Business life cycle management: what's your next move?
Every organization goes through a series of stages between conception and closure. Knowing what you need to focus on at each stage can help you better prepare for the future.
Ask yourself these questions:
- What life cycle stage is my business in right now?
- Where do I want my business to go next?
- What should I focus on in order to be ready for the next stage?
Some of the things you may want to consider:
Development: Before starting, you will want to focus on research, planning, and financing. It can be difficult for new businesses to succeed under the best of circumstances, so take the time you need to plan well and show potential investors you have what it takes to succeed. This sets a strong foundation for your business.
Startup: Once you've laid the groundwork, you will be focused on things like registering, finding a location, acquiring inventory, and hiring employees. Cash flow management is crucial at this stage. Keep your expectations in check. Make reliable sales forecasts and control your costs; this will help keep your business healthy, and allow you to establish a strong customer base.
Growth: In order to grow, and to improve productivity, your business must innovate with things like outsourcing and automating. Effective management and good decision making are key factors. Market research can help you stay competitive and gain new customers.
Expansion: This new period of growth generally requires more research, more planning, and more funding than earlier stages. Whether you're looking at developing new products, expanding into new markets, or creating new distribution channels, you must do your homework. Consider joint ventures or new investors/partners whose interests and experiences complement your own, to help you deal with the pace of rapid growth.
Maturity: When you've neared or reached market saturation, your challenge is to maintain the market share you have. You can do this by focusing on promotion and customer satisfaction, fine tuning your processes, and adapting to evolving industry standards.
Exit: Long before you plan to retire or move on from your business, it's a good idea to have a succession plan that details your exit strategy, whether you're selling the business, closing it, or passing it on to someone else.
Monitoring your business and its environment can help you make the best decisions possible at each stage. It also allows you to stay ahead of the game and gives you a better chance at longevity.
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