Research Identifies Six Traits of Success-Oriented Small Business Owners
Findings provide possible clues to why many firms fail while others thrive
According to a report from The Guardian Life Small Business Research Institute, six dimensions characterize small business owners who projected revenue increases and business expansion even as the recession peaked.
The institute’s analysis is based on a comprehensive study, The Guardian Life Index: What Matters Most to America’s Small Business Owners, which surveyed owners of 1,100 businesses with two to 99 employees.
The index identified 60 critical factors that correlated with success-oriented owners who projected 2009 revenues of more than 10% over 2008 in combination with the intent to expand their businesses in 2009-10. Insights from the research may help explain why, according to the U.S. Small Business Administration, only 51% of small businesses endure for five years or more.
The six dimensions, based on the 60 factors, paint a nuanced portrait and provide a deeper understanding of the success-oriented small business owner:
Collaborative. Success-oriented small business owners learn how to delegate effectively and build strong personal relationships with their management team, employees, consultants, vendors and customers. They are more committed “to creating opportunities for others.”
Self-fulfilled. Success-oriented small business owners place a high value on the personal fulfillment and gratification that their companies provide them, relishing the self-determination and respect that come from being their own boss and being in control of their personal income and long-term net worth. They are more desirous of “doing something for a living that I love to do,” “being able to decide how much money I make,” and “being able to have the satisfaction of creating something of value.”
Future-focused. Planning for both the short- and long-term future are key traits that characterize success-oriented small business owners. They are more focused on cash flow and more likely to have “a well thought out plan to run our business for years into the future” as well as “a well thought out plan to run our business day to day.”
Curious. Success-oriented small business owners are more open to learning how others run their businesses. They actively seek insights into best practices regarding management; business innovation; prospecting; and finding, motivating, and retaining employees.
Tech-savvy. Technology is a key point of leverage for success-oriented small business owners. They more intensely value their company’s website and are significantly more likely to “rely a great deal on technology to help make our business more effective and more efficient.”
Action oriented. Finally, success-oriented small business owners are more proactive about building their businesses. They are more committed to “taking the business to the next level,” “differentiating ourselves from our competitors,” and “having something to sell when I’m ready to retire.” They also see adversity as “a kick in the rear to help move you forward.” Not surprisingly, they are less concerned than other small business owners about the overall state of the economy.
A detailed research monograph that further explains the six dimensions and 60 factors associated with success-oriented small business owners is available at smallbizdom.com.
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