Often the word used to describe where a business wants to go in the long run is its Strategy.
“Strategy” is often seen as the domain of the military or big business, not small business.
However, strategy and thinking strategically is even more vital for a small business.
Small and micro businesses are 10 times more likely to fail than a larger business and most don’t last more than five years (Statistics NZ). Small business cannot survive the shocks big businesses can.
No matter how big a business is, it never has unlimited resources. IT MUST MAKE CHOICES.
Firstly, what it WILL DO to be successful. Even more important is what it WON’T DO.
Many small businesses say yes to too many things and suffer from doing nothing well.
Every business exists to meet the needs of someone, typically customers. If a business does not meet these needs as well as an alternative option or competitor, those they serve will go elsewhere.
So the process to develop your business strategy needs to answer two key questions:
1. What will you do and what won’t you do now and in the future to achieve the success you seek from your business?
2. Who are your customers and how do you serve them?
The challenge is knowing what will guide you when you are faced with these questions? There are no books, rules or procedures and no expert that will provide the answers for your specific business. The “compass” that will guide you is built within the clarity around these three statements:
• “Why your business exists” (Your Purpose).
• “What your business stands for?” (Your Values).
• “Where you want your business to be in 3-5 years?” (Your Goals).
The clearer you are on these three key statements the easier it will be to make the choices about your business.
For example, say an opportunity arises to partner with someone. You ask yourself the following questions:
• “Will I remain consistent with why I am in the business by entering into this partnership?
• “Does this person share the same set of values as me?”
• “Will this partnership help me reach my goals?”
If the answer is YES to all of these then great. This partnership is worth serious consideration. If the answer is NO to any of them, tread carefully and think things through before proceeding, or you may regret it!