Step 10 of Building a Better Business

Keeping your ‘well of happiness’ full will help you build a better business.

This should be something you focus on all the time. Just as the flight attendants tell you to put the oxygen mask on yourself before helping others, it’s the same in business - you need to look after yourself at all times.

What are the things that fill your ‘well of happiness’?

These are activities that restore your energy and resilience levels and help you face challenges in your business. It could be dancing, yoga, mountain biking, reading, weightlifting, cooking, or meeting friends for coffee. Most likely, they’re the things you just don’t feel you have enough time for right now.

Of course, you do have the time; you have the same number of hours in your day as Einstein or Helen Keller had. You’re just choosing not to spend your time on these activities.

Make a list of the pastimes that make you happy. These are things you keep putting off doing because you think you don’t have time or feel guilty about taking time out of your business to enjoy.

Now, make a commitment to yourself to spend at least 1 hour per day doing these things. Share that commitment with your business mentor or someone who’ll hold you accountable to spending your time in this way.

Lastly, set aside time in your diary to do these activities until they become an ingrained habit.

Keeping your well of happiness full reduces stress and restores your energy, both crucial to life and business success. So, make it a priority.

“Life is short. Smile while you still have teeth.” - Mallory Hopkins

Step 9 of Building a Better Business

Monitor your progress to reach your targets

When you’re driving, there are certain things on your dashboard that you keep an eye on - your speed, your fuel level, and the engine’s temperature.

It should be the same in your business. You should have a business dashboard with 3-5 key things you’re monitoring regularly.

Use this four-step process to create your own dashboard:

1. Determine which Key Performance Indicators (KPIs) should be on your dashboard.
These KPIs should have the greatest influence on you achieving your goals. For example, it could be the average hourly rate invoiced, your gross margin for any job, or the average transaction value for a certain period of time.

Which of your KPIs, when increased or decreased, will have the biggest impact on your future results? Choose no more than five to measure and have on your dashboard.

2. Work out how to measure your chosen KPIs.
The measurement process should be automated wherever possible. Most accounting software will measure your financial KPIs.

3. Produce a simple one-page report.
Produce this either weekly or monthly to track your results and progress. Set aside time to go through this report every time it’s produced and share the results with your team.

4. Repeat these steps with your team.
Identify the KPIs each of your team members should be monitoring. These will be different to the KPIs for your overall business. KPIs help your team understand the definition of a great day’s work for them. Monitoring and reporting the KPIs regularly will help your team know if they’re on track.

“Successful businesses measure and count things… unsuccessful businesses either measure nothing, the wrong things, too many things, or finally, they measure the right things, but they don’t communicate the measurements efficiently.” - Dick Costolo

Step 8 of Building a Better Business

Build strong networks to generate referrals.

Referrals are the easiest way to generate new business, and building strong networks is a great way to generate referrals. Networking and referrals are cost effective ways to grow, as the return on investment can be huge. Think about the types of networking you can undertake and encourage your team to do the same.

Five ways to maximise referrals from your networks:

1. Consider the lifetime value of a new customer.
Calculate the revenue you’re likely to generate from a new customer, then consider ways you could reward them to show appreciation for their repeat business. For example, you could send them a bottle of wine, a voucher towards their next purchase, or cash back. They’re likely to spread the word.

To calculate the lifetime value of a customer, use the below formula:
Average transaction value x average number of transactions x gross profit margin x customer lifespan

2. Identify businesses that complement your services.
What businesses have a mutual interest in your customers but aren’t your competitors? For example, a surveyor may work with lawyers, bankers, accountants, and tradies, and they can all refer business to each other.

Create an informal group and commit to meeting regularly. At each meeting, be sociable and have fun but also discuss how you can work together more effectively!

3. Focus on referring more to your networks than you’re seeking in return.
Giving work to others will encourage referrals in return - this is called The Law of Reciprocity. When you do something nice for someone, they’ll have a deep-rooted psychological urge to do something nice also. The more you refer, the more you’ll receive in return. And, be sure to thank your referrers!

4. Find out where your target clients hang out in the greatest numbers.
There may be existing networks that you can join right away that will result in referrals, e.g. BNI, Rotary, Chamber of Commerce, etc. Find out which one is most relevant to your business and join.

