My friend’s wife recently asked me if she should expand her profitable fitness studio to another city as suggested by her friends.
“Are your friends entrepreneurs who have grown multilocation, interstate or international businesses?” I asked her.
“Well, no,” she said. “Most are professionals, but they’re successful.”
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“They may be successful,” I said, “but as professionals or small-business owners. What qualifies them to encourage you to expand?”
“Big business, small business—what’s the difference?” she asked.
“A world of difference,” I said. “Just because you’re successful building a small business doesn’t mean you’ll be successful building a big business.” I’ve learned to be careful whom I take advice from. If you want to grow a small business into a big business, seek advice from someone who has built a big business. Small businesses are the backbone of the economy. Yet very few entrepreneurs grow their small businesses into big businesses.
My rich dad’s B-I Triangle represents the eight components essential for a successful business (below). If a business lacks (or is weak in) one or more of the components, the enterprise fails, stops growing or struggles financially. In the B-I Triangle, team is balanced by leadership. My rich dad told me, “A good team requires a good leader,” and the Marine Corps taught me that there are no bad soldiers—only bad leaders. Many entrepreneurs aren’t good leaders, so they fail to attract good people.
When my friend’s wife heard this, she was offended. “Are you saying I’m not a good leader?”
“No,” I replied. “I’m saying growing a small business into a big business requires increased leadership skills and experience.”
In the past, she had employee and partnership problems. Her employees only wanted more money and her partners didn’t listen. She left our meeting still convinced the problem was with other people. Now, her second location is having the same problems—leadership problems.
Strong leaders know how to evaluate and assess business challenges. The strongest ones know the futures of their businesses depend on their ability to target strengths and weaknesses—in themselves as well as in others.
Robert Kiyosaki, author of the Rich Dad series of books, is an investor, entrepreneur, and educator whose perspectives have changed the way people think about money and investing.