A former successful entrepreneur-turned-business advisor shares his observations on the five elements that propel businesses to success.
As a former entrepreneur executive in a billion-dollar consumer packaged goods company and international advisor and facilitator in the public sector, I have experienced both failure and success in delivering targets and projects.
My current role with the trade development agency of the Irish government affords me the opportunity to work closely with hundreds of companies, from startups to well-established corporations. While there are many variables (some controllable, some uncontrollable) that lead to a successful outcome, in my experience, there are five essential and controllable variables that must be in place to transform ambitions into achievement.
A robust strategic planning process is complex and without question requires a redirection of valuable resources. But arriving at a clearly defined and universally agreed-upon set of short-, medium- and long-term objectives and having a plan to get there is essential.
Within a corporate structure, shared values and culture are significant enablers to ensure everybody is aligned with the company's purpose and goals. External stakeholder participation in the planning process – particularly that of customers – can go a long way to ensuring a business arrives at a point where there is alignment throughout the organization.
There is a direct link between available capital and obtainable goals.
From my experience, capital availability ranks second only to poor product/market fit as a driver of poor decision-making. Too little capital drives survival behaviors that force development of the ideal customer profile, the route to market planning, and new product development into the "nice to have" context. Too much capital without the requisite controls can lead to a false sense of the realities surrounding the business.
When a business is strongly cash positive, every decision seems to be a good decision. When a business is cash negative, it seems like nothing goes exactly as planned and decision-making typically becomes challenging. Neither side of that point is completely accurate, of course – it just seems that way. The only reality is in how capital impacts decision-making.
Taking time to build the right team is critical. What can't be overlooked, however, is how skill set requirements change over time. A good team will always have commitment, belief, passion, vision and balance, driving forward on initiatives within its power and control to undertake. But there are variables and requirements that change over time, particularly when a company goes through significant growth phases.
There are points in an organization's maturity where business development team members (the front line) and management need to develop. There is a point where financial control becomes increasingly part of the executive function (particularly in small and medium enterprises), where investment in research personnel to enable new product development becomes critical and where investments in team training and development are no longer a luxury.
Fostering leadership capabilities and ethos within the team at all levels has the near-term effect of improving how we work, promotes ownership and encourages problem-solving. It has the medium- to long-term effect of building capability throughout the team and future leadership. When resulting process improvements align with the best interests of the company – though this is not always the case – you have a winning strategy.
The ability to adapt to change is essential. The question is not whether management is aware of all the many variables that affect the business – competition, changes in key customer personnel, internal personnel, interest rates, the economy, supply/demand, talent availability, trends, etc. – the real question is whether or not there are controls and systems in place to recognize and respond to the key influencers for your business (often the very influencers that, once triggered, demand attention and action, and helped fuel the ambition in the first place).
For example, there is a direct correlation between the amount of time C-Suite executives spend in a key market and/or with key customers and business success. In terms of adapting to change, executive relocation is an action that most often has the greatest impact on the go-to-market team. This level of market immersion can lead to a necessary pivot and correction within an organization in terms of focus, investment, strategy development, and even the company culture itself.
Even the most ambitious plans and innovative visions are just hallucinations without diligent, insightful and informed planning. Simply having the desire to achieve a particular business end and a strong yearning to achieve something unique is not enough. The five interrelated variables above are foundational to empowering an organization in building the right team, keeping a pulse on the market and rewarding the best of ambitions with success.