One of the reasons many people start their own business is because they are doing something that is their passion. Understanding the importance of working on your business and not working in your business will be the absolute difference between growing profits and your business being stagnant or possibly even failing altogether. Owning a business is very consuming and it is incredibly important to have the ability to stand back and take a look at it from a different perspective.
Too Close for Comfort
When a business owner has fallen into the trap of working 'in' their business, they are spending more time doing things they could or should hire people for. Consider a small boutique of specialty clothing. If the business owner is spending tons of time behind the cash register, they aren't spending time working on new products or networking for growth options. If a business owner is too tightly wrapped around the daily operations of a business, they run the risk of being so close to the problem that they can't see it.
The human resources aspect of a business plan is just as important as other major components. Establishing the role you will have as the business owner up front will help to draw the parameters around the areas where your time will be best spent. When you consider whether you could hire some extra help for minimal expense while using your time to grow your business, you are more likely to be optimizing your time and investment.
Wearing the Customer's Shoes
Most of us have had a poor transaction experience as customers, such as being placed on hold an excessive amount of time while waiting to speak with a service person or not receiving the product that we had ordered. The rude sales person at the point of check out can leave an adverse memory that eliminates the chance of a customer ever returning for another purchase. In many of these cases we wished the business owner had stepped into our shoes and implemented changes. An owner who is working too closely in their business will not be in the position to see these issues.
A business owner needs to consider where their time will be best spent. Some businesses can benefit from additional help while others may need to simply hire an independent consultant to help get an assessment of how effective the business is working. A customer survey is also a good indicator of the overall effectiveness of the business. However, none of this input will have any value if a business owner does not act on the feedback and make some of the suggested improvements that can ultimately lead to more sales and growth.