It never ceases to amaze me how many business owners (and their highly-paid consultants) come up with grand plans to grow a business which never get implemented or succeed.
In many cases this is due to the focus being on the interesting and exciting phases of the plan, without ensuring the basics are addressed.
The plans are made with detailed action plans and outcomes but never get implemented because the owner goes back and gets stuck in the daily routine which forms the foundations of the business.
Imagine if a builder and architect planned a great new project and started working on the walls and roof without ensuring the foundations were built and solid. It wouldn’t take long for the walls to move and roof to cave in.
Likewise the foundations of a business need to be solidly in place to ensure the business can stand the rigours of time.
So what are the Four Foundations?
The foundations are these basic things that have to be done to ensure the business functions.
- Cashflow: Manage cashflow and pay suppliers and staff
- Performance: Monitor the business performance and ensure it stays on track
- Obligations: Meet obligations such as your BAS, Superannuation and tax
- Debtors: Follow up debtors and ensure cashflow is maintained
Unfortunately many business owners spend time doing these basic tasks and then find they have no time to spend on the tasks to service customers and grow the business.
So how do you ensure your business has the Four Foundations in place and yet still have the time to grow your business and create wealth?
The answer is actually not that difficult.
Classify what you do each day into three types of tasks:
- No Value: Tasks that don’t add value and that you dislike doing such as bookkeeping, computer data entry, and general ‘administrivia’;
- Essential: Tasks that need to be done to ensure the business meets its obligations such as paying pay wages, preparing your BAS, and other compliance matters; and
- High Value: Tasks that add value and are the reason you went into business in the first place such as creating new products and services, generating new customers/clients, delighting your existing customers and so on.
Once you have categorised your tasks then it is a simple matter of determining which tasks you want to do and that will add value, as well as those tasks you can delegate to staff or outsource to external parties.
It won’t be long before you find you are performing those tasks that motivated you to go into business in the first place, which–apart from making you feel much more positively towards your business and giving you a spring in your step once again–will create improvements in your business performance as you focus on servicing your customers and growing your business.
How solid are the Four Foundations in your business? Which No Value Tasks are you going to delegate or outsource?
Business improvement all begins with clarity.
What action will you take today?