⚡ Get All Content for 20% Off ⚡

There Is No Magic Formula for Small-Business Success -- Only This It takes hard work to get the best team players engaged in the right tasks and to resolve the inevitable conflicts.

By Robert Reid

entrepreneur daily

Opinions expressed by Entrepreneur contributors are their own.

I've been asked many times to lay out my magic formula for building a successful small or medium-sized business. I usually respond by saying there's no magic, only hard work and experience.

While this is certainly true, the success of a small or medium-sized business depends on dedicated execution of the following: articulating a clear mission, hiring the right people, setting goals and measuring progress toward them -- and then resolving the inevitable conflicts that arise. The latter task is truly the tricky part!

With that in mind, here are the five ingredients in my not-really magic formula for small or medium-sized business success.

Related: How Purpose and Social Responsibility Can Set a Startup Apart

1. Develop a compelling mission. A clearly articulated, compelling mission attracts talent to the organization and encourages strong commitment to the team. It also acts as glue to keep members of the team unified over time. When formulating a mission, start with the why not how. Why is the company here? Why have other companies been unable to solve the problem?

2. Find the right people. Locating talented people with the right skills and experiences is essential, but that's the easy part. The hard part is finding people with the right character traits. I look for people who like working on a team.

Many smart and successful people don't work well in teams, and it's harder to create a successful organization with them, in part because as the organization grows in size, conflicts become harder and harder to resolve.

I also want to hire people who are champions of change and with a natural ability to establish plans, structures and processes. These traits are critical because people lacking them simply won't be able to support a rapidly growing organization. Ultimately, it's the personality traits of staffers (their attitudes, beliefs and actions) and their commitment to the mission that results in a company culture that's capable of fostering successful execution.

Related: Forget Setting Goals. Focus on This Instead.

3. Set clear goals. The process of creating long-term goals and short-term objectives to support the mission is also essential for successful execution. Clearly articulating these goals helps ensure that the people and processes will be geared toward moving the organization in the right direction.

Consider a school of fish or a flock of birds: If the goal is to move from Point A to Point B, no progress is made if each individual creature moves in a direction of its choosing.

In a workplace each member of a company's team should strive toward the same goals.

4. Measure progress. Setting goals doesn't mean much if its not possible to measure progress in achieving them. Attach specific financial, operational and process-oriented performance targets to specific activities supporting the objectives.

Measuring these activities against the targets offers a clear picture of the progress toward the long-term goals. Based on the picture that develops -- and with input from the team and the marketplace -- continually refine the objectives, supporting activities and measurement targets to ensure continued successful execution.

Related: 13 Growth Hacks From Some of the World's Most Successful Tech Entrepreneurs

5. Be prepared to resolve problems. No matter how successful a company is in developing a compelling mission, hiring the right people and measuring progress toward goals, problems will arise related to strategy, execution and culture.

To tackle problems, I like to start with the empirical data. I look at the progress made toward the measurable targets to determine what the problem really is. Is there a profile of the customers not adopting the company's solution? Are partners not moving forward with the company because of an unforeseen problem? Finding empirical data points can help in determine how big the issue is.

Then I address the root cause. Did the company not understand the opportunity? Did team members not communicate effectively internally or have the right processes? Did the organization not provide enough services to customers? Has the competition successfully countered the company's messaging?

With all the key stakeholders gathered in a room, I ask them to write down what they think is the problem's root cause. We brainstorm for a while to be every possible issue has been surfaced. Then I ask everyone to rate each suggested cause on a 100-point scale. We focus the discussion on areas of disagreement.

This process enables us to quickly expose and address the biggest issues first. This is contrary to the practice at other organizations (focusing on agreement and ignoring outliers). But those who use this sometimes difficult problem-solving process say it can facilitate an alignment.

Ultimately, ensuring agreement from all stakeholders about the approach and encouraging their contributions are the only ways to help an organization efficiently execute its plan and produce something better than what any other company can produce.

Related: 6 Key Factors in Scoring a $1 Billion Valuation for Your Startup

Robert Reid

CEO of Intacct

Robert Reid is the CEO of Intacct, a cloud-based financial-management software provider headquartered in San Jose, Calif. He has served as an executive of LucidEra, Siebel Systems, UpShot, Octel Communications, NBI and Zenith Data Systems.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Side Hustle

The Remote Side Hustle a 43-Year-Old Musician Works on for 1 Hour a Day Earns Nearly $3,000 a Month: 'All From the Comfort of Home'

Sam Ziegler wanted to supplement his income as a professional drummer — then his tech skills and desire to help people came together.

Business News

Costco CFO Reveals Uncertain Fate of $1.50 Hot Dog and Soda Combo

CFO Richard Galanti reveals that the price will stay the same — but only "for a while."

Business News

The Most Unexpectedly Popular Side Hustle of the Decade Has Low Startup Costs and High Markups

A new report shows that vending machines are a popular investment — and the industry is set to grow up to $3 billion by 2031.

Marketing

Ever Wonder Why Certain Websites Rank Higher Than Yours? This SEO Expert Reveals The Secret to Dominating Search Results

It's often the smart use of SEO, now supercharged with AI, particularly in keyword optimization.

Business News

AI Is Impacting Jobs. Here Are the Gigs Affected the Most, According to an Analysis of 5 Million Upwork Postings

The researcher said in the report that freelance jobs were analyzed first because that market will likely see AI's immediate impact.

Leadership

Former Interrogator Shares 5 Behaviors Liars Exhibit and How to Handle Them

Five deceptive behaviors to look for and how to respond to those behaviors when you encounter them.