Category: Entrepreneurship

Entrepreneurship activities are tremendously increasing not only at local levels but also across international boundaries (Cavusgil, Ghauri & Agarwal, 2002). Entrepreneurship is associated with economic development and wealth creation through production of novel products that meet present and latent needs of consumers. International entrepreneurship is an emerging area of business that has accelerated the growth of SMEs and merged various cultural, political and social aspects (Acs, Dana & Jones, 2003).

In the study of international entrepreneurship, this essay explores the entrepreneurial activities taking place across boundaries with a particular focus on Proteome Systems Limited (PSL) currently renamed Tyrian Diagnostics (Tyrian Diagnostics Limited).

The contextual framework of the essay includes the evaluation of the theoretical underpinning of international entrepreneurship in comparison to the reality in PSL.

The internationalization process, roles and characteristics of the entrepreneur are discussed as well as factors affecting the entrepreneurs in the target country and the current state of PSL in relation to international entrepreneurship. Literature Review Internationalization or International entrepreneurship (IE) concept entails to discover, enact, evaluate and exploit venture opportunities in international boundaries for the purpose of creating latent products for the consumers (Deakins, & Freel, 2006).

IE entails new venture creation in foreign untapped markets which has been made possible by technological advancement and aspects of cultural awareness (Acs, Dana & Jones, 2003). The entrepreneurial internalization process is occurring at a fast pace and this is influenced by various processes including globalization. Environmental forces that have enabled the growth of international entrepreneurship include technology advancement (Loane, 2006), enthusiasm of competition, knowledge’s moderating forces, entrepreneurs’ mediating perceptions, and ability to network (Deakins, & Freel, 2006).

Entrepreneurial Characteristics Successful entrepreneurs free themselves from industry dogma, industry rules, latest management tools, and a limited mindset (Lowe & Marriott, 2006). There are five basic entrepreneurial features and these include innovativeness, competitive aggressiveness, risk-taking, proactiveness, and autonomy. PSL, an Australian based biotechnology firm can be said to possess most of the above named features. First of all, it was risk-taking to venture in biotechnological products, a market segment that had long been overshadowed by conventional production.

Risk-taking involves decision-making and action-taking without knowledge of the outcome, and this can involve commitment of substantial resources. By venturing into a less-known pharmaco-production area, the founders of PSL took risks but fortunately the business picked up well in both Australia and the other world markets and PLS is among the leading proteomic diagnostic companies in the world. The company was started by a group of friends who studied together and had knowledge on proteomics dealings but lacked financial and legal resources to pull through.

The risk is observed when through networking investor agree to sponsor the project that has created the world’s top and recognized biotech producer of diagnostic and drug products. PSL is also entrepreneurial through its innovative activities as the firm is an innovative technology developer in proteomics and biotechnology (Proteome Systems Ltd). GlycoSuite, the world’s first protein glycosylation database was invented by PSL.

There are also other innovative products formed in the current Tyrian Diagnostics Limited and this includes WheatRiteI which is used for measuring wheat’s quality and the DiagnostIQI for the diagnosis of active tuberculosis. PSL shows proactiveness through looking forward into being a market leader in the proteomics production and seizing opportunities that will enable the firm to meet the future needs of consumers. For instance the drug products are aimed at increasing compliance and provide cures to diseases that had not been imagined before.

The competitive aggressiveness of the firm is shown through its ability to create unique products to become the leader among the competitors. Autonomy is observed when a group of individuals with knowledge team up to bring forth a business concept and carry the vision through completion. PSL achieved rapid internationalization, has good networking capabilities, participants have in-depth knowledge about the field and the company collaborates with investors and leading companies that can assist in driving the success of the company. Role of the Entrepreneur The entrepreneur basically leads in innovation of new products.

PSL is doing this through innovation of improved biotechnological drugs and agricultural products. At the international scale, the firm has the responsibility of ensuring that the produced invention will suit well with the cultural context of the country. A product can be good but its usefulness cannot be homogeneous in all the world markets. For instance, wheat variations produced for drought resistant areas are likely to gain a larger market share inn areas that require such a product as compared to areas that not prone to drought or don’t support wheat production.

This therefore implies that the entrepreneur’s role is to act as a strategic thinker. The entrepreneur does this by creating products that can meet the future needs of the customers after analysing the nature of each markets and deciding on the kinds of products that the various markets will need. Internationalization process The internationalization process involves increasing participation of enterprises-small, medium and large-in the international markets (Lowe & Marriott, 2006).

The process begins by the recognition of an opportunity just like the founders of PSL discovered that they can use their biotechnological knowledge in production of products that will offer improved solutions for human diseases and agricultural production. The next step is to determine the strategies that the firm will use to penetrate the world market. At IE level this can be determined considered form the angle of novelty, culture, or price. This is also the opportunity to determine the structure of the firm and how it will be positioned against the rivals in the market.

Competition at the international scale is very stiff and this warrants that appropriate strategic thinking should be applied in coming up with competitive tactics. Demand and factor conditions should be analyzed in establishing the market preferences and networking with related or supporting industries should also be considered as a way to attain a competitive advantage in the industry (Loane, 2006). PSL networking is spectacular especially at the initial internationalization process.

PSL joined hands with high-tech firms that had already established in the area of biotechnology and proteomics like Sigma-Aldrich, Alpha-Innotech, Shimadzu, and Millipore Corporation (Proteomes Systems Limited). Drivers of internationalization for the firm Generally, internationalization has been driven by the current business environment that is characterized by globalization, cultural emergence, increased competition and market preferences or the opportunity to provide latent needs by the enterprising firms (Parker, 2005). PSL is driven in the internalization process because of the nature of the industry in which it belongs.

The hi-tech biotechnological industry requires a lot of capital investment and technological capabilities that can enable the firm to come up with the unique but scarce products (Cavusgil, Ghauri, & Agarwal, 2002). In order to benefit from the input, the sale of the products needs to be high and it is uncertain that this can be obtained through local enterprising alone. The biotechnological market is well spread all over the world as certain niche of customers prefer the green technology. Internationalization was a way to reach these dispersed but available markets as well as introduce the novel products to newer customer segments.

PSL factors to IE were caused by the firm’s ability to attract a pull of investors at the initial developmental stage and this provided capital investment into newer global markets. Moreover, the founders were research scientists and this shows that they had a networking capability to contact other firms involving in similar business. This also enhances the support and motivation to IE. Description of intended target country High-tech firms face higher risks in enterprising and are therefore likely to benefit more form private equity funding rather than easily accessible loans from commercial banks and government loans (Parker, 2005).

