Companies don’t become successful without change, challenge and evolution. Complacency is the killer of any business. If you’re not where you want to be right now in terms of success and growth -- or even if you are – you’re probably not giving your business regular health checkups. You’re probably not challenging yourself to do better, be better. There’s always something else you can do to become more successful. But you can’t hope to achieve success if you don’t really know what your business is all about, who your customers are and what your end goals are.
Thriving as a small business isn’t about taking a snapshot in time; it’s a fluid process that needs to be questioned, challenged, monitored and turned on its head every once in a while. To do that, you need to get introspective.
Here’s a look at the questions you should be asking yourself as a small business owner. The questions may not be easy, but we promise you the answers you get will fuel you to go the distance.
Questions About Your Clients
- Do you know where your business is coming from?
- How do your clients find you?
- Do you know the return on investment of marketing dollars vs. customer value dollars?
Why these questions? How and where you originate your clients is important because they will go elsewhere if you fail to diversify and maintain. Knowing the referring mediums that bring you your business, for instance, is critical to ensuring your business stays robust, especially during unexpected market down turns. Having a marketing data strategy will help you understand your clients’ behavior and avoid wasted marketing dollars.
You can track analytics and count social followers all day long. You can track visitors to your website and see how many convert. You can do all that and you’ll still be spinning your wheels. In the end, the judge and jury for a successful marketing campaign is: your customers. If your audience isn’t connecting with your brand or you don’t even know how to reach them in the first place, all the money you throw at your online marketing campaign will be for naught. Know thy customers.
Questions About Your Time Spent in the Business
- How much time do you spend on email and other general administrative tasks?
- Do you measure and record your time spent on customers or with clients?
- Do you delegate tasks that you shouldn't be spending your time on?
Why these questions? The amount of time you spend on critical client and customer work vs. the overhead and admin of running the business is critical and a key metric that advanced business organizations use to stay efficient and highly profitable.
It’s time to eliminate or delegate non-critical tasks, putting value-added ones in their place. Research by Harvard Business Review shows that business owners spend 41 percent of their time on discretionary activities that bring them little to no personal satisfaction and that could easily be competently performed by others. You need to start thinking consciously about how you are spending your time, determining which tasks need your expertise to handle, and which ones you can creatively outsource to someone else on your team.
Questions About Your Business Financials
- Do you know your gross and net margins?
- Do you know which products/services are a) your best and worst sellers? and b) the highest and lowest profit producers?
- Do you know the cost per hour of your business or even how to calculate it?
- Do you know your revenue produced for every employee?
Why these questions? Tracking your key financial metrics to the product/service level is what differentiates an advanced business organization from the rest. This is essential in assessing your organization's financial health over time. The numbers you track will provide insights to key processes, help you better understand your financial performance, and gain insights that will help you make future business decisions.
Questions About Your Business Processes
- Are all your business processes documented and easily trainable?
- What systems and tools do you have in place to track potential leads, current clients and sales numbers?
- Do you have a client intake system?
- Do you have a sales checklist?
- Do you have a good understanding of your business capabilities and its capacity to do the work?
- What process improvements have you made in the last year?
Why these questions? Use systems and tools, such as Enterprise Resource Planning (ERP) for example, to improve how you document and execute your business processes and build efficient workflows so your capacity to do more with existing capabilities increases. This is key to scaling any business.
Questions About Business Goals
- Do you have short-, medium-, and long-term goals for the business?
- Do you have a plan of execution for those goals?
- Are you tracking the execution of that plan?
- Do you have a vision and mission?
Why these questions? Advanced business organizations have the focus and direction that comes from setting specific goals that are measurable, realistic and have actionable time frames. Having a strategy to focus your goals and actions will lead to greater alignment and better execution.
It’s not enough to have a vague idea of what you want to accomplish with your business. You need to really drill down. Short-term planning will focus on a three- to six-month time frame in regards to revenue and profitability. Medium-term planning, often overlooked when discussing strategic objectives, bridges the clarity of shorter-term goals with the depth and breadth of longer-term planning. Medium term planning looks at the next year or so of your operations. Long-term planning forms the foundation of your company's identity and purpose, looking ahead many years in the future and where you see yourself in five, 10, 20 years.
Questions About Your Business Employees
- Are you aware of the employment laws in your country or state?
- Are you paying employees the market rate and do you know how to assess and calculate that?
- Do you have someone working for HR in your business, a HR specialist or consultant?
- Are you regularly reviewing your employees' performance and giving feedback and rewarding them when necessary?
- Are you spending time developing your employees’ careers?
Why these questions? Your employees are the most valuable part of any business and their treatment has a direct correlation to how they perform. If you are truly concerned for your employees’ well-being and careers, you will create a strong company culture and a collaborative work space that attracts the best employees.
We hope these questions have been helpful in prompting you to take an introspective look at your business and challenge it to be the best it can be. We realize this isn’t an easy process, though. Come talk to us. We can help you collect and understand your business data so you can answer questions like these and start to improve your business for scaling and better profits. INFIX are experts in business data analytics and have helped hundreds of small businesses answer these questions. Start with a free 30-minute, no-obligation consultation.