You'll find volumes of advice on what business strategy to follow. Almost all of it is either based on anecdote or very tactical, and should be taken it with a healthy dose of skepticism. Sure, some business owners succeed, for a time, by trusting their guts. And yes, you should definitely keep abreast of your competition.
Michael Raynor took it a step further. He and his team studied twenty-five thousand businesses and found three simple rules that the successful companies followed:
- Better before cheaper—in other words, compete on differentiators other than price.
- Revenue before cost—that is, prioritize increasing revenue over reducing costs.
- There are no other rules—so change anything you must to follow Rules 1 and 2.
There's a proviso here, though, and unsurprisingly rule 0 is: do what the data says. Prioritize making data-driven decisions.
I'll let Raynor himself explain these rules in the video below.
Posted by Thomas Hopper on Permanent link for The 3 Simple Rules for Successful Businesses on September 21, 2023.