PSL has developed its market not only in Australia where it is based, but also in US and Japan. U. S. and Japan can be described as countries with higher legality indices and stronger conditions of economy. PSL is likely to attract venture capitalist in these countries with the United States having a supportive culture for enterprises and Japan a favourable market for production of high-tech machinery. Factors affecting entrepreneurs in target country Cross cultural differences is a major factor that influences entrepreneurs in the target country (Lowe & Marriott, 2006).

This is also accompanied by legal and market conditions of the country. For instance, PSL could not succeed to establish in its own in the US market because of market conditions in which the environment is highly competitive. The solution was to with a bio-tech firm in Boston and the sale of PSL’s products through the Boston firm increased PSL’s market share in the US market. Context of the consultancy report (Firms current situation) PSL had a fruitful beginning in the 1999 but currently there are challenges that the firm faces.

There was a drastic fall in the company’s revenue and profit in the year 2007-2008 despite the market conditions being tolerant. Nevertheless, the firm has established various collaborations that have sustained the business. For instance, the collaboration with Dow Agro Sciences (DAS) increased the reliability of PSL and still placed the firm in a position capable to deliver efficient services at the international level. DAS relieved PSL from financial constraints and introduced the firm to other networks of people that could support the firm and help it revive (Proteome Systems Limited).

Methodology Theoretical underpinning to PSL Initial theoretical models for internationalization were based on the fact that new ventures seek to derive a competitive advantage through the utilization of resources and sale of the outputs in many countries (Lowe & Marriott, 2006). These traditional approaches include the eclectic paradigm, foreign direct investment and monopolistic advantage theory. IE is an emerging way of thinking business across national borders and the concept builds on extant international business theories.

There are various paradigm developments that try to explain the complexities of international enterprising in a global environment. The paradigms are based on ownership and geographical boundaries of the firm, strategic application of international and cyber-networks, market boundaries within a globalizing economy, and nature of competition within the environment (Jones & Dimitratos, 2004). The internationalization process can be underpinned in the traditional eclectic model that explains the ownership, location, and internalization advantages of the firm in the innovation process and the takeover of international markets.

Ownership advantages explain the autonomy of PSL to independently come up with strategies and a business model that has established its unique competitive advantage. Location advantages can be used to explain the cross-boundary market venture in which PSL is located in various world locations. This not only expands the firm’s market and enables its growth but also provides the opportunity for the firm to meet varying cultural needs. Internalization advantages involve the firm-specific advantages that enable it to compete effectively in the outside, and this includes knowledge and asset-based resources.

PSL has been able to utilize its internal advantage of knowledge in which the founders are familiar and have skills to carry out the proteomic diagnostics production. Specialization advantages can also be added to this model in which the firm has taken a unique production and supply-line. The firm involves in agricultural biotechnology as well as invention of novel products for the treatment of human diseases. However, the specialization in production of these products is in ensuring that they produced using biotechnological methods with specificity to proteomic systems.

PSL’s IE can also be explained through the new venture internationalization theory which explains the firm’s process of establishing in other nations. Other than Australia, PSL is also located in USA where it joined with a Boston firm and also in Japan where it allied with Itochu. PSL also formed alliances with various Malaysian firms. This process can also be explained through financial cross-listing and institutional theory which explains that high-tech entrepreneurial firms like PSL need the assistance of resource enabled countries or firms which can act as venture capitalists to sponsor development of the products.

Management skill and strong team building abilities are often perceived as essential leadership attributes[3] for successful entrepreneurs. Robert B. Reich considers leadership, management ability, and team-building as essential qualities of an entrepreneur. This concept has its origins in the work of Richard Cantillon in his Essai sur la Nature du Commerce en (1755) and Jean-Baptiste Say[4] in his Treatise on Political Economy.

Psychological studies show that the psychological propensities for male and female entrepreneurs are more similar than different. A growing body of work shows that entrepreneurial behavior is dependent on social and economic factors.

For example, countries with healthy and diversified labor markets or stronger safety nets show a more favorable ratio of opportunity-driven rather than necessity-driven women entrepreneurs. Empirical studies suggest that male entrepreneurs possess strong negotiating skills and consensus-forming abilities.

Research studies that explore the characteristics and personality traits of, and influences on, the entrepreneur have come to differing conclusions. Most, however, agree on certain consistent entrepreneurial traits and environmental influences.

Although certain entrepreneurial traits are required, entrepreneurial behaviours are also dynamic and influenced by environmental factors. Shane and Venkataraman (2000) argue that the entrepreneur is solely concerned with opportunity recognition and exploitation, although the opportunity that is recognised depends on the type of entrepreneur; while Ucbasaran et al. (2001) argue there are many different types contingent upon environmental and personal circumstances.

Jesper Sørensen has argued that some of the most significant influences on an individual’s decision to become an entrepreneur are workplace peers and the social composition of the workplace. In researching the likelihood of becoming an entrepreneur based upon working with former entrepreneurs, Sørensen discovered a correlation between working with former entrepreneurs and how often these individuals become entrepreneurs themselves, compared to those who did not work with entrepreneurs.[5] The social composition of the workplace can influence entrepreneurism in workplace peers by proving a possibility for success, causing a “He can do it, why can’t I?” attitude. As Sørensen stated, “When you meet others who have gone out on their own, it doesn’t seem that crazy.” [5]

Perception of entrepreneurs

The ability of entrepreneurs to innovate is thought to relate to innate traits such as extroversion and a proclivity for risk-taking. According to Schumpeter, the capabilities of innovating, introducing new technologies, increasing efficiency and productivity, or generating new products or services, are characteristic qualities of entrepreneurs.

Entrepreneurs are catalysts for economic change, and researchers argue that entrepreneurs are highly creative individuals with a tendency to imagine new solutions by finding opportunities for profit or reward.[6] Largely due to the influence of Schumpeter’s heroic conceptions of entrepreneurs, it is widely maintained that entrepreneurs are unusual individuals. In line with this view, there is an emerging research tradition investigating the genetic factors that are perceived to make entrepreneurs so distinctive (Nicolaou and Shane, 2009).

However, there are also critical perspectives that attribute these research attitudes to oversimplified methodological and/or philosophical assumptions (Gartner, 2001). For example, it has been argued that entrepreneurs are not that distinctive, but that it is in essence unrealistic preconceptions about “non-entrepreneurs” that maintain laudatory portraits of “entrepreneurs” (Ramoglou, 2011).

Classification of entrepreneurs

A. Based on functional characteristics

1. Innovative entrepreneur: Such entrepreneurs introduce new goods or new methods of production or discover new markets or reorganize the enterprise. 1. EX: new product, new ways of product, new markets and reorganise the enterprise. 2. Imitative or adoptive entrepreneur: Such entrepreneurs don’t innovate,they copy technology or technique of others.

