Dozens — if not hundreds — of small business how-to books are published each year. Most of them aren't worth reading, and some merely rehash the same old ground over and over again; they're as useful as a refresher course, but that's about it.
Whenever Susan Solovic puts pen to paper, the result is a must-read. The columnist, media celebrity and author of several best-selling books for entrepreneurs including "It's Your Biz," talks about small business success in a way nobody else quite does. Even after almost 40 years working with startups, I learn new things from Susan every time.
She's got a new book out — "The One-Percent Edge: Small Changes That Guarantee Relevance and Build Sustainable Success" — about surviving by keeping up with changing times. It's no secret that many businesses, even big ones, have collapsed because they were caught wrong-footed by changes in the marketplace, technology and society. The last 40 years have seen a social revolution for which there are few parallels in history. Sometimes it's all you can do just to hang on by your fingernails.
But changing your business too rapidly can hurt you as well. I once worked with a recent U.S. immigrant who bought an Italian delicatessen and changed the entire menu, store name and store layout into a Caribbean-themed restaurant overnight. The idea was the right one — the neighborhood was seeing a huge influx of immigrants from Central America — but his sales collapsed within days because the deli's regulars went elsewhere.
Adapting to change is something of a Goldilocks challenge — the pace has to be just right.
"The One-Percent Edge" offers the following solution: Make small, incremental improvements in seven areas of your business. By continually assessing and adjusting products, customer service, people, processes, marketing, finances and leadership, you avoid the pain of radical overhaul (when it may be too late anyway) while increasing agility and resilience. Let's take a look at each.
Products: Your product or service mix should be continually critiqued. Solovic emphasizes that in doing this, "there can't be any sacred cows" and any dead weight needs to be cut.
Customers: Digital technology and information — including big data — have transformed the relationships between businesses and their customers. There is simply no excuse for being blindsided by changes in customer behavior or attitudes.
Solovic says you need to understand how prospects discover, view and interact with your brand, and at the same time find the group of consumers that is the most likely to respond to your brand's competitive edge. Once this group is identified, you must communicate with it and care for it properly.
People: Having the right people on board is essential to the success of any organization. And, as Solovic correctly points out, "You don't know what you don't know." People with yesterday's skills need to be culled out of the company (gently, with a generous package to reward them for their years of service). People with tomorrow's skills need to be sought out and cultivated.
If your organization is serving consumers and you don't have a director of social media marketing or director of mobile marketing, you are not keeping up with the times.
Processes: Having a great strategy doesn't mean anything if you can't execute it. According to Solovic, this is more than just your information technology. "Think of it like the internal workings of a clock or an engine," she says. "Do the parts work smoothly together to deliver the end result?"
Marketing: It's important to deliver a quality product, but it's more important that your customers perceive that quality. Did you know that in a blind taste test conducted by Consumer Reports magazine in 2007, McDonald's coffee beat both Starbucks and Dunkin' Donuts coffee? Yet McDonald's coffee hasn't created the cultlike following that Starbucks has for its product. Solovic argues that the customer experience and sense of community is as important, if not more important, than the product itself.
Finances: It's important to focus on revenues and profits, of course, but even companies that are technically in the black may be missing opportunities or profitability leaks because they aren't drilling down to understand what's driving the revenue and what may be bogging it down. To get it right, Solovic advises creating a "profit wheel" showing each of your products in terms of both percentage of sales and profitability. Then, ask: Is your team spending most of its time promoting a low-margin product when one with higher profitability makes up a small percentage of sales?
Leadership: This means you. Motivating your employees is great, but without an action plan, everyone goes back to doing the same old, same old. Rewarding employees who are not afraid to break the mold can be scary, but according to Solovic, it pays huge long-term dividends.
"The One-Percent Edge" is a small business guide that will stand the test of time. Go out and buy it. Now.
Cliff Ennico ([email protected]) is a syndicated columnist, author and former host of the PBS television series "Money Hunt." This column is no substitute for legal, tax or financial advice, which can be furnished only by a qualified professional licensed in your state. To find out more about Cliff Ennico and other Creators Syndicate writers and cartoonists, visit our webpage at www.creators.com.