The True Measure of Business Success
How do I know if I’m on the right path? How can I tell if it’s working? How do I know if my business is successful?
I’m frequently asked questions like these by new entrepreneurs. Despite pouring their heart and soul into their fledging ventures, most new business owners have little idea how to evaluate their efforts.
And it’s a fair struggle—when you’re not sure what to expect, when you no longer have a boss or an upcoming performance review, it’s hard to know what’s considered a “job well done.” And when you don’t start your business with a blueprint or step-by-step guide to success (where’s the fun in that anyway?), it’s easy to lose perspective on how far you’ve come.
Sure, healthy revenues and your break-even date are helpful barometers of business activity and customer engagement. But they don’t paint a full enough picture on their own—especially in the beginning, when you have no idea how the market will respond to your offering long-term and your overhead expenses are likely still lower than they’ll be in the future.
So here’s a better way to look at it: The true measure of success as an early entrepreneur is how much you’re learning—about your clients, your offering, your market, your business, and yourself. It’s not about how correct your original plan was, or if things are going “just as you expected”—it’s about learning what you couldn’t possibly have known beforehand.
Early success is also not about acquiring customers—it’s learning why those customers signed on and why others chose not to. It’s about getting feedback on what parts of your offering need improvement, and learning to turn feedback into a better product. It’s about understanding how your business influences the marketplace. It’s about knowing, through first-hand experience, what you like about working for yourself and what you don’t; where you add the most value to your business and where you are consistently wasting your time.
OK. You’re still probably wondering how learning and knowledge can really be more valuable than stellar sales results. Here’s how: If you don’t know why something is working, then you won’t how to respond to inevitable changes in the marketplace. But the more you understand about your business, your industry, and yourself, the better you’ll be able to successfully adapt to those changes and create a business that will last.
So the next time you want to evaluate your progress, put aside the metrics and instead ask yourself how much you’ve learned. What do you know that you didn’t before? What do you still need to find out?
As you’re reflecting, here are a few questions to try to answer:
Entrepreneurship is a lot like being a student in a pass-fail class. It’s not your job to be perfect—only to get a lot out of the experience and learn as much as possible. So no matter what stage your business is in, consider what you’ve learned as a crucial measurement of your success.
Photo courtesy of Jodi Womack.
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