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Top 5 golden rules of running a business

In order to run a business successfully you must follow some rules. Here are a few we believe are necessary:

  1. Build in concrete reward systems for your employees.  Talk all you want about “pursuing excellence.”  That’s a good thing to do, but what happens in reality is few people follow through because they don’t know how you define excellence or the specific actions to take to get there.  Instead, define a set goal, like achieving a customer satisfaction rate of 99%.  Give each employee who meets that standard over a specified time frame a bonus.  

Now, you can rest assured you will see positive change in employee behavior and your profitability.

  1. What can you be the best at?  This is what your company should focus most of its time on.  It’s okay to offer supporting products and services.  But you should define your primary product and service and focus most of your resources on being the best at it.
  1. Try a lot and keep what works.  When you get right down to it, business is very simple.  Groupon, for example, began as a site where you ask other people to give money or do something with you as a group.  Now, it helps you save money and try out new businesses, and it’s worth nearly $25 billion.  As you experiment with your business, don’t be afraid to try out different, even radically different, approaches to what you do.
  1. Involve your employees in decision making.  Yes, you and your senior management are intelligent people.  However, you don’t see everything that people on the front lines experience.  They may not have the solution to your business’s most pressing problems.  But, they have insights you can only get by doing what they do for 40 hours per week.  Get their feedback, and don’t be afraid to implement their ideas instead of yours.
  2. Surround yourself with people smarter than you.  No businessman has been able to take a company to extreme profitability solely on their own skills.  You may have heard these stories in the press, but behind the scenes they had lots of help.  Figure out what you do well, and then hire people smarter or more skilled than you to cover your weaknesses.  Your job is to move all employees and financial resources toward the same goal.