The first year of a new business is the toughest. It’s the make-it-or-break-it year. The challenges a new business owner faces on a daily basis require three key survival skills: self-reliance, self-direction, and resilience. No matter how brilliant the business idea, without these three skills entrepreneurs risk failure.
It’s a fact of life that every small business owner wears many hats to fill all functions: operations, sales, marketing, finance, human resources-even janitor and chief coffee-maker when needed. Unlike life in corporate America, where each employee has a specialized area of expertise, a new business owner must excel in all of the disciplines required to keep a small business running smoothly. The revenue drain of hiring employees can spell disaster for struggling new businesses.
Self-reliance means more than wearing many hats. It also means depending on self for motivation, discipline and decision making and accountability. The true entrepreneur doesn’t need a cheering squad to keep going. The self-reliant business owner is highly skilled at “picking himself up by the boot straps.” Without that all-important sense of self-reliance, critical decisions will be delayed and opportunities will be missed.
If you find yourself lacking self-reliance, do a total skills inventory to identify the gap that is holding your business back from prospering to your expectations. Rate yourself on a scale of one to four on each skill needed to run your business. Identifying which skills you are deficient in is the first step toward getting help to solve the problem.
One of the toughest challenges for new business owners is strategic planning: the ability to plan for multiple contingencies to reduce risk of failure. The self-directed entrepreneur analyzes market conditions to anticipate setbacks and defines alternative revenue sources to avoid costly earnings slumps.
Equally important, the self-directed business owner should be efficient in executing daily, weekly and monthly activities crucial to maintaining a continual sales pipeline and revenue stream. A successful entrepreneur needs no supervisor to keep him on track.
Unfortunately, not many people excel at both strategic planning and day-to-day tactical efforts. If you are an entrepreneur who gravitates to “the big picture,” daily and weekly task lists will help keep you on track toward your revenue goals. Invest in tools to minimize your busy work so that important data like customer contact information can be easily accessed, yet maintained with minimal effort.
On the flip side, highly detail-oriented business owners without a strategic plan suffer from lack of direction. Make time at least quarterly to consider questions like: “What could I do long-term to improve the efficiency of my operations?” or “What could I be doing differently to attract the kind of customers I prefer?”
While it is often true that persistence pays off, resiliency is a more essential skill to new business owners. Resiliency is the ability to change direction when needed. It is the bounce back” effect that is truly necessary to avoid business failure.
In business, change is constant:
* Economic conditions can reduce consumer spending
* Shifts in consumer tastes make your product out-of-date
* Improvements in technology make your inventory obsolete
Any or all of these things can mean increased competition and loss of market share for your business. You have to be prepared to deal with them–before they happen.
Those who lack resiliency fall victim to self doubt that all too often means the end of a promising new business. To increase resiliency, practice the old-fashioned skill of “getting back on the horse.” When things don’t work out as planned, do not stop to anguish over the situation. Immediately consider the best alternative actions to take. Take action as soon as possible. Even a less-than-perfect action plan will get you moving in a positive direction and avoid the stall of self doubt and despair.
A new business owner who builds up his or her self-reliance, self-direction and resiliency will greatly increase the odds of surviving that first year in business. And after the first year, your survival skills will ensure that you are well on your way to many more years of success.