Tag: Strategic management

Being adaptable as an entrepreneur

In small business, change is inevitable. One of the advantages of owning a small business, however, is that you are better able to adapt to this change than a large corporation is. Think of the differences between a sports car and a semi truck. As a small business, you have fewer people to clear changes with, and have more flexibility to make those changes quickly.

Be willing to accept change in your small business and adapt accordingly

It’s important to be prepared to accept changes and alterations to the way that you do business, and be ready to adapt to market changes. You may not like having to develop a new product or service, or ditch an existing one, but if that’s the way your market is going, can you afford to be left behind? As an entrepreneur, you should realize from the beginning that where you are is probably not where you’ll end up. Change happens so often and quickly for entrepreneurs, especially during the planning stages as new opportunities and ideas arise. Lack of adaptability can result in unhappy customers, lost profits – and many sleepless nights for the entrepreneur.

How to prepare for small business change

You can’t always predict the changes your small business will need to adapt to, but you can give yourself the best tools to make the best choices.

Firstly, refer to your business plan – or create one if you haven’t yet. A business plan is a formal document that includes a description of the business you want to run, your business goals, and the plan for reaching those goals. It’ll have important information like what your product or service is, a description of your customer, an estimate of how much of your product or service your customers will buy, and an estimate of your yearly expenses. It’ll also outline plans for hiring people, building your product and getting it to market. It may also contain background information about the organization or team attempting to reach those business goals.

Secondly, surround your small business with the best team you can, people who can enhance your skill set. Look for people who know more about marketing, accounting, finance, operations or strategy than you do. These people can be part of your founding team, advisory board, mentor board, or management board. They can also be professional advisors such as accountants or lawyers. Their advice and guidance will be invaluable to you when change looms on the horizon for your small business.

 

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What’s your out? Why an exit strategy is important

One day, maybe a very long time ago, you had a great idea that also happened to be a great business. You made a few sacrifices at the beginning and worked many an 18-hour day, but now your small business is ticking along smoothly. You might even have time and breathing room enough to sleep eight hours a night! Finally – your small business dream is now a reality.

So – how will you get out of it?

Why developing an exit strategy for your business is important

Aside from figuring out your business’ pricing strategy, location and HR policies, one of your most important responsibilities is the planning of an exit strategy. We know it seems kind of odd – you plan to spend years growing and nurturing your small business. Why would you ever stop? But an exit strategy ensures you’re prepared when the end comes. And it will come – every business has a lifecycle. Family businesses in particular need a well-planned exit/succession strategy.

On that note, a family-run business that plans to transfer ownership to a next-of-kin will likely operate much differently than a business that has its eye on a ritzy IPO in five years. Your exit strategy will inform how you run your business.

Tips for planning an exit strategy

You must have a clear understanding of how you’re going to get out of the business, whether it’s a few months off or many years away. You should take as much time and effort planning the exit of your business as you did in starting it. This won’t be a fast and simple process – planning your exit strategy may take weeks, months or years. Leave no situation unexamined.

Consider who may be interested in purchasing or taking over your company. If there isn’t anyone within your company that may be able to continue with it, consider family members, people within your network, or others looking to purchase a new business opportunity. You’ll want to get as much out of the exit as possible, considering everything you’ve put into your business. You may need to gradually downsize before finally withdrawing yourself completely.

The situation surrounding an exit will be quite different for different types of companies. Whatever you decide, make sure that your strategy is well thought out, planned and implemented properly. It wouldn’t hurt to consult people in your network who may have exited their own businesses – pick their brains to see if they can give you some useful advice.

Did you create an exit strategy for your business? Have you exited a business in the past? Let us know in the comments!

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What’s the secret for writing a business plan? There isn’t one

The secret to writing a good business plan is that there is no secret to writing a good business plan. Writing a solid, actionable business plan requires research, planning and execution just like any other small business undertaking.

Business plan = business model + business opportunity

Business plans begin with a business model, which are two very distinct things. A business plan is really just the written execution of a good business model. Find out why a business model is important here.

Of course, business models begin with an amazing business opportunity – which is different from an amazing business idea – don’t get this former professor started! Soon-to-be entrepreneurs find they have a lot to learn about opportunity identification, crafting a business model, writing a knock ’em out of the park business plan and then executing the plan – all while being flexible to respond to changing market dynamics.

Ninety percent of a business plan won’t help you

When I was developing the business concept for GoForth Institute – researching market size, polling small business owners, discovering its market potential – I got to the stage where I had proven the size of the business opportunity and the likely success of an online education program for entrepreneurs. So I stopped writing the business plan and just launched the company.

Typical entrepreneur. Because we had no written strategic marketing, financial, HR or operations plan, we experienced levels of stress that a completed business plan could have prevented. I did complete the business plan, but not until after we launched. Entrepreneurship is an ever-evolving beast, so being as prepared as humanly possible isn’t just a bonus – it’s a necessity.

Need more help? Get your free downloadable one-page business plan outline and a great business plan template on our website.

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