A Reality Check!
"Knowing others is intelligence; knowing yourself is true wisdom. Mastering others is strength, mastering yourself is true power." - Lao-Tzu
The 5 Key Qualities Needed to Succeed in Business
Why do some people succeed in business and others not and why are some exceptionally successful.
Some of it may be luck but there are common factors in successful business people that would seem to indicate otherwise.
It seems that great entrepreneurs have 5 key qualities that help them succeed in situations that others may fail...
1) Desire to succeed – not having an employee 9 to 5 mentality. They want to go that extra mile to succeed and will do whatever it takes.
2) Positive Mental Attitude – both towards themselves and their business. They see opportunities where others see obstacles, their cup is always half full and disappointments don't get them down. They look forwards, not backwards.
3) Commitment to hard work – they're not afraid of hard work and the commitment needed to succeed.
4) Patience – Rome wasn't built in a day and as well as being committed they have the patience to see the job through, taking it step by step.
5) Persistence – challenges and problems will reveal themselves along the pay but the successful entrepreneur will persist with their ideas and not give up or change direction.
Now go and prepare a business plan for growth and success!
Planning is key to any business throughout its existence. Every successful business regularly reviews its business plan to ensure it continues to meet its needs. It's sensible to review current performance on a regular basis and identify the most likely strategies for growth. Any size of business needs to measure its activity to be successful or it will not survive.
Once you've reviewed your progress and identified the key growth areas that you want to target, it's time to revisit your business plan and make it a road map to the next stages for your business. Take on board the publications, business models, guides and movies from; http://www.cavendish-mr.org.uk
This guide will show how you can turn your business plan from a static document into a dynamic template that will help your business both survive and thrive.
The importance of ongoing business planning
Most potential investors will want to see a business plan before they consider funding your business. Although many businesses are tempted to use their business plans solely for this purpose, a good plan should set the course of a business over its lifespan.
A business plan plays a key role in allocating resources throughout a business. It is a tool that can help you attract new funds or that you can use as a strategy document. A good business plan reveals how you would use the bank loan or investment you are asking for.
Ongoing business planning means that you can monitor whether you are achieving your business objectives. A business plan can be used as a tool to identify where you are now and in which direction you wish your business to grow. A business plan will also ensure that you meet certain key targets and manage business priorities. Business is easy when you have the `right` people and the `right` business model to help you with the success of the business.
You can maximise your chances of success by adopting a continuous and regular business-planning cycle that keeps the plan up-to-date. This should include regular business planning meetings which involve key people from the business. Take on board the publication `Create Your Own Success Story` details below.
To find out more, see our guides on how to review your business performance and how to assess your options for growth.
If you regularly assess your performance against the plans and targets you have set, you are more likely to meet your objectives. It can also signpost where and why you're going astray. Many businesses choose to assess progress every three or six months. The reality check is, every day with every job completed. Measure `every` activity for your success.
The assessment will also help you in discussions with banks, investors and even potential buyers of your business. Regular review is a good vehicle for showing direction and commitment to employees, customers and suppliers.
Defining your business' purpose in your business plan keeps you focused, inspires your employees and attracts customers. For more information see our guide on how to prepare a business plan.
What your business plan should include
Your business plan should include a summary of what your business does, how it has developed and where you want it to go.
You also need to make it clear what timeframe the business plan covers - this will typically be for the next 12 to 24 months.
The plan needs to include:
* The marketing aims and objectives, for example how many new customers you want to gain and the anticipated size of your customer base at the end of the period. To find out about marketing strategy, see our guide on how to create your marketing strategy in the publication `Accelerate with Impact`.
* Operational information such as where your business is based, who your suppliers are and the premises and equipment needed.
* Financial information, including profit and loss forecasts, cash flow forecasts, sales forecasts and audited accounts. See our business model on `Interpreting Accounts and Finance for the Non-Finance Manager`.
* A summary of the business objectives, including targets and dates.
* If you are an owner-managed business or even a large company, you may wish to include an exit plan. This includes planning the timing of your departure and the circumstances, e.g. family succession, sale of the business, floating your business or closing it down. See our guide: consider your exit strategy when starting up.
* If you intend to present your business plan to an external audience such as investors or banks, you will also need to include:
* your aims and objectives for each area of the business
* details of the history of the business, including financial records from the last three years - if this isn't possible, provide details about trading to date
* the skills and qualifications of the management involved in your business
* information about the product or service, its distinctiveness and where it fits into the marketplace
Drawing up a more sophisticated business plan
If your business has grown to encompass a series of departments or divisions, each with its own targets and objectives, you may need to draw up a more sophisticated business plan.
The individual business plans of the departments and separate business units will need to be integrated into a single strategy document for the entire organisation. This can be a complex exercise - but it's vital if each business unit is to tread a consistent path and not conflict with the overall strategy.
This is not just an issue for large enterprises - many small firms consist of separate business units pursuing different strategies.
To draw up a business plan that marries all the separate units of an organisation requires a degree of co-ordination. It may seem obvious, but make sure all departments are using the same planning template.
Objectives for individual departments
It's important for each department to feel that they are a stakeholder in the plan. Typically, each department head will draft the unit's business plan and then agree its final form in conjunction with other departments.
Each unit's budgets and priorities must be set so that they fit in with those of the entire organisation. Generally, individual unit plans are required to be more specific and precisely defined than the overall business plan. It's important that the objectives set for business units are realistic and deliverable.
However, complex it turns out to be, the individual business unit plan needs to be easily understood by the people whose job it is to make it work. They also need to be clear on how their plan fits in with that of the wider organisation.
