Julie Chomiak, Contributor, Business2Community
Small business owners are constantly making decisions in service of improving their business and providing the best value to their customers. However, without some perspective, it can be easy to fall down the rabbit hole and lose focus of the business mission and purpose. To proactively manage straying too far from your business proposition, ask yourself these five questions before making any major decision. Answering these questions will give you an objective view of how the decision could impact your business and keep your attentions on what matters most.
Does this further my overall strategy?
First and foremost, every business decision needs to be tied to your overall strategy. Consider how the idea or proposition aligns with your growth trajectory as well as your short- and long-term goals and brand promise. If any of these components don’t line up, it may not be the optimal choice for your small business.
Being selective about how you spend your time and resources takes discipline, but applying this filter to every consideration helps your small business avoid investing in proposals that aren’t in your best interest.
How likely is this idea to succeed?
Once an idea has made it through the first round of questioning, it’s time to weigh the likelihood of success. To make this assessment, you need to understand what success means for each initiative, whether this is a new product concept or a marketing campaign. After you have established what a "success" would be for the idea, it’s time to evaluate the idea. What are the potential obstacles, costs, time commitments and upsides to implementing this endeavor? It can end up feeling like a pros and cons list, but applying realistic barriers to your ideas helps vet out the decisions that don’t fit with your business.
How much work will this take?
Based off the previous question, you’ve already outlined some of the resources needed to move forward with an idea. Yet, when posing this question, get into the nitty-gritty details and do a cost-benefit analysis. If something will cost $5,000 between materials and time, and yield $7,500 revenue, is it worth it?
Consider what time-revenue ratio makes sense for your business, and use that as a guideline for proposals. Even if the revenue is immaterial, dive into how many man-hours will be required to get it off the ground. A "simple" idea can end up taking hundreds of hours. Establishing a clear scope of work beforehand assists in determining whether it’s a prudent decision.
Does it connect with your ideal customer?
Your customers are the backbone of your business and should be considered when making any decision. Run the idea past your customer personas and discuss how it would impact each group. If the concept does not resonate with your ideal customer base, it should be skipped. No business decision should isolate or alienate those who you’re trying to reach.
Often, this can be a point at which a proposal is tweaked and revised so that it does resonate with the target audience. Feel free to use this question as a revision period for an idea. Understanding the implications of moving forward with specific endeavors ensures you’re providing the best value and experience to your customers.
Is it feasible to test for a short period of time?
Last, but not least, ask yourself if this idea can be tested. Is it feasible to run a short test with your audience to gather insights without compromising your brand integrity and wasting money? If the answer is yes, then you’re ready to go. Plow ahead and get this idea into action! If your answer is no, then you should weigh the repercussions of running with this idea. Are you willing to leave customers with a less-than-stellar customer experience? Can you recuperate from a lackluster marketing campaign? Assess how the idea would affect your business long-term and if the risk-reward is worth it.
Making decisions is a serious part of running a business. Keeping a steady focus on your overarching priorities takes even more effort. Give yourself a leg up by removing the emotions, subjectivity and distractions out of the equation with these five questions. Your small business and your customers will thank you.