- Most successful businesses know how to optimize the resources available to them and are customer-focused.
- Successful businesses also have the organizational capability to support critical business objectives.
- Successful businesses are also flexible, know how to set goals that are feasible, support critical business and are authentic, among other things
What do most successful businesses have in common?
According to The Conference Board, an independent business membership and research association, there are three similarities that high-performing organizations, regardless of industry or geography, share. This research from 2015 defined these three building blocks as: using available resources to effectively execute business strategies, maintaining a strong focus on the customer and structuring the organization in order to support company objectives.
To better understand what traits link the best businesses, researchers identified 56 companies that rank highly in leadership, financial performance and people management. Those companies included FedEx, Coca-Cola, Target and American Express. The study's authors then surveyed 76 executives at 27 of those companies to learn how their businesses are run.
Amy Lui Abel, vice president of human capital research at The Conference Board and a co-author of the study, said that when looking from the outside, it may seem as if these companies don't share much in common.
"However, our survey of executives at those four high-performing organizations, and 23 others, revealed a layer of meaningful commonality underlying their success," Abel said in a statement. "While the DNA of every high-performance culture is unique, they rest on a common catalog of 'genetic' elements that proactive leaders will identify, adapt and incorporate into their own company's identity.”
3 elements successful businesses share
Based on their surveys, researchers uncovered three common "DNA elements" and strategies that successful businesses have in common.
Successful businesses use resources effectively and efficiently to execute business strategies.
- Create a culture of rigor and standards for financial stability.
- Require process around fiscal management, oversight and decision-making.
- Execute strategies in an operationally efficient manner.
- Align organizational structure to support business strategy.
- Create and maintain a culture of accountability.
There is a strong customer focus.
- Deliver high-quality products and services.
- Create a strong customer-centric culture.
- Focus the organization's process and products on customer needs.
Successful companies have an organizational capability to support critical business objectives.
- Attract and retain talent through strong brand reputation.
- Provide learning and development opportunities to all employees.
- Require supervisors to set clear goals and manage performance.
- Raise employee engagement to drive productivity.
- Develop a global mindset among leaders.
- Align rewards and recognition to support business strategy.
- Help managers create effective teams.
"In today's globalized, competitive environment, a huge array of measures – from market capitalization to employee-engagement scores – is available to evaluate a company's success," said Rebecca Ray, executive vice president of human capital for The Conference Board and a co-author of the report. "But such numbers alone reveal little about how an organization succeeds, or fails, in adapting to change, developing new capabilities and executing its long-term strategy."
What are some additional factors that contribute to business success?
In addition to the aforementioned things, there are also some other common contributing factors to business success. Some of which are:
Testing original ideas. One major contributing factor to successful businesses is having the ability to test out original ideas. In other words, most successful businesses begin with a brilliant idea that has been tried and tested.
Goal-setting. Another major contributing factor to having a successful business is being able to set the right goals. In other words, you want to be able to dream big but at the same time, setting goals and objectives attract success. Be sure that they are practical and achievable in both the long and short-term.
Being flexible. In keeping with that notion, although you should always be sure to cater to your customer base, above all, you must also be flexible and know when to make certain changes that are for the good of the business overall.
Understanding and embracing the digital realm. Going digital is not only good for the environment, but it can be great for your company as well. Although you may not be too excited about the initial costs, going digital can save money on office supplies such as paper, ink, filing cabinets, etc. While it may be easier to begin your business without making these initial investments, doing so early on can save you tons of time and effort down the line.
Being authentic. Another contributing factor of successful businesses is being able to build a brand that comes across as authentic. Customers have long since gotten tired of grandiose companies that seem to be telling them whatever they want to hear to make a sale. Success businesses find ways to spread a genuine message, which, in turn, attracts customers that are genuinely loyal and support your efforts.
Highly financially literate. Additionally, successful businesses must have a good handle on the financial realm. In other words, it does not matter how good your ideas are if you do not fully understand how to make money from them. Successful businesses are skilled at creating multiple streams of income and optimizing them over time.
Showing gratitude. As mentioned, very few companies last without loyal customers and supporters. Therefore, most successful businesses find a way to show their appreciation to their customers on a regular basis. For instance, they may choose to have giveaways, sales for frequent customers, rewards programs, etc. Any way you can give back to your customers and show appreciation is always a good thing.
- Being fearless. Last but not least, being fearless is one of the top ways businesses become successful. Starting a business is not for the weak. It can be tiring, tedious and downright maddening at times. Nevertheless, those who manage to stick with it often gain rewards in unforeseen ways. Moreover, they also are often not afraid to introduce new ideas and concepts that may seem radical or even taboo, in the name of furthering their business and brand.
The study was also co-authored by Amanda Popiela, a researcher in human capital at The Conference Board.