Running a business is no small feat. If you ask the U.S. Small Business Administration, they’ll tell you one-third of all new businesses fail in the first two years. If you let them continue, they’ll say half of all new businesses make it four years, and only 40 percent survive for six years or more.
So how do businesses survive? And more importantly, how do they thrive? We thought we’d take a break from industry topics today and focus on a broader business discussion that has undoubtedly touched every entrepreneur reading this blog.
What makes a business succeed? A recent study by Gallup found that a business’s ability to make it over the hump has everything to do with leadership. The quality of the company’s founder, along with the caliber of its management team, has more to do with company longevity than anything else, according to Gallup.
In its research over time, Gallup has found that companies that survive over the long term have executives that share the following key characteristics:
A clear vision: The leaders of successful companies are more likely to clearly articulate the corporate goals and competitive advantage(s) of their companies to their clients and employees. They create an inspiring narrative that unifies internal teams and clearly directs external growth efforts.
A close relationship with customers: They are more likely to make decisions about pricing, products and services with their customers’ needs in mind. They don’t neglect important matters such as profit margins, but they maintain a close relationships with customers and work toward improvements that will benefit those businesses long-term.
A plan for growth: They spend time planning for growth and aligning employee responsibilities with company goals. This requires an ability to step back from the day-to-day battles of business and articulate a plan for moving forward. This practice aligns employee efforts with a common goal and increases individual performance.
Gallup also found that business people who share these characteristics are three times more likely to build large businesses and to grow them significantly. They are four times more likely to create jobs, four times more likely to exceed profit goals and five times more likely to exceed sales goals.
What leaders have inspired you over the years? What traits can you emulate to make your business more successful? We’re grateful to be part of your professional life. If there is anything we can do to help you, please don’t hesitate to give us a call: (801) 245-0500