What makes a winning company? In my 25 plus years as an entrepreneur, I have had a front row seat to witness the performance of many businesses. I have seen companies rise and fall and those that rise to the top continuously demonstrate the mastery of the following six traits:
There is an old saying “if you can’t measure it, you can’t manage it.” Each department in the company should have at least 5 key metrics they are focused on. There are obvious items such as cash flow, inventory levels, gross margin percentage, payroll, etc. Less apparent might be sales metrics, employee turnover and safety statistics. Good business people know their numbers, review them in a timely fashion and adjust accordingly.
Tip: Run your financials as soon as possible after the month end. Review them to identify trends and, most importantly, adjust accordingly.
Peter Drucker once said, ”The number one duty of a company is to obtain customers.” Good companies think about sales. A lot. If you are not growing you are dying. Selling should not just be left to the ‘sales department.’ Winning companies have culture that understands the importance of sales and the attitude that everyone in the company can impact sales through their actions. At the end of the day it is the customers who pay the bills.
Tip: Prominently display in the lunch room (or common area), a list of the new customers obtained that month so that everyone ranging from the accounting staff to the warehouse personnel see results in plain sight. . Everyone then knows to do their part in making sure the new customers have a great experience.
Good companies know where they are, where they are going and have a plan to get there. This doesn’t have to be a massive exercise to produce a 100-page document to sit on the shelf. But it does need to be intentional and in collaboration with your key employees.
Tip: Twice a year, take 2-3 hours with you and your key employees and review (or do one if you haven’t already) your S.W.O.T – Strength, Weaknesses, Opportunities, and Threats – analysis. Make this a living document that becomes part of your meeting culture.
As the saying goes, “People don’t quit companies, they quit bosses who are poor leaders.” Winning companies have inspiring leaders who hire well, delegate, and don’t micro manage. Winning companies empower employees, encourage risk taking, and communicate effectively. Winning companies set clear goals, hold people accountable and reward performance.
Tip: As an owner, invest every year in a program or activity that will improve your own leadership skills.
Winning companies have good systems and do things in a predictable way day in and day out. It makes for great customer service. Employees love it as well because it is clear what their job is and how they will be graded.
Tip: Read the book “The E-Myth” by Michael Gerber.” You’ll never look at your business the same way again.
Winning companies work hard, have fun, and celebrate success! You spend too much time at work to not enjoy it.
Tip: schedule fun activities both inside and outside of work. If something great happens, make it a celebration.