There are many reasons why some businesses are successful but it generally boils down to a handful of success factors. Many successful business have failed because they forgot or neglected what made them successful. Think of Blackberry.
Below are the core principles followed by successful businesses:
1. They have skilled, dedicated owners with the right information carefully controlling business responsibilities. They have a clear vision for the business and have passion and enthusiasm which trickles down to employees and then to customers. They know a lot about their goals, their culture and what they want to achieve.
2. Well managed with high-grade staff and good people-management. – Leaders of successful companies aren’t afraid to hire people smarter than themselves. There are many companies who are felled by a leader who wants to be the smartest person in the room and wants to micro-manage everything.
3.Winning products or services that people want to buy and will continue to want to buy. – They have products or services that are in demand and continue to engage with customers to ensure their product remain relevant.
4. Very close to customers and responsive to their needs. – They never forget that without happy customers the business will stagnate and then fail. They engage with their customers and listen to them and adapt to their needs.
5. A cost effective route to market (getting the product to the customer). – They ensure that their products are easily accessible for their customers.
6. Clear objectives simply set out and communicated to all staff to give them direction and motivation. – They recognise that staff are one of their most important assets. They share the company vision and goals with their staff and ensure that all staff know and understand where the company is headed.
7. A dedication to continual innovation and improvement. – They never get comfortable with what they are doing. They question everything and push themselves and their staff to innovate and improve.
8. Effective management information and financial control – They use information to control the business. They use budgets and management reports to identify where the business stands financially and which challenges could crop up. They use information to develop strategies to avoid potential pitfalls that could prove disastrous for the bottom line.
9. They are adaptable – The most successful companies have the willingness and ability to quickly shift direction as the market and other various needs dictate.
While there are other components involved in owning, operating and building a successful business, what works for one company, may not work for another. Every business is different, with varying goals and varying definitions of success.
So if you ask, “but why do businesses fail”, I would answer “Because they don’t follow the core principles above.”
Thomas Jefferson said - “I find that the harder I work, the more luck I seem to have.”