In sport the winner is the first to pass the finishing line, but in business there are many factors at work. After a decade running her firm The Alchemists, one of the North Eas's most respected business consultants Lucy Armstrong gives a few pointers to future champions on how to beat their personal best.

WE cheered on and applauded the Olympics and Paralympics gold, silver and bronze medal winners this summer. But what about those who underperformed and those who lost?

There will be winners and losers in business too. Yet it is much more difficult to assess what constitutes success in business than watching athletes cross the finish line.

In Britain we like to rubbish the achievement of growing profits, somehow suggesting profits are rapacious and illustrative of immoral behaviour. Yet without profit, a business will definitely fail its shareholders.

Those who took the risk at start-up or backed the big expansion plan did not do so out of charity. They expect a return for their investment; that has to come from dividends on a stream of profits or sale of the business.

In large public businesses those shareholders are often our pension funds. Our future income depends on those dividend streams. Similarly, a business pays tax on its profits. No profit means no tax. It really is that simple; if we don’t want profit, then there will be profound implications for society’s choices about public services – schools, hospitals, roads, airports and defence.

Perhaps a business employing a lot of people is a success?

Certainly employment is a powerful, some would say necessary, social glue for holding society together and enables individuals to use their talents and skills.

Modern employment goes way beyond the Marxist description of exchanging labour for capital. Our psychological wellbeing is enriched by a stimulating and social experience at work. Yet every job is a cost to a business. People are the most flexible, resourceful and talented assets of a business but they are a cost. No business would choose to employ anyone if it didn’t have to.

Does the bank determine the success of a business?

It certainly has an influential role in the efficacy of day-to-day operations. Cashflow is the life-blood of business and the bank is the intermediary through which payments are made and received.

A recent survey in The Times showed that some £35bn of cash owed and overdue is being held back from small businesses in the UK. This is like cutting off the oxygen from a deep sea diver. Without it the diver will die.

Yet the bank is, in over 70% of cases, merely the intermediary. They have no investment in the businesses they serve, no loans outstanding or overdraft due. It is other businesses, often larger ones, that starve their smaller brothers and sisters of cash.

Anyone who pays a utility bill by monthly direct debit knows how reluctant big businesses are to repay the credit you build up with them, but pounce as soon as you are in debit. So it is with small business suppliers to big business.

If the customer is happy then surely a business will survive and thrive?

After all, everything depends on a contented customer, doesn’t it? Well, not necessarily. If customer demands are excessive, as might be argued with the vogue for constant “cost down” contracts or Government “best value” procurement, not to mention supermarket two-for-one offers where the supplier funds the deal. The customer may kill its supplier.

I worked for a manufacturer who supplied large retailers. One insisted we had dedicated factories for their products, uncontaminated with competitor goods.

Should the customer really have that much power that they determine how you organise your own production? Similarly I know an Alchemists client who has had contracts renewed, but at below cost. Lowest cost does not mean best value or a sustainable source of supply.

The public sector is responsible for around 40% of the economy so how and what it buys is crucially important to the wellbeing of UK business.

Yet the drivers for public procurers have more to do with avoiding political embarrassment and demonstrating an accountable process than achieving good outcomes. In a democracy this may be very important and what we want ... but it may also mean a business fails as a result.

In the private or family businesses who are typically clients of The Alchemists, there are usually a tiny number, less than a handful, of people who juggle these competing external demands on their business.

Some find it almost impossible or fail to see when one pressure is growing. The demands of the various external stakeholders change over time and with passing events.

Different skills are required to manage the early scrabble for cash at start- up when every contract counts, from the 10 or 20-year vision required to plan a new factory or acquisition.

Little surprise therefore that different people with different skills may be required to manage and lead a business at different stages.

The owners may remain the same but it is unlikely one person possesses all the abilities or energy to go on the whole journey as leader of the management team.

Kaleel Zibe, owner of Multichem in Hexham, recognised the value of an enhanced management team. He brought in a non-executive chairman alongside a new managing director for his business three years ago. Growth and profitability has accelerated and Kaleel’s comment was, “the best thing I ever did was to fire myself”.

Ultimately it is people who fail in a business and fail the business, its customers, employees and society as a whole.

Sadly the person in charge is often the one person failing to see that they should no longer be running the business and additional skills are needed.