1. EX: Chinese mobiles.

3. Fabian entrepreneur: Such entrepreneur display grates situation and scepticism in experimenting with any change in their enterprise. They change only when there is a serious threat to the very existence of the enterprise. 4. Drone entrepreneurs: Such entrepreneurs are characterised by a diehard conservatism and may even be prepared to suffer the losses. 1. EX: Acc. To MC Kinsey in 2015, 110-130 million people will be unemployed out of which 90-100 million people will be Fresher.

[edit]B. Based on development angle

1. Prime mover: This entrepreneur sets in motion a powerful sequence of development expansion and diversification of business. 1. EX: Ambani 2. Manager: such an entrepreneur doesn’t initiate expansion and its content in just staying in business. 3. Minor innovator: This entrepreneur contributes to economic progress by finding better use for existing resources. 1. EX: minimum wastage maximum production.

4. Satellite: This entrepreneur assumes a suppliers role and slowly move towards a productive enterprise. 5. Local trading: such entrepreneur limits his enterprise to the local market.

C. Based on entrepreneurs business

1. Manufacturing
2. Wholesaling
3. Retailing
4. Service

Based on personality traits

1. The improver: They have unwavering to run these businesses with high integrity and ethics. 2. The advisor: “Customer is right and we must do everything to please him” because company is built by advisors and advisors become customer focused. 3. The superstar: All depends upon the charisma and on the high energy of the superstar CEO. 1. EX: Richard Branson (400 co’s/Virgin coin), Larry Page (Google), Lt. Steve Jobs (Apple), Ratan Tata (Tata sons). 4. The artists: Are highly creative type, very conscious about business. If feedback is constructive i.e. positive than also lets go with negative self-image. 1. EX: Aamir Khan, Michael Dell (Dell), MC Cormich (EMI).

5. The visionary: Too focused on dreams with little focused on reality. 1. EX: Jack Welch (GE), Bill Gates (Microsoft), Kishore Biyani (Future Group), Warren Buffet (Berkshire Hathaway), Sam Walton (Wall Mart). 6. The analyst: More focused on fixing problems in a systematic way. 1. EX: Gordon Hore (Intel), Rana Kapur (Yes Bank), Gautam Adani (Adani Groups) 7. The fireball: A business owned and operated by a fireball is full of life, energy and optimism. They have “A get it done attitude in a playful manner”. 1. EX: Malcolm Forbes – Forbes magazine

8. The hero: Have an incredible will and ability to lead the world and your business through challenges. 9. The healer: They provide nurturing harmony to their business, they have uncanny abilities to survive and persists inner calm. 1. EX: Dr. Bindeshwar Pathak (Sulabh International), Kumar Manglam Birla (Son of L.M Birla). 1. The Opportunistic: take advantage of opportunities as they occur. 1. EX: Mark Zuckerberg

Theory-based Typologies

Recent advances in entrepreneur researcher indicate that the differences in entrepreneurs and the heterogeneity in their behaviors and actions can be traced back to their the founder’s identity. For instance, Fauchart and Gruber (2011) have recently utilized social identity theory to illustrate that entrepreneurs can be distinguished in three main types: Darwinians, Communitarians and Missionaries. These types of founders not only diverge in fundamental ways in terms of their self-views and their social motivations in entrepreneurship, but also engage fairly differently in new firm creation.

The process whereby old sources of competitive advantage are destroyed and replaced with new ones is referred to as creative destruction. Entrepreneurship by its very nature makes old knowledge redundant and introduces new knowledge through innovations so that firms could further develop and/or sustain competitive advantages.

In this context the spirit of the entrepreneur will always be needed, because the ability to see things differently is precisely at odds with things as they are. The key implication is that entrepreneurial insight is something non-rational which means that although knowledge and rational calculation might be available, there will always be a demand to go beyond the planned and the calculated, or at least to take an unorthodox and unconventional perspective.

According to Joseph A. Schumpeter (1883-1950), entrepreneurship triggers creative destruction. The process of creative destruction ensures “churn” results from the innovations in new products, services, and organizations which in turn creates value, but inevitably displaces or diminishes the value of incumbent products, services and organizations.

An expression that captures the essence of creative destruction is that “you can’t make an omelette without breaking a few eggs.” The unbroken eggs represent current production or existing status quo. The omelette represents something new, different, and better – an innovation. The price of progress is the destruction of the status quo. The creation of the omelette destroys the eggs.

Ideally the labour, capital, land and entrepreneurship that comprised the old would be instantaneously reallocated to the new. However, this seldom happens. Resources used in the old are very rarely suited for production in the new. The labour, capital, and materials used to produce horses are not the same as those needed for car production. Therefore the end result of this process is that old industries are demonstrably destroyed.

The two cornerstones of the creative destruction process are innovation and entrepreneurship. Entrepreneurship is the driving force that brings innovations to the forefront of the economy – the creation that triggers destruction.

In conclusion I wish to state that in many cases entrepreneurs are also innovators. Creative destruction is most likely to result when entrepreneurs are also innovators.

You may also be interested in the following: destruction of nature essay, destruction is a form of creation

The person I chose to interview is the owner of the company at my current place of work. Larry Godwin is the owner of Godwin Company, Inc, which is a forklift and golf car sales, and service company. Larry worked on his family farm growing up in Arkansas after leaving school in the fourth grade and then moved to Indianapolis when he was 18 years old and began working for a fan company. He got an opportunity for an apprenticeship position at a tool and die company doing mainly forklift repairs.

After that he went to work for Westinghouse, rebuilding electrical equipment, doing machine work, and maintaining their forklifts. He then decided to work for Kidney-Wood, a tow motor distributor, where he was a road technician for one year, he was then promoted to Service Manager. After working in that position for 10 years, he saved $4,000.00 by working overtime on evening and weekends so he could start his own business, that business is now a profitable company.

I think it’s important to point out that he did this with only a fourth grade level education. He is a very determined person and learned everything he knows by observing and taking in everything he learned at his previous places of employment. Larry first opened for business at 2222 East 10th Street in 1969 servicing industrial sweepers and scrubbers for hospitals and factories, as well as, servicing forklift trucks. In 1971 he moved his location to 846 North Hamilton and from there in 1974 he made his final move to 1175 West 16th Street. At this current location the company sales and services forklifts and golf cars. The company also owns 1151, 1201, 1205, and 1207 West 16th Street, which they lease these building to other companies who use it for storage or restaurant space. When he first started the business had a net worth of $4,000.00 and is now a multi-million dollar company. Larry started the business with the fact in mind that if he worked for someone else for the rest of his life, he would only make peanuts. He knew he was good at what he did and he told people so.

