3 Strategies to Begin Using in 2014—and begin building value in your business!Chia-Li Chien, Ph.D., CFP®, PMP®, CPBC
Chia-Li Chien | Jan. 02, 2014
Who is ready for 2014? Are any of us ever really as ready as we think we could or should be or as much as we want to be? Probably not. We’re all business owners, which means we are constantly pushing our business and ourselves, are always looking toward the future, and are maybe even just a little bit competitive.
As we begin the New Year, there are three strategies I’d like to see us all put some focus on, and continue, or begin, to build value in our businesses for a successful and prosperous 2014.
Let’s start with—PROFIT FORMULA
When it comes to stages in your business or business cycles, there are many different theories, beliefs and concepts on which to base your own plan. But you can pretty much always count on a start-up stage and a growth stage. However, in thinking like any professional investor, a business owner should also plan for an exit stage. There should be an end in mind.
In my profit formula system, there are four business stages every business must consider:
- Survival Stage
- Growth Stage
- Positioning Stage
- Significance Stage
Four types of business income:
- Repeat business
- Residual income
- Non-residual income
Each business stage can be associated, or matched, with one or more types of revenue. Do you know which stage your business is in? Are you structuring your business to take advantage of all four types of revenue? If not, the start of the new year is an ideal time to re-conceptualize your business to help you maximize the value in the business you create—and grow in value in 2014!
ACTION: Your first assignment for 2014 is to find out which products are associated with which type of revenue.
Step 1 – List all your products (including your services).
Step 2 – Try to combine some products into packages or innovate into new products.
Step 3 – Based on your current business stage, place your product where it best matches the revenue type.
Step 4 – Check for any missing opportunities in what you see in the chart.
Effective Pull Marketing means to deploy transparent market makers. A Market Maker is an entity that has your exact target customers.
Market makers are already well established and positioned in your market space. Market makers include strategic alliances, specific interest trade groups, or even just another complimentary business. They are all around you.
ACTION: Your homework second assignment for 2014 is to identify your market makers, based on your ideal target customer.
Step 1 – List the top three most profitable products or packages on the left side.
Step 2 – List three market spaces such as industry, revenue size, demographics, geographic, etc.
Step 3 – Identify the candidates for your market makers for specific products in specific market spaces. Identify at least 3 for each block.
Step 4 – Research these candidates and identify only 3 to target in the next 12 months.
KEY PERFORMANCE INDICATORS (KPI’S)
Key performance indicators or KPI’s, represent how you measure your critical success factors. This is a critical item to help you build business value.
KPI’s are nothing more than a set of very simple numbers. These numbers help you make effective decisions in your business. In general, most numbers can help you make the right decision. KPI’s work in your favor as a business owner, most importantly, because they are easy to understand, small enough to grasp, and a great tool for communicating to your team as well.
ACTION: Your third assignment for 2014 is to identify what types of information you should be tracking and find the smallest actionable and measurable number to track as well.
Sample Activities Based On KPI’s
Step 1 – On the left side, identify items you want to track. Identify only three sets of activities-based KPI’s.
Step 2 – Identify your goals. For example, you want to get 5 client appointments a week.
Step 3 – Write down your actual results for each month; red indicates you’re behind, green means you’re on track, yellow indicates you did not quite meet the goal.
Remember to break your goals down as small as possible so they are more achievable!
As you plan for 2014, plan to put in place the three strategies we’ve discussed:
- Profit Formula
- Pull Marketing
- Key Performance Indicators
A focus on these three areas will help you reach your resolve to build your business in value, and make 2014 one of your most prosperous years in business yet!
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