I would assess what is needed in this particular business and with these data assess the person using the CVI, an assessment that bypasses personality and behavior revealing ones unchanging motivational drivers and sense for how one is wired to contribute to the world around him.
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Check out his references and do a background check. It's not everything but it should be a good start.
There are certain characteristics of people that can be assessed to determine their suitability. In summary, they should be decisive, be driven by certain values that are suitable to the type of business and should base their decision-making on practical thinking. These characteristics can be determined by the use of a profile assessment that can be taken on line.
Passion for the Business. Persistence.
These are not reducible to paper or gleaned from qualifications but most often found in one's experiences. You can develop a hiring matrix but developing an instinct for people will net a far higher success rate.
Depending upon the business, hopefully it's something they have experience or knowledge in and are very passionate about it. There are personality and disc tests that can help find out too. Besides having knowledge or expertise in an area, a person needs an entrepreneurial spirit, willingness to go it alone, work long hours when needed, be the boss and make decisions, have good leadership and management skills. The disk tests really help and some of them can even help fit someone in the right business or business area.
Good question JC. Most all of these questions answer this question in one way or another. I'll take a little different tact here and make it simple. Does the person WANT to run a business or just do the kind of work (service/product) that the business plans to provide?!
Here is the point of the question. Many people start a business because they love to do the work, but they hate learning about business. Same business owners like this tend to create a job for themselves instead of creating a self-sustaining asset. As a result they find themselves miserable after the honeymoon is over.
If the person is serious about learning what is necessary in order to make the business successful then I say YES the person can learn what is necessary to be successful. They just must realize that it will require a change in themselves in order to finally achieve success.
I hope this helps, - Dino
The primary way of finding out if someone is suitable to run a business is based on three things:
(1) Previous experience.
(2) Their understanding of true leadership and entrepreneurship and, through questionning, ascertaining what creative energies they may have that will not only mean they will be able to run the business, but also to develop it.
(3) Define an opportunity to work with them on a small project, especially if it was in order to ultimately appoint them to the role to run a business on your behalf.
When I am writing a custom business plan for a start-up, buyout or expansion and my client says, I don't know too many times I start to wonder about their success. Don't get me wrong. There are many acceptable "I don't knows" for a start-up. These are followed by, "I will find outs". And when I need to chase after them and ask the same question 7 times, I get a sense of not qualified.
I'll try to answer with very simple words )
First of all, just check his/her personnel/professional background...(portfolio, experience, trusted person or not etc.)
Second, Analyze his/her business plan/offer/proposal (business type/model, his/her risks, your risks, costs, estimated revenue, rev.share percentage etc.)
Then you will get some results and will know what is your next step. Good luck )
This is a very good question. I would pose my answer in terms of if I were looking to join a start-up and I'll try to just talk in general terms. It is important that this individual in my opinion has sound business sense, whether through a combination of education and relevant experience. Getting to know this person through meetings would be beneficial to understand if their words and thoughts and vision of a business are in synergy with their experience. The next thing I would look for in this case is trust. This is where one has to listen to his/her intuition. I have learned through my experiences that if there is no trust, it can be very difficult to believe in the relationship that could be formed to help this individual run their company. You can also talk to others that you trust that know this individual (mutual colleagues/partners) and gain their opinion as well. At the same time, I would do research on how well this person has positioned their company to gain market share and how well they understand their customer need and what their value proposition is before potentially working with this individual.
HI JC - thanks for the interesting topic.
In my business coaching work, I face a lot of individuals who are keen to start up a business because they feel that they have great experience in their line of work. However, one needs to go deeper and find out their understanding of running a business which in most cases, it is the reason for failure.
Most start-ups fail within the first few months and most of the time it boils down to lack of understanding, knowledge and experience in running a profitable business. Questions to ask are the type of business they are interested in, understanding of their competition, Leadership skills (they might be good in their job but lousy leaders), understanding of the core business activities, management skills etc.
