21 Lessons i wish i was told before i went into business

1. Succeeding in Business Part 1
21 easy steps to greatly improve your
chances Tony Morrison
1-10

2. How easy is it to succeed in business?

3. Succeeding in Business
• Whether you are starting a business for the first
time or you have created and run businesses in
the past, in my experience there are certain
lessons that you should follow to give yourself
the absolute best chance to succeed. I have
detailed these on the following slides.
Tony Morrison
CEO Harcourts Real estate
Tasmania

4. 1-Personal Preparation

5. 1-Personal Preparation
• The skill set that made you a great employee
won’t necessarily make you a successful business
owner or a great leader of people.
• In fact the technical skills you developed as an
employee may hinder you in developing the
entrepreneurial and managerial skills that you
need to be successful in business as when things
get tough it is too easy to fall back on to what you
know best instead of developing new skills.
See The E Myth Revisited by Michael E. Gerber

6. 1-Personal Preparation
• One of the hardest and most underrated skills
in running a business is people management.
• Have you had any formal or informal training
in this field?
• Do you have experienced, successful role
models, mentors to talk to?
• If the answer to these two questions is no
then you need to seek advice.

7. 1-Personal Preparation
• Do you have a clear vision as to what you
want to achieve in your business?
• Do you have a set of values that you want to
run your business by?
• If you don’t have either of these two you will
end up running your business to the vision
and values of your staff which may be not
what you want.

8. 2-Create a Plan

9. Create a Plan – Why?
• It forces you to think about the future
challenges that you’ll face like:
– Your financial needs
– Your marketing and management plans
– Your competition and overall strategy
– To understand what is your core business?
– To document tasks that need to be done to
achieve this plan.

10. What should be included in the plan?
• Research on market and competition
• Analysis of what you bring to the market and what your
challenges will be :
Strengths, Weaknesses, Opportunities, Threats(SWOT)
• Goals, short and long term
• Time frames to achieve these goals
• Who is responsible for what in the plan?
• Who you are accountable to?
• How often is the plan reviewed?
• Key Performance Indicators (KPI’s)
• Exploration of ideal location (If start up business)

11. A plan is useless without
implementation

12. Implementation of the plan
• Men become successful, not because of what
they know, but because of what they do with
what they know.

13. 3-Choosing a Partner

14. 3-Choosing a Partner
• The first question is do you actually need one?
Why?
– Make sure there is a genuine need.
– Your partner needs to have the same goals, work
ethic, will and determination as you.
– Their skills should not be the same as yours but they
should be complimentary.
– You need a written exit strategy in place in case the
relationship doesn’t work.
– Be wary of friends and family, business can destroy
relationships.

15. 4-Get the right people on the bus
In the right seats

16. • Don’t except mediocrity
• Find people with a passion for their job
• People who buy into what you are trying to achieve
• Average people may not necessarily lose you business but they may
lose you opportunities
• Even the best employees need constant up-skilling
• Having great people is no good if they aren’t doing the jobs that suit
their skill set best
• Challenge your staff but reward them and praise them when they
succeed, give them public recognition on their success and then
nurture them to develop further
• Always hire on attitude before experience
• One wrong person can effect the entire attitude and performance
of the team
4-Getting the right people on the bus
in the right seats

17. 5-Financial management

18. • Are you financially solid? Things always seem to
take longer to develop than you think. Lack of
cash flow is the biggest reason businesses go
bankrupt.
• Do you have a basic understanding of financial
management and reporting?
• If not, do you have a person to turn to who does?
• Financial incompetence is a major reason for
business failure.
5-Financial management

19. 5-Financial Management
• Make sure you have plenty of start up capital plus
some reserve capital if things don’t run as
smoothly as anticipated.
• Make sure you are given a copy of your profit and
loss every month to carefully monitor all your
expenses and income.
• Make sure you create a budget at the beginning
of each financial year with cash flow projections.
• Understand that income doesn’t always relate to
profit.

20. Cash Flow

21. Cash Flow- It’s all about sales and
marketing
• “The argument could be made that the mindset of a business owner is the key to
success. Although that maybe true, mindset doesn’t bring in cash to maintain the
business. What mindset does is keep the owner focused on taking consistent
actions to keep cash flowing into the business.
• Mindset by itself will never pump cash into a business. Only actions can. If this
were the case, there would be millions of multi millionaires.
• Therefore, if cash flow is critical to a business staying in business, what are the
actions a business has to take to generate profits in the first place? The answer is
sales and marketing.
• Without marketing and making sales, there are no profits. When there are no
profits, there’s no cash flow. Without cash flow, there’s no business. Profits are like
the oil that keeps the machine running; when the oil runs dry and the owner of
that machine doesn’t maintain it, it stops working altogether.
• In fact, not only will it stop running it could damage the engine that makes the
machine run because of the extra tension and stress.