Plan and allocate resources effectively
The business plan plays a key role in allocating resources throughout a business so that the objectives set in the plan can be met.
Once you've reviewed your progress to date and identified your strategy for growth, your existing business plan may look dated and may no longer reflect your business' position and future direction.
When you are reviewing your business plan to cover the next stages, it's important to be clear on how you will allocate your resources to make your strategy work.
For example, if a particular business unit or department has been given a target, the business plan should allocate sufficient resources to achieve it. These resources may already be available within the business or may be generated by future activity.
You may need to do some precise budgeting to decide on the right level of resourcing for a particular unit or department. It's important that resources are prioritised, so that areas of a business which are key to delivering the overall aims and objectives are adequately funded. Bear in mind that this may involve making cutbacks in other areas.
Use targets to implement your business plan
A successful business plan should incorporate a set of targets and objectives.
While the overall plan may set strategic goals, these are unlikely to be achieved unless specific, measurable targets have been set.
Targets help everyone within a business understand what they need to achieve and when they need to achieve it.
You can monitor the performance of employees, teams or a new product or service by using appropriate performance indicators. These can be:
Ø sales or profit figures over a given period
Ø milestones in new product development
Ø productivity benchmarks for individual team members
Ø market-share statistics
Targets make it clearer for individual employees to see where they fit within an organisation and what they need to do to help the business meet its objectives. Setting clear objectives and targets and closely monitoring their delivery can make the development of your business more effective. Targets and objectives should also form a key part of employee appraisals, as a means of objectively addressing individuals' progress. See our guide on how to use appraisals to manage performance in the comprehensive publication` Accelerate with Impact` ISBN: 978-1-84549-289-2
When and how to review your business plan
Once you've drawn up your new business plan and put it into practice, it needs to be continually monitored to make sure the objectives are being achieved. This review process should follow an assessment of your progress to date and an analysis of the most promising ways to develop your business. To find out more about these stages see our guides on how to review your business performance and to assess your options for growth.
This process is called the business-plan cycle. In some businesses, the cycle may be a continuous process with the plan being regularly updated and monitored. For most businesses, an annual plan - broken down into four quarterly operating plans - is sufficient. However, if a business is heavily sales-driven, it can make more sense to have a monthly operating plan, supplemented where necessary with weekly targets and reviews.
It's important to keep in mind that major events in your business' target marketplace (e.g. competitor consolidation, acquisition of a major customer) or in the broader environment (e.g. new legislation) should trigger a review of your strategic objectives.
The key aims and objectives of the business as a whole should not need such regular updating and may not need to be changed for up to two years. Change when it is needed by monitoring activity daily.
Regardless of whether or not there are fixed time intervals in your business plan, it must be part of a rolling process, with regular assessment of performance against the plan and agreement of a revised forecast if necessary.
Here's how I managed rapid growth (example)
Established in 2003 near Sleaford, Lincolnshire, Anwick Forge produces decorative ironwork using traditional techniques combined with modern technology. A key challenge for owners Fran and Tim Mackereth has been to keep control of the business as growth accelerates. Fran explains how this has been achieved.
What I did
"A good business plan is a must for any new or growing business since it gives targets to measure against. We had clear goals for our first year's trading, plus an ongoing strategy for steady growth in the first three years.
"However, after three months our sales were 200 per cent higher than we'd forecast. We also found that we were attracting more complex - and profitable - commissions than we'd expected. While this was obviously good news, it also raised questions about how we would cope in terms of staffing, production capacity and order scheduling."
Update the plan
"Thankfully, our original business plan was well researched and put together so we only needed time to review and update our original assumptions. The new profit and cash forecasts provided all the information we needed to help us manage our unexpected growth.
"For example, we brought forward the employment of another blacksmith as well as investment in new equipment. Originally we'd also planned for me to join Tim in the business part-time after three years. Our rapid growth meant I joined after 16 months.
"These changes to our plan created a chain reaction. Doubling our capacity and freeing up Tim's time for business development soon led to even bigger and more lucrative contracts."
"As we've grown, we've stuck to some basic financial principles and processes, such as proper cash flow forecasting, to prevent overtrading.
"We're very rigorous in our estimates, costing every last step of a job so we don't quote too low. We also have a policy of not offering reductions - we price a job fairly, and that's it. There's no point cutting prices to attract business if you can't cover your costs.
"Other methods we use to control cash are 'just in time' raw material ordering to save on storage costs, insisting on deposits from customers and making sure we get paid in full on time."
What I'd do differently
Target our marketing more carefully
"While we did some successful marketing early on, we should have refined it earlier to reach specific customers and sectors. It's all too tempting to stick with what you've got when you're growing quickly and time is at a premium."
Address work-life balance
"A new business can be all consuming, especially if it's growing quickly, and that's not healthy in the longer run. We should have included work-life balance issues, such as taking holidays, in the business plan. We do now!"
If only every government and bank/Venture capitalist globally followed the easy business models with skilled and experienced people on board of any age we would all be successful!
Plus, How are you going to `Boost Your Business` in the future?
How will you achieve the following in your business, Improve Profitability – Increase Productivity – Management/Control Costs – Plan Effectively – Organise Efficiently, are all needed to be successful in business. Also, what `Management Techniques to Increase the `Bottom-Line` will you use?
There are proven methods available that will help all Directors/Managers to improve efficiency and effectiveness in the business environment.
`Boost Your Business` is available for immediate purchase by visiting the secure Cavendish eStore online at http://www.cavendish-mr.org.uk - customers can download this report in PDF Acrobat format immediately after purchase.
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5 Key Qualities Needed to Succeed in Business