In an earlier blog, I set out the four main types of business person and promised more detail on what defines each type, why to some extent they are that way, and what might be done to change that.
Lifestyle characteristics
You identify your objectives with those of the business and you are very clear why you are in business. It is to provide the lifestyle you want for you and your family.
You can be quite driven, and you care about the business, but you know that it is a means to an end.
Is this you, and if so, why are you like this?
Like many people, you may have had an upbringing which was a struggle, and you don’t want that for you and your family. You want to enjoy the fruits of your skill and effort, and you are clear what that means. You may, however, push on with the business past any likelihood of failure as you are still driven to escape your past. You may forget to take the foot off the pedal. Successful lifestylers plan to do just that – stop striving, and start living.
You are good at the “job” but don’t want the business to grow such that you no longer feel in control. You want to preserve your lifestyle, and that means not letting anyone mess it up for you. That can mean that growth becomes reduced or stops altogether. Whilst this may achieve your aims, it can bring its own issues. No business stands still, so perhaps you should be aiming for some change, even if that means making it better, not bigger.
SWOT
Strengths
You tend to learn from your mistakes and do well.
Your main motivators are money and success to drive the life you want; however you define that.
Weaknesses
You may fail early in your business life, and have to recover from that position.
Your decision making may be based on gut instinct or other irrational elements which increase risk.
You may have no consistent way of evaluating risk.
You may not trust anyone to do the job as well as you.
As you get older, you become more risk averse, which may impact your business by making it more susceptible to risk.
Opportunities
You understand that personal and business risk is different and you are willing to take higher business risks for personal gain.
Threats
You may make decisions based on personal gain rather than long-term business health.
Cash needed to fund your lifestyle may negatively impact on business health, especially when cash has been committed for long term projects.
When your aspirations are achieved, you turn risk right down in the business which may impact its ability to respond to changed market events. Ensure that your personal needs have similar time horizons to that of the business so that you are not locked into decisions that cannot be amended. For example, a larger mortgage and a new car might put a strain for some years on finances, and they may be difficult to change if a downturn happened.
When considering risk, sense check that a new risk does not add to an existing one.
For new high rewarding business activities, ensure that measurement systems are good so you know when to expand and when to pull back.
Common pitfalls
You may be limiting your business and personal success by believing that you have to grow to get better results, as you may think that keeping control will be increasingly difficult. Consider strategic partnerships instead, as you may be able to outsource or join with others to achieve a better result, without the need for a traditional growth path. Remember that making the business better doesn’t always mean growth. Alternatively, grow your people so that they can take some of the management strain – use simple, measurement systems so that you still feel in control.
Development routes
Sense check gut instinct decisions by checking that your instinct has evoked a truly comparable experience, and use independent measures to compare results. Take a moment – don’t just react and move on to the next thing.
Identify personal drivers and align them to business objectives to ensure that your long-term objectives are going to be met.
Acknowledge that there will be tensions between personal and business objectives and develop compensating strategies.
Ensure that personal needs can always be met even in difficult times. Keep something back to help cover the difficult time, so your personal objectives can always be met. It gets you away from short-term decision making, which often is damaging to longer term goals.