Every business owner has a big dream for their company and wants to make it happen. But it can be overwhelming trying to figure out which decisions are helping the company grow and which ones are hurting. Once a business owner gets in a groove of their company operating smoothly, they often don’t want to change it. If it ain’t broke don’t fix it, right?
Execution in your business is all about being efficient and effective. Doing things right and doing the right things. This applies both to how you operate your company as a whole and how each person performs their job function.
It’s easy to get stuck in a fixed mindset when your business is performing successfully. You have people and processes in place and are making good revenue each year. But a fixed mindset causes a business owner to think that their people are as talented and intelligent as they’ll ever get. There’s no need to invest in training or leadership development because employees’ talents and skills are fixed. And if processes and operations are working, there’s no need to change them.
On the flip side, a growth mindset drives a business owner to continuously invest in themselves, their business, and their employees. They believe that people can learn and develop new skills that can take the company to higher places and they constantly look for ways to improve how the business operates.
I work with a client that serves the construction industry. The current owners bought the company from owners that had more of a fixed mindset. The old owners didn’t view their employees as an asset and didn’t believe they could provide real value outside of simply getting the job done. But these new owners have cultivated a growth mindset and have made gradual, small improvements in all areas of the company. They’ve seen their business grow tremendously because of it.
They have invested in the current employees through training and development and have also invested in hiring new employees who could provide great value/insight to grow the company even further. They’ve made gradual improvements in their processes as well, all of which has driven profitability higher. The net impact of these changes created a business with average revenue per month of $1.87 million in revenue, a 24% increase. But more importantly, their gross profit percentage grew to 28.7 and a net profit percentage to 14.4, so they’re earning more on the money they’re bringing in.
Even though the company was successful under the previous owners, with all of these developments, the business is doing better than anyone thought possible. The changes the new owners made in clients, employees, and equipment with a focus on 1% (small, manageable) improvements made the net profit margin almost triple what it was 2.5 years ago.
So what about you? Are you stuck in a fixed mindset, operating your business the same way it’s always been done? Start looking for ways to make small, gradual improvements to begin realizing the business of your dreams.