Small business success secret #4

What makes an entrepreneur successful? I believe there are 18 traits. I’ll look at one each day for the next 18 days.

Small business success secret #4: Business owners try to anticipate what will happen next.

A small business exists to meet needs. But the needs of the marketplace change and the most successful small businesses will be the ones that anticipate what is about to happen before it happens. Watch the needs of your marketplace closely and pay attention to shifts.

Small business success secret #3

What makes an entrepreneur successful? I believe there are 18 traits. I’ll look at one each day for the next 18 days.

Small business success secret #3: Business owners make fast decisions and embrace the consequences.

Business owners know that there is rarely a perfect choice. They will think briefly about the short and long term costs and benefits, and then they’ll act… without looking back with regret. Learn to think fast and decide fast based.

Small business success secret #2

What makes an entrepreneur successful? I believe there are 18 traits. I’ll look at one each day for the next 18 days.

Small business success secret #2: Business owners need to be people of action. And, whenever possible, that action needs to be oriented towards revenue generation.

Given the choice between planning and action, act. Given the choice between redesigning your marketing brochure and picking up the phone to sell, start dialing.

Small business success secret #1

What makes an entrepreneur successful? I believe there are 18 traits. I’ll look at one each day for the next 18 days.

Small business success secret #1: Business owners need to accept that their effort doesn’t have to be perfect.

This includes websites, sales material, even your sales presentation. It just needs to be good and you can fix it on the fly. A good plan today is better than a perfect plan tomorrow. Move off of detail-oriented planning and start working on building your business.

Improve your workday schedule

Clock in Kings Cross railway station
Image via Wikipedia

Scheduling and prioritizing are always issues with small business owners: It feels like everything is a priority! And, when you focus one thing, three or four other things will get pushed back. So, what gets your limited attention and what gets delayed?

When billable work is piled high, it can be tempting to put your marketing and administrative work on pause. But any freelancer or consultant who has been in business for a few years will tell you that this is not a good long-term solution because it creates a feast-or-famine workcycle.

I found this to be the case in my business several years ago so, in an attempt to solve it, I put together an acronym — BOMA — which I use to make sure that my schedule is balanced out.

BOMA stands for the four elements that must be continuously performed to run a successful business:

  • Billable time: This is your revenue-generating work.
  • Overruns: This is the work you do that may not increase an invoice but still needs to be done. (i.e. if a client comes back to request a couple of revisions).
  • Marketing: Any positioning, branding, and promoting activities.
  • Administration: All the detail work that keeps your business running (like bookkeeping, taxes, scheduling, etc.).

Beginner BOMA Usage

So, here’s what I recommend to business owners: Your business will be more successful when you apply the BOMA principle to every single day: Make sure that each day contains elements of each one. Each day doesn’t have to include them in equal proportion, but you need to make sure that you do include them. (I’m willing to bet that most freelancers and consultants forget to schedule overrun time). Sit down with your schedule and block out each one. For example, you might block out 5 hours for billable work, and an hour each for overruns, marketing, and administrative.

When things get chaotic  or when a new opportunity presents itself that must be pursued, you take time from each one in proportion. For example, if you need to suddenly gain an extra 2 hours in your day, it can be tempting to take it all from administrative or marketing work; but instead, you can take a quarter of the time from each element (an hour and fifteen minutes from billable time, and fifteen minutes each from overruns, marketing, and administration). You’ll gain your two extra hours and you won’t sacrifice critical business activities.

Here are a few beginner BOMA best practices that I’ve used:

  • Color-code your schedule.
  • Group activities together (Billable work during your “on-your-game” time, administrative work for when you’re feeling less creative).
  • Track the amount of time you spend on each and record it as a ratio like this: B4h:O1h:M1h:A2h. This says that the freelancer spend 4 hours on billable work, 1 hour on overruns, 1 hour on marketing, and 2 hours on administration. Tracking your work this way helps you in the next step, Advanced BOMA Usage…

Advanced BOMA Usage

Once you get into the habit of making sure that your schedule contains all the elements of BOMA, you can start to optimize your business. Ultimately, you want to create a business that maximizes billable time and minimizes the time you spend on everything else (without actually minimizing the activities themselves).

Here are a few advanced BOMA best practices:

  • There is a tension between the billable time you spend and the overrun time you spend. In theory, if you put in excessive amounts of billable time on a project up-front, you’ll never need (non-billable) overrun time on the back-end. But that’s impossible to do and can cost you clients over the long-term when they aren’t happy with really high invoices. However, by pursing excellence (and not perfection) on the front end, you’ll minimize your overruns (but you’ll still get some) while keeping your clients happy.
  • Chances are, billable work and overruns are things you need to do yourself. And, in the beginning, you might also need to do the marketing and administrative work as well. But your goal should be to start outsourcing some of the work. For example, if you outsource your administrative and marketing work to an assistant, you can increase the amount of time you spend on billable work. Of course, that doesn’t free you up from ALL administrative work since delegating work to your assistant is a form of administrative work that you’ll need to schedule. But, you’ll minimize the amount of administrative time you spend by outsourcing it.
  • Depending on what you do, you might also end up outsourcing some of your billable and overrun work as well, although I recognize this is not for everyone.
  • Overrun time doesn’t always get used. Perhaps you send off a project but your client can’t get to it right away, so have some other activities waiting in the wings.
  • Turn overrun time into a combination of marketing time and future billable time by returning revised projects with added value that wasn’t requested and by recommending future work that the client should consider.