Break Points: 7 Challenges That Hold Small Businesses Back

Larry Kesslin, a consultant to VARs and MSPs and author of Break Points, thinks he has found the key "break point" areas that prevent small businesses (1 to 100 employees) from growing. Kesslin described the break points during a keynote today at TruMethods Schnizzfest, a managed services conference held in Philadelphia, Pa. Here's a recap.

1. Charting the Course/Have a Plan: "This is not about business planning. It's about life planning. A business is a tool to help you meet the needs of your life." Without a strategy for how you want to live and enjoy life you'll be come a slave to the business and face your first break point.

2. Let My People Grow/Hire Great People: You've got to delegate to fantastic people who were good hires. Always be recruiting. The best companies in this industry have the best people. "The best time to fire someone is the first time you think about it," asserted Kesslin. "It's all about your people. Nine our of 10 times your instinct will be right. If you don't get rid of people who are bad then the people who are good are going to leave."

There are three types of entrepreneurs:

  • Lifestyle CEOs take the cash out of the business.
  • Growth CEOs reinvest profits back into the business.
  • Hyper-growth CEOs take on investors to grow even faster.
Regardless of your entrepreneurial type you've got to always interview potential employees and then hire the best talent and let them grow.

3. Communicate, Communicate, Communicate, Communicate
  • How do you personally communicate?
  • How does your executive team communicate? How does your team communicate in meetings?
  • How does your executive team communicate to the company?
  • How does your company communicate to the market?
If you're not clear in all four areas you're holding yourself back, asserted Kesslin.

4. Partnership Pain: 75 percent of the businesses in the IT channel have multiple owners.
  • 50-50 partnerships are challenging. "There has to be a clear hierarchy in terms of who is in charge," said Kesslin.
  • "Do work between the two of you to communicate more effectively," said Kesslin.
5. Revving the Engine: "If you can't figure out a way to generate predictive revenue then you can't grow," said Kesslin. "If you can't conquer this you can't even get to the next two break points."
  • Develop a presentation that shows candidates what a great place your company is to work.
  • The candidate should then chase you for the opportunity; you should not chase them to take the job.
  • Invest extended time before making a hire. Make candidates earn the opportunity ask for the job.
  • Salespeople candidates who ask for the job will know how to ask for customer business.  That, in turn, will rev your sales engine.
6. Changing of the Guard: The people who help you get from 10 to 20 employees is typically a generalist. Once you have 60 or more employees, those generalists are less valuable. You'll need specialists.

7. CEO Time: Most business owners are looking to make a living, most CEOs are looking to run great businesses, most entrepreneurs are looking to change the world. Regardless of which category you fit start to understand your employees and create loyalty.

That's it -- for now -- from Kesslin. For deeper details his book is called Break Points.

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