He would tell his customers, “I’m the best forklift mechanic in the country.” And with that attitude he would gain the customers business and respect. He had basic accounting knowledge and knew the every department’s actions had to be accounted for in the books. He gained a lot of his knowledge by paying close attention when he worked for others in the past. He knew that the business had to either grow or go backward and it took approximately five years to get a good cash flow. He took out $100,000.00 loan from the bank to help grow the business and paid that loan off as soon as possible. It’s the only loan the company has ever had. You have to have a good understanding of the fact that you can’t grow so fast that you can’t pay your creditors and don’t go out on a limb by purchasing too much stock in the beginning and not be able to sell it fast enough in order to pay your bills. Things didn’t really smooth out until about ten years in.

He suggest spreading your portfolio out so that you won’t los everything if you make one poor choice. He also suggest starting with learning everything possible about something you like and ask yourself if you can make enough money in the beginning to raise the capital of the business because no bank will loan you money if you do not have capital. The biggest advise Larry gave me during the interview was you have to be honest, loyal, have integrity in the business and be able to handle or see that every complaint is handled in a timely and appropriate fashion. You have to know that the money that your business makes stays in the business.

If you start taking money out of the business account, then you are losing your profit. As the owner of the company you get a paycheck and that is what you use to pay your personal bills, not the company’s money. I enjoyed getting to know the owner of the company I work for and how the business was started. I was very impressed with Larry’s determination and passion he has for his business. He is an inspiration to any one wanting to start a business of there own. With only a fourth grade education he was determined and observant enough to learn from others and build a very successful business. I’m proud to work for a company that is built on passion, honesty, and integrity.

One of the best book by Rashmi Bansal narrating a story of 25 successful entrepreneurs from IIM- Ahmedabad. The book inspire young graduates to think beyond placements and salaries and to believe in their dreams. It is not the stereotype self help book. Some of the inspiring stories which inspires me most.

Naukri.com: Sanjeev Bikchandani The reason for starting his company was independence. As an MBA from Ahmedabad he could have worked for any multinational companies, but he did not want to be prisoner of his visiting card and the logo on it.

He has seen many ups and down in his career but never lost his hope. It is the persistence that makes him successful and it inspire many of us. I like his advice that never start your business to make money. Love your work it gives meaning to the life. Then you will never loose your hope. There is no such thing as a failed entrepreneur, only when you quit.

Until then, you are simply not successful yet.

Educomp: Shantanu Prakash is an optimist and innovator. When his father was retired and they wanted to settled in Delhi. He found that they do not have enough money to buy a DDA flat. Somewhere he knew that being a service holder he can not earn that much money, So he was sure that he will become an entrepreneur. He says that you don’t need money to start a businesses , if you have capital its great if you don’t it doesn’t matter, you cant start the business. He started a company Educomp it is into digital content and E-learning. Starting from scratch, now his company capitalization is Rs 7000 crore.

Feedback Venture: Vinayak Chatterjee was not sure what he wanted to do. He became a sales manager in Pond’s .The company treated him well and confirmed him area sales manager in 6 months. But he was not satisfied with his job as it was not as exciting as he wanted. He resigned Ponds and joined Apollo tyres which was badly in debt. He worked hard to streamline the company. But again he was caught in monotony and the challenges were missing in his job so he quite the job, this time he decided to do something new. With the team of his friends and his wife, he started a market research firm. He also made mistakes in his career but was able to come out from this with the rapport that he had made in industry. He did what his inner voice said. That’s what inspired me.

Make my trip:Deep Kalra at first joined ABN Amro, after that he realized not to work for bank. That point of time he thought to start his own business but that was only thought. He joined AMF bowling and after GE -the consumer finance business around the same time he came across with Ajit Balakrishnan of rediffCom and sunil bikhchandani of Naukri.Com. That’s when he realized internet was going to change lives and he wanted to do his own thing. Now his thought took a plunge and started his own business. The first Venture capital funding came from Neeraj Bhargava, the managing partner of e-ventures. He inadvertently gave away 70% of his company for funding. However he bought back the company during distress sale by e Ventures and that’s when he really became an entrepreneur. I learn from his experience that we should choose our field and partner carefully . Hire best employees, never focus on exit, concentrate on building a solid business.

Shri Renuka Sugars:Narendra Murkumbi: He shut down his first company because a Rs 5 crore turnover was not big enough. Today his second business Shre Renuka Sugar is Rs 1000 Crore company. One of the interesting success story which tells you to Think BIG. He passed out from IIM-A in 1994 and started a traditional business of Sugar mill. People felt that it is old business but he proved them wrong. There is no business which is old only the method of doing it is old. He worked wisely like there were some sick co-operatives , he approached co-operative run mills which were in distress and leased them. There are many things to learn from him and the way he made all this happen. I can say Innovation is the key to his success. In his point of view Core competence, doing one thing world class is no longer holds in India, look for new opportunities and scale up those opportunities.

Subhiksha: R Subramanian: He quit his job at Citibank 15 days after joining. He wanted to do something else and became India’s largest grocery chain store. But at first he started Assets securitisation systems in India and made lots of money. In 1996 his company was having enough money and staff but nothing much to do, So Mr Subramanian was planning to do something else to use this money , They conducted extensive research on customer behavior and found that offering the branded goods at a lower price than their competitors could make them stand in the competitive retail industry. They decided to start Subhiksha which was created with a promise of best value. The concept is successful because the profit margin is very less and it is giving best value to consumer. That is why with in a span of 10 years Subhiksha came over 1000 stores all over India. The greatest advise he gives, work in a real life companies , the smaller the better,don’t join big companies, join smaller companies because you will get far more exposure.

Mastek: Ashank Desai set up Mastek along with couple of friends. The group was formed on the IIMA campus- Ashank desai, Ketan Mehta , Sunder and Wasan. The company started operations in a two-bedroom apartment in Mumbai suburb, which was also the home of Ketan Mehta.. They started business with a public phone. They did not have a computer for first five years. The partners took Rs 1000 to 2000 as salary after meeting all expenses. But they never thought of closing down getting back to the job. An exibition by CSI proved to be turning point. The PC had just been launched and Mastek was the only software company to advertise there. They bagged order from Big companies like Citibank and HUL. And this struggle phase lasted 6 years. But the conviction and vision made the company successful.

The next phase one where company focused on exports. One of the partners settled in US to make this happen. Powered by strategy , systems and new markets to conquer. By the year 2000, Mastek achieved turnover of Rs 250 crore and consistently ranked among the top 10-15 in the software industries. As on F.Y 2008-09 company has a revenue of $200 million. Advice from from the mentors: You require a team feels trust for each other. And which is willing to designate one of them as a leader, Not based on shareholding alone but respect. Get 4-5 years of experience. Get bit of a feel and financial stability . Don’t just think about it, don’t just wish for it, jump into it and do it, if you are really serious. Remember that if the start up fails, it is your idea that failed , not you. Make plans but remain open to all possibilities. Retain work life balance.