Obviously, it depends on what type of business they are after and what their future aspirations are. Surviving the first 12 months is key in running a new business and all these factors needs to be considered before taking the next step. Sometimes all you need is someone to take your hand and assist you to get the 'basic' business infrastructure in place.... Normally 'determination' is not the issue but the business knowhow is...
I coach and give business consultancy services a lot of companies who want to move from the Western World to the Middle East, India and Asia and even though they might be successfull in their home country, they fail overseas because they do not understand the basic requirements to expand Internationally. For example one of the key factors of success here is understanding the culture - most companies come up with the idea that if it works in the US or in Europe, it should work in Vietnam or China.
In short, the cocktail for success is based on a lot of factors rather than just understanding your product/services etc.
Check out the following in a) his track record and b) what type of business he has in mind.
a) What type of employment record does he/she have . Larger corp with lots of resources or small company where you wear a lot of hats. This should illustrate this person's adaptability.
b) What type of business? Who would the potential competitors be? Where would be the source of venture capital for this person's start-up?
Hi JC ~
What I haven't seen addressed yet is people who are solo practitioners (e.g., chiropractors, acupuncturists, hair stylists, coaches, etc.) who are, by definition, "running their own business." If the person does not have a business background, they would either need to get some training or hire a manager with business savvy to run the enterprise while they see clients. Many sole proprietors in public-facing businesses do this as a matter of necessity: it is difficult for a solo health care practitioner to both see patients and manage the waiting room/payment desk simultaneously. However, a "front desk" person may not have the business skills to keep the business well managed and flourishing, so a business consultant or marketing/PR support might fill this need.
You actually pose a very deep question here. On one hand, this guy, lets call him Joe for now. He majored in Business at NYU, then went on to get a MBA from Harvard. He is very well educated. Is he fit to run a business on paper? Yes.
On the other hand, lets take Sue. Sue just immigrated to the US from China. She has no higher education, yet was a clerk in her family's store in Beijing before coming here and opening up her own business.
I posed two scenarios here. Now lets dive deeper. Joe opens up a Start Up based out of Boston. He hires 5 employees that he literally treats like dirt. He doesn't pay well for making his employees work long hours, with poor conditions. His business folds after year.
Sue on the other hand, gets married and she and her husband share the duties in the store which is becoming very prosperous in a San Francisco suburb. She is able to hire three employees to which she pays three dollars above minimum wage, and gives them time and a half for working over their hours. She gives them lunch breaks, and gives them perks as employees such as free drinks. Business booms for her and she is soon able to open a second store on the other side of town.
Looking at the two scenarios who is better fit to run the business? The Harvard MBA whose business folded within a year, or the hardworking immigrant?
There are a number of ways to check.
1. Combination of experience and education
2. Cross discipline experience in sales, marketing, finance and operations
3. Past success in similar ventures.
If a person is deciding to run their own business, it's important to have enough assets. All the skill in the world won't overcome lack of cash.
Is a person suitable to run a business seems to be a questions from your answer to your comment. It depends on who he is surrounded by. You will rarely find a person than can fit all the entrepreneur skills. However if they are surrounded by the people who have the missing skills your start up will be part of you 30% success... the most important if you bring someone from the outside is whether it will not just bring the necessary skills but will it fit with the business culture and values...and no test can answer this...
Is this something you love and enjoying doing? If yest, proceed to the next step.
I've found that having a business is like having a baby and it doesn't matter if the parents are "fit" or not because "the baby is coming and or already here." With that said, one quick sure fire way to see where they are is to ascertain whether or not the person knows the difference between a Deliverable and an Action Item. Not saying the person is not "fit" to run a business if they don't know, but there are some steps that need to be taken to get them more "fit" before they begin or dig themselves deeper. Much like learning how to change a diaper, the sooner you learn, the sooner you avoid a big mess. JustMy3Cents