Why You Need a Business Coach for Each Stage of the Business Life Cycle
From the moment you made the decision to set up a business, you entered into the business life cycle. It is the journey from startup to growth, maturity and eventually decline. At each stage of the cycle, you will encounter different challenges. As your business matures, operations and priorities will also change.
The best in business do not ride solo. Every successful CEO has had a valuable resource of counselors, advisors and mentors guiding their way. While small businesses vary widely in size and capacity for growth, common problems arise at similar stages of development. Business coaches offer the guidance and expertise needed to overcome these challenges and to continue to succeed throughout the business life cycle.
Stage 1: The Start-Up Phase.
According to the Startup Genome Report, more than 90% of startups fail, due primarily to self-destruction rather than competition. It’s a harsh reality. At this stage, organization is simple – the owner does nearly everything. Systems and formal planning are minimal to nonexistent. The company’s strategy is simply to remain alive.
In the start-up phase the owner is the business. You perform all the important tasks and are the major supplier of energy, direction and capital. In this phase, you need direction, connections and guidance from people who have been in your same position.
New companies are often created by new business owners. During this stage, we recommend seeking out a program like Think Like an Owner Academy. This program, led by business coaches and other local business owners, teaches you the major elements of business management and the leadership skills necessary to be one of the 10% of startup businesses that survive. The course is taken by other new or soon-to-be business owners of both start-up companies and well-established local businesses, creating the perfect opportunity to start building your network of business owners to look to for advice and strategic partnerships.
We also recommend attending Planning Days. Planning days are quarterly half-day events where you focus ON your business instead of IN your business. During an Annual Planning Day, you will establish both long term and short term goals for your business, and create an Action Plan on how to get there. During Quarterly Planning Days, you will evaluate if you are on track with your goals, modify them if necessary, and discuss with other business owners best practices to reach your goals the following quarter.
Stage 2: Growth Phase.
Your business has endured the initial stage of the business life cycle and has moved on to the growth stage. At this phase, your business is generating a consistent source of income and is regularly taking on new customers. Recurring revenue will help pay your operating expenses, and you should start to see your profits improve slowly and steadily.
During this stage, you will need to fine tune your business model and implement proven methodologies, sales models, marketing models and operations models to keep up with your growth. Your biggest challenge is dividing your time between a whole new range of demands requiring your attention, from managing increasing levels of revenue, attending to customers, dealing with the competition and accommodating an expanding workforce.
Your role as a business owner is changing from being able to do it all to taking a step back from the workload, hiring smart people with complementary mindsets, and taking on the role as head of the company. While you’ll still be on the front line of your company, you need to be aware of how your expanding and highly qualified team is going to be taking over a great deal of the responsibilities that were previously tightly under your control.
In this phase of the business life cycle, we recommend 1-to-1 coaching. In this program, you work directly with a business coach to devote the time necessary to achieve measurable results. While you are already experiencing steady growth, 1-to-1 coaching will work with you to develop and achieve your growth goals so your business reaches its greatest potential. Grow your business smarter with a business coach working by your side.
We also recommend attending one of ActionCOACH’s seminars, or holding an ActionCOACH-lead workshop for your team. These interactive programs cover various topics important to improving your business, and can be modified to fit your time frame.
Stage 3: Maturity.
After navigating through the expansion and growth stage of the business life cycle, your company should now be seeing stable profits every year. Your business is on top of its industry and has a dominating presence in its market. You may feel as though your business has plateaued, or is not growing at the substantial rate you’ve previously experienced. Your options are to either step back towards the expansion stage or start to think of a possible exit strategy.
At this stage, many business owners are faced with the challenge of finding new ways for growth, such as moving into new markets, adding new products or services, or finding ways to expand on existing business. During maturity, adaptability is key. Just as your business is changing, your target market’s buying behaviors may change too. Even if you are on top, you need to be wary of rapidly growing competitors who may be finding new ways to meet your consumers’ needs.
During maturity, we recommend participating in ActionBOARD, a group of 8 to 12 like-minded business owners from non-competing industries, who come together to focus on an individual goal, issue or challenge. ActionBOARD members discuss topics at a senior-level, focusing on key business areas such as sales, marketing, team building, communication, advertising, finances and time mastery. The board is designed to prevent owners from having to learn from their mistakes, and to instead learn to avoid the mistakes of others.
Stage 4: Decline.
It’s time for your reign over your company to come to an end, and for you to enjoy retirement! At the declining stage of the business life cycle, your have the choice to either pass the torch on to someone else, or to move on through a sale. What is your exit strategy?
The last thing you want is to leave your business in incapable hands. A business coach will help smooth the transition by working with your next-in-line to maximize their chance of success. Through programs like Think Like an Owner Academy, your next-in-line will receive formal business owner training and learn from other owners how to master business management and leadership. As a business owner, you can take the course too! It is a great way to brush up on topics that you may have had on auto-pilot, and learn different perspectives from other business owners.
Every stage of the business life cycle brings new or pre-existing challenges. Solutions that may have worked for one stage may not work for another. At each stage of your business, rely on a business coach to help overcome the challenges your business faces. For more information regarding the coaching programs listed above, contact us today!