In religion, the Ten Commandments are a set of biblical laws relating to ethics and worship which play a key role in three of the world’s major faiths.
In business, there is also a set of rules — rules which help set the tone of your organization and determine if it will succeed or fail.
In the past, I have written about some of the reasons why entrepreneurs venture out on their own — more flexibility, the ability to pursue their passions, freedom to make decisions. However, the road is not without its bumps. According to the Bureau of Labor Statistics, over two-thirds of businesses survive at least two years, but only 50 percent make it to the five-year mark; and only one third last at least 10 years.
While there is never a guarantee that a business will succeed, knowing the “10 business commandments” will give you a compass to guide you through the rough times.
Rule 1: Thou shalt turn a profit.
No matter what type of business you own — a “mom and pop” shop, a tech startup or a home-based business, you must turn a profit. This seems like a given, but sometimes people are so immersed in pursuing their dreams that they forget they need money, too. And if you’re not turning a profit, your “job” becomes a hobby.
Recently, I did a TV show on MSNBC which featured a young entrepreneur who brewed tea using only local ingredients. The company had signed a few distribution deals with notable supermarket brands in the Midwest, but after eight years had yet to turn a profit. When I was asked what advice I would give this startup founder, I said, “She needs to fold it up.” I admired her persistence and tenacity, but eight years is a long time to live off of credit cards and savings.
Rule 2: Thou shalt know thy value.
Customers need to fully understand the value of your product before they give you their business. You don’t necessarily need a unique product to succeed, but what you have has to set you apart from the competition. That is the value you provide your customers.
Think of companies like Apple, Google and Facebook. Apple offers customers the latest technology, making people feel they’re on the cutting edge. Facebook makes it easy for people to get in touch with family members, old friends and even colleagues. Google allows you to have a great amount of information at your fingertips, almost in real time. That’s the value each company provides.
You don’t have to be an industry giant to provide value, either. If you’re a local eatery that serves only locally grown ingredients, that’s your value. Or if you’re a family-owned laundromat that delivers to people’s homes, commodity is your value. Whatever makes you stand out, use it as your calling card.
Rule 3: Thou shalt invest in thy business.
According to CB Insights, one of the reasons why businesses fail is cash-flow problems. Twenty-nine percent of startups fail because of a cash crisis. As a result, business owners may be a little gun-shy about spending a lot of money on the latest software or gadget, but (as the saying goes) if you’re going to run with the big dogs, you’ve got to learn how to pee in the tall grass. (That’s actually our company’s motto).
Not investing in your business — whether that means new equipment or even good employees — could stifle your growth. A well-run business can survive on low cash, but you need to be smart when making an investment. Invest in software that will simplify things, and above all, invest in people.
Rule 4: Thou shalt surround thyself with what’s right.
In business, and in life, there’s very little you achieve on your own.
Entrepreneur Jim Rohn once said, “You are the average of the five people you spend the most time with.” Chances are, your success today has come about as a result of someone else giving you the benefit of his or her expertise in the past.
For me, it was my mentor, Mike O’Connor. I started out in the printing industry and Mike owned a print shop. He gave me the benefit of his experience by teaching me how much I needed to sell, how to set up metrics and KPIs and how to hit the targets I needed to hit. I still use all the tricks of the trade he taught me.
Through my journey, I’ve made it a point to surround myself with people with skill sets different from mine. Also, people who are passionate about what they do. You can teach skills to anyone, but you can’t teach passion. Passion and talent will take a company further than talent alone. That’s the kind of people I look to surround myself with.
Rule 5: Thou shalt never stop learning.
No matter how old you are or how long you’ve been in business, you never stop learning. It’s not just about reading books, it’s about talking to people (sometimes even younger employees), attending seminars and conferences and stepping out of your comfort zone.
In my book Think Big, Act Bigger, I refer to stepping out of your comfort zone as, “pushing things to the edge of the table, not off the table.” Stepping out of your comfort zone is always a challenge, yet it’s one effective way to grow and keep learning. The moment you start settling in to a comfortable routine, saying things like “We’ve always done it that way,” is when you stop growing and start putting your business at peril, too.
Rule 6: Thou shalt execute.
Every entrepreneur has great ideas up his (or her) sleeve; however, your idea won’t matter one iota if you’re afraid to pull the trigger. Idealism is what makes the American engine run, but idealism alone is nothing without a healthy dose of realism.
If you have a business idea that you’re certain will be a success, take the chance. Your idea has to be accompanied by facts, solid business plans and research, not just buzzwords like “unprecedented” and “revolutionary.” Everyone thinks his or her own product or service is the next best thing, but chances are it’s not. If you’re too afraid to go for it, someone else will execute, and you’ll be left holding a bag full of ideas. My advice: Don’t be shy, pull the trigger, work hard and EXECUTE.
Rule 7: Thou shalt not forget about marketing.
Small businesses don’t think marketing is as important for them as it would be to a Fortune 500 company. That couldn’t be further from the truth. Marketing (and sales) are just as important to every business, regardless of size. Businesses don’t fail because they lack great ideas; they fail because they’re not promoting and selling themselves. An idea might be innovative, but if no one knows about it, your efforts are wasted.
Branding represents who you are and what your company stands for, your values and principles. I once wrote, “Principles mean something only when they are inconvenient. As a small business owner, you must prepare to live your brand promise in good times and in bad times.”
Rule 8: Thou shalt be flexible.
Building a business is not easy. You’re competing with millions of people for attention; therefore, you need to be flexible with your plans. Every entrepreneur starts out with a plan, but that doesn’t mean it’s the only plan you should always follow. The plan must be flexible enough for when you encounter setbacks like a social media campaign gone bad, a defective product, lack of inventory or worse. Customers will be quick to give you their feedback. You must listen to that feedback and pivot accordingly.
Word to the wise, pivoting doesn’t mean changing strategies every time you receive a bad review or receive a customer complaint. Those events will happen, no matter how many zeros your business is worth. It’s about observing what’s working and what’s not, with a critical eye; it’s about adapting your business model accordingly.
Being too rigid and set in your ways is a critical mistake; and even if you break all the other “commandments,” this one must prevail.
Rule 9: Thou shalt strive for excellence.
This is one of those rules we must always keep front and center. When starting a business, you might find it easy to get caught up in building everything from the ground up. You might even over-promise some things in order to sign up your first client. While you must always strive to provide the best possible service, you must be careful not to over-promise and under-deliver. That’s the easiest way to fail. Providing excellent service should never be compromised at the expense of your bottom line.
Rule 10: Thou shalt think BIG.
Dreaming is part of being an entrepreneur — imagining how different things will be for you, personally and professionally. But you can’t build what you haven’t imagined. In order to be successful, you must believe you can make it happen. It’s not about being cocky and boisterous about how great your idea is, but about having a quiet confidence that says, “I can do this.”
Being trustworthy, professional, courteous, respectful, honest, transparent, competent, ethical, honorable and confident are staples in business and in life. And with no one sure path to success, having a steadfast set of core values will help you navigate the entrepreneurial road.