One of the surest ways to develop a skill is to learn from the best in the field. And when it comes to resilience – otherwise known as the ability to bounce back from tough times – Australian small business owners lead the way compared to the rest of the population.
The recently launched Reckon Resilience Report shows that small business owners are more resilient than the average Australian. For example, it shows that 63 per cent of small business leaders don’t take long to recover from stressful events, compared to a little over half (53 per cent) of the general population. And three quarters (74 per cent) tend to bounce back after hard times compared to two thirds (66 per cent) of the general population.
(If you are curious about your own levels of resilience, you can learn more at the Reckon Resilience Hub where you can try out the 30-second Brief Resilience Scale calculator. The scale was developed by academics in 2008 and is one most highly recommended methods of measuring resilience).
Given that 2020 has thrown a lot at small businesses in Australia – from bushfires and a global pandemic, to the first economic recession in nine years – the ability to cope with setbacks is more critical than ever to running a successful business.
But why is resilience so important to small business?
Resilience makes you richer, happier, less stressed and more satisfied
The Reckon Resilience Report shows that highly resilient small business owners are more likely than their counterparts to be financially successful (43 per cent vs 23 per cent). They are also twice as likely to be happy (93 per cent vs 43 per cent) and satisfied with their job (80 per cent vs 40 per cent), in addition to being nine times less stressed (6 per cent vs 57 per cent).
In fact, the average Australian small business leader forfeited $21,832 in revenue in FY18/19 due to missed opportunities because of poor resilience – such as pulling out of jobs early, being too tired to fully engage with stakeholders, or not updating cash flow – showing just how much low resilience can literally cost a business.
This means that with more than 2.3 million small businesses in Australia, poor resilience could be costing the sector $50 billion annually in lost opportunities.
Additionally, the report shows that resilience is often all that stands between success and failure for small businesses. Half (54 per cent) of all Australian owners admit to seriously considering giving up on their current business, with the average owner considering it three times. But those who are highly resilient are much less likely to want to give up compared to their counterparts (29 per cent vs 70 per cent).
Small business owners’ key tips to building and maintaining resilience
Nearly all Australian small business leaders (96%) think resilience is vital to a successful business, but their thoughts on where resilience comes from and how to build it vary.
Two thirds (63 per cent) of small business leaders believe resilience is a mix of innate and learnt traits, but almost all (96 per cent) believe resilience is a skill that – like a muscle – can be developed. And more than half (51%) think of resilience as knowing how to tap into tools and resources for support.
Perhaps unsurprisingly, 68 per cent of the small business owners surveyed said they learned resilience from the hands-on experience of tackling a challenging situation.
However, outside of meeting challenges head-on, small business leaders also rated the following measures highly for building and maintaining resilience.
- Prioritising self-care: Highly resilient business owners understand that they can’t perform at work if they aren’t taking care of themselves, with four out of five (78 per cent) agreeing that prioritising self-care is critical to staying resilient. This could include eating right, getting quality sleep and exercising. More than a third (37 per cent) even practice mindfulness exercises.
- Leveraging tools and resources to stay on top of things: More than half (58%) of small business leaders say they stay resilient by using tools and resources to remain organised and in control. They tend to use technology to their advantage, with highly resilient small business leaders being much more likely (90 per cent) than their counterparts (70 per cent) to think advances in technology make running a business easier. For example, they are more likely (47 per cent) than average (38%) to work with an easy to use accounting software like Reckon to reach their business goals.
- Tapping into personal and professional networks: About half (51 per cent) say they have learned resilience from family and friends, while more than half (57 per cent) attribute spending time with loved ones as a way to bounce back from hard times. Meanwhile, a third (33 per cent) say they learned resilience from mentors and a quarter (26 per cent) from colleagues.
- Using expert help or official resources when needed. Knowing when to seek outside support is critical to being resilient. Just under half (46 per cent) acknowledge that asking for help when necessary is important to building and maintaining resilience. For example, highly successful small business leaders are more likely (20 per cent) than average (16 per cent) to rely on business and financial experts to get through times of hardship. And 16% have learned resilience from mental health professionals. Additionally, 76 per cent of small business leaders agree that government financial stimulus packages do a lot to help small businesses stay resilient. Fifteen per cent say they have relied on government policy or stimulus packages to get through hard times.
- Having a contingency plan. A crucial aspect resilience is being prepared, especially for worst-case scenarios. Highly resilient small business leaders are much more likely (79%) to have contingency plans in place than their counterparts (51%), ensuring that their ability to bounce back during difficult times is strong.
You can read the full report here
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