the marketplace? The contribution to society the business willmake is taken into consideration and held as guiding principles in the business.
- What should my business look like in the future? A Vision of the future is carefully described and used as a business target.
- What strategy should I adopt to get to that Vision? An analysis of where you are in the business building process, what targets you wish to reach and how you are going to reach these targets is thought through and designed. This is your strategy.
- What systems should be in place to ensure consistent results that satisfy customers and create the best results? These will be routine ways of running the business that can be easily repeated in all important operations. Examples would be a marketing system, a financial system or a customer service system that works the same every time unless changes are indicated.
- How can we be better than the rest? Attention to innovation, improvement, excellence and industry leadership are important considerations for this owner.
There are other elements, of course, for each perspective. The listed ones are just a few major differences in the thinking processes of the professional and the business builder. The truth is, the business owner must carry out both roles. Your artistic application of management skills helps you organize and control all aspects for the sustainability and growth of your business.
The business builder takes the perspective of the CEO who sees the big picture then plans for business fortification, endurance and expansion. He/she doesn’t see themselves as always keeping their heads down grinding out the work and hoping they will eventually get help or maybe even afraid to get help. They see themselves as the founder of a great business that will be a benefit to society, financial freedom and personal independence.
Clear management skills recipes: “20 Directives for Small Business Success: Do or Die”