To Succeed as an Entrepreneur, Focus on the 5 Golden Priorities
As an entrepreneur, you’ll be wearing a lot of hats and dealing with a constant barrage of issues. Each day’s tasks and priorities will likely be a jumbled mess that changes as new emergencies and new developments arise. To be successful, you’ll need to quickly adapt to these low-level changes, but you’ll also need to have a solid “big picture” philosophy that serves as a foundation for your daily decisions. Without strict adherence to your most important, high-level priorities, your entire strategy runs the risk of falling apart.
These five “golden” priorities should serve as your entrepreneurial groundwork, taking precedence over any other high- or low-level considerations:
Innovation is the first priority, and it’s usually the first one to make an appearance in your entrepreneurial journey, during the ideation and brainstorming phase. It must be kept at the forefront of your mind during your entire course of business development; without innovation, there’s nothing to distinguish you from competing businesses. Innovation doesn’t require creating an entirely new idea; it could involve taking an older model and updating it for a new environment, or combining two previously independent ideas together.
How you innovate is up to you, but innovation must take priority over convenience. If given the choice between abandoning what makes you unique or forging ahead with greater risk, take the greater risk. Decreasing your uniqueness in the field will always come back to haunt you.
Related: Where Does Innovation Come From?
Many entrepreneurs get into the game with monetary desires, and there’s certainly nothing wrong with this. But some lose sight of the importance of profitability in favor of growing the business. They might channel all incoming revenue toward purchasing new equipment or hiring new staff, focusing on growth rather than sustainability. In some cases, this gamble can pay off, but it’s generally a strategically poor choice.
Even if you started a business for non-monetary reasons, profitability is still vital; without profit coming in, you’ll be unable to improve the business, sustain yourself, or invest in your own future. Choosing to take a loss in the short-term may occasionally be a necessary sacrifice, but in a broader perspective, your focus on profitability can never be abandoned if you want to succeed.
3. Cash flow.
Cash flow should be your ultimate financial priority in your business. Put simply, cash flow is a read of how much money you currently have and how that money will change in the near future. For example, you might have $1,500 in the bank, but you’re expecting payment for a $3,000 invoice, and you know a $1,600 bill is coming up. Managing your on-hand cash is vital to ensure that all your bills are paid on time. Just because your business is profitable doesn’t mean you’re in the clear. Some businesses have run out of cash and closed up shop even though they appeared profitable on paper.
Manage your cash flow tightly by dedicating at least one person to actively monitor it. Think critically about your on-hand cash before making any major financial decisions, and implement procedural stopgaps that help you stay cash positive. For example, you can delay payments on bills to the last possible day, and run credit checks on your customers to avoid non-payment issues.
The culture of your business is what’s going to keep your team working hard. If your culture starts to decay, even if it’s in favor of promising new opportunities, you may alienate your core workforce and end up with a disheartened skeleton crew to push your business forward.
Let’s say you get a new client and you’re worried about how you’re going to handle the work. Instituting a series of cultural changes, such as stricter scheduling rules and more bureaucratic processes, might do more harm to your company’s morale than good for your company’s efficiency. Think carefully about the cultural impact of your actions.
Last but not least, improvement should be one of your top priorities as well. Businesses, customers and economies never stay the same for long, so you’ll need to work hard to gradually adapt your business to the new circumstances. As you gain more experience as an entrepreneur, you’ll learn to make significant, steady improvements in your products, services, infrastructure, processes, branding and marketing. Only the adaptable survive on an evolving landscape.
Never sacrifice one of these priorities to correct or pursue something lesser. The most successful entrepreneurs of our time are the ones who kept these priorities straight and unbroken, no matter the circumstances. If you can do that, while still managing the chaos of day-to-day management, you’ll have no problem paving your own road to the top.