Your Path to Business Success #10: Motivate Action by Communicating Your Vision

A salon owner reached out to me recently because she wanted to increase her team's productivity. As we discussed her long-term goals, we quickly discovered that many of her goals were only in her head. We also identified that she was the only person who knew and understood them. She promptly identified why her employees could not meet her expectations. They did not know or understand them. We discussed the first skill in the Power6 Leader framework of motivating action and the role that clarifying and communicating your vision has in driving team performance. The more your employees know what you aim to accomplish, the better they will be at helping you bring your vision to life.

Answering the big question.

One of the more challenging tasks for small business owners is answering the question, "Where do you want to be in five years?" This question can be difficult because it requires you to think beyond today's needs and imagine tomorrow's potential. Many small business owners spend so much time thinking about how they will increase revenue this month or pay bills due this week that they do not ponder the future. 

Pro Tip: Research businesses outside of your industry for inspiration on what is possible. Some of the best ideas come from replicating the actions of others.

Make time to imagine.

The first step in communicating your vision for your company is to clear your schedule and create space to reflect on what you are working towards. Are you looking to scale your business nationwide, add locations, or build infrastructure so you can take a much-needed vacation? Clarifying what you want your business to look like in the future for yourself, will make it easier to communicate with your team.

Pro tip: Create a vision board to help you imagine your business's possibilities. Images can often help you find words for ideas that are not quickly spoken.

Why 5 years?

Looking five years into the future can help you overcome some of the fear, anxiety, and hedging that prevent people from setting ambitious goals. You want to get your mind out of the present, which is full of limitations. Allowing yourself to see beyond today or next year can give you space to be more ambitious and envision more possibilities. The purpose here is not to be a perfect forecaster of the future. The goal is to get beyond today's realities so you can build towards tomorrow's potential.

Pro tip: Don't worry about being practical at this point. You can be pragmatic when you start working on goals. This stage is all about dreams and wishes.

Journal to clarify vision.

We encourage business owners to write a journal about their vision. Journaling can help you verbalize your thoughts. The more you write about your vision, the more apparent it will become, and the easier it will be to communicate with others. Being clear on your vision is essential to having the confidence to share your dream. Martin Luther King revised and practiced his "I Have a Dream" speech multiple times before sharing it at the March on Washington. The more you ponder and refine your vision, the clearer and easier it will become to discuss.

Pro Tip: Dedicate 15 minutes to writing about your future two or three times this week. Research has discovered this is an optimal time and frequency for journaling.

Meet to discuss vision.

Once you have a clear vision of where you want your business to be in five years, schedule a meeting with your team. The meeting should be around 50 minutes long, and you should provide an agenda so your employees know what will be discussed. Ask them to consider their vision for where they see themselves five years from now and how the company can support their growth.

Pro tip: Bring in a third party to facilitate the conversation. Participating in a conversation instead of hosting frees up mental space to be more engaged.

Bring it all together.

After the meeting, you will want to convert your big-picture vision into actionable tasks. One of the first should be one-on-one meetings with team members to confirm their understanding of the vision and how their commitment to bringing it to life will serve them. Your employees will support your vision if you support theirs. Focus on building alliances of co-prosperity with your team members.

Pro Tip: Define the essential work for success, then verify that you have the right people doing the right things at the right time.

Summary

Within the Power6 Leader coaching model, motivating team action is the first skill we help small business owners develop. This skill sets the stage for building trust, guiding decision-making, delegating effectively, and navigating challenges. Defining and communicating your vision provides more certainty for your employees, leading to less stress and more engagement. Your work to align your team around a shared vision will increase your team's productivity.

Thank you for reading the latest version of our newsletter. We started this series to give small business owners the information they need to make 2025 their best profitability year. Throughout this series, we outline different tools and approaches we use with clients to help them with strategic planning and operational improvement.

Check out previous blogs to learn more about setting goals and taking steps to improve your business's profitability.

If you have any questions about the topics discussed here, you can email Executive Coach Dorian Cunion at dcunion@yourpathexecutivesolutions.com

Continue reading if you would like to learn more about the Power6 Leader Program.

Your Path to Business Success #9: Increase Certainty using a Balanced Scorecard

As a small business owner, you're juggling a million things, leaving you feeling overwhelmed, unproductive, and uncertain. You're not alone. Two years ago, we started working with a small business owner who was generating more debt than income. He was growing increasingly frustrated by how hard he was working and how little return he was getting for his efforts.

Your Path to Business Success

Over the last two years, we have executed the 4 Disciplines of Execution (4DX) approach to turn his business around. The 4DX approach calls for leaders to focus on the wildly important, act on lead measures, keep a compelling scorecard, and create a cadence of accountability. The balanced scorecard we developed after our first two sessions, along with the weekly scorecard we made from that document, has helped to give his business more focus and consistency. Updating this weekly scorecard, reflecting on wins, and developing solutions to address misses to goals has led to back-to-back years of double-digit earnings growth. The owner is now making over 6 figures a year, and he has the 4DX, Balanced Scorecard, his mindset shift, and commitment to continuous learning to thank for more profits and less stress.

