Recently, I wrote about “Resolutions”. Why do many resolutions fail? Why do some succeed? I shared research that suggests that failed resolutions often come down to three factors: 1) Changing your consciousness, 2) Accountability, and 3) Overcoming your internal fears of change.
Today, I will lay out the first five of ten critical factors to get your business off to a Fresh Start in 2022. Next time, I will finish up with the remaining five critical factors for success.
Key Factor #1: Vision
Do you ever feel like you are trying to get somewhere, but you’re not quite sure where?
Recently, I was talking with a client about change. We often know that we want to change, but we get overwhelmed in identifying where to start and how to start. The first and arguably most important place to start is with Vision. Where are you trying to go?
In Lewis Carroll’s “Alice in Wonderland”, Alice comes upon the Cheshire Cat and asks for directions.
Alice: “Would you tell me, please, which way I ought to go from here?”
Cheshire Cat: “That depends a good deal on where you want to get to.”
Alice: “I don’t much care where.”
Cheshire Cat: “Then it doesn’t matter which way you go.”
Alice: “…so long as I get somewhere.”
Cheshire Cat: “Oh, you’re sure to do that, if only you walk long enough.”
If you want to know what you need to change to make your business more successful, you need to start by identifying what success means to you. Focus first on desired outcomes. If you are to be successful this year, what does success look like? For many of my clients, success comes down to several factors:
- More net income for the business
- More revenue
- More time
- More joy
- More effective leadership
For 2022, what does success look like? Do you desire a specific profit or income target? How much more revenue do you want/need for the year? How much time do you need to free up? For what purpose?
Time is something most people know they want more of, but they don’t often know why. If you spend time identifying how much additional time you are seeking, it can help you better prioritize what to change.
Very few business owners devote enough time to defining “joy”. What would more joy look like for you this year? More interactions with your team? More celebrating? More vacations? Reading more books? Eliminating nagging issues that just drag you down? Spend time defining what joy looks like for you.
Finally, most small business owners I encounter believe that they want to become more effective leaders. But they don’t spend enough time envisioning what more effective leadership means to them. What are your leadership growth priorities? More vision? Better strategy? More effective people management? Getting on top of your financial management? Inspiring people on your team to thrive? Imparting thought leadership to your industry? What does more effective leadership mean to you?
Key Factor #2: Hard Review
Thriving companies spend time taking a hard look at their business to better understand three things:
- What should we keep doing (or do more)?
- What should we stop doing (or do much less)?
- What should we start doing that we aren’t doing now?
To answer these questions, you must take a hard, thorough look at your business. And you cannot rely on sycophants to tell you what they think you want to hear. It can be very difficult for an employee to muster up the courage to tell you that something isn’t working. So, reward your people for telling you hard truths. At the beginning of the year, ask each department (or member of your team) to answer the three questions above. Offer some encouragement (maybe small rewards) to people who offer the most helpful or innovative ideas. Give your team time, support, and resources to assess their own areas of the business. Make sure they understand that your focus is on breaking things down, so you can then build things up. Help them to not fear coming forward with truth – even if the truths may seem difficult to hear. If you know what is really going on in your business, you can begin to make changes. But if you don’t have a clear picture of the issues, you can’t begin to address changes needed to move forward.
Key Factor #3: Focusing on Understanding if Changes are Strategic vs. Behavioral
I’m reading a terrific book on changing behaviors, by Katy Milkman, “How to Change.” In my business coaching practice, I spend a lot of time on strategic changes. But Katy points out that often, change isn’t about strategy, but about behaviors. As you review the changes you are seeking, I encourage you to identify which changes are strategic, and which are behavioral.
Why does this matter? I find that business owners will sometimes review their results, see performance that doesn’t meet their goals, and decide that their strategy “is all wrong.” So, they embark on a different business strategy, but they may in fact be changing the wrong things.
Often, the change required isn’t really a strategy change, but behavioral. You may have the right business strategy for generating leads, for example, but you don’t have the right lead generation partners or processes to implement the strategy effectively. Rather than changing the strategy, perhaps you need to change the behaviors that drive the execution of the strategy.
Key Factor #4: Customer-Based Brand Positioning
Your brand isn’t really what you think it is. Your brand is really what your customers (or potential customers) think it is.
Most small businesses have a “gut feel” as to what their brand means to customers. But have you actually asked them? A few years ago, I helped a service company develop a brand strategy. To start the process, I interviewed several of their customers. The company believed that their customers “bought their brand” because the brand delivered some very specific financial benefits. So, the company focused their messages on those financial benefits.
