Eight Pillars to Evaluating Your Business
We have all heard the saying: “work on the business; not just in the business.” However, for small business owners and division heads it can be difficult to know where to start and where to focus efforts and resources. Time is limited and driving value and impact in the business is key to creating opportunities. Start by taking a step back and looking at the business from thirty thousand feet and complete an assessment of the eight key areas of the business. This will help determine where there might be opportunities for easy wins. By breaking the business into key functional areas, it can be easier to assess and determine where to focus.
Operations
Often this is the area of the business which is most understood by management, but it can also be an area with a lot of opportunity. Step back and critically assess your operations looking for opportunities to increase efficiencies, look for areas of improvement in the systems and processes, assess your products and services, and how take note of how they relate to changes in the market.
Marketing
Take the time to assess your marketing plan to determine if there have been any changes in the market that might affect the business. There has been a lot of uncertainty on the economy in the past few years and staying ahead of the market needs will help set the business up for success into the future. Think about how the business differentiates itself and what value it brings to your current and potential customers.
Planning
Assess your corporate Mission, Vision, and Values. Do these still fit what the business is trying to achieve and how it will be successful? In addition, complete your annual review of the corporate strategy taking the time to ensure the diagnosis holds true to the guiding policies and updating the strategic initiatives associated with meeting the corporate goals. Make sure the entire team is on the same page and pulling in the same direction.
Financial
Make sure the team is using accurate and timely monthly financial statements (balance sheet, income statement, and statement of cash flow) to make decisions. Compare these to the historical data as well as the projections created through the annual budgeting process. Taking the time to ensure the financial literacy of the management team meets the needs of the business will help ensure the financial health of the business and will make discussions and decisions easier.
Leadership
Step back and think about what skills the business needs to be successful. Then assess whether the current team has the skills required now and, in the future, to be successful. If the skills are in place and the right people are in the correct roles make sure the team has the autonomy to act in accordance with the strategic initiatives. If the skills needed do not exist think about what succession planning is in place to develop or obtain those required skills to supplement the team.
Sales
When was the last time management reviewed the sales opportunities. It can be easy to continue doing what worked in the past but taking the time to ensure the sales team understands the corporate strategy as well as the marketing plan will help ensure not only current success but future success. It takes time to build relationships and develop sales opportunities in most industries. Taking a future focused approach to sales is key to driving value.
People
With high employment levels and all firms struggling to find the talent they need, assess what is the business doing to attract the skills. Thinking through the recruitment process can identify opportunities to reach new talent. Additionally taking the time to review policies and how the business invests in it’s talent is key to retaining the current talent.
Oversight
Assess how corporate decisions are made and if the team has the tools they need to provide adequate oversight. Ensuring those responsible to corporate decisions have the necessary information will ensure accurate and timely decisions especially in trying time.
Follow Through
Finally, don’t waste your assessment efforts! Make sure you and your team follow through by assigning tasks and holding those responsible accountable to ensure you are capitalizing on your efforts and driving value in the business which creates opportunities for employees, shareholders, and other stakeholders.
Engaging a third party to help with a full in-depth analysis as well as the execution of action items can be a great way to ensuring the success of the team and the driving value in the business. Reach out to the get a copy of a full assessment document or discover more support resources.
