SBM Business Checkup
Every business eventually reaches a plateau.
It doesn’t matter whether you’re a manufacturer, contractor, CPA, law firm, retailer or technology company. At some point, growth slows. Sales flatten. Margins tighten. Hiring becomes more difficult. The ideas that once fueled your success don’t seem to produce the same results they once did.
When that happens, most owners instinctively look outside the business for answers.
“Maybe we need another salesperson.”
“Maybe we need a new website.”
“Maybe we should add another service.”
Sometimes those decisions help. More often, however, the greatest opportunity isn’t outside your business. It’s inside it.
After interviewing thousands of business owners over the years, we’ve noticed something interesting. The companies that continue to grow aren’t necessarily the biggest, oldest, or best-funded. They simply take time to step back and honestly evaluate their businesses. They identify weaknesses before they become major problems. They ask better questions.
Think of this article as your company’s annual physical.
Just as your physician checks your blood pressure, cholesterol and heart health before problems develop, every business owner should periodically evaluate the health of the company. Waiting until sales decline or profits disappear is like waiting until you have chest pains before scheduling your first doctor’s appointment.
The following eight questions are designed to help you identify what’s working, what’s holding you back and where your next opportunity for growth may be hiding.
Grab a pen.
Write down your answers.
Challenge your leadership team to answer the same questions.
The conversations that follow may become some of the most valuable you’ll have all year.
Question 1: Do you know where you are going?
One of the simplest questions in business is often the hardest to answer.
Where do you want your company to be three years from today?
Most owners answer with goals.
“We want to grow sales.”
“We’d like another location.”
“We want to hire more people.”
Those aren’t visions.
They’re objectives.
A vision is a detailed picture of the company you’re building. It describes the customers you serve, the reputation you’ve earned, the culture you’ve created and the role you, as the owner, want to play in the future.
Without that picture, it’s easy to chase opportunities that don’t fit your business. New services, new customers and new projects can all seem appealing until you realize they’re pulling your company away from where you really want to go.
One of the best investments you can make is spending an uninterrupted hour thinking about the future instead of today’s problems. Imagine it’s three years from now and your business has exceeded every expectation. What does it look like? How many employees do you have? Why do customers choose you? What are you known for? What types of work have you intentionally stopped doing?
Writing those answers down creates clarity, not just for you, but for everyone on your team.
Your Next Move:
Your Next Move
This week, schedule one uninterrupted hour to write your three-year vision. Include:
• Annual revenue
• Number of employees
• Ideal customers
• Services you’ll emphasize and those you’ll eliminate
• Your desired company culture
• The role you want to play as the owner
Review it every quarter and use it to guide major business decisions.
Your Vision: Get Started Today
So you’re ready to start. The good news: It’s simple. The bad news: It is difficult. Here are some definitions, steps, tips and questions paraphrased and excerpted from Ari Weinzweig’s “A Lapsed Anarchist’s Approach to Building a Great Business.”
A vision needs to be:
Inspiring
People want to be a part of something that is meaningful.
Strategically sound
It cannot be a fantasy. There have to be measureable components to the vision to assess success.
Documented
Putting the vision in writing gives it enormous power since it now has a great clarity and commitment.
Communicated
A great vision that no one else knows about isn’t gonna be effective. You have to sell your vision to your team. Get excited about it. Display it. Promote it. Show your staff what’s in it for them. Also, make sure your vision is something that can be explained.
Techniques to writing your first draft:
Go for something great – Go for greatness right out of the gate. It is harder to go back and sprinkle it on later.
Write from the heart – Great visions come from the inside out. Go with your gut.
Get in the future – Write as if you are already sitting in the future and pick a specific time in the future.
Go quickly – Don’t worry as much about the content at this stage. Just write. Shut off your inner critic.
Use the “hot pen” technique – Once you start writing, don’t stop. Just keep writing for 15 to 30 minutes. Don’t self-edit.
Get personal – It has to be single and holistic. You have one life, so feel free to blend your personal and professional goals.
A long (incomplete) list of questions to get you started:
Look out three to five
years (pick a date) into the future. Give your best shot at describing how things would look.