Assessment:

A inspiring book. All stories are very concise, interesting and to the point manner. I found some common things to everyone was their passion, self-belief and a never die confidence. The author has done a brilliant job of researching and telling the stories in a interesting manner. At the end of every stories you will find advice which is a precious thing. I am really inspired by this book which gives me a feeling and more than that it has given me courage to think beyond a good comfortable job. Sooner or later I will start my own businesses, Thanks to Rashmi Bansal for writing a brilliant book which has changed my thinking.

2. In Andrea’s case I would advise her to look at her options. She must look into the benefits and the drawbacks of staying within the company and transferring departments, or taking her redundancy package and starting up her own business. She should assess and measure the opportunity. Not only banking on the government authority as her only customer she must analyse if other customers are reachable. She must assess is if her market potential and annual growth is could be significant and durable.

She might also measure if the customer payback would be less than one year, and if she would break even within the first 2 years. Andrea should also assess her competition and see if she can compete and provide her services at lower cost than them, and lower capital.

All the above is important for her to look at when assessing and differentiating starting her own business from being a mere idea to an opportunity. Kit too should look at these same aspects of differentiating between a good idea and an opportunity as Andrea.

He should look into finding out the costs involved in operating his business in an environmentally friendly manner, and measure if the venture will be sustainable as well as profit maximizing, with cost effective measures. He must assess and formulate a plan on how he would build relationships and alliances with both the small firms in the industry as well as the larger companies who make and market the final product. With the skills and experience of his partner, he could learn more about how to start a new venture and learn from the mistakes made in the past, assess them and formulate a plan to do better.

3. If I were in their positions, my decision would be to branch out and move into small businesses. It would be good to achieve independence in this small business. It would make the move to expecting a profit after taking such a risk and leaving the security of the large company. In Kit’s position I would take the chance to start a business whose operations have less damaging effects on the environment, thus contributing to a better environment making a significant difference. In Andrea’s case I would make the move as well as it would be a solution to the government authority as they are looking to outsource its central services, as well as a solution to my problem as I was “in a rut” at work and would have needed to transfer departments or find new employment. This move would give an opportunity to reach my full potential that could have been held back in the confines of the government authority.

4. The Entrepreneurship Process is driven by opportunity. Market demand is key to measuring an opportunity. In Andrea’s case we see that there is viable demand for her Payroll business. If she branches out and starts her business she has the opportunity of getting the contract for the government authority she was working for before and provide the necessary service to them. This customer is reachable, thus enhancing the opportunity. In Kit’s case, he saw the opportunity of starting a business with a difference that operated in an environmentally friendly way setting him apart from the other businesses out there. There would be a business like his that uses environmentally friendly and less damaging processes. It is important to understand and marshal resources and not be driven by them. Andrea would qualify for a redundancy payment which would be an available resource to manage and use to start up her business. It is however important not to be focused on what cash one has like her husband – “If I could have a big enough redundancy package I’d join you” – because this would limit creativity and hold the entrepreneur back.

Kit on the other hand had a business plan I place as one of the resources he was use make use of, the environmentally friendly approach to his business would be a useful strategy for his business. He also planned to use relationships as a key resource. Building a network between other small firms in the industry would be a useful resource in his own business. An entrepreneurial team is vital for success. Kit planned to partner up with Robin Davidson for his business venture. Davidson has relevant experience and had been the founder of a former high tech company. He had motivation to excel, leadership and courage as he sought after Kit to partner with him and start up another business after his previous business collapsed. He was a good partner in that he was rather pragmatic and caused Kit to see the risks and realistic side of things as he shared his ideas, “‘sure – as long as it doesn’t push our prices up and lose business.’”

Taking the Rough with the Smooth

1. Entrepreneurs can learn many valuable lessons from the setting up of Innocent Drinks. Firstly one can learn from the three gentlemen to look at one’s own life for inspiration on a new venture. They based their idea on something they personally knew a lot about, and proved to be a real market opportunity. Entrepreneurs learn that ideas are worth little, but implementation is key. The idea of the automatically-filling bath was good, though implementation would be hard as it would be hard to convince others that it would work. The idea of the drinks was a good idea and it successfully implemented. Aspiring entrepreneurs can learn a valuable lesson in collaboration and the effectiveness of a reliable team. “Reed attributes getting through this phase to the strength of their friendship and to being part of a team.” Another lesson one can learn is to research the product and the market and learn everything you can about your endeavor.

The gentlemen had no experience in the fruit and drink market, but they conducted their own research in product tasting and in the market at the jazz festival. One can learn the lesson of perseverance from the Richard Adam and Jon’s experience. The ‘cash ran dry’ and distributers initially refused to stock their drinks, but they persevered, personally delivering them to health shops. From there we see that sales began and the companies wanted more. If they had given up, they would not be the success they are today. Another lesson for entrepreneurs is to be the solution where others complain. One should figure out a way to solve the problems and make a profit in the process. “if they could only come up with a way of doing something healthy and didn’t require a lot of time…” “…this moment of insight led to Innocent Drinks…”

2. A critical success factor is having a compelling case for innovation. In this case they had the idea of the automatically filling bath which did not succeed as they found it hard to convince people. On the other hand, the Innocent Drinks idea was conving and they made a compelling case, and people could see why the innovation was necessary. Another success factor is that their business plan fostered teamwork and the support of their friendship and passion to see this business venture through. A creatively resourced and dedicated team turned this idea into an innovation when they took matters into their own hands and began personally delivering the drinks.

The entrepreneurs were willing to take the risk of presenting themselves to local juice company and giving free samples, and personally asking the owners to sell their drinks, even when they had had not cash and had been rejected by distributors, thus presenting another critical success factor. Another success factor is having a well defined, yet flexible execution process. They had the initial plan of using distributors, but after they refused to stock their drinks, they entrepreneurs were flexible and came up with personally delivering the drinks.

3. Innocent drinks measured opportunity and well differentiated this opportunity from an ‘idea’. They had a large market demand as they this idea was based on something they knew about, they knew that the customer was reachable. They identified the market readiness and saw the consumer trends and behaviours such as their own that were seeking a new product. “Customers were asked to place their empty cups in a ‘yes’ or ‘no’ bin…” and the ‘yes’ recorded “a sliding victory.” The opportunity was very large, growing and undefined.

Resources – the business had very limited resources and investors were looking at different business propositions to what they had, and so at a point the ‘cash ran dry.’ The entrepreneurs had to be creative and learn to do more with less. Successful entrepreneurs devise creative and sparing strategies to marshal and gain control of resources. e.g. they loaded a van with drinks and personally delivered them to health shops and delicatessens.

