Business Sustainability TIPS (Part 1)
Introduction:
Running a successful business isn’t just about making money in the short term; but ensuring long-term sustainable profitability regardless of the business environment. To achieve this, business owners and managers need to adopt strategies that ensures a platform that allows easy adaptability. In this article, we will discuss a few tips to help you build and or assess the nature of your business’ platform. Once a solid platform exists then growth can be rapid and sustainable.
The Platform
A business that will be sustainable long-term is like a journey that never ends i.e. a marathon and not a 100 meters dash. Preparation is key for success. First and foremost is the mindset that is focused on the long-term, determined and disciplined to actualize it.
- Clarity of Vision, Purpose, and Core Values is what tunes the mind for the long-haul. Ability to diffuse this mindset throughout the entire organization is critical to success. Every action or decision must be driven by this mindset and in some cases, may be painful and come across as a loss in the short-term. It, however, will be building the muscle for long-term sustainability!
Vision is the future state of a business. It is better stated in a manner that it is unattainable but continues to propel. Stating it in terms of competitive positioning is not lofty enough as once that is attained, the question then arises, then what? An example is Google’s vision statement Google’s vision is to provide access to the world’s information in one click.”
Have you clearly defined your business vision in a lofty enduring manner yet?
Purpose is the reason a business exist – the reason for its being. A very short and impactful statement on the why? An example of a purpose statement that of Nike – “Our purpose is to unite the world through sport to create a healthy planet, active communities, and an equal playing field for all.”
Are you clear as to the purpose for your business? Do your staff know it and can relate it with passion?
Core Values are those critical standards that guide behavior or actions. They guide crucial actions and behaviors, such as how business decisions are made. Core values when lived out forms the organisation’s DNA and culture.
Accounting
Sound financial management is a critical backbone for a sustainable business. To manage an organisation’s finances, it is important that the proper financial records are kept. Accounts form the basis of taking good financial decisions. For sustainability, an organization must have dependable record of its transactions as well as adequate controls over the business finances.
The financial statements prepared from the financial records provide the basis for evaluating strategies deployed and the business performance. This information enables projections/modelling of planned or proposed strategies together with anticipated revenues, costs, expenses, profitability, and financial wellbeing or otherwise.
Once the platform of regular financial reporting has been formed, then we build core financial management principles of annual budgets, monthly or quarterly comparison of actual with budget, cash flow projections, monitoring key financial metrics, etc. on it. These sets the business on the path of sustainability. Regular financial analysis can help identify areas where changes may be necessary for long-term sustainability and growth.
Operations
The processes and procedures for producing what is sold by the business whether goods or services represents the core of the value creation process that entitles the business to revenue. It’s important that standards of quality that will be known with the brand be set, sustained, and continually enhanced. A core symbol of sustainability is where the quality of the service or product is independent of any staff. Appropriate tools, process design and its documentation, staffing, proper supervision and control of resources all form the foundation that guarantees the quality and efficiency of operations and its sustainability.
