Three Essentials for Success

May 31, 2012

If you making a trip from the East coast of the United States to the West coast, what would be the essential things would you want to have.  While food, mode of transportation and money often head the list, three essentials are 1. Where (specifically) do I want to go?   2.  Where are you now?  3.  Do you have a road map that will guide you on your journey. 

If you want to achieve personal or business success, the same three essentials are applicable.  While I believe the following discussion is relevant to both, in the interest of brevity, I will only address the business aspect. 

Where do you want to go?  Determining where you want to go in your business is more than setting a value that you would like to achieve.  It’s being specific as to what you want your business to look like at a specific point in the future?  Do you intend to build a lifestyle business or a legacy business?  Understanding the difference is important, as the decisions are vastly different.   

In a lifestyle business the owner simply uses the business as a vehicle to provide a level of income that will enable the owner to live comfortably, take vacations, pay for a nice vehicle and maybe pay for a few toys.   An owner who desires to build a legacy business is deliberate in taking actions to grow and perpetuate the business.  The owner exercises restraint, taking money out of the business only when it’s necessary. 

Where is the business at present?   A detailed assessment is made of the business including the financial position, market impact, and the resources available.  A comparison is made with its peers in industry and the strengths, weaknesses, opportunities and threats are assessed.  Inquiries are made into the system of internal controls and an assessment made of the extent to which processes and procedures are documented. 

Is there a road map?  Identifying where the owner desires the business go is strategic thinking.  The road map, what we call The Game Plan™ is the tactical plan.  It translates the owner’s vision, goals and objectives into a financial roadmap that will take the owner from where they are to where they want to go.  

Growing a successful business requires an owner be deliberate in building a success – including clearly defining where he wants the business to go.  Second, the owner must define where the business is at present.  Finely a plan needs to be developed that identifies the actions that must be taken to take the business from where it is to where the business owner wants to take it. 

 

 

 

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About the Author

Steven D. Olson, CPA, has extensive experience in a wide range of leadership, management and advisory positions. In the role of Chief Financial Officer, he provides executives with timely and accurate financial statements, ongoing cash flow projections, oversight over accounting and finance operations, as well as design and maintenance of the financial reporting structures.

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