According to a report investigating 41 countries published by the Bank of Korea in 2008, there were 5,586 companies in existence that were older than 200 years. Of those, 3,146 were located in Japan, 837 in Germany, 222 in the Netherlands and 196 in France. And in the U.S., there are currently only 72 companies operating for more than 200 years. That makes sense given that the U.S. is a much younger nation that those in Asia or Europe. Still, it is a tough pill to swallow that most businesses eventually perish. While no one wishes for their business to go belly-up any time soon, the facts are indisputable. The average life expectancy of a Fortune 500 company today is between 40 and 50 years. And the average life span of a family-owned business in the U.S. is only 24 years.
When people get around to thinking about their own mortality, they often create a “Bucket List” , which helps one pinpoint what matters most and focus on making those things happen. It is a useful, personal exercise. But what about a business? Should a company have a “Bucket List” of things to achieve? If so, what should that Bucket List include?
Focus on the Big Picture
It is easy for new companies to focus almost exclusively on survival during the startup years. Getting a business off the ground and making it profitable can take a lot of time and energy. For many small businesses, the loftiest goal is to “be in the black” at the end of the year. Once a company is successful and growing, the focus then shifts to managing growth. Most companies never get around to thinking about a Bucket List. But it is good for a company’s leadership to take a step back and consider the ‘Big Picture’ of what it wants the business to do and achieve. A business owner or leader should ask himself, “What do I want this company’s legacy to be?”
Here are some Business Bucket List suggestions.
- Hire Top Talent. It’s been said that a business owner should surround himself with people smarter than himself. These people are a company’s ambassadors. They should make the business shine. A business’ legacy will only be as good as the people it employs.
The late Steve Jobs, co-founder, Chairman, and CEO of Apple, considered hiring the best staff to be any business leader’s most important job. Apart from using his creative brilliance to design products, he applied his perfectionism equally to designing his team. Jobs believed that hiring was the most important thing he did. He managed all of the hiring for his team; never delegating it. He personally interviewed over 5,000 applicants during his career. His advice was to hire “A-List Players.” He noticed that the dynamic range between what an average person could accomplish and what the best person could accomplish was 50 or 100 to 1. Given that, he said leaders were well advised to go after the cream of the cream; a small team of A+ players. He felt they can run circles around a giant team of B and C players. A business can be so much more innovative and successful if it employs the best. That is a legacy to have.
- Be the Expert. Establish a company known for being the most knowledgeable in the field. Answer important industry questions on the company’s website and social media. Serve on panels. Host seminars on industry topics. Establish an association for like-minded professionals. Be the expert in the field as needed by media. In today’s knowledge-driven world, being the one most ‘in the know’ is quite an achievement.
- Create a Healthy Work Environment. Build a company that is a positive place to work; one that nurtures genuine friendships and focuses on employee education and growth, health and wellness, and concern for safety. Within a healthy work environment, allow for meaningful dialog and an attitude of caring that motivates employees in all sorts of good ways. Develop a workplace where employees feel their work matters and they are appreciated, and where employee ideas are heard and tried.
It is an achievement indeed if a company’s greatest claim to fame is having the highest loyalty rate in the industry. What do Kodak, General Motors and United Airlines have in common? These companies have among the lowest turnover rates in their industries. Employees at Kodak stay an average of 20 years while United Airlines employees stay an average of 12.6 years. The typical GM employee spends just over a decade with the company, which is almost double the tenure of the typical Ford employee (the automotive company which has the next-lowest turnover rate), who only spends 5.8 years with the organization.
- Know Thy Customers. Another lofty goal for a business is to have the highest customer retention rate in its industry. Companies should strive to know customers’ names, what they buy, and their opinions. And customer opinions should be heard and acted upon. One way for companies to know their customers better is to have customer appreciation events. Since people do business with people they know, like and trust, it is important for a company’s staff to be the personification – the face, voice, heart and memory – of the business. Have employees connect and bond with customers in sincere ways.
- Innovate. Does the business innovate or do something different or cutting-edge? Business innovations have changed the world forever.
Consider the development of modularity, which are the refinements in industrial processes that allowed high-volume output of functionally identical parts. This enabled mass production and the Henry Ford–style assembly line in the first half of the 20th century. It resulted in a profound shift from handmade to volume-produced versions of everything. Or consider the adoption of standardized shipping containers, which revolutionized transport and international trade in the second half of the 20th century. Containerization led to a significant reduction in the cost of freight transportation by eliminating the need for repeated handling of individual pieces of cargo, and also improved reliability, reduced cargo theft, and cut inventory costs by shortening transit time. Modern international supply chains are a consequence of standardized shipping containers. Achieving innovation is an item worthy of being on any business Bucket List.
- Build a Recognizable Brand. A business cannot grow, thrive and achieve unless people see and hear about it. A company’s longevity is tied to the health of its brand. It is important for a company to be known and recognized. Apple, Microsoft and Google are three brands that are recognizable everywhere. Microsoft was founded in 1975. Apple was founded in 1976. And Google was founded in 1998. Even though these companies are less than 50 years old, these are known worldwide. They are everywhere.
- Be Profitable. Yes, yes. This has to be on every company’s bucket list. Without it, there is no other “Big Picture” to consider. But if that is the only thing on a company’s Bucket List, then — no matter its net worth — it is a poor list indeed.
- Reinforce Teamwork. Hiring top talent and developing a good workplace are vital, but then nurturing the team is just as essential. It is valuable for a company to be known as a great place to work. To achieve that, look for fun things to do as a company. Start a field trip suggestion box. Get involved in a city improvement project with a co-worker team. Create or participate in a charity event as a company. Develop an annual company cookbook that can be a lasting reminder of its staff.
- Expand. When a business is the best at what it does, it has earned the right to grow. If the company has one location, it can open a second. If the business has various locations, it can consider franchising. This is evident in local brands that grew into global ones, and it is never too late to start. For example, KFC founder Colonel Harland David Sanders was 62 years old when he began franchising Kentucky Fried Chicken restaurants in 1952. Today, KFC is the world’s second largest restaurant chain (as measured by sales) after McDonalds, with 18,875 outlets in 118 countries and territories.
- Be Deemed Worthy. This is about more than PR hype. Earn awards and recognitions that speak to the company’s purpose and environment. Just about every city has a “Fortune 500” list of successful businesses. Many publications also have “Best Places to Work” lists. It is not bragging for a company to be recognized for its successes and efforts.
- Pay it Forward. Once a business is profitable and thriving, the business should have the financial means to give back to the community. Company staff can and should serve and do for others. Microsoft may be one of the world’s largest software developers and financially-successful companies, but the good work of the Bill and Melinda Gates Foundation – established by Microsoft founder Bill Gates — will far surpass any legacy left by Microsoft.
It stands to reason that companies with a Bucket List are more likely to focus on those things that are key, eliminating all the chatter, chaff and noise that threaten to distract and drown out what matters most. If it is done as a company endeavor, leaders may find that employees themselves will be more connected to the business, its customers and its goals. That certainly is likely to hit a lot of the items on most any company’s Bucket List. Good luck.
Quote of the Week
“One day you will wake up and there won’t be any more time to do the things you’ve always wanted to do. Do it now.” Paul Coelho
© 2016, Written by Keren Peters-Atkinson, CMO, Madison Commercial Real Estate Services. All rights reserved.