The small business New Year’s resolution: Getting your business check-up for 2021
Are you happy with your business this year? What are you going to do differently? How can you hire the right people to support your vision? Sadly, many small business owners do not spend enough time planning for the future. It’s quite understandable. Managers must keep pace with the daily demands of their businesses, including payroll, taxes, product/service delivery, and customer expectations.
Fortunately, the end of the year is the perfect time for a comprehensive evaluation of your company. Your business needs a checkup. Most people can relate to a checkup with their local doctor, depending on their background and personality characteristics (age, sex, family medical history). The doctor will conduct a variety of tests, including blood, vision, heart, and hearing.
In fact, one element, like an individual’s weight, is not the only indicator of overall good health. Likewise, small businesses could benefit from a good checkup too. Successful entrepreneurs think strategically when engaged in a hostile, global environment. After 27 years of managing projects and conducting over 100 organizational evaluations of business organizations, I realize that both large and small organizations struggle in implementing their operations effectively.This article examines what small businesses need to ask themselves in an effective checkup.
Welcome to the New Normal! Yet, nearly a year after this pandemic, the full impact on the U.S. economy is not clear. According to recent studies, more than four million Americans have left the workforce, and nearly 10 million are now unemployed compared with last Feb. 1. In fact, the number of unemployed people continues to rise. According to a business study conducted between March 28 and April 4, 2020, small businesses have been heavily damaged by the lockdowns due to COVID-19.
This research covered more than 5,800 small businesses, reaching a network of 4.6 million small businesses. The results showed evident damage of the pandemic. At this juncture, 43% of businesses had temporarily closed, and nearly all of these closures were due to COVID-19. Respondents stated that they had temporarily closed, largely pointed to reductions in demand and employee health concerns as the reasons for closure. In fact, the businesses, on average, reported having reduced their active employment by 39% since January. All industries have been impacted. However, retail, arts and entertainment, personal services, food services, and hospitality businesses showed significant employment declines exceeding 50%. Some businesses hope for assistance from the government.
According to a Babson’s Goldman Sachs report, 88% of U.S. small business owners have already exhausted their Paycheck Protection Program (PPP) loan; the Small Business Association gave these loans specifically to help businesses keep their workforce employed during the pandemic. These loans were helpful. Yet, these successes do not diminish the fact that more than 32% of PPP loan recipients already have laid off employees or cut wages. In fact, 43% of Black small business owners reported that their businesses’ cash reserves would be depleted by year’s end due to COVID-19.
Today’s small businesses and entrepreneurs must retool themselves, given the potential impacts of COVID-19 have the necessary capacity to change their way of thinking because of their passion. Yet, small businesses must be willing to evaluate their current operations and make the required changes. For example, customers have largely gone online to purchase services due to the lockdowns. If a business does not have an online presence now, this company does not exist.
Internet pioneer and CEO of PSINet Bill Schrader explains the significant of online visibility: “Almost overnight, the Internet’s gone from a technical wonder to a business must.”
With the appropriate diagnosis of an organization, a business can develop more sustainable success. Thus, the right checkup is critical. Below are some critical questions to help you conduct your own self-checkup:
• Do you have a clear vision for your business? What is it?
• Do you know why your customers buy from you and why others do not buy from you?
• What results are you getting from your marketing? Do you have an effective online presence on the web?
• Are you collecting data or the right kind of data on your customers and competitors?
• Are you keeping pace with your industry trends? If so, what are the key trends?
• How are you measuring results (i.e., key performance indicators like cash flow and revenue)?
• What are your key competitors’ marketing strategies?
• Have you evaluated your strengths and weaknesses (i.e., SWOT Analysis)?
In summary, successful global businesses, like IBM and Google, have continuous systems in place to evaluate their performance. Let’s call this process an organizational checkup. Small businesses that want to succeed in this global and technological climate must be able to conduct this self-evaluation or checkup. This article demonstrated the relevancy of a good checkup to help improve a business by asking probing questions. In many cases, small businesses do not have to take on this organizational checkup along. There are various organizations like the Small Business Administration and local universities that can assist in this process. Have you conducted a checkup for your business this year? It’s not too late. Start the new year with a healthy business checkup.
© 2021 by D. D. Green. Dr. Daryl Green provides consulting, guidance and management training for today’s small businesses. He is the Dickinson Chair at Oklahoma Baptist University. He and his students have assisted more than 20 businesses in the region with marketing and management expertise. If you would like more information about this article or business assistance, please contact Dr. Green at firstname.lastname@example.org or visit www.drdarylgreen.com.