Entrepreneurial Team – Richard, Adam and Jon formed a great team that was motivated to excel, had tolerance for risk, ambiguity and uncertainty as neither of them had done anything like this venture before. They had a good friendship and supported each other as a team through hardships, “Richard Reed attributes getting through this phase to the strength of their friendship and to being part of a team.” This team had resilience, commitment, determination and persistence, which is seen in their actions when they kept on with deliveries “distributors refused to stock heir drinks”

Importance of fit and balance – it is importance to find a balance among the driving forces of a team, resources and opportunity. These factors rarely match, but if they are in the right proportions (e.g. large enough team, sufficient resources, if the company will grow 20% over the next 2years) In this case we see they has insufficient resources, but that was balanced out by their having a strong friendship and team to get them past the hardship.

Sustainability as a base – a sustainable venture means achieving economic, environmental and social goals without compromising the same opportunity for future generations. This business was sustainable as Innocent Drinks was “a fruits smoothie that tasted good, was good for you, and that could be easily and quickly consumed.” It successfully addresses the social issue of healthy living and good food quality.

Importance of timing – we see the importance of timing in this case as Innocent Drinks was started just at the start of the dot-com era, when investors were not looking into their kind of business proposition. Because of this their financial resources were very limited due to few or the lack of investors leading to the cash running out. However, there is no perfect time decisiveness and seizing the opportunity makes all the difference, which is what the entrepreneurs did and they succeeded.

On January 26, 2011, health care conglomerate Johnson & Johnson announced that earnings had declined in the fourth quarter of the previous year, and lowered its estimates for its earnings for 2010. The firm claimed that the weaker results could be attributed to the depressed economy and to a string of product recalls. Sales figures do indicate that Johnson and Johnson has clearly been hurt by 17 recalls since September 2009, covering several over-the-counter medicines, a batch of contact lenses and some hip replacements.

The most serious problems have surfaced at McNeil Consumer Healthcare, which has had to recall many of its products, including one for an estimated 136 million bottles of children’s Tylenol, Motrin, Benadryl and Zyrtec – the biggest children’s drug recall of all time – that were potentially contaminated with dark particles.

Johnson & Johnson has been excoriated by the Food and Drug Administration for failing to catch McNeil’s quality problems. The agency slapped one of McNeil’s plants with a scalding inspection report, causing the company to close down the factory until 2011.

In response to these problems, Johnson & Johnson recently announced that it intended to revamp its quality controls, creating a single framework for its consumer, pharmaceutical and medical device divisions. Ajit Shetty, the corporate vice president responsible for supply chain operations, will oversee the new system, reporting directly to William C. Weldon, the firm’s chief executive. The company said it also planned to appoint chief quality officers for each of its three major divisions.

The decision to create a more centralized form of quality control was a difficult one for Weldon. The firm has relied heavily on acquisitions to grow over the years, resulting in a collection of as many as 250 different operating companies that are spread over 60 countries. Johnson & Johnson has been committed to providing each of these units as much autonomy as possible in order to preserve an entrepreneurial culture throughout the organization. “The company really operates more like a mutual fund than anything else,” commented Pat Dorsey, director of equity research at Morningstar.1

In spite of the benefits that Johnson &Johnson may derive from such an arrangement, Weldon had already been thinking about taking steps to be more actively involved with its far flung business units. He recently told investors that he has been particularly concerned about pushing for more internal growth: “We’ll come at it from a variety of different ways, to accelerate top and bottom-line growth.”2 Given the scope of the businesses that J&J manages, he believes that the best opportunities may come from increased collaboration between its different units. But even as he has been pushing for some form of stronger direction for its units, Weldon does not want to threaten the strong entrepreneurial spirit that has been the basis of much of its success. The concerns over quality control have pushed the firm to try to find a more effective method of running its businesses without stripping them of their relative autonomy.

Case developed by Jamal Shamsie, Michigan State University. Material has been drawn from published sources. To be used for purposes of class discussion. Cultivating Entrepreneurship

Johnson & Johnson has relied heavily upon acquisitions to enter into and to expand into a wide range of businesses which fall broadly under the category of health care. Over the last decade alone, the firm has spent nearly $50 billion on 70 different purchases. Since 2008, J&J has made eight acquisitions, including a $1.1 billion acquisition of Mentor Corporation, a leading supplier of products for the global aesthetic market. The acquisition allowed the firm to make substantial move into the growing field of cosmetic drugs and devices. “It’s a natural extension of where J&J would want to go,” said Michael Weinstein, an analyst who specializes in the medical sector for J.P. Morgan Chase & Company.3

As it has grown, Johnson & Johnson has developed into an astonishingly complex enterprise, made up of over 250 different businesses that have been broken down into three different divisions. The most widely known of these is the division that makes consumer products such as Johnson & Johnson baby care products, Band-Aid adhesive strips and Visine eye drops. The division grew substantially after J&J acquired the consumer health unit of Pfizer in 2006 for $16.6 billion, the biggest in its 120-year old history. The acquisition allowed the firm to add well known products to its line up such as Listerine mouth wash and Benadryl cough syrup.

But Johnson & Johnson has reaped far more sales and profits from its other two divisions. Its pharmaceuticals division sells several blockbuster drugs such as anemia drug Procit and schizophrenia drug Risperdal. Its medical devices division is responsible for best selling products such as Depuy orthopedic joint replacements and Cyper coronary stents. These two divisions tend to generate operating profit margins of around 30%, almost double those generated by the consumer business.

To a large extent, however, Johnson & Johnson’s success across its three divisions and many different businesses has hinged on its unique structure and culture. Most of its far-flung business units were acquired because of the potential demonstrated by some promising new products in its pipeline. Each of these units was therefore granted near-total autonomy to develop and expand upon their best selling products. That independence has fostered an entrepreneurial attitude that has kept J&J intensely competitive as others around it have faltered. The relative autonomy that is accorded to the business units has also provided the firm with the ability to respond swiftly to emerging opportunities.

Johnson & Johnson has been quite proud of the considerable freedom that it has given to its different business units to develop and execute their own strategies. Besides developing their strategies, these units have also been allowed to work with their own resources. Many of the businesses even have their own finance and human resources departments. While this degree of decentralization makes for relatively high overhead costs, none of the executives that have run J&J, Weldon included, has ever thought that this was too high a price to pay. “J&J is a huge company, but you didn’t feel like you were in a big company,” recalled a scientist who used to work there.4

Restructuring for Synergies

In spite of the benefits that Johnson & Johnson has derived from giving its various enterprises considerable autonomy, there have been growing concerns that they can no longer be allowed to operate in near isolation. Weldon has begun to realize that J&J is in a strong position to exploit new opportunities by drawing on the diverse skills of its various business units across the three divisions. He is well aware that his firm can benefit from the combination of its knowledge in drugs, devices, and diagnostics, since few companies can match its reach and strength in these basic areas.

