When I was learning to drive I swerved. Left, right, left. My driving instructor told me that if I focused a hundred yards ahead, I’d swerve less. That made no sense to me – what about the yellow lines right here?!? – but sure enough, it worked.
Entrepreneurs with high-growth businesses can be similarly consumed by the day-to-day struggles, and forget to look out at the horizon. While the need for rapid daily execution never goes away, the strategic value of a company can often be found by looking ahead and ensuring you’re still driving in the right direction.
So what should you focus on when there is already too much to focus on? Here’s what the best entrepreneurs do. Coincidentally, these are all things that investors value highly.
- Have an actual strategy. Not simply a plan, budget or mission statement. And not some boilerplate about how you’re going to make incremental improvement. A real strategy. Articulate what your market and customers will need in the next three years, how you will serve them better than anyone else, and what you need to be good at to successfully get there.
- Differentiate. Unless you’re De Beers, you have competitors. While there are strong arguments for and against obsessing over the competition, one thing is certain: You need to differentiate from your competitors. Know how you can (or should) uniquely satisfy your customers’ needs and leverage that position.
- Have a brand identity. As a small business you’re not likely allocating a brand budget and running television ads, but you can proactively coordinate your messaging, product, culture, logo, business cards, social strategy, etc. Everything should support a single, unified brand identity.
- Bear hug your customers. Perhaps the most important metric I study at companies is customer retention and, more specifically, revenue retention. That reflects both customer retention and organic account growth. Obsess over this, and know your plans to always improve it.
- Know your TAM (total available market). Simply knowing your opportunity is step one. Step two is ensuring there’s runway and figuring out how to expand it with products or distribution. Step three is having a strategy to capture share. Sounds like step one, right?
Thinking through these too often forgotten exercises is time well spent. You’ll find that your business will be more focused and you will swerve a whole lot less.