5. Get involved with non-profit organisations.Choose an organisation that you or your team are passionate about, be that a sports club or a local community organisation. Avoid ‘peddling your wares’ when working with the organisations. Simply wear branded clothing and have signage where appropriate. Prospective customers need to know you, like you, and trust you before they’ll buy from you.

What can you implement today to grow your network?

“The currency of real networking is not greed, but generosity.” - Keith Ferrazzi

Step 7 of Building a Better Business

Get someone independent to hold you to account.

Have you ever set a New Year’s resolution and then reset the same one again the following year? So, how can we increase our chances of successfully achieving our goals? Accountability.

The most fool proof way of ensuring you complete the actions you’ve committed to is to give someone nagging rights to follow you up. This may be your personal trainer at the gym who makes sure you show up at 6am, or it could be your accountant who checks in on you every 90 days to make sure you’re on track to completing your actions and achieving your goals.

A soft coach will likely encourage soft results.

If you think about the type of coach a successful sports team would benefit from, would it be a hard coach or a soft coach? It’s no different in business. We all need someone with the backbone to hold us firmly to account and follow through on consequences for failure to act (‘give me 100 burpees!’).

A soft coach, maybe a life partner or a friend, is likely to worry they’ll upset you if they nag about inaction. They’re likely to accept your excuses. Whereas a hard coach isn’t going to worry about hurting your feelings and they won’t accept excuses. That doesn’t mean they don’t have a heart. Great coaches have backbone and heart; they just care more about your results than your excuses.

If you really want to achieve your goals, seek accountability from a coach who’ll console you after you’ve done the burpees, one who discourages inaction, and enables you to achieve. We can help.

“A coach is someone who tells you what you don’t want to hear, and has you see what you don’t want to see, so you can be who you have always known you can be.” - Tom Landry

Step 6 of Building a Better Business

Being a better leader and building a strong workplace culture is crucial to having a better business.

Have you ever asked yourself if your workplace is toxic? With the average person spending more than 40,000 hours of their life at work, a workplace should be an enjoyable place to be.

We all have bad days, but if the following bells ring… your workplace may be toxic.

1. A lack of trust between owners and the team.
Is there a sense of ‘us’ and ‘them’? Everyone should feel part of the team.

2. No Core Values.
Or, worse still, Core Values which aren’t being lived into.

3. After meeting meetings.
Those chats after a meeting where team members go on to discuss the meeting or bag the person who led the meeting.

4. Highly stressful interactions.
Disagreements will happen from time to time, but these should be the exception, not the norm.

5. Team members and owners mistreat each other.
They may be working in self-serving ways rather than benefiting the team and business.

6. No team buy in to the core purpose or the business's goals.
Or, an absence of purpose or goals completely.

To create a stronger and happier workplace culture, consider the following points:

1. Develop your Core Values, with help from your team.

2. Define your purpose; why you exist for your customers - and make it clear to your team how their roles deliver on your purpose.

3. Make your Core Values and Purpose highly visible so your team know them and hold each other accountable to living into them.

4. Set annual and 90 day goals for each team member so that the sum of the individuals’ goals can deliver on your overall Business Plan.

5. Celebrate success and recognise team members for great performance.

6. Meet regularly with the team and give everyone the chance to be heard.

7. Avoid being held ransom by toxic employees by showing them the ‘door of opportunity’.

A toxic culture will inhibit the success of your business. Take an honest look at your culture and make changes to help build a strong workplace culture.

Need help developing your Core Values or your purpose? We can help!

“Culture eats strategy for breakfast.” - Peter Drucker

Step 5 of Building a Better Business

Once you have a clear Business Plan, the next step is to get your business structure right.

Your ideal structure will allow your business to become more efficient and achieve economies of scale. This will mean that your bottom line returns will increase at a greater rate than your revenue. Your organisation structure should allow your revenue to increase without creating bottlenecks.

An organisation structure should show all of the departments in your business, who is responsible for what, and how the hierarchy works.

Each of these departments should have only one leader. The same person can lead more than one department, but two or more people can't lead the same department.

