Last time, I looked at the importance of differentiation to ensure you had a competitive edge over your competitors. You could exploit this advantage by selling at higher price and generate increased profits. However, simply having a unique product that your prospects can benefit from is still no guarantee for successfully growing your business. There are, in fact, eight Key Results Areas that small business owners must concentrate on.
The eight Key Results Areas are:
- Competitor & Market knowledge
- Customer or client care
Your company’s performance and profitability will depend on how well you do in each of these areas. Assess your performance in each area from 1 (for poor) to 10 (for outstanding). Your overall company performance will be held back by your lowest score.
For example, if you marked yourself as an ‘8’ in all areas except differentiation, which you marked as a ‘5’, then your overall company performance will be at ‘5’. Keep improving your lowest score and it will reflect in your overall company performance.
The first two – competitor & market knowledge and differentiation – enables you to identify your place in the market based on the strengths and weaknesses of your main competitors. Your aim must be to develop some points of difference that separates you from the others. You can use your broader market knowledge to identify trends concerning your clients and prospects. You can tweak your marketing to exploit the opportunities this offers you.
The next three are self-explanatory. You need to be competent enough to negotiate contract terms with those buying your products/services and knowledgeable enough to spot when you are being asked to sign a one-sided contract.
The sixth, delivery, is listed as this is the vital step between sales and client care. It might include installation and user training, depending on your line of business. This step needs careful attention – getting it wrong will get your client relationship on the wrong footing at the start.
Customer care, client care, after-sales support – whatever you term it – now needs much more organising that ever. Clients are becoming more and more demanding and less tolerant of products/services that exhibit teething troubles. You need your clients to develop a loyalty towards your company so that they will buy other things from you. They might buy consumables or buy more of what they originally bought. They might buy your other product lines, ones with higher profit margins.
They will only do this if they are happy with their initial purchase and you will find these sales take much less time and effort.
Of course, if you foul up on the delivery or your product fails to live up to expectations, they will soon look elsewhere and your future revenue streams will disappear. You are then left with the challenge of winning another brand new client as a replacement. This is a time consuming and costly process.
In the long run, it is far better to “wow” your existing clients so they willingly keep buying from you and you can charge profitable prices.
Recruitment might seem to be an odd inclusion in a list of Key Results Areas. However, when you become very good at the other 7 Key Result Areas your business will start growing. You will need to grow your staff numbers to keep up with demand. If you were to recruit the wrong people into these key positions, it could set you back by many months, possibly years.
- Undertake an honest assessment of where you are in each of the 8 Key Results areas and identify where you are weakest
- Put in place a plan to improve your weakest area
- Review your Key Results areas every few months