Many entrepreneurs struggle with prioritizing tasks and making strategic decisions. The balanced scorecard is a powerful tool that can bring clarity and control to your business. Major consulting firms like Boston Consulting Group and business schools like Harvard teach business leaders how to use this tool to drive higher levels of growth. You do not have to hire a big-time consulting firm or get an MBA to use this concept. Throughout this article, I will share how to set up a balanced scorecard.

Financial Goals: The Foundation of Success

Financial goals provide a snapshot of your financial health. While you have autonomy in choosing your specific targets, consider these three key metrics:

1. Revenue: A strong indicator of how well your offering resonates with the market. Rising revenue suggests growing demand for your products or services.

2. Margin: This reflects your business's efficiency. Increasing the percentage of revenue converted into income can help you achieve profitability goals with fewer inputs.

3. Payroll as a percentage of revenue: Labor tends to be a company's most significant expense. Paying attention to the percentage of revenue that goes towards labor can help you determine if you are getting the most out of your labor spending.

Pro tip: Review your financial performance for the past year and establish challenging but achievable targets.

Customer Goals: Converting customers into profits

You need customers to achieve your financial goals, but not all customers benefit your business in the same way. Establishing customer goals can help you focus on the customers who will fuel your financial goals.

l. Define these three customer-centric goals:

Number of Customers: Determine the target number of customers you need to serve to achieve your financial objectives. This helps you visualize your lead generation needs.

Customer Frequency: How often do you want customers to purchase? This helps you strategize for repeat business and determine how many customers you need overall.

Customer Satisfaction: Measure how well your product or service meets customer expectations. You can use metrics like net promoter scores.

Pro tip: Calculate the lifetime value of a customer to help you determine how much you should be willing to spend to acquire a new customer.

Process Goals: Streamlining Operations

Process goals focus on the activities that drive your customer goals. Consider what processes you need in place to achieve financial and customer goals. A few to consider would be:

Customer Acquisition Activities: Set goals around marketing efforts, such as social media impressions or website traffic.

Operational and Execution Activities: Focus on delivering consistent product and service quality. Establish goals that help you identify and improve the quality of your products and services.

Business Activities: Set goals for internal processes like financial reviews or stakeholder meetings to ensure you're dedicating time to key business drivers.

Pro Tip: Consider your current systems and identify the bottlenecks that impact your ability to attract and retain customers. Establish metrics to help you identify if you are removing those bottlenecks.

People Goals: Investing in Your Team

Our Power6 Leader program teaches business owners the success equation of culture x processes = results. Setting goals around selecting, developing, and inspiring your team will help you build an organizational culture that can leverage the processes you have in place to achieve your business goals. We encourage goals around the following:

Professional Development: Set goals for the amount of time you will dedicate to professional development to ensure you and your team have the knowledge and experience to lead effectively.

Performance Conversations: Evaluate current team gaps and work with them to develop individual development plans to help them grow the skills, mindset, and experience they need to thrive.

External Partnerships: Identify key external relationships, such as with marketing experts, coaches, lawyers, or accountants, and set practical goals for selecting and managing these key partners.

Pro Tip: Make a list of all your employees and key partners. Write down their strengths, weaknesses, and capabilities. Reflect on where you have gaps and how you can better leverage the talent around you.

Putting it All Together:

By setting these 12 goals and assigning metrics, you will gain clarity on your business objectives and how to prioritize your time, money, and resources. Once your scorecard is built, establish a routine for reviewing your performance and identifying ways to achieve your goals. Each time a new opportunity presents itself, ask, "Where does this fit into my scorecard?" If it does not align with helping you achieve one of these 12 goals, you should ask yourself if you should pursue this opportunity.

Creating a disciplined approach to running your business will help you stay focused, measure results more effectively, and learn faster. The Balanced Scorecard provides a framework for strategic decision-making, allowing you to move from feeling overwhelmed to feeling in control. It's a powerful tool for any small business owner seeking sustainable success.

Thank you for reading our latest blog. Hopefully, you have a better understanding of a balanced scorecard and how it can help you with clarity and direction. If you are looking for help establishing your goals, start by going back and reading our previous post. Over the last few weeks, we have covered each of these topics.

If you have any questions, or want to sit down and discuss your current strategy, email Executive Coach Dorian Cunion at dcunion@yourpathexecutivesolutions.com

Download this free resources to get started on your balanced scorecard.

5 year plan .pdf.pdf

Download PDF • 220KB

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One of the suggestions we provide clients is to leverage as many free resources as possible. If you do not have a SCORE mentor, visit their website, check out their resources, and find a mentor. Richmond | SCORE

Verizon Small Business Ready is also a great free resource you should leverage to help you understand different business concepts. Here is a link to their website Verizon Small Business Digital Ready - Landing

The SBA, and The Department of Small Business and Supplier Diversity also provide great resources for small businesses.

