Businesses have important milestones also: starting up, weathering the first year or two, refining a business model, adapting to changing customer and market needs. I have incredible respect for the businesses I work with, because they manage to do all of these things, and weather business cycles, while still turning a profit. It ain’t easy!
What if businesses celebrated milestones, like people do? What should we celebrate (We’re still here! We grew! We made money!) and what questions should we ask to take stock? Here are some questions that come to mind for six stages of the business lifecycle:
- Start up: Why are you starting this business? Have you researched the market, pricing, and margin structure to turn a profit? Is your position unique, compelling?
- First Birthday: Now that you’ve tested the market, was your initial strategy right? Course correct…what needs to change?
- Terrible twos: Are you learning how to swim, or just staying afloat? Do you spend time adding value, or doing tasks which could be outsourced?
- Years 3-10…Growing pains: What is needed for your business to grow? Where are resources stretched thin, and how will you meet needs for capital, skills, etc.?
- Years 11-20…Mid-Life Crisis: Have you gotten complacent? Is your identity stale? What would happen if you lost your largest customer, your license, or some other business asset? Have you diversified?
- Years 21+…Maturity: Has the market changed? Are staying in touch with customer needs? Incorporated the latest technology? Are you vulnerable to a new competitor? Don’t get so set in your ways that you fail to embrace change.
People use milestones to take stock…birth, first day of school, graduation, weddings, anniversaries…and businesses should too. Perhaps more important than the specific questions we ask, is the act of pausing periodically to reflect on what has been accomplished, and plan for the challenges ahead.
I found a wealth of business planning information here (James J. Hill Business Reference Library), which is organized by stage of business lifecycle. What do you think are the key milestones for a business, and what areas of focus are most important at each stage of growth?