Are you waiting for something to change so you can multiply the size of your business? If your business is running well, chances are it’s your mind-set that’s holding you back! Since day one of your business launch, you’ve probably been in the mind-set of ‘manager’, i.e. the day-to-day doer and organiser in your business. And this is fine, until you are ready to experience the synergies in business that allow it to grow exponentially and free you from spending all your time and money on it.
Our latest blogs discuss the four steps before synergy in business. These are 1) controlling all aspects of the business, 2) finding your niche, 3) leveraging your business services and products, and 4) building a winning team. To read the blogs click here.
Once you’ve worked through these four highly rewarding steps, you are so close to stepping back from your business and becoming the investor or entrepreneur that you envisioned when you started your business. Can you taste that poolside cocktail already? The fifth step is called ‘synergy’. Synergy is about multiplying the size of your business exponentially, unreliant on your (the business owner’s) time and money. To create synergies in business, you can adopt strategies such as mergers/acquisitions, adding new products or services, expanding geographically, franchising or starting a related business.
As your business moves into a state of synergy, so too must your mind-set. You need to grow your thinking from that of a manager and business owner to that of an investor and an entrepreneur. Changing your mind set then not allowing yourself to slip back to the ‘doer’ is critical if you want to maintain synergies in business.
What is the mind-set of an investor or entrepreneur?
Investors (people who make money from their money) and entrepreneurs (people who make money from other peoples’ money) have a mind-set that allows them to increasingly escape their two biggest constraints; time and capital. This might be a new and strange position for you to be in, but those who can adapt to the new-mind set will succeed, while those who slip back into the mind-set of the doer or manager will probably not.
If you’ve designed appropriate systems for keeping the business running, trust that you can fully step out of the mind-set of the manager. This requires a shift to longer term thinking and to exploration of ideas that have less certain outcomes than those you encountered in day-to-day business management. Challenge yourself to think only in the long-term and make decisions based on that, instead of what could happen tomorrow or next week.
Adopting the right mind-set to ensure synergies in business requires certain skills, such as a broader understanding of different business models, investment strategies, higher-level financial management and a wider range of businesses and industries. It also requires you to focus on different measures, such as return on capital, enterprise value and portfolio mix. This will require more of your day-to-day attention than the usual Profit and Loss statements or ordinary management metrics. More of your time will be spent working outside your existing business as you start to explore the many and varied options for multiplying it. Embrace it!
From there, the scope for what you can achieve is almost unlimited!
What are some examples of great business synergies?
Great investors are really good at managing money so it produces more money. Investing your money for maximum returns involves leveraging your assets in clever ways. Leveraging the success of your first business to create a second or third company based on the original business model is an excellent way to achieve this. Similarly, franchising your venture allows you to sell entire businesses thereby growing your business more rapidly; unconstrained by limits on your time or your capital.
If you’re looking for some more advice about how to achieve synergy and multiply your business, you can download your free copy of the eBook Synergy – Run your business like a well-oiled machine here.