Building a business

What are the main ingredients to building a business?  Why do some fail and some succeed?  What are the key skills and activities necessary to make a business survive?

Here are five activities we should be doing a lot of, if we want to make a success of a new business.

#1 – BUSINESS PLANNING

We need to understand who we are and what we are doing.  This is usually done through a business plan, a definition of our business activity, our market, our product(s), our strategy, our plan, and our team.

#2 – PROCESS IMPROVEMENT

On a micro level, we also need to define and monitor our regular activities, so that we can judge whether we are living up to our own standards.

Process management involves a two-stage process. 

1. First, we break our business operation into the necessary processes which make it work well
2. Second, we measure the metrics that tell us whether those processes are actually succeeding.

This creates a virtuous circle of organisation and improvement.

#3 – RAISING CAPITAL

If we have a viable business, then it will need access to money to help it grow.  This means raising capital – chunks of money which enable growth to happen.  Capital comes from debt (people lending us money in return for regular interest) or equity (people giving us money in return for future profits).

#4 – IMPROVING RELATIONSHIPS

There is no business without relationships.  These can easily go sour, so it is important to check in regularly with stakeholders (customers, suppliers, employees, funders, the public), ask them what is going right and wrong for them, and adapt what we offer to suit.

#5 – BRANDING AND MARKETING

All of the above informs how and where we present the business.  Our brand identity should accurately and attractively reflect what we do.  Then, in our marketing, we can make it quick and easy for customers to get in touch.

SUMMARY

For your business to thrive, it needs:

1. A BUSINESS PLAN – to know who we are and what we are doing
2. GOOD PROCESSES – to improve what we do
3. FUNDING – to resource our growth
4. GOOD RELATIONSHIPS – to inform how we adapt
5. BRANDING AND MARKETING – to grow and consolidate our customer base