Aligning your business goals with your retail capabilities
Just because a business might be classified as small, it doesn’t mean its goals aren’t big. However, reaching the major growth milestones that indicate success for a retail operation requires access to the working capital necessary to make these goals attainable. While a small business might have big goals, it’s important that the company’s capabilities align with these aims.
As noted by Harvard Business Review, although there’s no universal formula that leads to a successful business, most corporate leaders would include strategic alignment as part of their equation for success. Not all companies will have the same elements involved in this alignment process, but there are certain primary components that can optimize the long-term fulfillment of the goals for a small retail operation.
Testing your small business’s strategic alignment
The source noted that factors such as the market strategy and the corporate organization are some of the more important aspects to this process. Strategy, purpose and organizational capabilities must all be in sync to successfully reach your business goals. HBR provides a simple two-step matrix to test your company’s strategic alignment: How aligned your strategy is with your long-term purpose, and how aligned your strategy is with your organizational capabilities.
For the first step, it’s important to differentiate between a purpose and a strategy. Your business’ purpose is what you are trying to achieve. Is this reaching a certain amount of annual revenue, products sold or growth into a key market? The strategy consists of how you plan to get the business to point where it will achieve this goal. The purpose should stay consistent over time, a fixed object that your business should strive toward. The strategy, on the other hand, should be flexible, as this includes the choices that determine whether the company can fulfill the purpose. A strategy will include such options as what products to sell, which technological features to implement, which markets to cater to and why, and a host of other elements.
For the second step of the test, organization covers the capital, resources (including human) and management systems needed to enact your business’ strategy. Having all of these facets aligned can be difficult, but the payout is worth it. Business2Community reported that Raj Sisodia discovered in the research to his book “Firms of Endearment” that companies with a high degree of alignment between their employee engagement with and the purpose and goals saw returns grow by 1,646 percent between 1996 and 2011.
“To maintain strategic alignment, a company’s people, culture, structure and processes have to flex and change as the strategy itself shifts,” HBR noted. “The symptoms of poor alignment are often obvious, especially to those who work in the company, but also to customers who do not experience the service they expect from a company’s branding and advertising.”
Checking the organizational capabilities
Retail shops trying to reach their business goals need to have the right kind of capabilities to succeed in reaching these milestones. But what kind of capabilities do these include?
Having enough goods to sell is crucial for a small retailer trying to grow. However, this can be a double-edged sword. On the one hand, it’s important to carry sufficient merchandise to satisfy customer demand. This includes having extra stock in case of an unexpected run on certain goods. On the other hand, though, having too much inventory in the warehouse means the company’s funds are tied up in products that aren’t moving quick enough. This money can be more effectively allocated toward ways that better fit into the company’s overall strategic vision instead of sitting on a shelf in a warehouse and collecting dust.
All employees and team members must be on the same page to ensure consistency and a high level of quality across the board. If the marketing team is focusing its efforts on expanding into other markets, the main business goal is converting more leads in the current market, then there is a gap in the company’s alignment. It’s important to include staff members on the alignment strategy to guarantee a successful implementation.
Funds are vital for every company, and no small business will achieve its business goals without enough revenue to capitalize on growth opportunities and reach its milestones. Without enough money to effectively align your operational capabilities with a purpose-driven strategy, your business goals can be more like an unachievable dream.
Those organizations that find themselves short of cash and unable to realize their business goals should consider a small business loan from an alternative lender. With quick and easy access to this working capital, you can take the necessary steps to implement the strategies required for fulfilling the purpose and ultimately reaching your business’ long-term goals.