How to organize your business for success

As if running a business isn't hard enough...
By Elias Ek

Many small business owners and managers make it even harder on themselves and their employees than necessary. The unfortunate result: most new small businesses never survive to see their first anniversary. And even if they survive the first year, the chance that they?ll survive for five years is almost non-existent. The primary failure factor: lack of resources and planning. Endless days and nights of hard work for nothing, just to close the doors and scratch ones head. It doesn?t seem right.

Surely, there has to be a way a new small business can increase its chances for success and allow a business owner a better life, rather than draining the life out of them.

The secret to creating a business that truly works is to go to work on your business, rather than in your business. And one way to do that is to outsource certain key elements of your business to keep costs down and allow the entrepreneur in you to focus on what you love your business.

An independent system
A business owner should think about why he started the business in the first place and what the goals with the business are. If we assume that most people start a business since they dream of a better life, then the archetypical entrepreneurial life with long hours, many worries, and the wearing of so many hats, suddenly seems quite wrong.

As Michael Gerber says in his book The E-Myth, nearly every small business focuses on doing the wrong work. Stricken by an ?entrepreneurial seizure,? they think that if they know how to do the technical work of the business, they can build a business that does that technical work. This is the problem.

Many small business owners react, "Sure, but I cannot afford to hire anyone else to help me do the work, so I just have to do it myself."

But they miss the point. Successful business owners, true entrepreneurs, work on the business, finding a better way to get all the work done.

What every business owner who has successfully built multiple locations knows, is that they started by building a business that worked completely independent of themselves. They created an integrated process for consistently delivering the same product or service at the same level of quality.

If you're a business owner who works long hours and still can't see your business taking off, begin by asking yourself the following questions:

• What would happen if, tomorrow, you could not do the work? How would it get done?
  
• What is the core competence of your business?
  
• Have you documented how your business works and created systems so that other people could manage it and duplicate your results?
  

If you do not have answers to these questions, regardless of how complex you think your business is, you do not have a business. All you have is a job. And it?s not even a great job since it requires unlimited hours, doesn?t guarantee a salary and offers little time off.

When you can begin to see the business as apart from yourself, rather than a part of yourself, you are on your way to creating a business that really works.

How do you want to spend your time?
Obviously, someone has to do the work. If it's not the business owner himself, then there are only two choices: hire staff or outsource it.

Most small businesses choose to hire staff and attempt to do everything in-house without giving a thought to outsourcing. But quite often a small business does not need the full time services of more than one or two people. A business owner will spend a lot of time (finding the right person, managing staff, dealing with personnel issues, etc) and money (on office furniture, equipment, training, salaries, higher rent for a larger office, etc). All that time and money subtracts from time and money spent on the demanding and very essential strategic aspects of running and growing the business

While large businesses have been outsourcing services such as customer service, order management and telemarketing for years, few services have been available for small and medium sized businesses. Service providers have traditionally shunned taking on the small volumes that SMEs can offer. But that?s changing.

A new trend has given rise to companies which provide business services to SMEs. One such company in Taiwan, Enspyre, was formed in early 2002 by a group of entrepreneurs who, drawing from their own experiences from starting and running businesses, wanted to create a company that could make a big difference for small businesses. The entrepreneurs come from all over the world ? Taiwan, United States, England, Ireland and Sweden.

Enspyre concentrates completely on small and medium sized businesses, offering them a complete set of business processes. In other words, Enspyre helps its customers handle full customer interaction from sales and marketing support like telemarketing to order management and customer service.

What makes Enspyre like "Viagra for small businesses" as one company called it is that they give a small business the extended resources of a large business. Some of Enspyre's customers are one or two person companies. By working with Enspyre, they can suddenly have a telemarketing department, a full team of sales assistants and customer service representatives. And Enspyre's multilingual staff can help them extend their business overseas with sales support and customer service.

Enspyre's services are totally scalable so the company only pays for what they need. And for the price of one new employee or less companies that hire Enspyre are hiring the support of a full team with international business experience.

When a small company partners with an entire team like Enspyre's it suddenly becomes a much larger, more powerful company able to achieve more than ever possible and often for no than the equivalent of hiring one or two additional staff members sometimes even less. Viagra for small businesses indeed!

Perfecting Your Process
Enspyre's consultants work with small business owners who often have not put an efficient and effective business system in place, assisting to design processes that can be easily expanded.

Local Taipei clothes designer Winson Lo is founder and only full-time employee of T-Kingdom. She outsources production of the clothes she designs to local contractors and staffs commission-only sales people.

Moreover, Winson founded T-Kingdom with her own resources and has had to keep her overhead low. Even today, she is still T-Kingdom's only full-time employee, responsible for selecting and designing the fabric, managing her sales force and communicating with her customers. T-Kingdom outsources actual production to a clothing manufacturer.

Soon after founding T-Kingdom, Winson faced a dilemma. Most of her potential customers existed in other countries and to ramp up overseas sales she would have to hire two to three skilled people, fill a full office with all the equipment they would need (e.g. furniture, computers, software, phones, etc) and devote most of her time to management. The costs were more than she could take on. Moreover, for parts of the day her sales staff would have little to do (i.e. when overseas customers were sleeping), while at peak times overseas they would not be able to handle all calls.

Winson chose to team up with Enspyre to assist her in expanding sales in overseas markets without having to hire a new staff or invest a lot of capital. Outsourcing this to a professional service provider such as Enspyre breaks down costs and capacity over a number of customers is obviously a better choice than hiring an international sales staff.

Lo has more time than ever to work on her business, improving and adding designs, refining sales pitches and work with Enspyre to establish larger resellers that will ensure future sales.

Winson now plans to hire a manager that she can teach to do the job according to the processes that she and Enspyre have set up. At that point she truly has a business since she can keep designing clothes or even take a vacation and the business will keep on earning her money.

Do you have comments, suggestions or tips?