In the journey of mastery, certain aspects of business are always true. Once we recognise these truths, they can guide us through the ups and downs of the marketplace and help us achieve our goals. I am sharing four “truths” to help you on your journey.
I think it is essential to recognise that regardless of how expert we are, we aren’t able to change the fundamental truths of business. If we lose sight of them, it’s possible to be the best in the world and yet find that our company will fail.
Cash is king
No matter how great your product or service is, you only have a business if you have cash.
I remember when the world suffered, in 2008 and the subsequent years, the fallout from the banking system crisis. I discovered that sub-prime mortgage interest rate swap derivatives buried in the banking system weren’t an esoteric way of reducing risk as initially described. Assuming, of course, that you had even heard of them. I hadn’t, and I expect you probably hadn’t either.
They proved to be a threat to the global economic system and all but broke it. In the ensuing months, my business, and many others, (re)learned about cash the hard way. I suffered a significant bad debt in my business from a previously reliable customer. For many months, I had no idea if I could survive. I did, and it was a cathartic experience that taught me the importance of cash flow. When the pandemic struck, I was much less affected; I was ready.
Always watch your finances and ensure you have enough stashed away in reserves to weather any storms that may come your way. Especially events you may not see coming and, in any case, cannot control. An unexpected pandemic, a banking crisis, or whatever is next may not be predictable. What is predictable is that sooner or later, something will affect your business that’s beyond your control. Financial resilience depends on how flexible your costs are; for some, it’s easy to preserve cash, and for others, less so. How much you need to hold will therefore vary depending on your model.
People matter even more.
Whether it’s your employees, customers, or partners, people make your business run. Yet, if you are like me, you are probably tired of the old tropes about people being your greatest asset. My issue with those platitudes is that they don’t treat people as people but as a piece of value. Assets can be bought and sold, but if you do that with people, it’s called slavery. For a reason. Let’s not do that.
Instead, let’s build our humanity together, recognise everyone’s talent, and help them on their journey of mastery. We can only do that if we build strong and genuine relationships with them. As you progress on your journey of mastery, creating great connections with others will be part of what you become skilled at.
Change is constant
No matter how successful your business is, some elements are changing. Some companies hit a sweet spot and relax, and gradually, their business dwindles. Others will imitate their success and find innovative ways to improve it. When they do, some of your customers will move.
Over the years of running my business, I’ve developed tools that customers love. Yet today, they are no longer as applicable. I’ve honed my working practices carefully. listening to what is changing and asking how that affects my customers and suppliers. I’m sometimes wrong, I see a trend that I think will be enduring, yet it peters out. Perhaps I see something that I believe will be a flash in the pan that turns out to burn brightly for a long time. Honestly, you can never rest on your laurels, and if you did, it wouldn’t be comfortable; all those twigs eventually irritate.
The market is constantly evolving; your business needs to evolve with it. This means staying up-to-date with the latest trends, technologies, and customer needs. Embracing change is essential for growth and success.
Failure is inevitable
No matter how hard you try, you will make mistakes. The key is to learn from those mistakes and use them to improve your business. It’s essential to have a growth mindset and be willing to take risks to achieve success. Failure is not the end but rather an opportunity to learn and grow.
In conclusion, these immutable truths are the foundation of any successful business. By keeping them in mind and incorporating them into your business strategy, you can navigate the challenges of the marketplace and achieve your goals on your journey of mastery.