Indeed, Johnson & Johnson has top-notch products in each of the areas in which it operates. It has been spending heavily on research and development for many years, taking its position among the world’s top spenders. It currently spends about 12% of its sales or almost $7 billion on about 9,000 scientists working in research laboratories around the world. This allows each of the three divisions to continually introduce promising new products. Its pharmaceutical division, for example, is currently working on a drug to prevent strokes and one to treat prostrate cancer.

Weldon believed, however, that Johnson & Johnson can profit from this convergence by finding ways to make its fiercely independent businesses to work together. In his own words: “There is a convergence that will allow us to do things we haven’t done before.”5 Through pushing the various far-flung units of the firm to pool their resources, Weldon believes that firm could become one of the few that may actually be able to attain that often-promised, rarely delivered idea of synergy.

Even as Weldon has been supportive of the efforts underway at each of its divisions, he is also pushing for all of its units to work with each other to address different health problems. He has appointed one of its rising stars, Nicholas Valeriani to head a new Office of Strategy and Growth that would attempt to get business units to work together on promising new opportunities. “It’s a recognition that there’s a way to treat disease that’s not in silos,” Weldon stated, referring to J&J’s largely independent businesses.6

Such a push for communication and coordination would allow Johnson & Johnson to develop the synergy that Weldon was seeking. But any effort to get the different business units to collaborate must not quash the entrepreneurial spirit that has spearheaded most of the growth of the firm to date. Jerry Caccott, managing director of consulting firm Strategic Decisions Group emphasized that cultivating those alliances “would be challenging in any organization, but particularly in an organization that has been so successful because of its decentralized culture.”7

Benefiting from Collaboration

Weldon, like every other leader in the company’s history, has worked his way up through the ranks. His long tenure within the firm has turned him into a true believer in the Johnson & Johnson system. He certainly does not want to undermine the entrepreneurial spirit that has resulted from the autonomy that has been given to each of the businesses. Consequently, even though Weldon may talk incessantly about synergy and convergence, he has cautious in the actual steps he has taken to push J&J’s units to collaborate with each other.

For the most part, Weldon has confined himself to taking steps to foster better communication and more frequent collaboration among Johnson &Johnson’s disparate operations. “They are the experts who know the marketplace, know the hospitals,” he once said of the people who work in the firm’s various business units.8 Besides the appointment of Valeriani, he has worked with James T. Lenehan, vice-chairman and president of J&J, to set up groups that draw people from across the firm to focus their efforts on specific diseases. Each of the groups has been reporting every six months on potential strategies and projects.

Perhaps the most promising result of this new collaborative approach has been J&J’s drug-coated stent, called Cypher. The highly successful new addition to the firm’s lineup was a result of the efforts of teams that combined people from the drug business with others from the device business. They collaborated on manufacturing the stent, which props open arteries after angioplasty. Weldon claims that if J&J had not been able to bring together people with different types of expertise, it could not have developed the stent without getting assistance from outside the firm.

Even the company’s fabled consumer brands have been starting to show growth as a result of increased collaboration between the consumer products and pharmaceutical divisions. Its new liquid Band-Aid is based on a material used in a wound-closing product sold by one of J&J’s hospital-supply businesses. And J&J has used its prescription antifungal treatment, Nizoral, to develop a dandruff shampoo. In fact, products that have developed in large part out of such a form of cross-fertilization have allowed the firm’s consumer business to experience considerable internal growth.

Some of the projects that Johnson & Johnson is currently working on could produce even more significant results. Researchers working on genomic studies in the firm’s labs were building a massive database using gene patterns that correlate to a certain disease or to someone’s likely response to a particular drug. Weldon encouraged them to share this data with the various business units. As a result, the diagnostics team has been working on a test that the researchers in the pharmaceutical division could use to predict which patients would benefit from an experimental cancer therapy.

Dealing with Setbacks

Even as Johnson & Johnson has been trying to get more involved with the efforts of its business units, it has run into problems with quality control with several over-the-counter drugs that are made by McNeil Consumer Healthcare. Since 2008, F.D.A. inspectors have found significant violations of manufacturing standards at two McNeil plants, leading to the temporary closure of one of these. These problems have forced the firm to make several recalls of some of its best selling products. Weldon admitted that problems had surfaced, but he insisted that these were confined to McNeil. In a recent interview he stated: “This is one of the most difficult situations I’ve ever had to personally deal with. It hits at the core of who J&J is. Our first responsibility is to the people who use our products. We’ve let them down.”9

Quality problems have arisen before, but they were usually fixed on a regular basis. Analysts suggest that the problems at McNeil may have exacerbated in 2006 when J&J decided to combine it with the newly acquired consumer health care unit from Pfizer. The firm believed that it could achieve $500 to $600 million in annual savings by merging the two units together. After the merger, McNeil was also transferred from the heavily regulated pharmaceutical division to the marketing driven consumer products division, headed by Collen Goggins. Because these consumer executives lacked pharmaceutical experience, they began to demand several changes at McNeil that led to a reduction in emphasis on quality control.

Weldon is well aware of the threat faced by Johnson & Johnson as a result of its problems with quality. He is especially concerned about the allegation by F.D.A. that the firm initially tried to hide the problems that it found with Motrin in 2009, hiring a contractor to quietly go around from store to store, buying all of the packets off the shelves. McNeils’ conduct surrounding the recalls has led to an inquiry by both the House Committee on Oversight and Investigations and by the F.D.A.’s office of criminal investigations.

Various changes are underway at McNeil to resolve these quality issues. Goggins was pushed out of her post as senior executive in charge of all consumer businesses. Weldon has allocated more than $100 million to upgrade McNeils’s plants and equipment, appoint new manufacturing executives and hire a third-party consulting firm to improve procedures and systems. Bonnie Jacobs, a McNeil spokeswoman wrote in a recent e-mail: “We will invest the necessary resources and make whatever changes are needed to do so, and we will take the time to do it right.”10

The problems at McNeil, coupled with the recalls of contact lenses and hip replacements, have led Johnson & Johnson to make changes to its corporate oversight of its supply chain and manufacturing. In August 2010, the firm appointed Shetty, a longtime executive to oversee a new systems of companywide quality control that involves a single framework for quality across all of the operating units and a new reporting system. The need for these changes was highlighted by Erik Gordon, a professor at the Ross School of Business at the University of Michigan: “Nothing is more valuable to Johnson & Johnson than the brand bond of trust with consumers.”11

Is there a Cure Ahead?