22. Cash Flow- It’s all about sales and
marketing
• Bankruptcy is a result of lack of capital; not a surplus of it. The main way capital is
raised to sustain business is to sell something of value to the end user known as
customers or buyers. When there’s a steady flow of buyers for products or
services, a business generates cash flow – therefore driving profits.
• The easiest way for struggling businesses to get customers is to attract business
through marketing, and then closing a deal with a sale. Although some forms of
marketing are free, generally marketing requires a budget to pay for the
advertising medium which in turn requires cash flow.
• If a potential buyer contacts the owner, the buyer has already shown interest in
what the owner has to offer. Little effort is required to close the sale and make a
profit. This allows more time to focus on more potential buyers – which equals a
bigger cash flow.
• If, however, the owner contacts a potential buyer, the buyer’s in control of the
outcome of the transaction – making it harder to close the sale and leaving less
time to reach more potential buyers.” CRR Consulting

23. 6-Don’t try to grow too big, too soon

24. Don’t grow too big too soon
• If you grow too fast there are so many things that can potentially go
wrong from:
– Compromised quality of product or service causing customer complaints
– The back end support system, delivery and order fulfillment systems,
monitoring systems and various processes not being properly established to
support and survive growth
– Employee skills not growing in line with the expansion of the business thus
creating loyalty and morale issues
– Expansion requires major financial investment that can turn sour if a company
cannot keep up with the resulting financial obligations
– Cash flow shortages caused by expansion costs exceeding revenue
– Loss of control.

25. Dilution of Vision
• One of the biggest challenges that a business
leader faces as the business grows is their ability
to sell their vision, to transfer their passion to
their staff. What can easily happen is that the
business owner’s vision can start to be slowly
diluted as new staff don’t buy into what they are
trying to create.
• It is critical that anyone who joins your business
totally understands what your goals/vision is and
what is expected of them in their role.

26. Dilution of Vision

27. 7-Understand the value of existing
clients

28. 7-Understand the value of existing
clients
• Spend more time appreciating and more money
rewarding existing clients and less chasing new
clients. Most businesses do the opposite.
• Happy existing clients will help you find new
clients without any cost to your marketing
budget.
• It is much cheaper to keep long term customers
than to find new ones.
• Do you have a marketing budget to reward
existing clients?

29. The No.1 reason clients leave you

30. 8-Develop a great culture

31. 8-Develop a great Culture
• Workplace culture can be defined as the “way
of life” for those in a particular workplace.
This has many elements including: policies
and procedures, language, dress code,
attitude to training and development, support
mechanisms, authorities, power relationships,
conventions, recognition,conflict management
and dispute resolution processes.

32. • You need to develop a great culture of people
being happy to come to work and wanting to
buy into what you are trying to build.
• A culture where there is opportunity for
growth and good work is recognised and
rewarded.
• A safe environment where employees feel
comfortable, valued and enthused.
• Ultimately to become an employer of choice
8-Develop a great Culture

33. The Financial argument for building a
great culture
A Great culture
in your workplace

34. 9-Create business on your terms

35. 9-Create business on your terms
• By becoming a marketing expert
• Great marketing will draw clients to you on your
terms whereas prospecting for new business will
generally draw clients to you on their terms.
• It is obvious which method is more profitable
• Remember, when people contact a business
owner about a product or service, the owner's in
control the entire time. Who contacts who first
makes a huge difference in the final result.

36. • Great marketing will also compensate for
average closing skills if your business is sales
related.
• Great marketing creates competition which
does the closing for the sales person.
• If you are not a good closer become a great
marketer.
9-Create business on your terms

37. 10-People will pay more for skill than
they will for service

38. 10-People will pay more for skill than
they will for service
• Great service is mandatory to have people return
to your business. In today’s competitive
environment having people return to your
business, whilst increasing your turnover, does
not necessarily increase your profit margins.
• It is great skill, expertise or knowledge that will
generally allow you to charge more than your
opposition for similar products or services and
therefore increase your profit margins.

39. • Think of the following
• If you had the choice of a very friendly dentist
who was always on time, remembered your
name, was quite competitive on price but
sometimes hurt or a dentist who didn’t have
any bedside manner, was more expensive but
you never felt a thing?
• Who would you go to?
Example 1

40. Example 2
• Ladies, If you were going out for a big gala event
and you had the choice of two hairdressers, one
who greeted you with champagne, was on time,
cheap and was always very friendly but the end
result was 50/50, or a hairdresser who was a bit
of a gossiper, was always running late, as well as
being a bit more expensive but she made your
hair look amazing.
• Which one would you choose?

41. • If you were in need of critical surgery and had
the choice of an expensive but brilliant doctor
who was terrible at small talk but had never
lost a patient on the operating table or a
lovely, friendly, cheaper doctor with a great
bedside manner who had a pretty good but
not perfect record under pressure?
• Who would you choose?
Example 3

42. Conclusion
• In all three examples most people would
choose the more skilled person at a higher
cost.
• People want service, expect service, demand
service and may not return if the service is not
acceptable but they will pay more for skill,
knowledge and expertise than they will for
service.

43. 21 Lessons of successful Businesses
1-Prepare yourself personally before going into business
2-Create a plan and make sure you stick to it
3-Be careful in your reasoning behind and choice of partner
4-Getting the right people to help you is paramount
5-Correct Financial management is critical
6-Don’t try to grow too big too soon
7-Understand the value of existing clients
8-Developing a great culture is so important to ongoing success
9-Create business on your terms by becoming a marketing expert
10-People will pay more for skill than they will for service
11-21- (follow Tony Morrison on Slideshare to view)