At first glance, understanding why one business is successful and another isn’t can seem confusing or random. In fact, though you can’t completely quantify what makes a business successful, many of the most successful companies have the same things in common. Even with different products and services, varying management styles and company cultures, successful businesses overlap in some fundamental ways.
What Makes A Successful Business
You won’t find one formula explaining to you what makes a company successful. But successful companies tend to focus on the same things, even if their approaches differ. From customer service to new technology, focus on the same things the companies you admire are pursuing. Even some of the small steps companies take, like a few extra benefits they offer employees, contribute to their success. It takes a long time to build your company, and longer to create the kind of long-term success you’re looking for. Start with these strategies now.
Pursuing a Mission
A company’s mission is essential to running all aspects of the business. It helps the founders grow the company with a major goal in mind. It gives the employees something to work towards, and creates a sense of purpose. It also lets customers know what the company stands for and helps give them a personal connection.
Your mission is more than just a banner declaring that you stand for something. Your business should run according to the mission. Do you say you’re devoted to using clean energy? Then you should invest in clean energy for your facilities, and find vendors and suppliers at all points of your supply chain who also invest in or use clean energy. The more your mission can focus how your business runs, the more meaning it’ll add to your company.
Focusing on Customers
Customer service and customer experience are major focuses of the most successful businesses. The first step is creating products and services that customers want. But focusing on customers goes beyond your products. Customers are tired of dealing with companies through phone menus and automated chat bots. They want a human connection. For a customer, it’s important to feel like their business is valued, and that you’ll work to solve their problems. Just a few bad customer experiences can have a big impact on how well-liked a business is.
People will return to your brand because of exemplary customer service, even if you don’t have the lowest price. Amazon is always willing to send replacements for packages that are lost, without giving the customer a hard time. Costco has digital receipts, which makes returning items, even years after you got them, much easier. Customers don’t want to fight with disgruntled employees to prove that their problem is worth a company’s time. Even if you start small, provide good customer service and you’ll keep people coming back.
Employing a Great Management Team
Successful companies, big and small, need good management, from the top level down to people like foremen and shift supervisors. Quality leaders offer employees communication, a natural company culture, and clear goals and objectives. Criticism is constructive, and employees feel valued yet know where they need to work harder. A good leader lives the company culture, complies with standards and rules, and is an example for the employees. Ultimately, good leaders make employees feel valued.
Being a bad leader isn’t just about making poor decisions for the company. In fact, a bad leader can make good financial or marketing decisions, yet lead a team of miserable employees. From failing to empathize with employee struggles to communicating in an unclear or frustrating manner, bad leaders inspire employees to quit or switch departments left and right. Have you ever heard the saying: “Employees don’t leave companies, they leave managers”? It’s a cliché for a reason.
Retaining Employee Talent
Good managers are part of how a successful company keeps good employees on payroll. A mission with great core values that employees can believe in is another way. The most successful companies recognize the good talent they have, and work to keep it. That means more than a competitive salary and a few benefits. Employees need to fit in with the company culture and feel valued for their contributions.
Offering additional training opportunities and extra perks like telecommute days are popular ways companies keep their best talent. Benefits packages with flexible sick and vacation day options are another. Finally, employees need to know that development opportunities, including moving up the ladder or moving laterally within the company, are possible. That way you don’t lose someone to a similar position at another company.
Keeping Detailed Financial Records
One key component in what makes a successful business is the financial records. Businesses need a very clear idea of how much they make and spend. Keeping track of finances helps businesses spot good patterns and possible financial dangers. When businesses know their finances, they can choose to make investments, pursue innovations, or pay for new equipment or new suppliers. It’s also how businesses know when they need to hire more people.
Outsourcing some of the financial burden is a smart move for smaller companies. Successful corporations can, of course, afford in-house accountants and analysts. Smaller businesses with good success don’t take on more than they can handle. Plus, successful CEOs know not to get too bogged down in the nitty-gritty work, because it actually gets in the way of managing and leading effectively.
Continuing to Innovate
When you create a quality product, people are going to copy you. That’s why the most successful companies are always innovating, whether it’s improving on products that already exist or coming out with entirely new stuff. Think about why so few people leave their Apple products once they switch over. Apple consistently manufactures the leading laptops, smartphones, and tablets. Every time another company catches up, Apple zooms ahead again.
Innovating at the small business level looks a little different, but still impacts the business. Improving a product, finding a way to offer a lower price, or discovering new ways to show customers you appreciate them are all powerful innovations. Never stop pursuing great ideas.
Pursuing Long-Term Goals
Successful companies have both short- and long-term goals. Whether these goals are making investments in new technology that won’t be ready for several years, or working toward growing the company a certain amount in the next decade, long-term goals are important. Instead of jumping from small success to small success, a long-term goal puts those smaller successes together into a bigger picture.
At the same time, companies have to be willing to change and adapt if a long-term goal is no longer serving the mission or the customers. Privately held companies with big successes often pursue strategies that other businesses might deem too risky. Once you go public, you lose some of these opportunities. Even on your first day of business, you should already be working toward those extended goals.
Adapting to New Technology
As new technology develops that will help you run your business, use it. Successful companies are quick to embrace new technology. For one thing, customers certainly are embracing that technology, so being on the bandwagon is part of what makes a company successful. Plus, as you add new technology, you build the infrastructure to continue advancing. If you wait several years, then you have to implement something completely new and complex, instead of adapting as new editions and formats come out.
New technology gives businesses the chance to lower costs or improve the customer experience. Automating a system or using software to analyze customer data will enhance how the company runs. The best companies are always adapting to new technology and making it work for them. Even if you can’t afford something big and fancy, look into new software or office equipment that will make your days easier.
Every business has a unique approach to these elements of success. One business may get more mileage out of investing in new technology, while another might find that increasing quality customer service is the best way to go. If you want to emulate successful businesses, always keep learning. Follow your favorite business leaders and track the companies you admire. You’ll continue to get ideas for giving your own business more success if you learn from both their triumphs and failures.