Entrepreneurs often shy away from chaos, thinking that chaos is bad. Chaos is part of growing up. A small business has to go through the motions. The small business could stay small and stable or become a big business. In either case, the road to stability may be chaotic. The degree and interpretation of chaos differ. Before actually getting into how to tackle your business being overtaken by chaos, let us define what exactly is business chaos.
What is Business Chaos?
A chaotic business is one that is splashing but not swimming. A splashing business is doing some sort of work, but it is not moving forward. The business lacks direction, goals, and milestones. Part of it could be due to a lack of vision and diversified focus within the company.
As a business includes an undertaking between and amongst many people with different skill sets and different backgrounds, it requires their uniformity of purpose. When there is a uniformity of intentions across a business, it becomes an organization. An organization is a set of people doing a set of activities with an end goal that is directly or indirectly related to the success of a business.
What are the Reasons for Business Chaos in a Small Business?
The top 4 reasons for chaos in a small business are listed below:
1. Lack of specialization
Entrepreneurs like to dig deep. But they dig so deep that it becomes a hole from where they need help to get out. They also wear many hats – which is required to a certain degree. But in business, specialists are as much required as generalists. Entrepreneurs and the management cadre of small businesses run the risk of burning out, reducing quality output, and bad decisions when trying to chew more than they can swallow.
2. Not knowing how a business is grown
Atomic habits and micro-wins apply to businesses as well. Small businesses must focus on the specifics as much as the larger picture. While chasing the horizon, the iceberg in the middle should not be ignored. Small businesses should take each day as a day to win and prioritize their activities. The fortunes of small businesses are heavily vested in how well customers respond. But being customer-centric does not mean being a slave to them. Small businesses must tread a fine line being a “Yes man” and a “No man”.
3. Not having systems in place
A business needs systems; otherwise, it will involve manual intervention at every step. And manual intervention is fraught with risks of errors. Instead, automation is the best way to get systems in place. Investing in automation and workflow tools increases the fluidity of the conduct of business operations. From using secure purchase order forms to fulfillments to gathering customer feedback, doing so with automation and systems in place helps grow the business.
4. No reflection
Small businesses need to hustle hard, but they also must take time off to reflect upon themselves. Your small business requires this type of introspection. Or else, customers eventually catch undetected bad habits somewhere down the line. Introspection is also an opportunity to clean up business processes, optimize systems, rethink investment strategies, shuffle resources, and many more such activities. Otherwise, the chance is high of your small business being overtaken by chaos.
10 tips to avoid your small business being overtaken by chaos
The top 10 tips that small businesses should avoid to prevent them from being overtaken by chaos are listed below.
1. Create areas of control
Entrepreneurs can focus on research, development, marketing, sales, customer engagement, and business expansion. They can keep the operations, administration, and general management of the business within different control areas. Doing this has many benefits. Firstly, it is easy to scale the business this way. Secondly, it is easy to measure the workings of a business. Thirdly, but not the last, it creates a more ownership mindset in the business by employees. This is one way to get collective and collaborative control. It is also a democratic management style that allows control-area owners to voice their opinions.
2. Being proactive more than reactive
Small businesses must anticipate ahead of time and plan for contingencies. This is the way to compete. While management gurus might say there is no such thing as plan B, plan C, and plan D, the reality is different. Creating multiple plans is the way to stay flexible –a liberty that big traditional businesses don’t have. Small new-gen businesses can keep this type of functioning style even when they grow into large enterprise businesses. Old habits die hard, so habituating into this proactive decision-making habit at the start will serve a small business in the long run.
3. Business is about the structure
Many entrepreneurs don’t understand the nuances of business structure. They either find it too abstract, or they lack education in this. Small business owners must keep business process management in place. Pricing, competition, analysis, vendor relationships, business development, talent management – all of these business functions must have structure. The management of the business functions, workflows, communication systems, decision-making hierarchies, ideation framework, and new business creation process need an organized way to flow around the organization. When all aspects of a business have structure, it is easier to have a holistic view of the business.
4. An agile mindset
Here, we are not talking about any agile framework. An agile mindset keeps small businesses from falling into complacency, lack of innovation, reinventing, and lack of focus. An agile mindset is taking small steps and measuring each step along the way. Each milestone along the journey is an opportunity to reflect upon the strategy. If the strategy is not working, there is an opportunity to change to another course of action. This is what an agile mindset is – the ability to adapt to the vagaries of the external business world.
5. Reinforcing the vision
Small businesses might lose their way, but they should not lose focus. Reinforcing the focus, vision, and mission statement constantly is the duty of the business owners, not only to their employees but to them. Constant reinforcement of the business ideals helps the business think and act a certain way. All business activities become oriented to the larger goal of the company. The business subconsciously imbibes the reinforced vision. All actions then become a reflection of these ideals. It then lessens the chance of your small business being overtaken by chaos.
6. Stop being dramatic
Small businesses can afford to think big and larger businesses can’t afford to think small. When small businesses think big, they might make brash decisions to get to the goal faster. This type of action is a characteristic of small startups that want to leapfrog into the big league. Although it works on occasions, the actions bringing results mean the ones completed with calculation and precision. Small businesses thus have to cut the drama and tune into reality. They must take a hard look at the state of their affairs. They must accept the fact and do what it takes to get what they want.
7. Taking time to think and plan is not a waste of time
Small businesses want to compete. They might feel that they are losing out on time. The same time can be used to work on a product, service, or idea. But that’s not how it works. Time to think and plan means the time when innovation and ideas grow. Small businesses might be run-of-the-mill without innovation and new ways to do things.
8. Follow-up is not begging
Small businesses start with a flurry and might lose steam when it comes to sales engagement. A lack of responses from customers might put them off. But in the business world, staying emotionally balanced and being objective is the name of the game. It is about getting personal yet staying business-like. Sales engagement must not shy away from follow-ups. Implementing tools for efficiency like sales force automation (SFA) can help simplify these types of processes for your team. Keeping the momentum on the follow-up is not pleading or asking for ex gratia. It is about doing business the way it is done everywhere.
9. Core competencies are the engines
Small businesses may want to do many things at a time. But as any wise hermit would say, doing one thing well has the same effect as doing one hundred things. Small businesses must focus on quality and not worry about versatility and variety.
10. Protecting cash flow
Optimization of business processes, reducing expenses, and saving money is how to protect cash flow. Businesses that do this are in great shape – recession or no recession. Cash flow also allows them to plan for any costs associated with new customer acquisitions.
Small businesses can use survey makers, automated invoice trackers, and business payment automation software tools, in addition to workflow tools, to start automating their business. Any of these can help against your small business being overtaken by chaos. Any automation must reduce repetition, save time, and increase utilization.