We are always here to help you on your path. Whether you are looking for thought or accountability partners, need help overcoming a mental block, or mastering a new skill, we will provide you with the guidance and support you need to achieve your business goals.

Your Path to Business Success #8: Why Your Business Needs A Balance Sheet

Imagine trying to assemble a complex puzzle in the dark. You might be able to connect a few pieces, but without seeing the whole picture, you're likely to make mistakes and end up not achieving your goal. A balance sheet is like turning on the light, allowing you to see all the pieces and how they fit together. With a clear view, you can strategically assemble the puzzle and create a complete picture of your financial health.

Your Path to Business Success

What is a balance sheet?

A balance sheet is a financial snapshot of your business at a specific point in time. It shows your assets (what you own), liabilities (what you owe), and equity (the difference between the two).

Example of a balance sheet

Why is it important?

A balance sheet is like a financial snapshot of your small business, giving you a clear picture of its financial health. It shows you what you own (assets), what you owe (liabilities), and the value of your business (equity).

This information is crucial for making informed decisions about your business, such as investing in new equipment, taking on debt, or expanding your services. For example, a mental health practice could use a balance sheet to determine whether it has enough funds to hire another therapist or open an additional location.

Lenders and investors rely on balance sheets to assess your business's financial stability and creditworthiness. By regularly reviewing your balance sheet, you can track your progress, identify areas for improvement, and ensure the long-term success of your business.

Pro tip: Set a goal for writing down all your assets and liabilities. Getting them on paper is the first step to having a clear picture of your business's profitability.

How often do you review your balance sheet?

• I do not have one
• Once a month
• Once a quarter
• Once a year

How can you use it to make decisions?

1. Identify and manage assets: A balance sheet helps you understand the value of your assets and make informed decisions about buying, selling, or utilizing them effectively. If your business is struggling with cash flow, selling underutilized assets might be a good way to generate some cash.

2. Monitor and control liabilities: By tracking your liabilities, you can manage your debt levels and make strategic decisions about repayment. Debt can be a good thing if it is fueling your growth. Developing a strategy around leveraging debt to grow revenue is critical to a successful business strategy.

3. Assess your equity position: Your equity position reflects the overall value of your business. Monitoring it helps you understand your financial stability and growth potential. Your equity goals will vary based on your growth stage. Newer companies tend to have lower equity as they invest in growth. As your company matures, you will want to see your equity grow. The balance sheet will allow you to monitor progress over time.

   
   

Pro Tip: Review the interest rates on your current liabilities. Which borrowing sources carry the highest interest? Eliminating these liabilities will help you reduce your debt burden and improve your business's profitability.

How do I Build A Balance Sheet?

Building a balance sheet for your small business involves a few key steps.

1. Start by listing all your assets, which include everything your business owns, such as cash, inventory, equipment, and accounts receivable.

2. Next, list your liabilities, which are all your business's debts and obligations, such as loans, accounts payable, and any other outstanding debts.

3. Finally, calculate your equity by subtracting your total liabilities from your total assets. This will give you a clear picture of your business's financial health.

Regularly updating your balance sheet helps you track financial progress, make informed decisions, and ensure long-term success. If you need assistance, consider consulting with a financial advisor or accountant to ensure accuracy and completeness. Accounting software like Quickbooks can make it easy to build a balance sheet.

Don't leave your business in the dark.

Take the time to create and regularly review your balance sheet. It may seem daunting initially, but the insights you gain are invaluable. Like turning on the light to solve a puzzle, investing time in your balance sheet will give you the clarity and control to navigate your business toward success.

Need help?

If you're struggling to create or interpret your balance sheet or simply looking for a thought partner to guide you, Your Path Coaching and Consulting is here to help. We can assist you in building the financial acumen and routines necessary to improve your business's profitability.

Schedule a free consultation today to discuss how we can help you achieve your goals.

Get help understanding financial reporting

Remember: A balance sheet is not just a financial statement; it's a roadmap to your business's success.

Thanks for reading our latest installment of Your Path to Business Success. This series is designed to help business owners have their best year yet. If this is your first time reading, check out the other blogs in this series. Each touches on a different topic of business acumen. Knowledge is key to growth. We are here to help you gain the knowledge, skills, experience, and network needed to achieve your professional goals. If you have any questions about anything covered here, email executive coach Dorian Cunion at dcunion@yourpathexecutivesolutions.com

Looking for Additional Resources

Reach out to the experts from our network.

CPAs

Lisa Moody, Discover the Factor https://www.discoverfactor.com/

BJ Lanier, Nova Accounting bj@novaaccounting.com

Bookkeepers

Ashley Cloude, Cloude Accounting, ashley.cloude@gmail.com

Sabrina Trimiew, MarBey Accounting, sabrina@marbrey.co

Zach Broaddus, Profit Map, http://broaddus.biz/

Carina Epps, Everlife Accounting Group

Fractional CFO

Scott Geller, PathPredict http://www.capitisadvisors.com/

Carina Epps, Everlife Accounting Group CFO Services