What’s the one thing that most closely determines success or failure of a business? Marcus Buckingham sought to figure this out.
He went to a prominent venture capital firm that had made hundreds of investments. The firm provided names of 140 ventures it had invested in-70 that went on to considerable success and 70 that failed. Buckingham contacted the CEOs of each and asked them to answer 25 carefully developed questions. He then analyzed the answers and found that the answer to a single question was the most reliable predictor of success.
That’s right. One of Buckingham’s questions was, “If a business is to succeed, what is the most essential characteristic?” Answers varied and included the likely candidates: focus, passion, persistence, innovation, creativity, thrift, productivity, teamwork and timing. But the one that correlated most positively with actual success was customer focus.
Interestingly, Peter Drucker – the leading business mind of the 20th century – held that the first and foremost purpose of every business must be to create and serve customers in meaningful ways.
This may seem like common sense to you, but before you dismiss it, keep in mind that common sense is not necessarily common knowledge or common practice. We tend to get sidetracked with all sorts of nonessential activities that don’t get us where we want to go.
Who is Marcus Buckingham? He may be the most influential corporate consultant today. I spent part of a day with him recently. He had just come from a presentation to a large group of State Farm Insurance managers and was scheduled for Oprah and Microsoft the following week. His best-selling books include First – Break All the Rules, The One Thing You Need to Know and Now, Go Find Your Strengths.
So what is the one thing you should do during this broad economic downturn? Eliminate the time, energy and resources you waste on nonessentials. Focus squarely on getting to know your core target customer groups and improving the value they derive from your products and services.
This article originally appeared in The Business Owner Journal, the periodical of choice for owners of small and midsize private businesses. All rights reserved, D.L. Perkins LLC. © 2012.
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