The value of business support
People don’t start a business just because they enjoy business, they set up their own company because they have a particular skill or passion for something and believe that they can make money out of it. There is often the perception that they will have more time available and be able to earn a higher income but the reality is that within the first two years at least, most business owners have far less of both. According to the Australian Bureau of Statistics, “60% of businesses in Australia will fail within their first three years of operation, with 20% of businesses failing in their first year of operating” Businesses do not generally fail due to technical knowledge of products and services (the key reason the company was established in the first place!), but there are some consistent reasons for the failures:
Lack of business experience
Cash flow problems
No budgets
Ineffective sales and marketing
Staffing problems
General economic conditions
If you look at this list, it suggests that it’s fundamental business knowledge that is lacking and this is hard to acquire quickly unless you have come from a background where you were required to handle these aspects anyway. This is where ‘business support’ comes in. With increasingly competitive marketplaces, the ability to skill up quickly and address what are potentially fatal shortcomings is fast becoming a necessity, and it is advice, tools and templates that can be a sound antidote to business failure through getting things right from the outset.
The first thing to say regarding possible business assistance is to take the time to find the right type of support. Business Advisors and Business Mentors should be skilled in providing you with the right advice, tools and means to set the business on the right path and help you navigate the challenges that you will inevitably face in the first few years. Establishing the correct business structure is essential since if the company products or services do turn out to be in high demand, then a lack of structure can cause tremendous internal issues not to mention potential health ones too.
When selecting someone to assist you, my recommendation is to use someone that has a track record of success that you can verify. Since the barriers to entry for business support are low (there are no specific qualifications associated with this area), anyone can call themselves a Business Advisor so check their ability to produce results since there really is no substitute for proven experience. Before entering into any agreement, arrange to meet with the individual(s) you are considering so that you can a) get a sense of whether this person can really help you with your business and b) check that you would enjoy working with them.
Finally, I do just want to distinguish between a Business Advisor/Mentor and a Business Coach since these titles often get confused. As indicated above, the former provides advice, tools and capabilities to help your business succeed. A qualified Business Coach does not actually provide advice at all. Business Coaches are focused on the performance of the individual and establish areas to be improved or developed through intelligent questioning. The terms of their accreditation do not admit the provision of advice and are hence typically used by more senior business leaders.
Ian Ash ACC, AInstIB
Managing Director OrgMent Talent Solutions - ianash@ombs.com.au