The Formula for Business Success
As global markets become increasingly more competitive and financial turmoil worldwide continues to put pressure on nearly every type of business, I have had more and more organizations approach me to assist them in finding ways to be more competitive and successful in today's economy. Although there is absolutely no "one size fits all" solution, to me the absolute most powerful strategy is to make sure that the core elements of your business are running so incredibly well that your customers absolutely love doing business with you and are eager to tell their friends, family and colleagues about your products and services. All the marketing tricks, ads and social media efforts in the world simply cannot overcome poor quality or lackluster customer service. That is why for the past 19 years my career has focused exclusively on studying the fundamental elements of business success. Traveling worldwide at upwards of 200 days a year, I have worked shoulder to shoulder with some of the best (and worst) business leaders of our generation. I've also maintained a strict regimen of reading a minimum of 100 business books a year since 1989. In preparation for writing my book Awesomely Simple, I compiled all of my research and reading down to a single page that I called my “Strategy Map.” This single piece of paper represented more than 175,000 pages of reading on business excellence and an additional 5,000 pages of interview notes and survey results from my work as a consultant and trainer. I then took all of that information and tried to uncover the pattern… the formula for business success. Well, here is what I came up with:
(T+C+ECF) x DE = Business Success
Let me take you step-by-step through the elements of this equation.
Talent
You need the brightest, most talented, values-based people you can possibly get on your team. Here is the truth: “The success of your organization is directly proportional to the quality of the talent you can attract and keep in your organization." I recently had the great honor of having lunch with one of America's wealthiest and most successful entrepreneurs, a man who started with nothing and built it into a multi-billion-dollar company. When I asked him what the single most important piece of business advice he could give me was, he smiled and said, "It's all about people, people, people. You can kid yourself about a lot of things in your business, but at the end of the day it's always going to come down to the quality of your people." It is a given that you must produce a product or service that is competitive and of a high enough quality to please your customers, once you have accomplished that minimum standard the single most important factor in the future success of your business are the quality of your employees. Mediocre people equally mediocre and failing business… Great people lead to the opportunity to build a truly great and highly successful business.
Culture
Many people used to feel that "culture" was sort of a touchy-feely issue, a “nice-to-have” but not a strategic issue. Nothing could be further from the truth. If the success of your business is truly tied to the quality of the talent you can attract your team… culture is key because highly talented people want to work with other great people, doing cool and meaningful work at a company that treats them with respect. Trust me; you cannot have a winning company without a winning culture. So, what are the elements of a winning culture? A few of the key ones include: treating employees fairly, creating a family like atmosphere where employees are friends with each other, giving your people to support and resources they need to do their job well, creating an organization that people are proud to work for, fostering innovation and creativity, and making it a habit to "catch people doing things right" and find a way to praise your best workers and celebrate their accomplishments often.
Extreme Customer Focus
Let’s face it, about the only sustainable competitive differentiators left to most businesses today are the quality of your people and the quality of your customer service. Competitors can copy your products, they can copy or beat your price (there's always someone willing to go out of business faster than you), they can copy your distribution channels, they can reverse engineer your technology, they can put a location directly across the street… they can copy just about everything but who you have on your team and how your team treats the customer. Therefore, building a culture of extreme customer focus, where your organization "owns the voice of the customer,” is one of the surest ways to control the marketplace. The goal then must be to utilize every possible avenue in finding ways to talk to, listen and connect with your customers in order to position yourself as a trusted advisor and friend who is deeply focused on delivering great products and services and building the strongest possible customer relationships.
Disciplined Execution
Lastly, you combine the first three elements: Talent + Culture + Extreme Customer Focus… and then you work like crazy to get your entire team to execute with discipline. For the past seven years I have taught a class on strategic thinking at the Wharton school of business at the University of Pennsylvania. Each year I have about 100 senior executives attend my class, and every year I asked the same question: "What percentage of companies that know how to succeed in the marketplace, that have a great strategic plan… effectively execute their plan?" Year after year the answer is the same: 10 to 15%. It does you no good whatsoever to hire great people, create an amazing culture, and do a superior job of listening to your customers – if you cannot instill a high level of disciplined execution so that your great ideas are turned into massive action. Therefore it is critical to create the systems and processes necessary to ensure that people clearly understand what their roles and responsibilities are, and specifically what they will be held accountable for. The final step in creating a culture of disciplined execution is to broadly communicate progress on all essential goals and objectives so that everyone in the organization knows how things are moving forward, when there is an issue and who is responsible for delivering the required results.
So there you have it, the pattern of business excellence: Talent + Culture + Extreme Customer Focus multiplied by the power of Disciplined Execution. It is my firm belief that if you take this equation and follow it with vigor and commitment, you will see a strong positive impact on your business.
Byline: John Spence has been recognized as one of the top 100 business thought leaders and as one of the top 500 leadership development experts in the world. He is an international keynote speaker and management consultant and has written five books on business and life success. www.johnspence.com
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