Every business wants to obtain a strong market position within its target niche(s). How does one company achieve success when others lag behind (and some even fail)? The answer is surprisingly simple–successful businesses share the following six qualities:
- They plan for growth constantly.
- They market effectively.
- They manage their finances shrewdly.
- They supervise their operations watchfully.
- They generate positive cash flow consistently.
- They maintain positive company morale unwaveringly.
How Do Successful Companies Plan For Growth?
Companies that fail to plan for growth (or for downsizing, if necessary) are companies that operate out of control. By sheer luck, you may be able to make money for a season or two without planning. In most situations, however, luck and proactive planning must work hand in hand to make a business successful. Many companies aiming to be an industry pacesetter miss the mark because they allow one area of the business, be it marketing, operations, technology, or finance to control the actions taken–or not taken–in other areas. Successful companies realize that planning the company’s direction is a far-reaching enterprise: the executive (team) must utilize information and resources from as many sources as possible. consider the external environment, and develop tasks to be accomplished within established schedules.
Without a doubt, effective planning requires work. However, every business should consider planning for growth a positive challenge. On the other hand, if a company slows down or even stops growing, the executive (team) can still apply many of the principles applicable to business planning for growth.
Planning must first be understood in its proper context. Successful entrepreneurs understand that planning is not an annual event to be dreaded and feared, but rather the ongoing process of anticipating what will happen in the future and developing a strategy to respond to these events. Therefore, smart folks plan on a regular, even daily basis. In addition, their plans are not developed as dogmatic, end-all solutions to company problems or challenges from here to eternity. They understand that a plan by nature is subject to change and revision. Being flexible in the way one develops, implements, and modifies plans creates much greater success than those who do not plan at all–or those who only develop plans on an “as-needed” basis.
Furthermore, planning in successful operations is not arbitrarily limited to one area of the business. Effective planning encompasses all three of the primary functions of a profitable business: operations, finance, and marketing. Additionally, the preferred order for planning is not as some would imagine. For example, operations can not be allowed to determine the organization’s finance and marketing goals.
Most business executive teams plan only in so far as they make a schedule for the completion of various seasons of the year. Such small-scale planning is useful, but one must also develop a better feel for the “big picture”–the combined approach of marketing, finance, and operations that will generate desirable results in the next week, month, year, and decade. Many successful companies therefore draft their marketing plans first, outlining the number of units (whether of time if a services firm or items if a products firm), design/features, locations/markets, prices, and means of promotion. The financial plan then accounts for the obligations that will be undertaken as a result of the marketing plan. Finally, the operating plan discusses how customer/client needs will be met and what resources will be employed to make it happen.