Every leader of an emerging business knows that there are fundamentals that must be mastered to foster business growth and success. A quality solution offering. Excellent customer service. Focused sales. Targeted and compelling marketing. Money!
If growth were merely a matter of assembling the talent needed to master those broad brushstrokes – and to secure financing – the path to success would be fairly straightforward. Yet according to a recent study by Inc. magazine and the National Business Incubator Association, over 80% of new businesses fail completely within their first five years. While there may have been growth along the way, the end result for 80% is shrinkage to zero.
The path to business growth can be smoothed if you focus on the constraints that must be overcome. The challenge is to know where to look for the constraints. Over many years of leading companies, we have worked hard to understand the most common business constraints and have distilled them into seven primary categories.
The key is that by examining where you stand with each constraint, good or bad, you will have defined a context for surfacing business major improvement opportunities. With this valuable understanding you can then begin the process of correcting business challenges and then unleashing the full value of your business. See if you can spot improvement opportunities in your own business by using the following criteria and set of optics.
Know Thy Customer
It is crucial to develop a deep intimacy of how your target customer creates value (B2B) in their job/function/process and what the major improvement opportunities are for them to maximize performance. This provides the foundation for creating solutions that solve meaningful problems that can be economically and operationally justified. Too many companies create a product looking for a solution. Knowledge of the size and importance of the problem you are solving, customer buying behaviors and barriers to buying are crucial to consummating sales.
Responsible business owners do their best to avoid spending money on things they feel they don’t need, restricting expenditures to solutions that they feel will solve meaningful problems. Appealing to this need is the starting point for winning their consideration. It’s not enough to be perceived as “innovative” or “advanced.” You must be perceived as being needed. And that requires knowing your customer.
Knowing Thy Competition.
A high quality, unbiased and formal assessment of the competitive landscape provides the basis for determining market entry viability, and truly effective market positioning. While most energies focus on like offerings, it’s oftentimes equally as important to understand those players that appear different yet compete for the same budget dollar you are.
In the B2B world, with very few exceptions, being truly unique is not possible, unless you’re solving a problem that doesn’t exist. Any viable solution must solve known problems that prospects are currently addressing in one way or another. The options from which they choose are your direct competition.
In assessing your competition, don’t stop with solutions that are the most similar to yours. Make sure you understand all competition for the budget dollars you seek.
Developing Strong, Actionable Segments
A true understanding of market size and the segments that exist within it provides the entrepreneur with the ammunition to create focus and dominate segments. Discovering and defining the characteristics that define each segment provides the basis for targeting of product features, target marketing methods, and sales positioning.
Articulating a Meaningful, Defensible Value Proposition
A solid value proposition is the cornerstone of market messaging, for setting hooks with customers that inspire them to take “next steps” through the sales process, and for sales/customer dialogue. It also serves as the link between corporate strategy and the quality of field activity. A strong value proposition can only be articulated when the previous tasks of customer, competition, and segment focus and definition are understood. The value proposition must serve as the blue print for all marketing, sales and product development activity.
Committing to Sales as a Differentiator
Successful execution of a business plan (particularly B2B) requires the leadership team to establish as much valuable differentiation as possible. Simply relying on a differentiated product or better service will not enable breakthrough revenue growth. The engagement with the customer and how they feel about the value, sincerity, and integrity of that engagement must be differentiated as well. This sales differentiation must also deliver strategic value to the business by increasing win rates, reducing sales cycle times and maximizing forecast to sales accuracy and success. We believe anemic attention to the sales process represents a very common thread in tracing business failure. The cornerstone for transforming an interesting company into a great company is that entrepreneurial management teams understand that sales and marketing excellence must be a component of their corporate intellectual property.
Building Passion and Commitment in the Team.
Simply put, inspired teams created inspired results. Over time, in the heat of continuous battle and the overcoming of consistent obstacles team passion and commitment can wane. Commitment to a vision, regular communication, and good understanding of team strengths and shortcomings enable teams to break through the problems and achieve inspiring results.
Aligning Everything, Establishing a Drumbeat
Rapidly growing, resource-constrained organization must manage commitments, align its resources and stay focused on the critical success factors. The degree to which they accomplish this has an enormous bearing on ultimate success. Getting the right people in the right seats on the bus is business critical. The next priority is to get everyone rowing in the same direction. History has proven that great ideas without great alignment and execution result in wasted energy and poor results. Keeping teams on the straight and narrow is what separates the winners and losers.
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