1. How big is your business? Sales volume? Locations?
2. How will you measure success? Rank in industry? Contribution to community? Quality?
3. What standards of excellence are set by your organization?
4. What are the most important product lines or services you sell?
5. What types of products or services are sold in your industry that you won’t offer?
6. How do you sell? Describe the shopping experience. What makes it unique?
7. What special products or services are you offering the market?
8. What sort of customers shop there?
9. Where do they come from?
10. If your customers were asked to list three noteworthy things about your business, what would they be?
11. How many staff members work in your business?
12. How would you describe your business’ management style?
13. What types of people are you hiring as managers?
14. How do people in the business relate to those around them? What sort of relationship do you have to your staff? What does the staff say about their job?
Question 2: Would You Hire Every Employee Again Today?
Every owner has employees they couldn’t imagine losing.
They also have employees they quietly wonder about.
The difference usually has very little to do with technical ability.
Great employees solve problems. They take ownership. They support their teammates. Customers trust them. They make the entire organization stronger.
Weak employees require constant supervision, resist change and often create more work than they eliminate.
Successful companies understand an important truth: skills can often be taught, but attitude, integrity and work ethic are much harder to develop.
That’s why hiring should never focus solely on experience. It should focus on character and cultural fit.
Just as important, great organizations regularly evaluate whether every employee is in the right role. Sometimes people struggle because they’re in positions that don’t match their strengths. Coaching, training or shifting responsibilities can often unlock tremendous potential.
Occasionally, however, the kindest decision—for both the employee and the company—is acknowledging the fit simply isn’t there.
Strong cultures are built one hire at a time.
Your Next Move:
Choose your leadership team and honestly rate each person on:
• Performance
• Dependability
• Coachability
• Leadership potential
• Culture fit
Then ask one simple question:
If this person resigned tomorrow, how hard would I fight to keep them?
Your answer may identify where your leadership attention is needed most.
Question #3: Are You spending Too Much Time on the Wrong Customers
Revenue can be deceiving.
Two customers may each spend $100,000 annually, yet one may generate twice the profit while requiring half the time and producing several referrals.
That’s why the best companies don’t simply pursue more customers. They pursue better customers.
Your ideal customers appreciate your expertise, pay on time, generate healthy margins and enjoy working with your team. They become long-term partners rather than one-time transactions.
Other customers consume enormous amounts of time, negotiate every invoice, constantly create emergencies and prevent your team from serving better clients.
Not every customer deserves the same investment.
Conducting an annual customer review often reveals surprising opportunities. You may discover that 20 percent of your customers generate 80 percent of your profits or that a handful of difficult relationships are consuming a disproportionate amount of your team’s energy.
Growth isn’t always about adding customers. Sometimes it’s about attracting more of the right ones.
Your Next Move:
Review your 25 largest customers.
Identify which are:
• Highly profitable
• Easy to work with
• Loyal
• Referral sources
• Growing themselves
Then ask:
How can we replace five average customers with two exceptional ones?
That one question can reshape your entire sales strategy.
Question #4: Do Your Numbers Tell A Story
Every business owner looks at financial statements.
Far fewer actually use them to manage the business.
Growing companies don’t wait until year-end to discover whether they’re successful. They review a consistent scorecard every month and use those numbers to guide decisions.
The goal isn’t to become an accountant.
It’s to understand whether your business is getting healthier or weaker.
A monthly leadership meeting devoted entirely to reviewing key metrics can identify small issues before they become expensive problems. More importantly, it keeps everyone focused on the same priorities.
Remember this:
Revenue is important. Profit is essential. Cash is reality.
Focusing solely on sales can create a false sense of security when margins are shrinking or receivables are growing. Instead, monitor a handful of key numbers that truly reflect your business’s health.
Your Next Move:
Review these metrics every month:
• Revenue
• Gross profit margin
• Net profit margin
• Cash on hand
• Accounts receivable
• Sales pipeline
• Customer retention
• Revenue per employee
• Marketing ROI
If one number moves in the wrong direction for three consecutive months, don’t simply note it. Assign someone to identify why—and bring back a recommendation for fixing it.
Question #5: What is the One Number That Defines Winning
Walk into most companies and ask managers what success looks like, and you’ll probably get several different answers. Sales wants more revenue. Operations wants greater efficiency. Accounting wants stronger cash flow. Customer service wants happier clients. Human resources wants lower turnover.
The problem isn’t that those goals are wrong. It’s when everyone is chasing something different than the organization loses focus.
That’s why many high-performing companies establish a Critical Number, which is the single measurement that best defines winning for the business over the next 12 months. It gives everyone a common target and helps employees understand how their daily work contributes to the company’s success.
