Successful companies urge creativity at every level

Question: Six months ago, my partner and I started a new manufacturing business building a new hardware device for the personal computer. This device will make surfing the Web “faster.” I expect our company’s sales will explode. I am looking forward to the challenge, but my wife feels we have overlooked something in our planning. She also doubts our sales will take off. Can you help her see the light?

Answer: I am neither a marriage counselor nor an optometrist, but I will go over the key points of a fast-growing business. Keep in mind that many businesses do not know the real growth potential of their business when they start. Some businesses make absurd assumptions as to how large they can grow on the back of an inferior or over-marketed product or service.

There is emerging evidence from studies that certain configurations and cultural factors at start-up determine the success and growth of a given business. These are as follows:

* Low-growth businesses are usually dominated by one owner/manager.

* High-growth businesses usually involve more than one person at start-up.

* Team starts (two-plus people) are usually involved in very high growth.

* Family businesses maintain a constant low-growth capacity.

* Note: Neither high- nor low-growth is determined by educational qualifications.

Apart from the above, all of which can be challenged by contrary and successful examples, there are a number of factors that can contribute to the specific growth and business success. These include:

Human resources:

* Start-up leaders are highly motivated for growth.

* Leadership creates committed and loyal staff.

* Leadership makes resources available to upgrade skills of all staff.

* Leadership delegates with trust.

* Leadership ensures that trusted team members are informed of crucial developments.

* Leadership ensures quality recruitment & training systems.

Marketing management:

* Marketing opportunities are thoroughly understood/researched.

* Market and customer trends are constantly monitored.

* Customer focus is part of the company’s vision and mission.

* Suppliers are good “friends” and are committed to your quality standards.

* Distribution and delivery systems are constantly monitored.

* Working environment is clean, attractive and well-run.

* Brand identity and awareness is established and growing.

* Exterior sales people are well-managed and motivated.

* Customer feedback systems are in place.

* Continual comparative evaluation of market leaders and competitors.

Operations:

* Built in “Lego” mechanism allowing flexible expansion/contraction at short notice.

* Access to flexible labor.

* Access to contracted production, packaging, warehousing and distribution.

* Ongoing analysis of management and performance controls.

* Continual improvement in product/service and their related systems.

* Establish ongoing quality controls that assist in governing the organizational development of the business.

Financial management:

* Integrated financial management systems from sales, purchasing through to preparation of management accounts.

* Sound financial base negotiated with bankers and investors.

* Tight cost and cash flow controls continual monitoring of gross profit margins, overheads and return on capital.

Management systems:

A fast-growing business is led by a single leader or a leadership team. It requires a set of skills, some of which are left-brain, and some of which are right-brain with the appropriate behavior styles.

The right side of the brain is responsible for the creative, intuitive and imaginative aspect of the human personality, and the left side is responsible for the organizational, technical and functional aspects.

The ideal leader or entrepreneur will have almost a perfectly balanced brain. This is, of

course, not the case in the majority of cases, so how a leader performs and grows the business will depend on what side of the brain dominates the personality. The leader/leadership team will be comfortable with uncertainty but will seek ways to reduce unnecessary risk in any new venture.

You cannot paint a business by numbers; neither can you throw paint at the wall to create art. Business growth requires vision and planning. If you don’t have a vision, what is there to plan? If you don’t have a plan, how can you realize the vision?

Think of the product or service as water. Management systems are the plumbing that delivers the water. You never see the plumbing; but if it messes up, everybody knows about it. In order to ensure sound plumbing and delivery of good, quality water, you must plan your systems.

Finally, above and beyond the jargon that dominates business development lies the creative pulse that drives the imagination of the business owner. Great entrepreneurs will work from the gut, from instinct and from intuition. This is the real stuff of a modern business.

The most successful businesses will encourage creativity at all levels of their organizational structure. Management systems that support control and efficiency will

release the creative energy that produces loyalty, innovation and enjoyment of the business growth experience.

Greeley resident Russell Disberger is a founding member of Tekquity Ventures LLC, a Louisville-based specialty venture-capital firm investing in technology development and licensing. He can be reached at (970) 396-7009, (303) 926-3990 or via e-mail at disberger@home.com.

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