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Work on and not in your business

You have surely heard the statement above, but what does it really mean?

To start, run and succeed in business is not for the faint-hearted. Why? International statistics state that 40% of all new business start-ups fail in the first year and 80% within the first 5 years, and 80% of those who made it through the first 5 years fail in the second 5 years. Hence, only 4% make it after 10 years. South Africa is no different – our failure rates might even be worse. It is said that business is simple, but not easy.

Where do you find your business on this bumpy road to success?

In the classic entrepreneurial book, The E-Myth, Michael E. Gerber unveils the reality of running and owning a business.

A business owner, according to him, is 3 people in one:

  • An Entrepreneur : visionary, innovator, is mostly unstructured, deal-maker
  • The Manager: practical, planner, implementer, creator of order from chaos
  • The Technician: the doer

Many people start their own business, because they are good technicians, but without prior knowledge and experience of running a business.

This article provides some insights into how the business owner can juggle the three roles (entrepreneur, manager and technician) to enable a business to grow and become more successful over time.

Practical guideline to illustrate how a business owner can work ON his/her business

Element Task Role Where to get help

Business Owner– self

Improve own skills – continuous education

Technician

Industry training bodies / Technicon / University

 

Decide which tasks / responsibilities may be delegated

Technician / Manager

Management team

 

Redefine own responsibilities after the task above is done

Manager

 

 

Focus on:

  • Deals
  • Innovation
  • Financial well-being of business
  • Competitiveness of business

 

 

Entrepreneur
Technician
Manager

Manager

 

Sales staff
Specialists in industry
Accountant

Accountant

People management

Create job descriptions

Manager

HR practitioner

 

Negotiate key performance areas with staff

Manager

HR Practitioner

 

Address remuneration and incentives for staff

Manager

HR Practitioner

 

Upskill staff

Technician

Industry training bodies

Marketing

Choose the optimal marketing elements to market the business

Manager

Marketing Specialist

 

Identify the target market

Manager

Marketing Specialist

 

Do research – competitors and trends in industry

Technician/Entrepreneur

Press releases /
website of competitors / market research specialist

Sales

Ensure optimal staff appointment practices

Manager

Staff placement agency

Sales (continue)

Identify the ratios and figures which will present guidance on how well the business is doing w.r.t.:

  • Prospecting new clients
  • Number of quotes
  • Number of accepted quotes
  • Number of implementations
  • How well after-sales service is done
  • Number of sales to existing customers

Manager/Entrepreneur

Sales Specialist

Information Technology

Is the business using technology productively?

Manager

IT Specialist

Management

Does the business comply with all appropriate legislation

Manager

Accountant

 

Are management meetings scheduled and structured?

Manager

Management team

 

Are minutes of meetings and decisions taken up to date?

Manager

Management team

 

Are the financial reports up to date?

  • Dashboard
  • Projections vs. actual figures
  • Corrective actions where targets are not being achieved

Manager

Accountant

In closing

The reality of the practical guideline above is that the majority of tasks to be done in business speaks to the role of manager. The implication is that, if you are doing all the work as technician (the doer), the progress and future success of your business will suffer.

This list of tasks is by no means complete, but it is a very good point of departure. It is very important that you find the balance between the roles of Technician, Manager and Entrepreneur that will work best for you and your business.

To support business owners with the important task of business planning, Sanlam gives you free access to the book Your Annual Business Game Plan for Success, which provides an easy and straightforward framework needed to draft a well-crafted game plan that will create the positive change and growth necessary for business success.

Go to www.sanlamgameplan.co.za to download your free copy.



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