Small business ownership is not without its ups and downs. Even the best businesses can experience ebbs and flows, especially when you’re trying to grow your company from the ground up. How you manage the ebbs and flows of small businesses will determine whether your business succeeds or fails. If you understand the various ways in which your business can ebb and flow, and plan accordingly, you have a much better chance of succeeding long term. Read on to learn more about how ebbs and flows affect your small business and what you should do about it.
What is an ebb?
An ebb is a decrease in the amount of activity within an organization. This can be in a variety of areas including product sales, employee productivity, and customer service (among other things). An ebb might be caused by seasonal fluctuations in the market or changes in demand for the product or service you sell. An ebb can also occur due to outside factors that affect your organization such as economic downturns, natural disasters, changes in government policy, new technological advancements, and shifts in consumer preferences.
What is a flow?
A flow is an increase in the amount of activity within an organization. This can be in a variety of areas including product sales, employee productivity, and customer service (among other things). A flow might be caused by seasonal fluctuations in the market or changes in demand for the product or service you sell. A flow can also occur due to outside factors that affect your organization such as economic upturns, new technological advancements, and shifts in consumer preferences.
Why does a small business ebb and flow?
As discussed above, ebbs and flows are natural parts of the small business lifecycle. Furthermore, ebbs and flows are the results of three major factors – the market, the business, and the people. The market refers to the customers you sell to and the demand for your product or service. The business refers to your company’s processes, products, and services. The people refer to your employees, their skill sets, and how they work together. When these three factors are aligned, a business will have an upward flow. When they are misaligned, a business will have an ebbing flow. The trick is to recognize these ebbs and flows as they occur, and take action to correct them.
Strategies for managing the ebbs of a small business
– Market ebbs – The market ebbs are the result of changes in customer demand. When this happens, it’s important to ask why. Market ebbs could be due to changes in the economy, changes in the environment, or changes in government policy. When this happens, it’s important to take a step back and see if there is anything you can do to respond to the market. If not, there’s nothing you can do. Simply ride it out and hope that things get better. If there is something you can do to respond to the market, do it. This might involve changing your product or service, changing your marketing message, or changing your sales approach.
– Process ebbs – If a process ebbs in your business, it means that one or more of your business processes is underperforming. To correct an ebbing process, start by asking yourself why a process is underperforming. This can be difficult to do because it involves being brutally honest with yourself. Once you’ve identified the reasons why the process is underperforming, brainstorm ways to improve the process by addressing the root cause of the issue.
– People ebbs – If a person within your organization is underperforming, it could be due to a variety of factors. It could be that the person isn’t in the right role, or they’re having trouble with the work. Regardless of the cause, an underperforming employee can cause an ebbing of the people within the organization. When a process or person ebbs, start by asking why. Once you’ve identified the cause of the issue, brainstorm solutions to correct the issue.
Strategies for managing the flows of a small business
– Market flows – When the market flows, it means that there is an abundance of customers for your product or service. This could be due to seasonal fluctuations, or it could be due to new technologies or shifts in consumer preferences. When this happens, it’s important to seize the opportunity. You don’t want to squander your good fortune, or you risk losing it. If you’ve been in business for a while, chances are you’ve experienced an upward flow before. When you’ve experienced an upward flow in the past, take the lessons you learned and use them to capitalize on the current upward flow. If this is your first time experiencing an upward flow, don’t get too excited. This flow could slow down or even reverse itself. Be prepared and don’t get overzealous.
– Process flows – When a process flow is strong in your business, it means that one of your business processes is performing well. This can either be due to the fact that you’ve hired the right people and put them in the right roles, or you’ve optimized the process in some way. Whatever the cause, it’s important to capitalize on the strong flow by scaling it. Scaling a process means increasing the volume of the process to see if it can be applied to other areas of the business.
– People flows – When a person is performing well, it means that they are maximizing their contributions to the organization. This is either due to the fact that you’ve hired the right people and put them in the right roles, or you’ve optimized their work in some way. Whatever the cause, it’s important to capitalize on the strong flow by scaling it. Scaling a person means increasing the volume of their contributions to see if they can be applied to other areas of the organization.
The ebbs and flows of a small business are natural parts of the lifecycle. The trick is to recognize them when they occur, understand why they’re occurring, and take action to correct them when necessary. When you do, you give yourself a much better chance of long-term success.
The roller coaster ride of a small business is something that most entrepreneurs go through, but it's important to find balance. Watch the full episode here: Episode 9-How to manage the Ebbs and Flows of Small Business.