What Do You Want To Be When You Grow Up?

By: Troy Hazard
A while back I had the privilege of being one of the judges in a small business competition. Over the course of the event we had the chance to see some great businesses in action, hear their stories, and how they were going to develop their business should they be the successful entrant.

The field was close, but one business in particular took my eye, it was a cool idea in an unusual space with some great potential.
I was so impressed by the concept that when the owner, Jodie, missed first place by a nose I figured it would be a good thing if we created an 'on the spot' second prize of a few 'strategy days' in her business, just to give the business it's own mini kick start.

I arrived at her store and took a look over the business and how it worked. And a very proud Jodie took me through the business from raw product to cool instrument. With a backgrounder on the business complete we sat at her meeting table and I asked the first question. What do you want to be when you grow up?

Now that sounds pretty straight forward but you'd be surprised at just how many small-business people fail to understand, or visualize, what their business looks like when it's finished, when it grows up.

Jodie was one of those business people. She had a range of great ideas, amazing enthusiasm and energy, and five concepts on what the business MIGHT look like when it grew up, but no real clear vision. And there lay the best place for us to start on our strategic journey.

It's relatively easy for an enthusiastic person to start a business, all it takes is a great idea, a few bucks, and ambition. The hard part is running it and growing it once you've opened the door, and keeping the momentum of that raw talent and ambition going. (....and I know just how hard it is, I've had 10 business interests in the last 20 years...crazy?...correct!)

So here's how we worked out what Jodie, 'wanted to be when she grew up'.

Is your business sustainable, or another shooting star?

Categories in business will always remain relatively strong, but the market positioning of some of the businesses within those categories sometimes leaves a bit to be desired. There are some key things to consider when assessing the sustainability of the business you are either in, or looking to invest in, within your chosen business category.

The first thing to consider is, do you really have a core customer market for your product, or do you just like it.

1. Do you really understand your target market, how big it is, what is the market's hot buttons, and are you fulfilling a promise to that market?

2. Is the business offer going to be relative to that target market moving forward, or is it going to be seen as a fad to the market?

3. Do you have any real independent professional market research as opposed to just your 'gut feel' of the market. In other words, can you show the market facts!

4. Do you have a clear understanding of the category and how to address market and product changes within that category moving forward? Have you demonstrated you are not only prepared to change but have a plan to change to keep ahead of the competition?

5. Does the business have a Unique Selling Proposition, (USP), a unique product or service, or a unique market advantage? Does it have something that not only sets it apart from the competitors it has today, but the ability to set it apart from the competitors in the future?

All of these things are important in helping you determine if your chosen business has long term sustainability, and can give you the longer term return you seek. And over the course of day one with Jodie, we worked our way through each and every one of these questions, and the vision began to unfold!

What is your business model? Do you have a model?

1. Do you have a clear understanding of your financial model? Are you clear the business can be profitable? And not just profitable, but cash positive, and yes they are different.

2. Do you have the human resource to deliver the product or service you are offering? Having the cash resource in business is one thing, but without the human resource to deliver the business promise, the cash will soon disappear as you struggle to fulfill that promise.

3. How does your human resource model interact with your financial model?

4. Do you feel your business model is portable? If you had to, could you pick it up and put it in another location. While this seems like something that may not be relevant it may just come around and bite you down the track, so you need to consider it.

5. Do you have a one, two, five, and 10-year business plan, and how does your model relate to that plan? Does it change with time, and if so how does it change and how does this affect your financial and human resource modeling?

6. Do you have your systems and processes written down so that anyone coming into the business could pick up on how to run it in a matter of days?

7. Because you have systems, processes and a plan in place, could you leave the business for a month and not have to worry about it? If you can't, then you don't have a business, you have a job.

Remember your business needs to have a real life plan in order for you to make a real life from its returns. You don't want to find yourself at halftime without a game plan for the second half.

I'm OUTTA here!

So, now that you've worked out that you are all good to go, your market is clear, your model is strong and you have a path to the date when you truly feel that you've grown up, how are you going to get out? Do you have an exit plan for the business i.e. do you know what you are going to do when you want to get out of the business? And how will that exit affect you?

As part of your planning on what you look like when you grow up you need to take into consideration how you are going to exit the business. Will your business offer you a way out when you are done, and provide a solid return on your original capital investment? Your exit evaluation is as important as your entry evaluation into business as its one thing to buy or build an asset and another to be able to sell it for a profit when you are looking to exit.

Look to set a sunset date as to when you're going to exit the business. This may seem difficult at the outset but if you are mentally prepared for a term in business then you have a start, middle and finish to your journey. This way you have a better chance of avoiding business burn out. If you don't have a place in the future to work towards then every day you are working is just another day torn out of the calendar with no purpose or goal.

Now you might say that there is no way for you to know when that finish might come, or when you believe that you have really grown up, after all you may have not even opened the doors yet or served a customer. So try this. Set a business plan that identifies what your end game is, and when you get there pause, and review your position. Work out if you are ready to go or if you'd like to set another end date a little further into the future.

I can see clearly now!

Over the two days I spent with Jodie, we dug our way through the maze of great ideas, unique concepts, unusual target markets and wild visions to drill it all down to ONE idea, ONE vision, and ONE visualization of what the business looked like when it grew up.
Troy Hazard is the former Global President of the elite Entrepreneurs' Organization and has owned managed and run ten companies in the last two decades. He is an international speaker and author of 'The Naked Entrepreneur' www.troyhazard.com www.eonetwork.org www.theedgecs.com