Building a Profitable Business Takes Time
By Travis Snider, EvCC Small Business Accelerator Lead Instructor and Business Coach
In September 2010, a group of 17 local companies joined the first Small Business Accelerator at Everett Community College. The Program’s promise was to accelerate company growth and profitability while reducing an owner’s time in running the business. By the end of ten months, participants reported a number of significant improvements, but also lamented, there was still so much to do.
The group was made up of very experienced entrepreneurs. Revenues ranged in size from $400,000 to $10 million. Employee counts were from 5 to 70. The average length of ownership was over 15 years.
The program introduced students to a process we call “Business Acceleration”. This is a method of assessing, designing and growing a company in a structured and sustainable manner. In the vision exercise of the business acceleration model, most participants determined they would double the size of their companies within 3 to 5 years.
Assessment of a company’s current situation is the starting point for business acceleration. Owners analyze what’s working and what’s not through a review of financial and operating trends and business assessment questionnaires. An important exercise is to identify an owner’s personal “frustrations” about the business. These frustrations are issues that act as obstacles to achieving high level results or owner satisfaction.
From previous research, we found that owner frustrations are an important indicator of where improvements should be made. Experienced business owners are survivors and understand how to run a business. The difficulty, they say, is where to set priorities for future change. What should come first? What will provide the biggest immediate result? Where should I spend my time? How long should it take?
The assessment typically identifies 15 to 20 issues requiring attention before growth can occur. Issues like a lack of financial statements, limited marketing results, or a lack of skills in the workforce hinder progress. Our Accelerator group identified many frustrations during the program and set to work to eliminate them.
Some frustrations take longer to fix than others. This is particularly true in developing highly skilled employees or increasing the results of effective marketing. Patience and discipline is required while working to achieve results.
By the end of our 10-month Accelerator, significant progress was reported but most of the owners felt they were just getting started.
Why was this? The answer is that running a successful business is complex and requires hard work and a high level of discipline. Growing a business means “working on the business”. Much of the work is important but not urgent. In the everyday world, owners are confronted with urgent issues and constant interruptions. There is little time available for addressing the root causes of the frustrations or building solutions to eliminate them unless specific action to do so is maintained.
What must be done to build the profitable business?
Business Acceleration is a two to five year process. Owners should recognize there are limits to what can be accomplished in a given time period. Only a few initiatives can be effectively managed at a time. Entrepreneurs must be patient and steady in their efforts. Here’s what you can do to build your business:
- Assess the business and find the frustrations. Prioritize them.
- Create a vision of the future including goals so you know what you are aiming for.
- As an owner, determine your most valuable priorities and devote 60% of your time to them.
- Pick 2 to 4 priorities to work on. Don’t get distracted with too many projects at once. When you’ve completed one, add another. Continue the process.
- Give yourself time to work on these priorities. Set aside at least 2 to 4 hours per week.
- Engage employees in top priorities. Allow them time to work on the projects and hold them accountable for deadlines and results.
- Recognize your accomplishments along the way. Celebrate victories.
- Don’t give up and always stay focused on results.
What’s the payoff?
Growing a business is a long term process. Consider the first 6 to 18 months to be the building period. Give yourself adequate time to get things moving. It’s easy to become distracted or jump to other strategies. Stay focused and watch for results. Then you should be ready for sustained business acceleration.
Accomplishments reported by Accelerator participants:
- Significant increases in gross profit and net income
- Increased skill levels among employees
- Improvement in lead generation
- Greater ability to measure operational trends
- Reduced time in managing the business
- Higher confidence in one’s ability to expand the business
Attend an information session
To sign up call 425-267-0150 or email email@example.com.