Small businesses strive on their ability to get things right within these components of small business success triangle that you are about to read in this article. Just like a stool cannot stand without its three legs, a small entity cannot survive without getting the three components of thing success triangle spot on.
3 Pillars of Small Business Success Triangle
Products and services
Products and services are what every business deal on and therefore the basis for everything else that goes on in a company. Everything else will crumble if a business fails to sort out her products and services. The three things that people are really looking for from a small business as far as product and services are concerned are; quality, quantity and speed of delivery.
Let’s briefly look at the elements of one of the small business success triangle pillar.
- Quality: the quality of your goods and services saves you money both in the short and long run. It also ensures that your business does not just survive but thrives. The costs of quality are not just monetary but also non-monetary.
The reputation of a company is quickly dragged to the mud if its products and services are not of the highest quality. Having a quality control and quality assurance process in place is a very important player in the league of small business success triangle.
- Quantity (product mix): variety is the spice of life is a very popular saying even in finance when one is advised to diversify and have a portfolio of investment. People will quickly get tired of a business and its commodities if there is no innovation and changes.
- Speed of delivery: no one wants to be kept waiting for so long for a product or service that they have already paid for. Imagine you spending 2 minutes waiting for checkout cart of an online shopping site to load.
I bet you will hit the cancel button and immediately look for another website where you can buy same product. Modern performance management models have started incorporating the importance of speed of delivery in the measurement matrices that must be evaluated by management.
People are what make the world go round and not money as widely held. The stakeholders of a company are made up of people and people are the most important leg in the small business success triangle. The main components of personnel in the success triangle are; customers and people. This section will discuss these important ingredients of personnel that help a small business succeed.
- Customers: customers are always king to every organization. Without customers, an organization will go out of business faster than it takes to a child to say da-da. To succeed as a small business, you must have a world class customer services in place. Bear in mind that customers play a very important role in the survival of a business
Small businesses now compete on the speed at which they respond to the enquiries of their customers. And constantly strive to make information available for customers at all time and in all forms.
- Workforce: The workforces of small businesses are the soul and spirit of the entity. In as much as processes especially the accounting systems are now highly automated, people are and will remain the most important asset of a business even though they are neither on the statement of financial position (the balance sheet) nor on the asset register.
Recruitment process and training are two areas where successful small businesses have struck it right ab initio. Your business venture can never go wrong with the right people in the right positions within the company.
Controls within a small business like the management accounting controls and internal controls are mechanisms put in place by business owners to ensure that organizations meet their objectives economically while at the same time safeguarding the assets of the organization.
In my capacity as a small business accountant and consultant, I have come to realize that controls are actually present and functional in small businesses. This is contrary to the belief that small businesses don’t have controls due to the small number of people working for small businesses.
Well, this depends on what you mean by control. Below are five components of controls that promote small business success.
- Corporate governance: I chuckle when I hear some finance professionals saying that a small business does not need to have corporate governance in place. Their argument is based on the fact that traditional corporate governance literatures emphasised on the importance of having layered management levels. I agree with the fact that corporate governance strives on checks and balances but that does not make it any less useful to a small business.
Corporate governance is a phrase used to describe how organizations are controlled. For a small business to succeed, it must have good way of controlling things.
- Cash flow management: the phrase ‘cash is king’ is truer in small businesses. Unlike larger businesses that can fall back to their buffer or sources of fund institution to raise money when cash level is running low, a small business will quickly die without cash no matter how profitable the business might be.
Small business cash flow management is a fundamental component of small business success triangle that cannot be ignored by anyone.
- Environmental control: customers are now very sensitive on environmental matters and tend to patronise organizations that are environmental friendly more than those that do not care about their environment.
Investors are constantly looking for green and environmental investment opportunities as this according to them have yielded more stable returns than environmentally toxic businesses. There is this saying by a consultant friend of mine who say that being environmentally friendly is the beginning of small business success.
- Compliance: you don’t want to be at loggerheads with the regulatory authorities a small business that wants to succeed. Compliance should not be viewed from regulatory point of view alone but also from the point of view of the customers. Your customers will be happy to do business with you if you meet and surpass what the law requires of you as a commercial entity.
You are wasting your time and losing out on money if you a small business owner and you are still looking for the secret of successful entrepreneurs as there is no such thing as small business management success secret.
All you have to do is manage the areas identified in this article on small business success triangle and I will see you at my next holiday in that dream Island of yours.