What do successful business leaders focus on?
If you look at the lifespan of high-growth, successful businesses, they all seem to go through similar phases. It makes sense that as a successful leader you have to change your focus along with those phases.
The first phase is all about understanding the market opportunity. Or, understanding the problem that needs to be solved. It’s important to understand not just the problem, but also the number of people who have that problem, how much of a problem it is for them and how much it is worth to them to solve it.
The second phase is all about developing the product, or developing your brilliant solution to the problem. This stage, and the word brilliant, are critical because if you have a brilliant solution to the problem, and you can build a business that is brilliant at solving the problem, for the value people with the problem place on having it solved, you’ll make a lot of money – at least until others copy you or develop better solutions.
Phase Three is about getting people to pay for your product. This may overlap with the earlier phases as you home in on your target – the phenomenal business model. And this is really the biggest test of all in getting a business going. Getting your first customer is often the most difficult bit. Once you’ve done that you can use them as a reference for how good you are to get the second (which is still difficult, but probably less so) and then you’re off! You have a real business with revenues.
Which if you are successful, leads straight on to Phase Four. The key challenge then becomes coping with the customers and keeping them coming. And the business leader has to move the focus on to recruiting and retaining good staff to do some of the work all these customers are creating, and to help with finding more like them.
And that is as far as many entrepreneurs get! Their growth levels out at the volume of business they, and the staff they can manage themselves directly, can generate and handle.
The best entrepreneurs though move on to the next phase. They introduce the dreaded ‘management’. The processes, systems and structures that enable the organisation to repeatedly sell and deliver quality in increasing volumes. In other words, to grow.
By that stage many people find they’ve built a nice business that generates them a nice income with a nice lifestyle. And that’s it. But there is one more stage that is critical if the entrepreneurial leader wants to remain an entrepreneur and pursue the next opportunity – or even retire to a yacht. And that is when you put in place a strong management team that can run the business without you – at least on a day-to-day basis. Your role then evolves to one of leadership: developing the vision and direction, motivating the team to go in that direction and being able to trust them to get on with it.
Thanks to Bob Bradley: http://hardybee.wordpress.com/2011/04/16/phases-of-business-growth/
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