There is no question that accurate financials and other numbers-based reports are essential to succeeding in business. But “the numbers” are not the drivers of your business. They don’t explain why one owner is struggling while another is thriving in the same business in the same location.
The numbers are a scorecard. They show what the results are but not why they happened. As a business advisor, I find that those who focus mostly on the numbers are often cost cutters. And cost cutting—while necessary sometimes—is not a long-term business success strategy.
Business success is driven by leadership. Effective leadership inspires confidence and enthusiasm inside your organization and with customers, suppliers and others critical to your business’s success.
The foundation for success is set long before the numbers are generated. Success rests on the establishment of a vision for your business: the goals, the action strategies and then the financial forecasts that ultimately show whether your goals are being met.
The numbers can then determine the level of success because there is a target to measure results against. When the numbers are reviewed frequently, adjustments can be made progressively, rather than waiting for year-end figures to determine your levelof success.
Based on my work with companies of nearly all types, here are some key leadership recommendations that will help to drive results that can be measured by “the numbers”:
- Establish a vision for the business that has clear, specific goals for a specific period of time and that are consistent with your own vision and goals for your personal life.
- Identify the specific target audience of customers for your products and services and be specific in communicating to them your features and benefits compared with your competition.
- Build a synergistic team by employing only those who have the specific skill sets to execute the functions of your business needed to achieve your operating goals.
- Provide operating efficiency through systems leverage including organization structure and staff skills training, the application of technology and computers to speed up systems and the use of operations and communications flow charts.
- Use appropriate financial management to maximize resources management.
- Build your operating culture on a customer-centered focus and identify opportunities to build your business with referral-based marketing strategies. Create "raving fans" to drive a growing business. An outstanding book that demonstrates the power of the customer to drive business growth is "Building The Happiness-Centered Business" by Dr. Paddi Lund (published by Solutions Press).
- Spend more time generating revenue than on reducing costs.
- Be forward looking. Operate in the “present-future” and don't get bogged down in the past. Learn from the past but don’t live in it. In the recent business bestseller, “Good to Great,” author Jim Collins emphasizes this approach when he wrote: “Enduring great companies preserve their core values and purpose while their business strategies and operating practices endlessly adapt to a changing world.”
Success is created by planning and hard work, testing and measuring, fortitude and resilience—and a passion for what you do as the business owner. And as Colin Powell said, “There are no secrets to success. It is the result of preparation, hard work and learning from failure.” Remember, the numbers only measure success. Leadership is what gets you there.
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