The 6 Secret Keys to Building a Lasting Business
The average lifespan of companies today has decreased by more than 50 years over the last century. In the 1920s a successful company typically lasted for an average of 67 years, compare that to the 15 years that a successful company usually survives today.
Fortunately, there are still organizations today that have the passion and desire to build a company vision that will carry on for multiple generations and ages, with more and more emerging.
However, unlike many of these externally financed companies, most companies have to ultimately learn how to stay in business, and your Internet business is no exception.
Learning how to survive and thrive in today’s constantly changing environment requires you to develop a robust strategic business plan that will set you up for success. A strong strategy and your roadmap, along with the critical ingredients for success, will help you navigate the ever-changing and complicated business world and help you focus on the business activities that will allow you to build and maintain a long-lasting Internet business. If you don’t have a plan for exiting the market, then you need to have a strategy for continually evolving, creating, and sustaining growth year after year. If you are looking to build an Internet Business that will last for a century or more, here are six key actions that you need to take to get you ahead, retain your competitive advantage, and build a long-lasting business.
1. Build Out a 12-Month Sales Pipeline Cycle
In order for your business to last, you have to have a continual flow of qualified leads and be able to close the sale. The best way to do this is to build out a 12-month sales pipeline cycle by bringing your sales and marketing teams together. When you bring these two valuable teams together, you allow your marketing department to build their marketing qualified leads (MLQs) at least a quarter in advance. This then allows your sales team to take the leads and work on turning the MQLs into qualified sales leads (SQLs).
For this to work, you have to have clear product positioning and messaging. The best way to ensure this is by interviewing your customers, carefully studying the market and your buying persona so that you can clearly understand how you can find and convert consumers into potential buyers. This means that you will need to have a clear understanding of the structure of your resources to your potential revenue, whether this comes from sales mining and hunting, inbound marketing efforts, the growth of new and current customers, partnerships or referrals, and so on. You will need to take the time to project your potential revenue and then allocate the budget and resources to each source of revenue and have a clear way to track them accordingly. Setting up a 12-month sales pipeline cycle will set your business up to continue to have a steady flow of new customers that you can sell your products and services.
2. Develop a Strategy to Keep Up with the Competition
It doesn’t matter what business you are in; there will always be competition. To build an Internet business that can go the distance, you’ll want to make a list of your ten biggest competitors, as well as a list of the smaller ones. When you’ve completed your list, sit down and thoroughly study your competition. Learn about the products or services that they are offering their customers, analyze their positioning in the market and the messaging their delivering. Take the time to learn about their target customers and the total contract value or average sales that they are going after and how they are marketing their products. If you want to get ahead, you have to know everything you can about your competition.
From here, you should gain a thorough understanding of how your company and product offerings are different from your competition. Figure out how to emphasize the unique value that you can bring to your customers that your competition can’t. You need to take the time to figure out what sets you apart from your competition. Is it that you are in a particular niche that you can do better than everyone else? Is it the excellent customer service and personal attention that you provide your customers? You must make sure that both your marketing and sales staff know these differences and your employees need to embody this knowledge as well.
From time to time, refresh your list of competitors and relearn everything you can about these businesses. To keep things fresh, try to do this exercise every six months. Another thing that you can do is try to find out which competitors you can befriend and see if there are any complimentary offerings that you can partner with them on.
3. Develop a Business Model and Product Innovation Cycle to Adapt to Changing Market Conditions Quickly
Business models and product offerings are a lot like fashion. They go in and out of style every few years. To stay on top of this, you need to carefully study the trends in the market and have a laser focus on your customer’s buying behaviors. Study them carefully and try to learn how their buying journeys change throughout the years. You’ll also need to look at how your competition offers similar products and services to yours in a different way. When you are trying to build an Internet business that is long-lasting, you have to assume that every two years your business model is going to change and you have to sit down and figure out how to improve your business model for continued growth.
