Everyone who starts or leads a business dreams of passing it along to their family or trusted colleagues, “the next generation.” But, very few business leaders and entrepreneurs are successful in making that transition happen. Every year, countless businesses and organizations fail, closing or selling out to competitors because they cannot transfer the founders’ vision to successors who share it. Excuses are made and fingers are pointed. Long-term success takes more than hard work and a little luck. Leaders and entrepreneurs who achieve exceptional organizational longevity share eight business practices that guide them to long-term success. They think differently than the other, unsuccessful types. They operate differently. And, they lead differently. These are the techniques that help them make the transition to their next generation of leaders successful.
1. Engage in ongoing planning with a realistic vision. Successful executives and entrepreneurs prepare for success on an on-going basis, not just when they are in start-up mode. They move beyond their initial business plan to augment their success by leveraging new opportunities and seeking ideas to enhance operations and profitability.
They are disciplined in the habit of writing down their plans, reviewing them, and sharing with their essential employees and advisors. They know that on-going planning for the future, for the inevitable transition, keeps them focused and moving forward. These leaders continually, and formally, evaluate what is working and what needs to be changed.
2. Establish a realistic vision of the future. Lasting business leaders also match their vision to their abilities. They leverage one success into another rather than making rapid, huge leaps beyond their capabilities. Those who don’t have a realistic vision risk their success, their enterprise, their future, everything, because they reach too high before their cash, talent, or operational capabilities are ready for higher levels of success.
Enduring leaders actively and effectively manage their transitions and hire sophisticated talent to match their future needs. Their success is sustainable because they build it on a viable foundation that is based in reality not on wishful thinking.
3. Use disciplined approaches to developing leadership and executive skills. Leaders who operate enduring enterprises understand experience is critical, not just with the operational or technical expertise, but also with the ability to lead, manage and weather the daily challenges of not having someone tell you what to do. These leaders understand they need to continue cultivating their own ability to manage and create strategies.
Those with enduring success continue developing and enhancing their own skills to expand their resources, grow their opportunities, and build their “business arsenal.” They read. They hire the consulting and professional talent they need to augment their internal expertise.
4. Implement sound fiscal management. Fiscal discipline is fundamental to long-term business or enterprise success. Yet, only a few leaders have the self-discipline to manage their cash flow for the inevitable peaks and valleys. They respond to immediate pressures and spend money they don’t have.
Too many leaders waste money on flashy projects, trying to impress people. They never prepare for the future because they’re focused on living in the moment. Some make ill-advised decisions that create financial crises rather than making prudent commitments they can realistically handle. Successful leaders of enduring enterprises focus on building real net worth by mastering financial discipline and tightly controlling what they spend.
5. Adapt to changing circumstances. Markets change and technology advances. Those business leaders who are successful over the long-term understand and adapt to change. They invest in people and technology to enhance productivity. They stay on top of competitors and respond as necessary. By continually adapting, they are able to leverage emerging trends and long-term evolutions that are fundamentally transforming their industries. Enduring leaders create enterprises that last well beyond their own tenure, always looking ahead to identify tools, resources, ideas, and technology that can enhance their organizational success.
6. Build substance into the enterprise. Businesses and organizations have come and gone over the decades. Some succeeded brilliantly, but most failed to meet the expectations hyped by their founders and owners. The primary reason for these “failures” has been a lack of substance to the enterprise; most of what was promoted was smoke and mirrors.
Sustainable enterprises have substance. They deliver on the promises they make, and fulfill the expectations they raise. Customers, suppliers, and employees can count on them. These enterprises demonstrate a consistency of quality products and service that can be trusted over time. An on-going reputation for dependability is often a real predictor of long-term enterprise success.
7. Control growth. Those businesses that survive over the long-term have leaders who carefully and deliberately manage the size and growth of their enterprises. Those leaders who focus on growth ensure that the organization has adequate finances, equipment, and staff to meet their evolving needs. Those who maintain a smaller size often find they are better at managing the stability of their overhead and fixed costs.
Maintenance-oriented enterprises may even make more money and have less stress than their growth-oriented peers. Both growth- and maintenance-oriented leaders who succeed over the long-term effectively manage their appetite for risk and keep the scope of their business within their comfort zone. They maintain leadership enthusiasm by controlling the pace of growth or by achieving sustained financial success.
8. Maintain motivation. Staying motivated is tough in any enterprise after the euphoria of taking over or starting up begins to wane. Once the day-to-day activities begin to become routine, most people lose their enthusiasm. Even harder is dealing with the real stresses of leadership.
Boredom is often a leader’s worst enemy. Leaders of enduring enterprises motivate themselves and their employees by continuing to look for new opportunities to meet their customers’ needs. This creates an atmosphere of innovation and ongoing success measured in revenues, customer satisfaction, and employee retention.
Leaders who enjoy enduring business success have learned to constantly adapt and evolve. They respond to continuing competitive pressures by finding ways to meet evolving client needs. The secret to long-term sustainable success is to do things with discipline and excellence. Leaders of enduring enterprises, both large and small, do more than just dream of success. They make their success a reality by taking the actions necessary to achieve it, and to make it last.
Are you ready to become a leader of an enduring enterprise? If you are, which of these strategies do you need to begin to implement?
Jill Johnson is the president and founder of Johnson Consulting services, an award-winning management consultant, and author of the forthcoming Bold Questions series. She helps clients make critical business decisions and develop market-based strategic plans for turnarounds or growth. Contact her at LinkedIn, or visit www.jcs-usa.com.