Part 2 of “The Road to Live Business” series
It’s very rare that a small or midsize business stands the test of time. An article from the Harvard Business Review recently noted a study from the Family Business Institute that revealed only 30% of SMBs are still active through the second generation, 12% through the third, and three percent through the fourth or beyond. And as markets further develop and globalization adds more pressure, running a small or midsize business has never been more difficult.
The reality for most small and midsize businesses is that they do not have significant capital in the bank that can float them for a month or more of declining revenue. Every customer counts. Every moment counts. And every shift in the market is an opportunity to grow and expand.
To meet these market dynamics, every company – from $500-million businesses, to the smallest of firms, and everyone in between – must operate faster than their consumers. And I say “must” because it’s a mandate, not a competitive advantage.
Why running live is within reach for small and midsize businesses
This May, I had the pleasure of attending SAPPHIRE NOW, the SAP annual user conference, where I spoke to many people from a variety of companies and industries who are facing these realities. All of them have their own stories, but there was one that really made me realize the importance of running a Live Business.
A young business owner told me about his small retail company. He was now following in the footsteps of his grandfather and father as president of the family business. Although this was an exciting time for him, he quickly realized that his current business model would not allow him to maintain his chain of stores and pass it on to the fourth generation.
How can he guarantee that his children will have the chance to carry on the family business? In this day and age, it’s about real-time insight and constant evolution.
Even the smallest of decisions must be based on actual, current data to see emerging trends and know how to act. And I’m not talking about what’s going to happen five years from now – it’s about what’s happening next week, tomorrow, right now. One decision and one insight at a time, the company will grow and expand because it was able to adapt to customer needs and behaviors at the very moment they change.
Luckily, the same technology that large enterprises use to get this insight is available for small and midsize companies. The cloud has made it incredibly affordable for firms to invest, implement, and maintain the solutions they need to leverage real-time analytics from operations and inventory management to supply chain and sales. With a trusted provider, your company can implement a solution quickly and know that it will run at a high level of efficiency – all within one low monthly subscription that can be built into your monthly budget.
Running a live business is critical for any company – but it’s more urgent for small and midsize businesses. There is no longer the luxury of time, especially when you consider the close connection between market changes and their financial statement.
In the end, success depends on your ability to maneuver the business in real time. How will you make the most of the year, month, day, hour, or, more important, the moment?
To learn how your business can become a Live Business, check out Forbes Insights’ recent report “Doing Business In-the-Moment: How SMBs Run Live in the Digital Economy.” Over the next five weeks, we will share additional insights from this research. Be sure to check every Tuesday for new installments to our blog series “The Road to Live Business.”