Lack of preparation means you’ll fail
Gathering and analysing your situation in business are two crucial components to success. Without them, you’re running the risk of stuffing-up how you operate, offer your services, target your market and the ability to learn from your competition.
All of the above will contribute to your success or failure. So, do you want to leave your business to chance or know that the decisions you make are backed by evidence and real-world knowledge?
Here’s why gathering information in business is important
As people, we often gather information in order to make a decision that best services us and our needs. When we’re looking for a new restaurant to try our first stop is Google.
First, we do a search of the local area. Then we scroll through a list of the establishments. Then we work out the cuisine we feel like. Then we read reviews to understand what others think of the place. Then we look at the menu.
It’s not until at least this point that we make a decision on where we’re going to eat, how far we’re prepared to travel to get it and whether we have Japanese, Italian or Mexican.
Yet, when it comes to something more important than dinner, gathering information in business is often an afterthought (or not even a thought at all). So much business failure would have ceased had owners gathered the information to make the correct call on the future of their business.
When I talk about gathering, I mean market research and it needs to include certain things to be conducted to an adequate standard.
The gathering you need to conduct
What your marketplace looks like: If you don’t have a clear and accurate idea of your marketplace, there’s no way you can compete. When my clients are researching this stage, I pepper them with questions about it to judge how much they know. One of my clients entering a market dominated by cheap and nasty offerings thought his quality would cut through. It’s taken nearly two years but his quality service offering is working, but he seriously misjudged his market and the fact that most of his potential customers wanted cheap as they didn’t place high value (partly because they were just used to it being of a poor standard). Had he not been tenacious and truly believed in what he was offering, he would have given up after one year.
Understanding what’s happening in your marketplace can take time, but like above, it could save you two years of hard work (and stress).
Understand your business externally and internally: While your marketplace is external, you also need to look internally and gather relevant information about this. That’s things like how you operate as a business, customer on-boarding process, project management, staff training and operation manuals. This arguably goes against the start-up mindset of just get it going and work it out from there, but I’ve seen this step missed and it can potentially ruin what might have turned from a good idea into a successful business.
If you don’t have strong answers to how you manage above, the information you’ve gathered internally is not good enough.
Competition research: This is seldom done properly. It’s more glossed over than researched and reviewed correctly. Why would you want to make the mistakes your competitors have? You won’t know what they’ve done wrong unless you get your Sherlock Holmes on and investigate everything about them. Spend most of your time looking at industry-leading competitors. There are many reasons why they’re currently winning and you need to find what they are (I bet one of them is because they’ve understood what I’m writing about in this blog).
This is a huge component in gathering information, but don’t become all consumed with what your competition is doing. Know it and understand it, but be confident in what you’re offering too.
Now that you’ve gathered the information you need, you must analyze it to truly understand it.
Here’s why analysing information in business is important
There’s no point in taking the time to gather all this information without wanting to understand it and apply what’s relevant and avoid what you know, based on analysis, won’t work. For every hour you put into gathering, I believe you need to double (at least) the amount of time you spend analysing it.
If you’re looking for an example of what makes some successful and others not, the ability to analyse their situation and respond to it effectively is your answer. Look at businesses that can offer an analysis or compile data or metrics, they dominate because they have information everybody needs – that’s the Google and Facebook model.
The analysis you need to conduct
Look at trends that are working (or not working): This will tell you a lot about the future of your industry. Back in the day, so many large businesses misjudge the impact of digitalisation of our world. Think Blockbuster and Kodak who use to be market-leading operations but now are a distant memory. They didn’t look at trends and it cost them dearly. If it can happen to colossal beasts like them, it can easily happen to you.
Analyse but go with your gut: Analysis will inform your action but make sure it’s a course of action you want to take – that comes down to gut-feel. Henry Ford was probably told to make faster horses, his gut-feel was to make cars. Often in life how something (or someone) makes you feel is often right. If you don’t feel comfortable making a certain decision, it’s probably the wrong one. Gut-feel is incredibly important but make sure it is based on the sound research and analysis you have conducted. Just because it “feels good” is not strong enough to stand up to the pressure of running your business.
Done is better than perfect: Analysing is something that, if you want to, will never be completed or then actioned. This is counterproductive to you achieving your business goals. Therocially, you could spend the rest of your life perfecting the analysis of your situation, but you don’t need to. It will never be perfect, but quickly enough it will be to a point you can rely on it and use your analysis to make informed decisions. So, get it done (not perfect) and start using it.
Here’s a real-world example
A client came to me too late. Their 20-year business had dived and all their previous success had resulted in nothing. I couldn’t save them, they had gone too far and I’m simply helping them through a bargain basement sale of a once profitable business.
They realised there was a problem and committed to gathering and analysing the information they needed. To be fair, they did a bloody good job and got 90% of the process right but they failed to look internally and that’s where the problem was.
What they didn’t understand was that their brand didn’t appeal to end-user (or their customers). Newer more trendy competitors had emerged and were dominating because their logo, website and taglines spoke directly to the people they wanted to target. Instead, the business I was dealing with was only prepared to do a half-assed job of a brand refresh (not an overhaul) and the company they engaged to do it was inexperienced and lacked the confidence to suggest a radical change was needed.
Ultimately the missed 10% cost them their business, while their competitors continue to grow.
Gathering and analysing the information you need is a crucial step towards your success. Likewise, not doing it is putting one foot in your own grave.
When success in business is so heavily stacked against you, it’s your ability to gather the information of your circumstance and effectively analyze it that will make or break you.
So if you need help in this area, gather your information on me, analyse whether I’m best placed to help and if so, get in contact.