The high road or the low road?

 

The high road or the low road?

As part of our coaching practice, we ask programme members the following question:
 
Why did you start your own business?
 
The answers are generally very similar.
  • I felt I could make more money doing (what I do) myself
  • I wanted to be in control of my own time
  • I did not like the way I was treated at my last company
  • I had a great idea that I wanted to put into practice.
However, nobody starts a business which they believe will fail. Most people start a business in which they have expertise in what the business does. A florist starts a florist shop. An electrician starts working for himself as an electrician. A financial adviser like myself starts a financial advice business. This trend is very well covered in the excellent book for small business owners – the E- Myth Revisited. The book also covers the reasons that most new businesses fail in the first five years. The figure is around 80% which is alarming and terrible for the people concerned.
 
The main reason is, although they know how to do what the business does, they have no skills in how to run a business.
 
This skill of understanding how to run a business well is significantly more important than knowing how the work of the business is done.
 
A highly experienced business owner could probably make a success of a florists business, even if he or she did not have the slightest idea on how to be a good florist. Essentially, this is where a good business coach can help – they know the strategies which work and the ones which are less likely to.
 
Nearly everyone believes they can make more money working for themselves. This is normally is a primary driver for taking the risk of starting their own business. This is fine as an initial driver as we all have to live and pay our bills. However, once the business is relatively stable and profitable running a business purely for the money is the low road. This low road has a high potential to end in dissatisfaction, stress and burnout.
 
Maslow’s hierarchy of needs as shown below says that once our physiological and safety needs are met, we all aim to satisfy our needs for self- fulfilment.maslow hierarchy of needs
 
Setting the main goal and purpose of the business as only making a large a profit as possible causes a problem. It will make it more difficult for the directors and team to stay motivated and aligned with that purpose in the longer term.
 
The high road is to set a purpose of contributing to the world and adding the most value possible. Of course, the bottom line of working as effectively and efficiently as possible does not go away. The business must continue to make a profit to thrive.
 
Delivering on this higher purpose will generate money as customers all appreciate good value. This higher mindset will align the directors and their teams to work harder. They will also have higher levels of job satisfaction that simply more money will not bring.

Action required

Review your company goals – are they set around the high road or the low road?

Explore what your business does. Ask your customers why they use your products and services. Talk to your employees. Ask them what value the company provides.
 
Once you have collected all the information, spend some time setting a vision for the future. This vision should encompass the contribution the company intends to make and the value it provides. Clarify and write down the company purpose, mission and values.
 
Get feedback on your statements from your employees and customers before settling on a finished version. Then keep these statements under review and set your company goals and direction around them.
 
This is the higher road which leads to self-fulfilment for all people working at the company. It also helps you employee people who are aligned with what you are trying to achieve.  These more engaged employees work harder and smarter to help achieve company goals and produce higher profits.
So in deciding on your business goals remember the high road or the low road is a conscious decision which can make a big difference in your approach
Enjoy the journey

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