You have your awesome idea; you have even written a mission statement and developed a business
plan. You have accumulated enough start-up cash, either from your own pockets or from your first
round of investors, and you are ready to launch. Hopefully, you understand that, even though you may have a team of managers for each function, you, in the end, have to be the start-up management of everything, at least in the early stages.
Managing the Budget
You’re the one with the idea; you’re the one who gathered the cash. This does not mean, however, that you are the one who is best fit to manage the financial end of your business. A huge percentage of startups, in fact, go “belly-up” within the first 5 years or earlier because of money.
If you are not large enough to hire a financial manager, and this area is not within your skill set, then you need to at least contract out for someone with a track record of financial management of startups. This individual can develop your budget, can tell you whether you can realistically afford to do something, can make suggestions on cutting expenses when necessary, and can, over time, give you some great information, such as how much each customer acquisition is actually costing you.
And here’s a little gem to keep in mind – if you are not breaking even by the end of the first year, you have some re-thinking to do.
Managing the Personnel
One of the biggest mistakes passionate entrepreneurs make is assuming that everyone they bring on board has the same level of passion as they do. And so they hire quickly only to regret it later when they have an employee who lack enthusiasm, isn’t willing to go beyond what is asked, and in general is not contributing to the entire team.
You need to be able to fire people quickly, and, if you cannot do this, you have no business being in business, unless that business is so small it requires only you and perhaps a partner. During the interview process, you need to see “fire in the eyes” and body language that says, “I really want to do this!”
When you do hire, be certain that you put a 90-day contract in place. Meet with that person 60 days into the contract and conduct a mutual assessment. If you want improvement, that still gives the person 30 days to make a turnaround. At the end of the 90-day contract period, you simply don’t renew if you are not satisfied.
Managing the Marketing
If you have the funds to hire a marketing professional, then you are better off than most startups. You may need to be the initial marketer, and this is absolutely the most critical piece of your business, except for the quality of the product or service you are selling. Nothing gets sold if no one knows you exist and if your brand is not being promoted absolutely everywhere.
A marketing program takes time, time, and more time, not to mention creativity and basic know-how. Many a startup has skyrocketed to huge success with a totally web-based marketing strategy, but you will have to do some solid and in-depth research on how this is accomplished, if you think you can do the same. The best advice for small startups is to do the following:
Find a marketing company that specializes in small business startups and contract with that company. This is an area in which you cannot be a “penny-pincher.” Look at the track record of the company; check out the businesses it has in its portfolio. Be certain those businesses are similar in size and budget to yours. Ask for a marketing plan and tell them you are soliciting marketing plans from several potential firms. If they are hungry and want your business, theywill get on it immediately.
Most marketing plans rely more heavily on web-based strategies, and this is a good thing,because such strategies are cheaper. Any marketing plan should include a great website, a well-maintained business blog, a presence on every social media site possible, etc. Your marketing consultant needs to fully understand your target market and to develop plans to reach thatmarket where it is. Content marketing is “king of the hill” these days, and you need someonewho can do this exceptionally well.
You are not off the hook for marketing just because you have contracted with someone tomanage this function. You are the ultimate manager, and you must constantly monitor how yourbrand is being promoted and where. You need to have systems in place to discover from whereand how your customers got to you, and your marketing consultant should set these systems upand provide regular reports to you with suggestions for new thrusts.
Managing Your Product or Service
The customers are coming! That’s a great feeling, but with this increased flow, you will meet new
- Product Quality Control: If you have a small shop that is producing your product, you need to be there constantly, checking for quality and ensuring that every individual is committed to the best product possible. Nothing will drive customers away more quickly than somethingdefective, particularly if they ordered it online and they now have the hassle of returning it for a replacement. Every product must be up to your standards, whether it is a scarf, a toy, a piece of software or a bottle of wine.
- Service Quality Control: If your business is in providing a service and you have employees that are responsible for delivering that service to customers, then you job as quality control manager means that you will travel with them as they deliver it, observe their work, and continually look for ways to improve on services. Suppose, for example, you have a landscaping business. Someone has to meet with the client, listen to his/her needs and “pains,” and draw up optional designs to be presented as quickly as possible, before the competition moves in. You need to periodically accompany your reps as they meet with those clients. A bad customer experience kills your relationship not just with that potential customer but with all of their friends and acquaintances, not to mention that bad press you may get on social media.
- When Things Go Haywire: It’s great to have a growing business. When a rush of orders for your product or service comes in, however, and it is more than your current work force can manage, “Tag, you’re it!” You will be in that production line; you will meet with a potential client even if it means sacrificing a family event to do so. There are just times when management means being in the trenches with everyone else!
Delegating Management Functions
There is only one rule for the entrepreneur. Don’t delegate anything until you are absolutely certain
that the person to whom you are delegating a management responsibility has your complete confidence and trust. You are your company and you are your brand. Don’t allow anyone else to tarnish it!
Images: “Notebook with text inside Start Up on table with coffee, mobile phone and glasses./Shutterstock.com“
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