Ten Essential Elements for a Successful Business

A good business to startup needs a few essential elements to start, for that
business to remain functioning these ten essential elements need to be enforced
as well. The first one is to focus, the ability to focus on the task at hand, and the
ability to perform a task that they have set in mind, working towards the plan,
and staying focused on that plan is extremely important. Having the intense belief
in your vision and focusing on that vision is important. The next one is the market,
having a good idea of who is going to buy your product or service. Knowing your
niche in the market, knowing your customers well, keeping an open eye for what
they like and more importantly also understanding what is it that they do not like.
This will not only help you understand the nitty gritty of market but also help you
in customer satisfaction. The next element is the Brand, knowing who you are is
extremely important because in the end everything boils down to how you sell
yourself and what you say in your elevator pitch which is nothing but the brand
image that you create in the mind of the reader. Creating awareness for the brand
is important for people to know your company or your business.
Team, one of the most important elements for a business to run, to retain good
talent the company must have good culture, have core values, and enforce those
core values along with that appreciation for those employees and providing
feedback is also important. Controls, having the accounting, records, inventory,
plans in check is extremely important. Keeping a check on the plans and
reinforcing those are essential for the business, hence keeping a note and
reviewing it time and again is important. The next element is Profit, it is important
to look at, profitability is really something a business owner should keep a check,
maintain appropriate cash for the venture is another essential element that each
business needs to keep a check on, having a check on their debt-to-equity ratio. A
ratio more than 50% has red flags all over the balance sheet. The next element is
sales. Everything starts with the sales, the revenue, for any business to have a
going concern, the sales play an extremely important role. Knowing your clients is
equally important so that you can get new clients to increase your sales. Knowing
how to market your product, advertising that model. All of that is important. Also,
Process, having a process for everything that we do, have a policy manual and
have training round to pass on how the business is done and to understand what
the business does well. The last element is the drive, the drive to excel at the
business, the incredible drive to win, drive to succeed.
One of the businesses I love is DELL Inc, I believe it has all the ten essential
elements. Dell was founded in 1984 by Michael dell on a simple concept, to sell
computer systems directly to customers. The company’s core business strategy is
built around its direct customer model and highly efficient manufacturing and
logistics. They are also expanding that core strategy by adding new distribution
channels to reach even more commercial and induvial consumers. The company
has also started to pursue a targeted acquisition strategy. Dell’s goal today is to
provide the best possible customer experience by offering superior value; high
quality, relevant technology; customized systems and services. Today the
computer industry is arguable the most important industry in the world.
Dell Inc. is one of the few corporations which was able to remain at the top of the
market but also nevertheless has a difficult time because of the inconsistency
between its strategy and new changing environment. From the beginning Dell’s
strategy was built around several core elements: build-to-order manufacturing,
mass customization, partnerships with suppliers, just-in-time components
inventories, direct sales, market segmentation, customer service, and extensive
data and information sharing with both supply partners and customers. But
nowadays Dell and other U.S. personal computers (PC) makers are struggling to
eke out a profit in an environment of falling prices and intense international
competition. By any measure, the Dell Computer Corporation's direct sales model
is one of the most successful strategic innovations of the past 15 years. With the
deceptively simple concept of bypassing the retail channel to sell directly to
consumers, Dell created a model that undercuts its competitors on price, forges
closer links with customers and provides shareholders a return several times that
of market averages. 
Dell is not the largest personal computer company, but it is the fastest growing.
Dell's year-over-year unit sales rose 67 percent in the second quarter of 1997,
while the No. 1 PC company, the Compaq Computer Corporation, rose 25 percent,
according to Dataquest, a market research firm based in San Jose, Calif. And Dell's
return on invested capital reached 167 percent in the second quarter, nearly 10
times the industry average. At about $100 a share at the end of September, Dell's
stock price quadrupled since the beginning of the year, after adjusting for splits.
As Mr. Dell tells the story today, there was no moment of blinding insight, but
instead a gradual evolution as the model changed to suit his growing company. So
Mr. Dell refocused the company on what he calls the cash conversion cycle, which
consists of inventory, payables, receivables and cash flow from operations. The
compensation packages of the company's top 500 managers were adjusted to
reflect return on invested capital as well as growth. To spread the message
throughout the company, training videos for entry-level employees, as well as
internal newsletters, all stress the importance of these metrics. In many ways,
Dell's direct model was singularly well suited to maximizing the cash conversion
cycle. Because Dell sold direct to customers, it carried little or no finished-goods
inventory; because it bought components on a just-in-time basis, there was very
little parts inventory; and because customers often paid Dell more quickly than it
paid suppliers, cash flow was positive.