You have leveraged an outstanding business plan to acquire a round of funding. The venture looks really promising and as an entrepreneur, your million dollar business is all set to take shape. What else do you need, as all the hard work is done and the world is your oyster.
On one aspect, a lot has been achieved by you and is gratifying, but at an operational level the entrepreneur in you needs to bring in an additional dimension of a business leader to ensure that a fantastic idea gets implemented. Being proactive rather than reactive is essential for driving a successful venture.
While the complete list can be exhaustive, we have identified three key functional areas that are critical to the success of a business and something every entrepreneur needs to analyze on a regular basis.
Arguably, the most important factor in your business model. Identifying and retaining talented people is a challenge for most multinational organizations and this becomes tougher for startups. A start up environment is very different; where multi tasking and working with limited infrastructure is a norm.
It does not take more than a few weeks to understand the mind set of team members. Do not hesitate to have a quiet discussion with a colleague if you spot a problem. Remember your team members should have an entrepreneur’s mind set and a desire to make your venture a success. Share the larger picture with them and reiterate the risk and reward mechanism on offer.
Do not hesitate to take a strong business decision if you believe some members in your team do not have the aspirational element that your business requires.
Over the last decade we have seen large companies push through products or services that they believe are important to customers. A top down approach does work well in certain circumstances, especially if you have a very loyal brand following like Apple or if you are in the commodity business like petroleum, where the brand has a limited impact.
However, for most businesses especially, small to medium ones, it is absolutely essential to keep your ears close to the ground. Listen to your customer and answer their question so that your product or service matches their need, rather than restructure the question to suit your answer. An entrepreneur should never forget that the customer is king. The actual value of a product or organization is based on what your customer thinks, rather than what an accounting valuation displays.
Again a critical component in your business lifecycle. Be relentless in reducing costs. Irrespective of the size and scale of your business, funded or boot strapped, keep your costs low. Remember a rupee saved is a rupee earned.
Having said that, it does not imply that your cost saving mechanisms should reach unsustainable levels and impact your business. Always try to eliminate waste and restructure costs to optimize returns. Now, it is easier said than done, but, as an entrepreneur, you need to take that step forward, from dreaming about an idea to living that dream successfully.
Do not hesitate to contact an expert if you struggle with optimizing your operational activities.
From a business perspective, the first step should be to achieve operational profitability. Simply put, your business should be in a position to pay its expenses. Review your business plan and market trends on a regular basis and come up with a rational time line for operational break even.
Also, as an entrepreneur do not starve yourself. You need to pay your own bills and while there will be months when financial constraints will require you to take a financial hit, you must avoid getting into the entrepreneurs myopia state and ignore the obvious financial alarm bells.
Remember being foolish by staying hungry will, if not anything, give you an ulcer. Why add to costs by having to pay for medical bills.