But when I spoke to their customers, it was very clear, that while the financial benefits were “nice”, they weren’t nearly as important to their customers are a more intangible or personal benefit that the company delivered. When their customers talked about the company to friends, the customers didn’t focus on the financial benefits, but rather on how the company was incredible at helping their customers achieve other more legacy-driven goals. So, my client completely shifted their messaging away from financial benefits and more towards the type of benefits their customers really appreciated.
When was the last time you interviewed your customers? I encourage you to do that every year, and consider using an outside party to help you objectively hear what your customers are saying.
Key Factor #5: Product Strategy
The best positioning will fail if you don’t have the right product strategy. Are you offering the right products at the right price to the right customers? And how do you fare against your competition?
Customers. Do you know who your target customer is? Effective product strategies must start with clarity around your target customer. Unfortunately, many business owners demonstrate FOMO (Fear Of Missing Out). They refuse to identify a target customer for fear that they might exclude other potential clients from buying their product. But in reality, by refusing to understand their target customer, they develop products (and services) that become so “generic” they end up meaning very little to anyone. Spend time identifying who your best customers are . Why are they so good? What do they want from products or services such as yours?
Competition. When I hear someone say, “we are so unique; we really don’t have any competition,” I am immediately leery. Everyone has competition for their products or services. The competition may not look identical to you, but there is something out there that your customers will spend money on, instead of buying your products and services. You need to understand more about your competitive set. What do they do well? What do you do well? Where can you focus on, regarding product differentiation? The more you can differentiate, the easier it is for customers to see you as unique and valuable.
Pricing. What types of pricing analyses do you complete each year? Do you know whether you are priced too high? Too low? Are there aspects of your service (or product) that customers value deeply and you can charge more for? Are there some parts of your offering you should discontinue or price differently because customers simply don’t value that …or your competition can deliver it much more cheaply or effectively than you? If you sell through distributors, you also need to check on the final price that customers are paying. Is that consistent with your expectations …or is something breaking down in the process and your end price is not what you need it to be.
Benefits. What “benefits” do your products or services deliver to your customers? Are they meaningful to your customers? Do your customers also view these as important benefits that they are truly seeking? Let’s say you drove to a quick serve restaurant early one morning seeking a breakfast sandwich. You drive up seeking a fresh egg biscuit, and you discover that the restaurant serves only soup and salad. They may offer the most delicious soups around, but it is 8:00am, and you don’t want soup. For you, it doesn’t matter how great the soup is if it doesn’t deliver the product that you are seeking.
The analogy may seem absurd, but often I find companies that offer terrific products or services, that do REALLY nice things, but they don’t offer the benefits (or features) that their clients are really seeking. You need to understand if you are offering what your customers really want.
Product Performance. Stuff happens. Your amazing products or services aren’t always amazing. But are you tracking your performance? If you are a product company, are you periodically evaluating product quality? Do you compare it (objectively) with your competition? If you offer services, is the delivery of your services consistent? Do some service providers on your team offer less effective performance that others? Are you regularly checking with your customers to seek how they view your performance?
Getting off to a Fresh Start in 2022 can seem overwhelming, but it doesn’t need to be as difficult as you think. First, clarify your Vision. Do you have a very clear idea as to where you are trying to go? Without that clarity, you may spend a great deal of unproductive time chasing down paths that aren’t getting you closer to your true desired outcomes. Second, you should give your business a Hard Review. Involve your team, keep the process simple, and reward your team for sharing difficult truths. If you know where you are starting, it will help you get to your vision much faster.
Third, take time to understand whether you need Strategic or Behavioral Changes. You may have great strategies, but something is preventing their effective execution. Or perhaps your behaviors are perfect, but your strategy needs to be tweaked. Understand what is truly preventing change from occurring. Fourth, focus on Customer-Based Positioning. It is really easy to sit back and think you know how customers feel about your products. But if you don’t ask them, it is very likely that you may not really know. Finally, take a hard fresh look at your Product Strategy. Focus on customers, competition, pricing, benefits, and performance. If you get these right or make product strategy changes that reflect an ever-changing marketplace, you can ensure that your products and services remain fresh, relevant, and valuable to your customers.
Next time, in Part 3, I will focus on the remaining 5 Key Success Factors to Get Your Business Off to a FRESH START in 2002. These key factors are: 6) Functionality (time and roles), 7) Capability (skill sets and training), 8) Capacity for Change, 9) Communication, and 10) Accountability, Coaching, Support.
Carter Welch is an accomplished business leader, consultant and coach responsible for driving success in numerous businesses large and small. A former Procter & Gamble and Pillsbury executive, he focuses today on guiding small business owners to identify obstacles, overcome fear, develop winning strategies, lead organizations and ultimately, to achieve great success. He can be reached at 707-339-2842 or by email at email@example.com.
Embrace Change - We Can Help
Know that change can set your business apart and help you grow. To find out more, reach out to us here at Protea Financial. We would love to help!