To stay ahead of the changing markets, you’ll want to allocate some company resources to researching the market and changing trends and figure out how you can innovate your products and service ahead of their time, which will allow your business to emerge as a leader in your industry with industry best practices, as well as industry-leading practices. The two-year cycle of change can empower you to architect a period of innovation, which means you’ll want to strive to embrace the inevitable change rather than trying to fight it. When you can develop an innovation cycle within your business, you can allow your products and services to be introduced to the market before your current products reach the end of their life, which will give you a distinct advantage over your competition and allow you to continue to grow and build a business that will be around for years to come.
4. Plan for Turnover to Stay Talent-Current
As your business grows, it is inevitable that you will need to improve the capabilities of your leadership team. The founding executives that are currently loyal to you and your business might not have the capacity to grow along with your company. This can lead you to finding yourself in a bit of a conundrum of having to choose between loyalty and competence. While you will want to reward the dedication of these team members by allowing them to keep their job, if they don’t have the expertise to perform their duties in the manner that you need, it could eventually damage your business. It’s inevitable that as your business grows, you will experience turnover and you will need to replace employees and leadership team members that have been with you since the beginning.
To keep your business moving forward and growing, you’ll need to spend some time determining what your executive dream team will look like. Once you decide this, you’ll need to look at your current team and identify the gaps that exist compared to your dream team. As you determine the gaps, start to develop a plan that will allow you to maximize your leadership talent. When you feel like your plan for building your dream executive team is completed start to incrementally execute the plan to bring on the right leadership talent for your business while minimizing business and cultural disruptions.
5. Create an Elastic Workforce
If you’re running a business that’s seasonal and requires ramping up and down, then you need to build a flexible workforce to meet the seasonal demands. This will require you to carefully consider the roles of each of your employees and how you can supplement these roles when needed to ensure that you are meeting the demands of your customers. One easy and efficient way to do this is by outsourcing some of the positions in your company or hiring independent contractors to help pick up some of the slack during your peak seasons. These are two very effective ways to solve the elasticity issues that often come with seasonal businesses and can help you stay on top of the continual ramping up and down that comes with seasonal work.
Fortunately, just about every function in your company can be outsourced. Everything from software testing and development, marketing, HR, finance, IT, administration, and others can be handled effectively by an independent contractor or temporary employee. In order for this to work and enable you to build a long-lasting Internet business, you need to take some time to determine the critical positions in your company that you will always need and want to keep in the house, and then outsource the rest. Keeping your company elastic with independent contractors and outsourcing will allow you to quickly ramp up and down when things get busy, without having to spend the time and money to train seasonal employees. Creating a flexible workforce can help you on your way to building a business that will last for years.
6. Balance Growth vs Profitability
As you continue to grow your business, there will be times that you will need to raise capital for improvements and other business-related expenses. If you’re self-funding your business, then your sources of money might be substantially limited. While you might be able to use the funding that comes from the positive cash flow that your business is currently generating, there is going to come to a point when you will need more cash to grow your business. One way that you can accomplish this is through a business line of credit, which is an example of an affordable cash source for growing your business. However, getting the banks to approve your application for this can be tricky.
This is where a healthy balance sheet will come in handy. Maintaining a healthy balance sheet will allow you to anticipate better when you will need the money to grow your business. Your balance sheet is what will provide the banks and other investors a glimpse into your company’s financial condition and can help you endure economic downturns and keep your business growing. When you can present a healthy balance sheet, banks and other investors will compete for your business.
Too many of the businesses today aren’t posed to last. With most companies these days lasting no longer than 15 years, it is essential for you to set yourself up from the start for success. These six strategies can help you create a business model that will allow for continual growth. Companies that can last for 100 years or more can be more financially stable, allowing them to experience fewer ups and downs, which helps them to endure less stress and worry about the possibility of loss and layoffs, and can make a more significant contribution to the economy and society.
These simple strategies can help you build a brand and company that lasts and that will provide you and future generations with the stability and prosperity you dreamed of when you first started your company. If you want your Internet business to be long-lasting, it’s important to start taking the necessary steps today and enjoy your success for many years to come.