Having a profitable business with consistent and predictable cash flow is important to your company’s survival. However, if cash flow, revenue, and profits – the quantitative sides of your business – are the only things you seek to improve, then the qualitative sides of your business will suffer. Although it’s easy to identify your business’s quantitative factors, it’s harder to identify it’s qualitative factors. Thus, I want to identify eight foundational components that drive up your business’s intrinsic value – its qualitative worth.
This article is a key feature in the Value Growth Series. Within it, I will give you a brief, high-level overview of the 8 foundational components that drive up your business’s qualitative value. As I continue through this value series, each component will link to its own mini-series. Each mini-series will dive deep into the different aspects of each component. So, tag this article, favorite it, or save it in your Internet cookies to return to it again and again as I add additional information!
The easiest way for me to illustrate the 8 components that drive up your business’s qualitative worth is to place them on a pie chart, like pieces in a pizza pie. (Just don’t put any pineapple on my pizza!)
If you’re trying to increase your business’s intrinsic value, you must start with planning. Often one of the weakest areas of your business; yet, it’s fundamental to business growth. If you don’t plan, then you have no direction, nowhere to go and no way to get there. How can you make improvements if you don’t identify and determine ways to improve your company’s strengths and weaknesses?
The second slice on your pizza pie is leadership, which is found throughout your entire organization. To increase your business’s intrinsic value, you must build leadership from the top-down and from the bottom-up.
Next, you come to your business’s sales division. To grow your qualitative worth, not only must you sell, but you must have a sales process. You must specify the verbiage you want to use and the types of customers you want to reach.
Although marketing complements your sales department, most business owners neglect it as much as they do planning. To increase your business’s value, you can’t advertise anywhere, everywhere, or nowhere. You must develop a marketing plan that gets your company’s message to the right people.
Now, you have to work with your team members. Do you have them positioned properly within your company? Do their personalities match their skill sets? Are you communicating your business’s culture and values to them effectively? Are your people prepared for longevity through any type of transition?
If you have people within your organization, you must have operational structures and systems. Are you using the right ones? And, are you utilizing them efficiently?
Most small business owners think their CPA or tax advisor handles their books, so they don’t have to worry about the finances of their business. However, this couldn’t be further from the truth. Finance goes through the heart of your company. It shows you how to quantify what you’re trying to achieve, so it’s as valuable as the other slices in your pizza pie.
Finally, you must work to strengthen and improve the legal aspects of your business to grow your company’s intrinsic value. Here, you’re making sure that you’re compliant with laws, contracts, and agreements. It’s shoring your business up against worst-case scenarios so that you and your business are protected from harm.
Within your company’s eight foundational components, you have four core areas.
If you overlay a DISC personality profile on each of these sections, you’ll notice something interesting.
Those people in your planning and leadership departments tend to have D, or Dominant personalities. They are decisive, driven, results-oriented people, often your CEOs.
The people in your sales and marketing team tend to land in the I quadrant and have Influential personalities. These interactive, optimistic, fun, social people are best used within your company to engage customers and clients.
Next, you have your S personalities, your Steady supporters, over your operations and people. They approach tasks systematically and work in assisting roles within your company.
Finally, your finance and legal people tend to have C, or Compliant Personalities. Analytical and accurate, they fuss over minute details and numbers instead of getting involved in drama or chaos within your organization.
RELATED READING: Using The DISC to Build a Compatible Staff.
If you apply the DISC Assessment Personality Model to the eight fundamental components of your business that affect its intrinsic value, then you have a powerful device. You can identify your team members’ personality strengths. Then, you can place your team members in roles within your organization that will strengthen each of its core areas. By doing that, you can begin growing the qualitative value of your business. So, remember to bookmark this article, and join me as I show you how to increase the eight fundamental qualitative areas of your business.
Stick with us for the next article in our series. We will be learning about what’s involved in and the implementation of The Business Planning Process.