Every organisation has 10 departments:

1. Shareholder.

2. Director.

3. Leadership.

4. Product / Service Development.

5. Operations.

6. Marketing.

7. Sales.

8. Finance.

9. HR.

10. Admin / HR.

If you’re the owner of the business and currently leading multiple departments, ask yourself how well you're leading each department.

Do you struggle with HR? Maybe you don’t love leading the Finance department and therefore you procrastinate doing important Finance tasks?

Consider outsourcing or training one of your team members to take over the leadership of one or more departments. They’ll likely do a better job and you’ll free up some time! Remember, overloaded team members (you included) are more likely to make mistakes. Also, paving the way for your team to grow and develop improves loyalty and engagement.

It’s important that your Organisation Chart is a living and breathing document that your team understands and works in sync with. Check in with your team regularly to ensure they’re aligned with the structure and respecting the hierarchy. During performance reviews, discuss whether there have been any changes to each team member’s role and update the chart to reflect these.

We can help you create the best organisation structure for your business, along with job descriptions for each role. Get in touch!

“Mission defines strategy and strategy defines structure.” - Peter Drucker

Step 4 of Building a Better Business

You know what you want from your business; it’s time to plan how to get it.

Start by deciding what you want personally from your business. For example, if you need $100,000 p.a. to cover your living costs and a family holiday, and your overheads are $100,000, then your gross profit needs to be $200,000. If your current gross profit margin is 50%, then your annual sales need to be $400,000.

Make sure your plan is linked directly to how you’ll achieve what you want personally from the business, e.g. $100,000 and a six-week holiday.

Follow these rules to create a solid plan and achieve your goals:

1. Keep your plan on one page.
Double sided if you must.

2. Set a maximum of four main goals for the year.
These should be broken down into 90 day goals and actions to ensure you’re working towards your annual goals.

3. Identify no more than five Key Performance Indicators (KPIs).
Any more and you’ll lose focus. Pick the KPIs most likely to have an impact.

4. Share the plan with your team.
Ensure their goals align with your plan. Help them to define their own actions and the KPIs that they need to achieve.

5. Keep the plan visible.
Track your progress against the plan and celebrate success with your team along the way.

6. Review your plan at least quarterly.
Make sure you’re completing your 90 day actions and achieving your 90 day goals. Update the plan with new goals each quarter. Having someone independent hold you to account helps.

Your Business Plan is the most fundamental document in your business. It acts as a how-to-guide to achieving what you want from your business.

Your business is there to serve you; you should not be a slave to your business.

Need help creating your plan? Get in touch for more information about our Business Planning service.

"Hope is not a strategy." - Anon

Step 3 of Building a Better Business

Defining exactly where you are now - warts and all – is crucial to building a better business.

This step is often overlooked, but you must know your starting point to create the best route to success. It sounds so obvious, but many business owners plan for the future without fully understanding where they are now.

Answer the following questions honestly to help define where you are now (warts and all):

1. How aligned are the owners / leaders of your business?
If asked independently, would the leaders have the same vision for the business? We must address conflict and align thinking before we can plan the future.

2. What activities are generating your current results?
It’s not just about the sales numbers, but the activities driving your results. Consider the number of leads you’re generating, your proposal or quote conversion rate, average sales value, etc. It’s essential to know these numbers now so you can improve them.

3. How engaged is the team to deliver your vision?
Businesses with a great culture and an engaged team significantly outperform those without. Your team needs to understand how their roles contribute towards the overall vision for the business. Without the team on board, you won’t achieve leverage.

4. How appropriate are your measurement and reporting systems?
If you can’t measure it, you can’t improve it. Review the systems you use to measure your results. Do they provide accurate and useful information? The decisions you make are only as good as the information they’re based on.

5. What are your five biggest vulnerabilities right now?
What keeps you awake at night? Is there industry disruption? Is there new legislation that could impact operations? Are your systems robust? Do you have high team turnover, succession to plan for, cashflow strains, or a weak Balance Sheet?

Take the time to define where your business is at now. Be honest and identify the weaknesses in your business so you can take steps to improve.

Skip this step at your peril!

Need help answering these questions? Get in touch!

"Opportunities don't happen. You create them." - Chris Grosser