Time, distance & speed - Running a(nd) business

I was stopped, frustrated, by a red light at the intersection of Falcon and Miller Street. I was on the last uphill home and wanted to hit it with momentum. When the walking man flashed green I took off. My calves ached and my lungs burned, but there wasn’t long to go – I could afford to exhaust the gas. I remembered tips from short articles I’d read – shorter, quicker strides uphill; focus on pumping your arms to propel forward.  I hit the last incline with pace as I turned left into Ernest Street, gritted my teeth and exhaled hard. I sprinted the last 50m into my cul-de-sac – I had made it.

I had no performance goals when I started running. The basic measurements of time, distance and speed were irrelevant to me at that point. When I began, there was only one metric that was important to me – survival. I also had a vague and hopeful long term goal of a reduction in weight, as well as a gain in health and fitness. Simple.

If we replace the running jargon above with the lexicon of business, it becomes quite a familiar narrative that I hear on a daily basis from business owners.

Most businesses start with a great idea and lots of passion. Success? Well, statistics say that’s a little harder to come by, with 30% of small businesses ceasing in the first 3 years (according to the Australia Bureau of Statistics).

The key metrics that should be measured whilst running a business are, for most start-ups, irrelevant to them at that point in time. There is only one metric going through an entrepreneur’s mind – survival.

HOW DO ADVISERS LIKE ACCOUNTANTS HELP BUSINESS OWNERS BECOME SUCCESSFUL IN BUSINESS?

To answer that question, let’s look at the role of a running coach:

• Help identify the runner’s goal
  • Like me, running may be part of a larger, more holistic goal – general health and fitness. So, for example, a measurable goal may be an ideal weight. For others, a goal may be to be able to run a marathon in under 3 hours. However, one thing is for sure – without a goal, it is hard to measure what success means to you.
• Formulate a plan to help them achieve that goal
  • For general health, this is likely to be a more holistic plan which includes nutrition like reducing the amount of burgers and beer consumed in a week, combined with an activity plan, such as 5-10km’s, 3 times per week. For your more serious runners: both the nutrition and activity plan will be much more specific and intense – metrics like time, distance, speed, pace, cadence and running efficiency; each having an activity based strategy behind them to drive performance, therefore boosting the overall likelihood of success. Zero burgers.
• Keep them accountable to that goal
  • A plan to achieve a goal is only valuable if you’re held accountable to everything within it. A good coach will regularly check in with you and even run with you for parts of the journey.
• Celebrate success when goals are achieved, or learn and adjust when targets are missed
  • Pop the champagne! You’ve run a marathon in under 3 hours! We all subscribe to this easy flow chart of success: Define, plan, action, measure, celebrate – however, as the eloquent boxing legend Mike Tyson once put it ‘Everybody has a plan ’till they get punched in the mouth’. What if during training you develop shin splints or roll your ankle? You need to be able to adjust your strategy when life (or the asphalt) punches you in the mouth (ankle). It might take a little longer to achieve your goal – but that’s ok.

So, back to my original question – how do advisers like Accountants help Business Owners become successful in business?

If we replace the running jargon above with the lexicon of business, it becomes a like for like answer. Your adviser should be able to help you define what success in your business looks like, help you develop a plan with metrics to measure like revenue and profit targets and most importantly, keep you accountable on a regular basis.

Good advisers deliver reporting on a monthly basis at minimum, showing budget (goal / target) vs. actual reports across all your important metrics or KPI’s. The best advisers talk you through these reports as well to see if there’s anything to be learnt or if any of the plan needs to be adjusted for the inevitable punch in the face that always seems to just be around the (red) corner of the boxing ring that is small business.

Through my ongoing journey of learning how to run and running a business, I’ve learnt that the foundations of successful strategies in one, often translates directly to the other… and this is a great thing – I bloody love champagne.

Cheers!