Helping You Achieve the Freedoms of Time, Money and Peace of Mind
Why do some businesses fail?
For any new entrepreneur, it’s natural to be optimistic. Whether that person has a world-changing idea or is starting a new coffee shop, the glass has to be half full that the business will succeed. Otherwise, what is the point of starting a new company in the first place?
Unlike many other traditional accounting firms we offer a business development service that entails tasks and processes to develop and implement growth opportunities within and between organisations. We have developed many different modules in the fields of business, commerce and organisational management. Business development is the creation of long-term value for an organisation from customers, markets, and relationships. It doesn’t matter if you are a “for profit” or “public benefit entity”, a “social benefit organisation” or a “not for profit organisation”- such services will be valuable to you.
Why not take a look at our services that are listed on our website here?
“Everyone needs a coach.”
These are the words Bill Gates chose to open his TED Talk with impact. Interestingly the point he highlights and the one characteristic common to all high performing individuals, from executives to athletes is the fact that they all have a coach. Yet, surprisingly in business we find resistance from many business owners who don’t believe they need business development or coaching services.
The Harsh Reality
However this entrepreneurial enthusiasm is misplaced. The reality is that it’s a cruel world out there for entrepreneurs. The Bureau of Labor Statistics in the United States keeps a sobering tally of how often businesses fail, and here are the numbers from 1995-2015:
Years in Business and Failure Rate
1 year 21.2%
2 years 32.1%
5 years 51.2%
10 years 66.6%
20 years 79.6%
Statistically speaking, there is over a 50% chance that any new business is toast in five years.
Business Failure Can Be Complex
It takes the confluence of many factors to build a successful business: assembling the right team at the right time, achieving product/market fit, staying on top of the competition, and getting the necessary funding are just some of the key elements to success. In the same vein, it is often hard to pin down just one reason for failure, since everything is so interconnected. For example, one study by a U.S. Bank shows that 82% of small businesses fail because of cash flow mismanagement. This is a fair point, since without cash flow there is no business.
However, while cash flow may end up being the final nail in the coffin for many businesses, it’s also fair to say that a lack of cash flow can be the symptom of other problems. What if the company is going after the wrong market? What if the team is dysfunctional and unmotivated? What if the company isn’t differentiated enough to compete? With any of these situations playing out, it should be no surprise that sales aren’t coming in like expected, which would certainly tank cash flow. At the same time, a company with the right team and product should be able to make swift changes to right the ship from any chronic issues.
Some Reasons Businesses Fail
• 82% experience cash flow problems
• 42% find that there is an insufficient need for their product or service
• 29% run out of cash
• 23% do not have the right team
• 19% are out-competed
We developed this service because we did not want our clients owners and leaders to feel alone or unsupported. Do you find it difficult to make time to work on your business rather than in your business? Are you keen to find new strategies to improve performance and overcome business challenges? Would you like an independent coach to discuss your burning issues and opportunities with? We appreciate that owning your own business is hard work; the purpose of Monthly Coaching is to provide you with accountability and support with planning and decision making to ensure progress. We will help you overcome roadblocks and challenges in your business, working in synergy to utilise our combined expertise. Click here.
The Habits of Highly Effective Leaders
Organisations of all shapes and sizes are under immense pressure to retain good talent. High employee turnover can directly impact a company’s bottom line, with many studies suggesting poor leadership is one of the main causes. It takes many skills and experience to be an strong leader, and the behaviours of poor leaders that should be avoided at all costs. In today’s rapidly changing world, how can the qualities of a strong leader positively shape a company’s future?
The benefits of investing in Leadership
Effective leadership is worth its weight in gold, with 58% of employees claiming they would choose having a great boss over a higher salary. Not only that, 94% of employees with great bosses feel passionate about their job - nearly twice as many as those working for a bad boss. A strong leader increases employee loyalty, creating a conducive environment for reaching a company’s goals. In fact, research shows that companies with strong leaders are crucial when it comes to outperforming industry competitors and are three times more prepared to react to the speed of change. Moreover, a company with a strong leader is almost five times more likely to have higher customer engagement and retention rates. Emotional intelligence helps leaders to adapt to changing circumstances in their workplaces, or in their own roles and those of their team members.
Emotional Intelligence (“EI”) Is key to successful leadership. Our Head of Business Development, Camelia Petrus, PGDip I/O Psychology is a fully certified practitioner of the GENOS EI programme and a member of the OPRA Psychology Group.
How is the emotional intelligence climate in your organisation? For more information on EI click here.
How to lead effectively?
While each organisation has its own processes and demands different skill sets, there are core behaviours that separate leaders from managers:
• Clear Purpose: Clearly articulating the company’s future vision to all levels of staff in a clear and concise way.
• Contagious Passion: While managers light fires under people to motivate them, leaders light fires in people.
• Self-Accountability: The expectation to work harder than employees and set a standard of excellence.
• Flexible Determination: Leaders are agile and open to change.
• Sustainable Outlook: Focusing on long-term goals proves to a team that a leader is invested in the long-haul.
• Dual Focus: Beyond thinking big picture, leaders provide employees with a clear and actionable strategy for success.
Effective leaders are born from this combination of behaviours. However, one of them has the farthest-reaching impact, both on employees and a company’s bottom line: purpose.
Purpose and Performance
A strong and well-executed purpose can build organisational resilience and improve long-term financial performance. Leaders who amplify an organisation’s purpose create a culture of optimism where employees feel safe in proposing new ideas that will shape the success of the organisation.
The Future of Performance
To stay competitive, continuous learning and re-skilling should be at the heart of every organisation’s leadership strategy. Leaders of the future should possess the ability to redesign jobs in a more fluid way and lean in to the changing nature of work. According to McKinsey Analysts “If we don’t disrupt our business, somebody else is going to do it for us.” While management is a foundational skill, organisations need to invest in their leaders to ensure constant growth. Embracing the traits of an effective leader can not only provide improved returns - it also empowers organisations to thrive in an uncertain future.
Checkout our service on effective governance.
And remember as Bill Gates said “Success is a lousy teacher. It seduces smart people into thinking they can’t lose.”
Chris Lynch, CA
Managing Director, Lynch & Associates Limited
Get in touch by Email or Phone: +64 9 366 6008
Chris is the founding Director of Lynch & Associates Limited.
He qualified as a CA in 1973 and is a full member of the College of NZICA now merged with CAANZ. His expertise is in the areas of tax, accounting, business development, forecasting, and auditing. He has a clear focus on adding value to his clients lives and businesses and seeing the people behind the numbers.
Chris experience includes working as a CFO and company secretary for some of New Zealand’s leading companies before starting his own CA firm in 1999. In his previous roles Chris has worked in the wool, dairy, engineering FCG, banking and investment banking and stock broking industries.
Today he uses this vast experience to assist his clients add value to their businesses and personal lives.
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