Starting a small business and turning it into a successful enterprise takes more than just passion. Over half of new businesses fail mainly because the entrepreneur is unable to utilize a fundamental set of business skills to translate their passion into a profitable enterprise. In order to succeed, not only do you need to be proficient in your technical skills but you also need to become proficient in a particular set of business skills in order to transition your startup to a professionally managed enterprise.
It is important to know early on which skills you possess and which ones you will have to learn or delegate to others. When it comes to the developing the skills that you lack, most of them can either be learned over time, delegated to employees or business partners who are strong in specific areas, or you can engage the help of a professional business advisor.
Following is a set of essential business and people skills that you will need to master as you work towards developing your business:
- Delegation Skills — Delegation involves assigning responsibility to others in order to complete business related projects and tasks. The ideal position that you want to obtain is one where your staff carries out all the routine activities of your business. Effective delegation involves achieving the correct balance between effective controls and allowing people the freedom to be able to complete their job effectively. The key to delegating effectively is understanding what it takes to make your business work for you, rather than you working for your business!
- Communication Skills — Communication is an important part of life and is one that is often taken for granted. When you think about it, almost everything you do requires improved communications. To be effective in business, you have to communicate well. When you hire a new employee, good communication skills help you select the right person. When you communicate with your various stakeholders, you need to be clear about your expectations and to be sensitive when dealing with problems. The key is to know how to effectively communicate your vision with passion and conviction.
- Negotiation Skills — Almost everyone negotiates informally on a daily basis without even being aware of it. Formal negotiation is a skill that can be learned through experience and practice. People who a good at delivering presentations and public speaking tend to be more skilled at it than others. Experienced speakers are more likely to know what to say, when or when not to say it, and when to make concessions. The key is to learn how to develop a win-win approach in negotiations with all parties, while keeping in mind that you also want to obtain the most favorable outcome possible for yourself.
- Strategic Planning — Strategic planning is a very important business activity. Strategic planning is a process of defining your company’s strategy or direction and making decisions on allocations of available company resources, including capital and personnel. It also involves figuring out which steps are required to reach a particular business such as customer growth or expansion into new markets. The key is to understand how to project your company’s future performance, within a three-to-five year framework or more, supported by your well-defined business plan.
- Team Building Skills — Team-building and teamwork skills are essential for an entrepreneur in today’s workplace. People working at their potential in teams generate better solutions and more productivity than individual members working independently. The key is to know how to build teams of employees, partners, advisors, and investors that will help you take your business to the next level.
- Leadership Skills — Leadership is a process of getting things done via people. Leadership, a critical management skill, is the ability to motivate a group of people toward a common goal. Leadership is also the ability to take charge, assemble, mobilize, and motivate teams. The key is to know how to forge long-term relationships with prospects, customers, suppliers, employees, and investors.
- Analytical Skills — Today’s workplace is becoming more technologically advanced and complex. With this rapid increase of technology, the need for analytical thinking also increases. Analytical thinking is the ability to objectively assess the present state of your business, to determine where you want to be in the future, and what to do in order to close the gap between where you are and the future growth of your business. The key is to know how to gather, review, and evaluate data that is necessary to formulate and express compelling arguments.
- Sales and Marketing Skills — Establishing effective sales and marketing practices – from pricing and advertising to sales and client relations– are all essential in growing your business. The ability to analyze your competition, the marketplace, and industry trends are critical to the continued development of your business. The key is to know how to draft and effectively communicate a compelling message to your target audience which generates new business, and in turn, helps to enhance your revenue streams.
- General Management Skills –– Management involves directing and controlling a group of one or more people for the purpose of coordinating activities that will accomplish a goal. Management encompasses the deployment and direction of human resources, financial resources, and technological resources. The key is to know how to develop and implement a workable management system that will manage daily operations, nurture stakeholders, and support business growth.
- Cash Flow Management Skills — Cash flow is king! It is generally acknowledged as the single most pressing concern of the small and medium-sized businesses. In its simplest form, cash flow is the movement of money in and out of your business. Cash flow is the life-blood of all growing businesses and it is the primary indicator of the health of a business. The effect of cash flow is real, immediate and, if mismanaged, totally unforgiving. The key is to know how to monitor, protect, control, and put cash to work within your business.
- Financial Management Skills –Business financing is the application of a set of techniques that individuals and businesses use to manage their money, particularly the differences between income and expenditure and the risks of their investments. The need for timely budgeting and reporting of financial performance is of the upmost importance. The key is to know how to interpret and analyze your financial statements, in such a way, as to identify the items that are adversely affecting your profitability.
- Time Management Skills — Time Management is a set of related common-sense skills that help you use your time in the most effective and productive way. Time Management is a very important skill to master. Learning this skill will empower you to achieve more and to use your time wisely. The key is to know how to manage your time efficiently and to focus primarily on activities that are most likely to deliver value to your business.
Starting a new business is an exciting venture, full of challenge, opportunity, and excitement. However, the success of your business demands more than hard work and expertise in your field. To build and run a successful business you need to learn to apply a business skill set that will enable you to turn your passion into a thriving professionally managed enterprise. Learning to incorporate such skills will not only help you professionally, but will prove rewarding to everyone whom you and your business encounters as you shepherd your company into the future.