The young have always taught their older counterparts, and it’s no different in the business world, where start-ups have much to offer more senior companies. Today’s most successful companies are growing nearly three times faster than in the past. In order to succeed at this rate, both employees and business leaders have to be adaptable about their attitudes towards growth, acquiring new skills, embracing change and being flexible.
While more established businesses often have strategies molded in past success, younger entrepreneurs propelling new, innovative products and services, typically have a more open-minded approach to their operations and thinking. Over the past 20 years, many established businesses have failed because they did not evolve and embrace change. In today’s ever-changing marketplace, it is advisable for established companies to heed the lessons of today’s startups in order to remain competitive in their business space.
Startups always have their eyes on their competition. A simple way to do this is to set up “Google Alerts” for your top competitors, so you can keep an eye on what they are doing and what is being said or written about them. When you make a point to be more aware of the business environment around you, you allow yourself to be in a better position to identify potential changes and threats in your industry.
Another strategy employed by startups to stay competitive is their continuous focus on the mission. Those businesses whose employees stay focused on the mission are more easily able to recognize threats and opportunities as they arise and make decisions about how to respond to them.
Companies of all sizes should recognize that the best way to keep and attract customers is to always remain customer-focused in their business strategy and daily operations. Staying in touch with your customers can provide valuable feedback on new product or service offerings, promotional activities, etc. No matter the size of the business, customer focus is key. A great example of this is McDonald’s recent decision to switch to paper straws. Customers complained about the environmental impact of its usage of 1.5 million straws per day and the company listened and implemented the change.
Employee engagement is another key focus for many successful startup businesses. One recent survey showed that engagement is the single most important piece in creating a strong, creative and mission-driven workplace. Workers who feel valued and believe in the start-ups’ vision are more productive and want to see “their” company succeed.
Employee engagement can have a tremendous impact on profitability as demonstrated by a Gallup poll which indicated that businesses with greater employee engagement experienced:
o 41% less absenteeism
o 24% – 59% less turnover
o 28% less shrinkage
o 70% fewer safety incidents
o 17% greater productivity
o 21% higher profitability
The hotel business is notorious for its high employee turnover, but Hyatt Hotels has learned that they can keep their turnover rate low by investing in employee development and promoting employees from within the organization. It also offers travel perks and tuition reimbursement. As a result, Hyatt employees at all levels feel like they have room to grow within the company.
When it comes to business, size matters. One advantage startups have is that they are usually small, often less than 100 people, allowing them both flexibility and more time for leadership to connect with employees. This enables everyone to be more engaged with each other. Oftentimes, too, there’s a less hierarchical structure, which gives all workers a greater voice at all levels of the company. If an older business can disrupt its traditional paradigm, at least a little, to provide a greater voice for employees, which, in turn, leads to their greater investment in the company’s success, it’s likely to reap significant rewards.
Another factor that’s being successfully modeled by start-ups is flexibility and the ability to pivot and adapt quickly to changing business environments. In an ever-changing economic landscape, such as the one that the COVID-19 pandemic has created, it’s imperative for a business of any size to adapt – and do so quickly, with as little disruption to its clients as possible.
It can be a big and often complex task, but adjusting can mean the difference between surviving and failing. It’s not large versus small, nor start-up versus a long-established business, it’s more important that all successful companies stay open to new ideas, be ready to act on them and keep your employees engaged at every level.
We work with businesses of all sizes and are happy to discuss your firm’s strategies for growth and resilience during these turbulent economic times. Schedule a call with one of our accounting advisors today.