Be Better or Be Bigger? In Blackboard Fridays Episode 35, Jacob talks about Growth Planning. Need this implemented into your business? Talk to the international business advisor who can do exactly that – Contact Jacob, Learn More, or Subscribe for Updates.
In previous episodes, and once while dressed as Business Santa Claus, I have challenged you to decide whether your immediate focus in business is to ‘Be Better’ with your existing resources, or ‘Be Bigger’ by growing the size of your business engine.
Of course, everybody wants to ‘Be Both’. Which is achievable, just not by trying to do both at the same time.
This week we focus on the 6 Ways your business can ‘Be Better’. How can you reduce waste, improve profitability, and maximise the power being generated by your existing capacity.
Which of these 6 are you doing well?
Who is Jacob Aldridge, Business Coach?
“The smart and quirky advisor who gets sh!t done in business.”
Since April 2006, I’ve been an international business advisor providing bespoke solutions for privately-owned businesses with 12-96 employees.
At this stage you have proven your business model, but you’re struggling to turn aspirations into day-to-day reality. You are still responsible for all 28 areas of your business, but you don’t have the time or budget to hire 28 different experts.
You need 1 person you can trust who can show you how everything in your business is connected, and which areas to prioritise first.
Welcome to the first of this two-part Blackboard Fridays conversation where we’re going a little bit deeper into Capacity.
If you go back to one of the first blackboard Friday’s episodes we shot, we talked about how “Growth” is the most dangerous word. Dangerous because it can mean different things to different people.
In this episode we break down the difference between focusing on Being Better – getting more revenue out of your existing resources – and Being Bigger – growing your business and your resources to increase your business capacity.
There are six ways to do each of these. Next week I will explain the 6 Ways to Be Bigger. Today I’m going to give you a little example in each the 6 Ways to Be Better.
When to Choose ‘Be Better’?
So when is it appropriate for your business to focus on being better? It’s best addressed when you find that your utilization rate, the actual revenue that you’re generating from your team each month, has a large element of waste compared to that capacity.
That’s why it’s important to calculate your capacity and know exactly the dollar value of that waste. It gives you and your team the incentive to focus on being better to reducing that waste.
For example, if you have a Capacity to generate $3 million of revenue, and your are only generating $2 million of revenue each year, then you have $1 million of waste. Growing your team may increase the $2 million amount … but probably won’t fix the waste issues. The better strategy (pun intended) is to close the gap towards $3 million with your existing team.
How to Be Better in Business
Here are the 6 Ways you can do this.
1. Better Analytics and Financials
The first of those is better analytics and financials.
Let me give you an example of a client of mine that worked on this option. They were able to produce an increasing amount of data from their retail sales team. What they discovered was that the variations in each individual sales performance was as much as 100% over the course of any given day.
Two people standing next to each other, and one was selling twice what the other person was doing.
That gave them the incentive to focus on some training to improve the sales skills of all their team to grow that.
It was only when they had that analysis that they were able to break down the per salesperson data that they were able to identify that that was a gap in their business. Looking at the analytics and the financials in your business, can help identify waste that you may not even realize exists.
2. Better Skills
“Better Skills” is an obvious one to reduce waste and improve revenue outcomes. The capability and training of your team is one that can make real difference.
One of my clients ran a Training Needs Analysis and mapped out a 12-month program with their team. At the end of the 12 months they had increased the skills of their entire team, but they’d also managed to build a career progression journey.
Now new people coming into their industry had clearly defined levels of skills to aim for, and they had a training program that helped make move people through the levels of their career (in this case seniors, managers, and eventually set them up to become Partners in the business and creating a succession plan for the existing owners).
All as a result of focusing on skills to reduce waste.
3. Better Sales
Better Sales is more than just a higher conversion rate in sales meetings, it’s about designing and implementing a better sales system.
This is an obvious one for most businesses when it comes to bringing in more revenue. The trap to avoid is just trying to “close better” when there are many other factors in play.
I’m really excited to talk about this one because of a recent email I received from a client, where we have doubled their revenue turnover in the last six months through a Better Sales project.
We mapped out a very simple process to break down sales activity (and help empower) for those in the business who were going out and doing the sales. We discovered that the business owner, while great at what he did and loving what he did, didn’t know what conversations to have in what order.
Breaking down his sales process gave him a lot more confidence and a lot more focus. He wasn’t pushing the technical sale too early, and nor was he having gentle nurturing conversations anymore with people who were ready to begin. The Gratitude Sales process played a part, but only one part of the project.
Would you like to double your revenue in six months?
4. Better Brand and Marketing
Better Brand and Marketing is similar: If you don’t have leads coming into your business, then there is almost certainly going to be waste.
There’s either going to be idleness in general, or there’s going to be ups and downs where a busy month is followed by quiet month because those new clients are not coming in.
A great Brand strategy can cost you tens of thousands of dollars (or more, if you add multiple Brands or Countries into your plan). And that investment can absolutely pay off many times over.
Great marketing strategies can be much cheaper, if you focus on the Marketing Bullseye approach to continually improve your activity … and the results it generates.
5. Better Culture
When your team are engaged, they will step up, they will put in the extra discretionary effort, and they will help close that waste gap to create more revenue (and therefore more profit) for your business.
Culture has a very clear return on investment. If you’re not clear what the return on investment is, and I’d love to have a conversation about how we could define that in dollar value for your business.
If you believe Culture is the airy-fairy incidentals, the one off expenses like a Christmas party or birthday gifts, then you are overlooking a fundamental truth in business: Culture is the experience your team have when they come to work every day, and if that experience is sub-optimal … then the commercial results they generate will also be below par.
6. Better Operations
The last category of Being Better is “Better Operations”, and this really comes down to the structure of your team.
Have you got the right people on the bus, and importantly, are they sitting in the right seats? I see this all the time.
Here’s a really common example for businesses with 12 – 24 employees. You have successfully grown into a Capacity Engine of this size, but you have discovered that the fantastic Office Manager who facilitated so much of that growth when you were small is now holding back a whole lot of information, is becoming a bottleneck. You need to restructure that business and get that individual to hand things over.
Similarly, you as the business owner may be creating a bottleneck. You might have this great team underneath you, capable of generating $1 million every month, but because most of the decisions still go through you, your capacity is holding back the capacity of the entire business.
Understanding your operational structure gets you the right person doing the right job at the right time and reduces that waste. On average, when I go into a business and do some of these projects, we find profit increases by 20% in the 3 to 6 months we’re designing the strategy.
A 20% increase in your bottom line in a short timeframe is a great outcome for just about any business owner, especially when it comes without having to invest in the growth.
But Then What?
So you’ve identified that you have surplus Capacity in your business engine. No need to grow, just find ways to reduce waste and increase revenue.
You’ve been through this list of the 6 Ways to Be Better in Business, and identified the 1-3 which are most relevant to you. Thanks to your capacity calculations, you and the team have a clear measure of what success looks like.
So you’ve then designed and implemented those priorities, and watched as your current team create more revenue, more easily, without needing any of the additional team members they were perhaps asking for.
Success! But now you will face the next problem – a team that’s running close to Capacity can burn out, and you risk losing some of those gains. Plus you still want to achieve more in your business – help more clients, generate more profits, improve your valuation.
You need to decide to grow into a bigger engine.
Want to learn more about how this can apply to your business? It costs nothing to chat:
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