FOUR reasons why small businesses fail to grow
In every industry, new companies come to the horizon every day. While some grow and dominate, others stagnate or shrink and ultimately fail. There are many reasons why companies grapple to grow, despite of repeated attempts.
Two years back, NY Times came up with blogs citing the main factors that were acting as determinants to the growth of the SMBs. Taking excerpts from there, here are the top four reasons explaining why only some small companies grow while others hit the wall.
1. Poor Monitoring
You cannot be in control of a business if you don’t know what is going on. And this is precisely what happens with most of the small and medium-sized businesses. They are completely in dark about the actual happenings taking place within their processes. With no stats in hand – their company runs like a directionless car with no one to take the right turns and pull the brakes at the right stops.
SMB owners have a common — and disastrous — attitude that monthly business review sessions is suffice to keep watch over the business. In reality, business monitoring is no less than a daily job where entrepreneurs need an application like a small business CRM that gives them a bird’s view of the entire operations in minutes.
2. Lack of Implementation
Whether you want to achieve 75 percent customer satisfaction or 85 percent customer satisfaction – these are mere figures on paper until you do not do anything about it. To ensure that your business actually takes any benefit out of it – IMPLEMENT these policies.
And this is where the SMBs falter. What they fail to realize is that merely setting high standards and not taking any action upon it is as ineffective as no standard at all. They need to implement control systems that assure those customer service standards are met. Then only will their good intentions be accompanied by good results.
3. Excessive Technology
Technology can be both a blessing and a curse for businesses – it depends on how it gets used. While the larger enterprises have a better control over their enterprise systems – SMBs fall short at this aspect. In the lieu of getting the best of applications at hand, they have turned their business process into a cobweb of standalone applications.
Amassing so many applications has made it very difficult for a small company. They are spending a large chunk of their time on managing, integrating and troubleshooting these applications. Plus the added hassle of data discrepancy as the records are lying in multiple databases.
Obviously, they have not understood that while technologies can do many wonderful things, they can also be overwhelming and expensive if not implemented right. What the small and medium businesses principally require is: UNIFIED BUSINESS GROWTH SOFTWARE that orchestrates their business processes and manages them together.
4. Dysfunctional Management
Courage, Fortitude, Attitude & Passion – these are the ever important corporate cultures that drives a company. Throw in lack of Focus, Vision and Planning into the mix and you have a disaster.
Unfortunately close to seventy percent of small and medium organizations experience the second option; which precisely explains why these businesses have a dysfunctional management.
This message goes to all the SMB entrepreneurs: understand that a company is a reflection of the owner’s desires and personality. While some of you might want to take over the world, some will be happy making a reasonable living. Whichever is the goal – it’s important that you maintain a driven culture in your company. Values like Courage, Fortitude, Attitude and Passion should be there to create an inspired staff.
Patricia is a full time CRM consultant at ConvergeHub and part-time blogger. She has earned herself quite a fame as a specialist and market expert in CRM software. In the last five year she has worked with various companies as CRM consultant to help them move their businesses to cloud. Her expertise lies in offering cloud CRM consultation, CRM customization and integration solutions to small enterprises. For last one she is engaged in building ConvergeHub, cloud-based CRM solution for SMBs, as a consultant.Follow her at Twitter: @convergehub