First you need a great idea or product. The next Microsoft or Amazon, a budget airline or a fast food outlet. But then how do you exploit that idea and make it a success?
The four key factors that make a successful business are leadership, vision, strategy and management. Think of a great company and you will see a great leader driving it, Richard Branson at Virgin; Jeff Bezos at Amazon; Steve Jobs at Apple; and Phillip Green at Arcadia.
Great Leaders are entrepreneurs and have vision. Henry Ford said – ‘If I had asked people what they wanted, they would have said a faster horse’. A leader needs vision to identify a need in the marketplace before the consumer knows they need it. A great company will tell you what you would like before you have asked for it, or know you need it. You see it every day in retail and fashion. The key is to predict what the marketplace wants in advance of the competition.
A leader not only needs this vision but must have the drive, single mindedness and courage to get his or her view across. Other characteristics of leaders - good and bad are – ambition, passion and obsessiveness and at times disruptive behaviour. It’s a fact that people don’t like change. They will always resist it. A great leader needs to help people to overcome this default position and engender confidence for people to follow him or her.
The vision for the product or service needs to have a strategy. The strategy should be clear and concise. Whilst flexibility at times is not without its plus points. Once a business has identified its strategy it should focus on it single mindedly.
The strategy requires execution. If the role of the leader is to know the right things to do; the role of management is to do the right things. Someone asked why the New Zealand All Blacks have been so successful. The answer was that having established the right things they keep doing them, over and over again.
Good management will put in place robust operating systems, will motivate people, review risk management and control and ensure there is adequate finance.
Cash in a business especially in its formative years is more important than profit. A robust financial reporting system is paramount to inform management of what and when cash is required.
But the key to getting the business over the line goes back to the strength of the leader. And it is sometimes sad to note this strength is not always fully acknowledged until after the leader has moved on.