Last week I attended the Business North West 2012 event at G-MEX Manchester. As I listened to one successful entrepreneur after the other gave what they considered their motivational messages about how it is possible for anyone to establish and run a successful business, an odd question popped into my mind. The question is this: is it possible for just anyone to start a business and succeed?
My answer to this question is simply no!
As I listened to many of those successful entrepreneurs giving their woe-to-win stories explaining how they overcame obstacles to succeed. I detected one similarity in all of their stories; not a single one of them explained how they did it.
It is easy to pump people up with motivational bla bla bla about how it is possible to achieve greatness bala bo balaba but without telling them how to do it, the cause is lost from the onset.
The biggest myth in the world of business is this: business is common sense. That is the biggest BS going around in the business world that is causing people to mortgage their homes and the future of their families to plough the funds into business ventures that are certain to fail.
If you attended the Business North West 2012 event or you have attended any event recently where you heard successful business people tell you that all that is required to succeed in business is to have belief and balls. Before going to tell your boss and telling him where to stick his job or mortgaging your house read the rest of this article.
Trust me on this one, just hold your fire until you have read the rest of this article because those guys did not tell you the full story.
Business is not common sense. I will repeat this point: business is not common sense. Business is a skill and a profession like any other profession; it must be learnt. The likes of Steve Jobs, Bill Gates, Richard Branson or Donald Trump did not start their business from literally nothing to multibillion businesses just by having common sense. What I keep telling all of my clients is this: the gap between one thousand pounds and a million pound is just a single idea or getting a single decision right.
However, you need to have that single idea or you need to be able to get that single decision right. The idea and the ability to get that single decision right do not only take common sense.
There are four elements responsible for the success of any business, whether it is the HSBC bank in the City of London or a toilet cleaning business in a dusty New Delhi.
The four elements are:
- Visionary leadership
- Good people
- Good system
- Good marketing system
There is a fifth element which is the glue that holds all of them together:
- A good business model
A friend of mine just received half a million pounds from his father to invest in any business he pleases. He identified three businesses and called to ask my advice as to which one would be the best one to invest in. I told him that he could invest in any of them and succeed. He tried explaining to me that one of them seems to have a good profit margin, the other was a cash cow with low profit margin and he was not very sure about the third.
What I told him was this: every business has a hundred percent chance of succeeding or a hundred percent chance of failing. Success or failure in any business is not the function of the type of business, the location, the economy or the product. Success or failure in any business depends on those four elements especially the fifth one.
Before Facebook, there were many social media sites. Why did Facebook manage to dominate all of them? Before Google, there were other search engines, today Google is synonymous is search engine; how did it happen? Is Microsoft successful because they have the best operating system in the world? Windows is probably the least secure operating system in the world, yet Microsoft dominates its rivals.
Facebook and Google are successful because from the onset their founders made the crucial decision of making their services free and then found creative ways of making money from their services. Microsoft's success stems from their ability to form alliance with other big corporations and governments.
What I have tried to demonstrate with the above examples is that success in business does not occur as a result of common sense or big balls, but the result of the above five elements that all of the successful entrepreneurs at the Business North West 2012 event failed to point out. Inevitably, it can be deduced from this article that, it takes more than common sense to succeed in any business venture.