Although most people will have made and broken their personal New Year’s Resolutions by 24 January, there are seven good habits every business should stick to.
Although most people will have made and broken their personal New Year’s Resolutions by 24 January, there are seven good habits every business should stick to, writes Simon Paterson, a partner at tax specialists Robert James Partnership.
Researchers at University College London have found it takes 66 days before a new behaviour becomes automatic, and that includes very simple changes like drinking more water. The secret to succeeding is to understand from the start that introducing any change will need a lot of effort and in some cases, require breaking down the activity into smaller elements and sub-goals. If you can accept this and not be discouraged about minor lapses, you stand a better chance of success.
With this in mind, here are my top seven business resolutions for 2010.
1. Set goals and make them SMART ones
You have a long term plan or vision but how will you achieve it? Break down the task into smaller goals and set achievable objectives according to the SMART methodology (Specific, Measurable, Attainable, Realistic and Timely).
2. Ask clients for a business referral or recommendation
It’s obvious but many business owners shy away from such requests and feel embarrassed to ask. But it doesn’t have to appear pushy. You could simply ask clients for informal feedback and finish by suggesting they tell anyone else who might need a similar service about you. Most will be only too happy to oblige.
3. Focus on profits, not turnover
Turnover is vanity, profit is sanity so the saying goes. Many business owners we work with are delighted to tell us their turnover is on the up, but are failing to look at the bottom line, which is dwindling by comparison. Remember, you are making the same amount of money with a £500,000 turnover and 20% profit margin as you are with a £1 million turnover and just 10% profit. To avoid this trap, introduce regular management accounts. Watch your costs and overheads in relation to sales and see how they impact upon profit levels. Then identify ways to reduce overheads, increase pricing and focus on the most highly profitable activities. Conduct a client review and consider letting less profitable or difficult clients go in favour of securing more desirable ones during the coming year.
4. Invest in your own skills and business knowledge
It is important for business owners to accept the need to delegate and recruit experts in their respective fields for certain areas. However, this needs to be balanced with developing your own weaknesses as skills. Identify where your business knowledge could be improved and make it a goal to conquer this subject by starting a course or reading relevant books and journals. And if you haven’t already, sign up to the RSS feeds of key publications and bloggers and spend an hour a week scanning their posts for something thought provoking.
5. Improve work/life balance
As a consequence of the tough economic climate, business owners are increasingly stretched, working longer hours than ever before. In our experience, practically all business owners want to improve their work/life balance and allowing time to unwind, do something for yourself, or spend more quality time with family is essential. In fact, it’s critical to maintaining the focus and motivation required to achieve all your other resolutions.
6. Go for customer excellence
Invest time in understanding what it means to offer customer excellence in your area of business and concentrate on delivering it. Do this by examining how you communicate with clients – on the phone, emails, meetings, via your website. What can you do to improve these interactions and strengthen your customer relationships? Once you have done this, analyse who your top customers are, what their total sales were and what differentiates them as a group. What can you do to further develop them and attract more customers like them?
7. Celebrate your successes
Finally, always take time to celebrate success. It’s a long way off but once you get to the end of this year, record your accomplishments and celebrate each of your successes with employees. Remember, the best thing about creating a plan is seeing yourself reach goals and appreciating what you have accomplished. Then give yourself some breathing space and start on your resolutions for 2011.