What New Entrepreneurs Must Know About the Management Skills for Success
What potential entrepreneurs must know before taking the leap including the management skills required. Would be entrepreneurs rightly focus on their dreams and passion but the hidden traps must be avoided.
Half my life was spent as an entrepreneur and small business owner and the other half as a corporate executive. Many of my clients in the early days of my financial services business were entrepreneurs and started small businesses. Today we see more and more start-up efforts in all types of industries but the failure rate stays about the same.
Studies show that over 50% of start-ups fail and a high percentage struggle to make it and stay afloat, sometimes for an extended period of time maybe even years of hardship and sacrifices.
I am a big supporter of people from all walks of life aspiring to launch a start-up and pursue their dreams. American business and success is founded on the risk taking and innovation of the entrepreneur.
What are the obvious Start-up Issues?
Much has had been written about the fundamentals of launching a business. Things such as:
There are many others and all have been written about extensively. We are more concerned here with the not so obvious issues.
What are the Less Obvious and Often Hidden Traps for Entrepreneurs
1. You do not have the control over many business activities you might have had while working for a company or organization.
2. Your administrative support and resources will be totally different and that cost must be built into the business plan.
3. There is no “job security” for a new business owner. Seems obvious but have financial plans been made for the families financial wee-being?
4. It is critical to realize that the long hours and stress of launching a business can create both family and social balance issues. Some candid conversations with family and friends about how the entrepreneurs life and interactions will be changing.
5. An aspiring entrepreneur is often so passionate and emotionally invested in their idea that they become really over-confident. This can lead to excessive risk-taking and being closed off from reality or the input of those closest to you.
6. Your family and social circle connections can virtually disappear. A new entrepreneur needs to strengthen their family relationships and communications more than ever. How you do it will be different due primarily to the tremendous time and effort needed to build the business. Close friendships where the new business owner could “vent and seek support” must be aligned with the time available. New social connections must be sought with others who might help provide ideas and resources for the start-up effort.
7. Contingency plans must be put into place in the event the business’s survival is threatened.
In the end, the preparation for the obvious requirements for success and the somewhat hidden obstacles will go a long way to making the risk of creating a start-up business less difficult.
Management Skills and Techniques Entrepreneurs Need for Results
It is important to understand that launching a new business as the “owner-entrepreneur” still requires important management skills for success. Owners are always managers on many different levels. Making an assessment of your management skills and abilities as part of the business plan may prove crucial. Where certain skills will be required for the proposed business and where the assessment indicates that a lack of important skills exist, a high-priority management development program may prove massively beneficial.
A consistent point for start-up success is the owners ability to hire the right staff and then delegate many important tasks to them. This is so because the successful entrepreneur must quickly make the transition for “I have to do everything to I will empower others to do important work. This requires the owner to train and develop people so they can be trusted to take work off the owners back. The ability to outline tasks and assignments quickly, communicate the work effectively through proper delegation skills and then manage for results is at the heart of a high-performance business.
There are important resources available. We found the Gallup “Strength Spotlight” programs and this could be a good resource before and after a business launch.
Another comparison that I believe is of the utmost important is to be able to understand the strengths and characteristics of proven and successful entrepreneurs whose businesses have become successful. The INC magazine website produced a detailed study called “Inside the Mind of the Entrepreneur.” Here are several important statistical excerpts from the article comparing the Inc. 500 entrepreneurs and a Study Sampling 2,700 entrepreneurs on important traits for success.
Business Focus of the Fortune was 72% for the 500 and only 20% for the national sample. Business focus deals with such things as goals, business plans, metrics for measuring progress, etc.
Delegator was 61% for the 500 and 22% for the sample. This is a management skill and mind-set we stress to entrepreneurs and corporate managers alike.
Relationship Builder – 46% for the 500 and 22% for the studies sample. This speaks to our point of maintaining an entrepreneurs social network and working to extend it withing the niche of the start-up business.
I encourage you to take a close look at the full article here>> Inside the Mind of the Entrepreneur
Understanding that bumps in the road and even failure of a given start-up attempt do not mean that entrepreneurial success is not possible. One of my close friends and driven entrepreneurs attempted at least 3 business start-ups over 10 years before finally finding the right idea and model. He ultimately built a business and later sold it for a very large jackpot. The ability to persist but with rational exuberance proved to be a key.
The most important thing to consider is to think through all the requirements both the fundamental ones and the somewhat hidden obstacles. Going into the game as prepared as possible with a complete business plan and the support network required is essential to success.
The old saying that “success is where preparation meets opportunity” could not be more telling than in the new business start-up!
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