Entrepreneurs are the new heroes of the American economy; they are the reason millions of Americans have jobs. However, with the still unstable state of the U.S. economy, the only thing harder than establishing your own business is keeping it afloat. Mortality rates of businesses have always been high, and the years following the 2008 great recession, the rates were even higher.
These days, the importance of critical monitoring of a business’ vital signs could not be stressed more. A minor overlook can result to failure. Due diligence is necessary to guarantee a business’ survival.
When talking about vital signs to watch for in a business, successful entrepreneurs will advise you to focus on where the money is. Income, expenses, sales and profit margins are important indicators of a business’ stability, and as such, they require constant monitoring. Most experts, however, state that the financial component is just one piece of the puzzle, and that non-financial components are equally important in determining if a business is thriving or not. Although oftentimes hard to measure, these non-financial indicators relay more information pertaining to the business’ future direction.
Team morale, market and consumer satisfaction, initiatives for growth and advancement, an entrepreneur’s attitude and perspective, and an effective business plan are important non-financial business indicators that entrepreneurs need to keep an eye on, if they want their business to flourish and not fall on hard times.
It is easy for some entrepreneurs to overlook their team’s morale when in pursuit of profits. Unhappy and unsatisfied employees tend to work in a less productive manner, and this affects business in every aspect. Small business owners can monitor their team’s morale through a formal survey or through a less-formal one; both will yield useful results.
One of the most telltale signs that there is a certain level of dissatisfaction in the workplace is negative talk. Body language and facial expressions can be revealing as well. As a CEO, you have people in your company who can be significant and reliable sources of information; talk to them in order to get an insight on your workplace’s current situation.
A team’s morale can be affected if one member of the team is not contributing. It is important as a CEO that you ensure that each member of your team is the right and best one for the job. With marketplace dynamics in mind, perform a human capital audit to leverage past experiences, specific skill sets, and core competencies of all your employees in an effective manner.
Constant communication also helps a lot in boosting morale in the workplace. Implementation of programs geared towards improving your employees’ skill level and encouraging them to play an active part in the company can boost their level of fulfillment. The more fulfilled they become, the more you are likely to have productive, creative and dedicated employees.
Market and Consumer Satisfaction
Market research is a vital component in a successful business. Contrary to what other people think, you do not just engage in market research when you are establishing your business. Instead, you continue to monitor the marketplace even when your business is up and running. Diligent monitoring of emerging market trends, competitors and consumer satisfaction will keep your business from being left behind. Take time to understand your customers’ buying habits. A decline in the volume of repeat customers or referrals is a flashing red light for you to take action. Do a survey to find out if your business is still addressing the needs of your customers, or perform a competitive analysis to find out if your competition has a better market positioning in place.
As a business owner, know that you will encounter various challenges and opportunities as long as your business exists. Although challenges may be easier to spot than opportunities, especially in a bad year, know that one does not exist without the other. Successful entrepreneurs exercise vigilance at all times, and act fast enough to avoid having any opportunities slip away.
Initiatives for Development and Advancement
At the current tough economic times, some entrepreneurs waste their time waiting for the economy to get better, instead of pushing for innovation and evolution. As a result, their already dwindling sales continue to plummet some more. Listen to what your customer and market need, and from there, create initiatives to address their needs better. Be open-minded and interact with other entrepreneurs to gather new ideas. Mark Zuckerberg, a genius in every word, did not come up with Facebook all by himself.
Entrepreneurial Perspective and Established Business Model
A healthy business has a business owner with a passion and a vision and a well-developed business model. An entrepreneur who enjoys what he is doing and is fueled with the passion is more likely to encourage potential partners and funders to help with the business.
Business model is vision on paper. It is easy to aim for a goal that is written down. Business models require constant assessment to ensure that objectives, plans and projections are updated in reference to the current economic conditions.
It is important for small business owners to keep track of how they allocate their time and energy to determine their productivity. It is easy to lose sight of strategic direction when immersed in the most trivial of things. Entrepreneurs should be less involved in task-based things and be more involved in business and leadership development, and employee morale.
Kimberly is an internet researcher, writer, and contributor at entrepreneurweek.com blog network. She may be reached at email@example.com.
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