During my years in the corporate world and as a coach I’ve found seven practices that can adversely affect any business. It’s my Top Seven Business Sins list. These sins are not the mortal sins spoken of in religious doctrine. They won’t condemn you to an eternity of torment. They can, however, be fatal. Fatal to your business, that is. Many business owners believe that they won’t get punished unless they get caught. But, if you commit these sins, by the time you realize you’re being punished it’s much too late to claim ignorance.
You may recognize some of these sins in others. If they make you feel uncomfortable, good. Take action now to correct the problems standing in the way of your success. In ascending order of importance they are:
7. Not using your professional team
You’ve got an accountant, a lawyer, a banker, an insurance agent, and probably a financial planner. They are a resource that you can choose to use or ignore. These are knowledgeable professionals whose expertise is invaluable, if you use it wisely. When I hired my lawyer, I told him I expected him to keep me out of trouble, not defend me after I got into trouble. Make them members of your team. Keep them informed and get feedback before you make any major decision or commitment.
6. Lack of Systems and Procedures
If you were in an accident and unconscious for three days could your business run without you? Do you have an operations manual? Even if you can be at your business every day, would you hire a fox to guard the henhouse? Of course you wouldn’t. You’d even keep an eye on your trusted dog. So why would you let a single employee control all your deposits, write all your checks, or provide pricing to customers without a second pair of eyes checking the transactions? As President Reagan said, “Trust, but verify. ” Put procedures in place to protect your business.
5. Failing to plan
Some businesses succeed by accident and some people win the lottery but most who consistently succeed in business do so because they develop a good plan and then follow that plan. Sure things change, but if you don’t know where you want to go it really doesn’t matter which road you take. Failing to plan is planning to fail! So, plan the work and then work the plan.
4. Ignoring your customers
Have you told your customers lately that you love them? Unless you are the only business in town, your competition is trying to convince your customers to become theirs. Research has shown that for the majority of consumers the intangibles like customer service, quality and convenience are more important than price. If your business is like many service businesses, you probably get 80% of your revenue from 20% of your customers. Invest 80% of your attention in your best customers.
3. Doing, not leading
Many people spend too much time working “in” their business instead of working “on” their business. Leaders determine the goals and the direction of the company. Managers implement that plan and employees do the work. You are responsible for setting the tone, not doing the work. Get the train moving and then control the speed. Don’t shovel the coal. Ask yourself, “What is the highest and best use of my time?” Focus on the important things in business and life.
2. Not collecting receivables
I had a client once who said, “Billing is one procedure, Payment is another. ” He believed in one but not the other. The majority of businesses that fail do so for lack of cash flow, not debt burden. Make sure your customers understand and agree to the price and terms and then follow up with them before payment is due to prevent problems. Recognize and reward prompt payment.
1. Making your business the most important thing in your life
Okay, I admit that this will probably not result in the failure of your business. As a coach I have to ask you to think about it, though. Why are you in business? What’s the purpose? What’s your goal? If I asked your friends and family what’s important in your life, what would they say?
Committing these sins won’t guarantee your failure, and renouncing them won’t guarantee your success. But, as a business owner, wouldn’t you prefer to invest your time and money in something that is more likely to pay off? Business owners who embrace good practices are much more likely to achieve their goals, experience less stress, and enjoy a more rewarding personal life.
Dave Ferguson is a coach and the owner of Lake County Business Coaching, Inc. , a coaching firm dedicated to helping people in business become extraordinary, to realize their dreams by achieving their goals. More information is available at http://www.LakeCountyBusinessCoaching.com