Small business owners are faced with many decisions that determine the success or poor performance of their business. Each day small business and start-up owners make decisions that will improve or increase business or lead to loss. Routine decisions such as what stock to buy and which products to discount may not sink a business but ones that are more strategic such as introducing a new product or entering a new market could have severe consequences.
Business owners need to decide on many issues. These include what sort of business model to develop, development of a new product or service, how to go about commercialising a new product, what market research to carry out to test and market and what marketing plan they need to introduce.
An online publishing start-up Liquid State developed their product for a year but soon realised that they needed to rebuild their product. They built a new version of the product which wasn’t flawed but was not suitable for the customers they wanted to pursue. The new product has grown rapidly and the business has been awarded accolades for high-growth start-ups. The customer base has grown 30 times since their start up.
What do you think about the decisions that you are making in your business? How many of them do you feel have worked and how many have not? Have you thought about ways to improve your decisions?
A lot of research has gone into finding how decisions in business can be improved. Researchers have looked at decisions that happen routinely and repetitively. What they found out is that deliberate practice involving action, feedback, modification and action again helps to improve decision-making.
Think about it. Almost everyone knows that the more you practice, the better you become at what you do. Yet in many areas you will find that just spending lots of time practising won’t necessarily make you better at what you are doing. What is needed is feedback so that you can take corrective action.
For routine decisions such as selling products to customers you would quickly adjust your selling approach if your initial attempts failed to close the sale. Feedback from your customers enables you to revise your approach and come up with more effective ways of selling your product or service. The same might happen in a retail store where you are deciding on products to sell in your store. Some might be dogs yet others may fly off your shelves.
Yet what about more strategic decisions such as coming up with a brand-new product or service and needing to decide on what customer segment or niche market you are going to sell to? This is not a routine, repeatable decision but a strategic one that if not successful can have a major impact on your future viability.
In these areas where strategic decisions need to be made for a small business or start up such as developing a new product, testing selected markets and introducing a marketing plan, it may be necessary to involve someone with prior experience and knowledge that can help you to make better decisions.
This is why many small business owners and start-ups rely on mentors, coaches and business adviser to assist them with non-routine decisions. With insight into products and markets business advisers can help correct and adjust decisions through detailed preparation, analysis and planning.
Tough conversations about how you are going to develop a good start-up idea and test it in the market or even reposition your existing business against a new and strong competitor, won’t only help prevent you from making blunders but will assist you to make decisions that are more viable for your business.