Business Start-up Management

Challenges for Small Business

Starting a business is a big achievement for many entrepreneurs, but maintaining one is the larger challenge. There are many standard challenges every business faces whether they are large or small. These include things like hiring the right people, building a brand and so on. However, there are some that are unique to small businesses. Here are a few challenges that may be faced:


1. Client Dependence
If a single client makes up more than half of your income, you are more of an independent contractor than a business owner. Diversifying your client base is vital to growing a business.


2. Cash Management
Having enough cash to cover the bills is a must for any business. To avoid shortage small businesses owners must either be heavily capitalized or be able to pick up extra income to shore up cash reserves when needed. This is why many small businesses start out with the founders working a job and building a business simultaneously. While this split focus can make it difficult to grow a business, running out of cash makes growing a business impossible.


3. Fatigue
The hours, the work and the constant pressure to perform wears on even the most passionate individuals. Many business owners, even successful ones, get stuck working much longer hours than their employees. Moreover, they fear their business will stall in their absence, so they avoid taking any time away from work to recharge. Fatigue can lead to rash decisions about the business, including the desire to abandon it completely. Finding a pace that keeps the business humming without grinding down the owner is a challenge that comes early (and often) in the evolution of a small business.

4. Owner Dependence
If you get hit by a car, is your business still producing income the next day? A business that can't operate without its founder is a business with a deadline. Many businesses suffer from founder dependence, and this dependence is often caused by the founder being unable to let go of certain decisions and responsibilities as the business grows. To meet this challenge a business owner merely has to trust that he can give over more control to their employees or partners.


These are some of the challenges a new business faces and the challenges should be considered before leaping into a start-up. A competitive drive is often the catalyst to start a new business but time invested in a well thought out plan will be rewarded.

Please let me know your thoughts. gerry@polarisgroupmc.com

Managing Change in Business

When implementing change in an organization no singe methodology fits every company. Here are a few ideas that may help facilitate change in your business.



1. Address the “people side” of the business.
Any significant transformation creates “people issues.” New leaders will be asked to step up, jobs will be changed, new skills and capabilities must be developed, and employees will be uncertain and resistant. Dealing with these issues on a reactive, case-by-case basis puts speed, morale, and results at risk. A formal approach for managing change — beginning with the leadership team and then engaging key stakeholders and leaders — should be developed early, and adapted often as change moves through the organization.


2. Start at the top.
Because change is inherently unsettling for people at all levels of an organization, when it is on the horizon, all eyes will turn to the CEO and the leadership team for strength, support, and direction. The leaders themselves must embrace the new approaches first, both to challenge and to motivate the rest of the institution.

3. Involve every layer.
As transformation programs progress from defining strategy and setting targets to design and implementation, they affect different levels of the organization. Change efforts must include plans for identifying leaders throughout the company and pushing responsibility for design and implementation down, so that change “cascades” through the organization. At each layer of the organization, the leaders who are identified and trained must be aligned to the company’s vision, equipped to execute their specific mission, and motivated to make change happen.

4. Communicate the message

This stage cannot be overly stressed. Clear communication of objectives, involvement of staff at the early stages, and empowering them will facilitate involvement and buy in for the company.

5. Prepare for the Unexpected
No change program goes completely according to plan. People react in unexpected ways; areas of anticipated resistance fall away; and the external environment shifts. Effectively managing change requires continual reassessment of its impact and the organization’s willingness and ability to adopt the next wave of transformation.

It is obvious to most business owners that people matter. Sometimes however the organization gets lost in plans and processes rather than facing the difficult and more important people issues. Making the initial steps to involve the entire organization starting at the top will help achieve success.

Please let me know your thoughts. gerry@polarisgroupmc.com