Your Critical Number will depend on where your business is today. A construction company struggling with profitability might focus on gross profit per project. A manufacturer may concentrate on on-time delivery. A professional services firm may target revenue per employee. Another company may decide its biggest opportunity is improving customer retention or cash flow.
The key is choosing the one improvement that would create the greatest positive impact if you achieved it.
Don’t choose ten priorities. Choose one.
When your team understands the company’s most important objective, decisions become easier. Projects receive clearer priorities. Employees know what winning looks like. Progress becomes easier to measure and celebrate.
Your Next Move:
Ask your leadership team one question:
“If we could improve just one part of our business by 20 percent this year, which improvement would have the biggest impact?”
If everyone gives a different answer, your company probably lacks focus. Spend the time to find alignment.
Question #6: How Do You Compare with the Best?
One of the greatest dangers in business is believing you’re doing well simply because you’ve never looked beyond your own four walls.
Imagine running a race without knowing where everyone else is.
That’s exactly what happens when owners fail to benchmark their businesses.
Perhaps your gross profit margin is outstanding. Or perhaps it’s five percentage points below the industry average. Maybe your customer response time is excellent or maybe competitors are responding twice as fast. Without comparison, it’s impossible to know.
Benchmarking isn’t about copying competitors. It’s about learning from them.
Talk with your CPA, commercial banker or industry association about benchmarking reports. Join a peer group. Visit trade shows. Read industry publications. Study companies that are known for exceptional customer service—even if they’re in completely different industries.
The goal isn’t to become someone else.
The goal is to become the best version of your company.
Great business owners are lifelong students. They’re constantly asking, “What are others doing better than we are—and what can we learn from it?”
Your Next Move:
Choose one area of your business to benchmark this quarter.
It might be:
• Gross profit
• Customer retention
• Employee turnover
• Proposal turnaround time
• Website conversion rate
• On-time delivery
• Customer satisfaction
Then identify one best practice you can implement within the next 90 days.
Small improvements, repeated consistently, create significant competitive advantages over time.
Question #7: Are You Working on the Business or Just Keeping It Running?
Ask most owners how their week went, and the answer is almost always the same.
“Busy.”
Busy answering email.
Busy solving employee issues.
Busy handling customer requests.
Busy attending meetings.
Busy putting out fires.
The problem is that being busy isn’t the same as building a better business.
As companies grow, owners must gradually shift from being the chief problem-solver to the chief strategist. That means spending more time developing people, strengthening customer relationships, reviewing financial performance, improving systems and looking for the next opportunity.
Take an honest look at last week’s calendar.
How much time did you spend growing the business?
How much time was spent simply maintaining it?
Technology and artificial intelligence are making it easier than ever to automate routine administrative work. Scheduling, meeting notes, customer follow-up, proposal creation and many repetitive tasks can now be handled faster than ever before. The goal isn’t simply to save time—it’s to reinvest that time where you create the greatest value.
If your calendar doesn’t reflect your priorities, neither will your business.
Your Next Move:
At the end of next week, estimate how you spent your time.
• Growth: Sales, strategy, customer relationships, leadership development.
• Management: Meetings, coaching and project oversight.
• Administration: Email, paperwork and tasks someone else could perform.
Then identify one recurring responsibility you can delegate, automate or eliminate over the next month.
Five reclaimed hours each week adds up to more than six extra workweeks every year.
Question #8: Is Your Business Giving You the Life You Wanted?
Let’s finish where every business owner started.
Why did you decide to own a business?
For most people, it wasn’t because they dreamed of answering email late at night or worrying about payroll every Friday.
They wanted freedom.
Opportunity.
Financial security.
The chance to build something meaningful.
Yet somewhere along the journey, many owners discover they’ve built a successful company, but not necessarily the life they envisioned.
The business depends on them for every major decision.
Vacations become stressful.
Family time is interrupted.
Personal health takes a back seat.
That’s not the definition of success most entrepreneurs had in mind.
The strongest businesses don’t simply produce profits. They create choices. They allow owners to spend time where they’re most valuable while trusting capable leaders to handle day-to-day operations. They provide financial security without demanding every waking hour in return.
In the end, your business should support your life—not consume it.
That’s the real measure of success.
Your Next Move:
Rate yourself from 1 to 10.
Does your business provide:
• Financial security?
• Time with family?
• Personal fulfillment?
• Peace of mind?
• Opportunities for your employees?
• Confidence about the future?
Whichever category receives your lowest score deserves your attention over the next year. Because improving your business sometimes begins by improving your life.