Weldon realizes that the recalls have presented additional challenges for Johnson &Johnson which is already facing a tougher economic environment. Sales of its various consumer products such as Tylenol, Benadryl and Rolaids have shown a substantial decline over the last six months of 2010. Weldon has been working hard to reassure analysts, investors and consumers that it was already dealing with its quality problems. But Les Funtleyder, who invests in health stocks for his investment firm said: “These problems are accumulating. At some point investors are going to start to question J&J’s management.”12

But the firm’s diversified portfolio of products that are spread across various areas of heath care have helped it to weather the various problems that it has encountered. In particular, Johnson & Johnson has managed to offset its loss of sales in over-the-counter medications with relatively strong sales from pharmaceuticals and devices. “With interests spread out all over the health-care industry, J&J does not live or die by any one product,” remarked Herman Saftlas, a pharmaceutical analyst for Standard & Poor’s.13

Moving forward, Weldon is hoping to strike a balance between direction and freedom for Johnson &Johnson’s business units as he pushes to get the firm to start to grow again. Until the first quarter of 2009, the firm had managed to increase its earnings, adjusted for special items, for 94 consecutive quarters. Weldon believes that he can only resume Johnson &Johnson’s record growth by pushing its businesses to work more closely together than they have ever done in the past. The firm can tap into many more opportunities when it tries to bring together the various skills that it has managed to develop across different divisions.

At the same time, Weldon has become acutely aware of the problems that can arise when the corporate managers start to push the business units to become more effective or efficient. To a large extent, the quality problems at McNeil can be attributed to the decision by J&J to merge it with the consumer health care unit that it had acquired from Pfizer. The larger merged unit was then moved away from the pharmaceutical division and subjected to more centralized control within the consumer division. As a result of all of these efforts to wring more profits out of McNeil, the firm had to resort to a string of recalls that have tarnished the image of J&J.

Above all, Weldon is acutely aware that much of Johnson & Johnson’s success has resulted from the relative autonomy that it has granted to each of its business units. He knows that even as he strives to push for more control and direction, he does not want to threaten the entrepreneurial spirit that has served his firm so well. But it is clear to Weldon that he has to rethink the process by which his firm manages its diversified portfolio of companies in order to ensure that there are no further threats to its reputation. “This is a company that was purer than Caesar’s wife, this was the gold standard, and all of a sudden it just seems like things are breaking down,” said William Trombetta, a professor of pharmaceutical marketing at Saint Joseph’s University in Philadephia.14

1. Shirley S. Wang & Rhonda L. Rundle. J&J to Acquire Breast-Implant Maker. Wall Street Journal, December 2, 2008, p. B1. 2. Amy Barrett. Staying on top. Business Week, May 5, 2003, p. 61 3. Christopher Bowe. J&J Reveals its Guidant Motive. Financial Times, January 25, 2006, p. 17. 4. Peter Loftus & Shirley S. Wang. J&J Sales Show Health Care Feels the Pinch. Wall Street Journal, January 21, 2009, p. B1. 5. Avery Johnson. J&J’s Consumer Play Paces Growth. Wall Street Journal, January 24, 2007, p. A3. 6. Holly Hubbard Preston. Drug Giant Provides a Model of Consistency. Herald Tribune, March 12-13, 2005, p. 12. 7. Business Week, May 5, 2003, p. 62.

8. Avery Johnson. J&J Realigns Managers, Revamps Units. Wall Street Journal, November 16, 2007, p. A10. 9. Business Week, May 5, 2003, p. 62.
10. Natasha Singer & Reed Abelson. Can Johnson & Johnson Get its Act Together? New York Times, January 16, 2011, p. B4. 11. New York Times, January 16, 2011, p. B4.
12. Natasha Singer & Reed Abelson. After Recall of Drugs, a Congressional Spotlight on J.&J.’s Chief. New York Times, September 29, 2010, p. B4. 13. Johanna Bennett. J&J: A Balm for Your Portfolio. Barron’s, October 27, 2008, p. 39. 14. Natasha Singer. Hip Implants are Recalled by J&J Unit. New York Times, August 27, 2010, p. B1.

Working for yourself is the American dream. Most employees have dreamed of being their own boss, and it has many benefits, but there are a few disadvantages to it as well. Advantages of working for yourself are that you are responsible to yourself. Your destiny is in your own hands, as well as your financial future. You determine how much work you do, when you go to work, when you quit for the day, when you take a vacation, how long the lunch break will be, and if you really want to put up with a grouchy customer.

The business is in your hands and you decide. Instead of griping about the bad advertising campaign that corporate came up with, you decide on an advertising campaign yourself. Disadvantages of working for yourself are really the same as the advantages. You decide when you go to work, when you quit for the day, when you take a vacation, and how much you will make.

All the while knowing, if you are a small business, that if you are gone the business is either not open, or if you have employees, that they are not being supervised by the person who cares the most about the business—you. You have to make all of the decisions regarding health insurance, benefits, marketing, bookkeeping, management, and customer service. Owning and operating a business is a tremendous responsibility and not everyone is ready for or capable of handing the stress or the commitment.

Still, if you are one of those unique individuals with the spirit of an entrepreneur, then being in business for yourself is the only way to live. Many people in fact simply can’t imagine another way to live. Some people in this world are sheep, following others blindly. Others are shepherds, preferring to lead. Pathfinders who make their own way. If you are an entrepreneur, you are one of the shepherds and will only be happy in business for yourself.

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I’ve been an entrepreneur most of my adult life. Recently, on a long business flight, I beganthinking about what it takes to become successful as an entrepreneur–and how I would even define the meaning of success. The two ideas became more intertwined in my thinking: success as an entrepreneur, entrepreneurial success. I’ve given a lot of talks overthe years on the subject of entrepreneurship. The first thing I find I have to do is to dispelthe persistent myth that entrepreneurial success is all about innovative thinking and breakthrough ideas.

I’ve found that entrepreneurial success usually comes through great execution, simply by doing a superior job of doing the blocking and tackling. But what else does it take to succeed as an entrepreneur, and how should an entrepreneur define success? Here’s what I came up with, a Top 10 List: 10. You must be passionate about what you are trying to achieve. That means you’re willing to sacrifice a large part of your waking hours to the idea you’ve come up with.

Passion will ignite the same intensity in others who join you as you build a team to succeed in this endeavor.

And with passion, both your team and your customers are more likely to truly believe in what you are trying to do. 9. Great entrepreneurs focus intensely on an opportunity where others see nothing. This focus and intensity help eliminate wasted effort and distractions. Most companies die from indigestion rather than starvation, i. e. , companies suffer from doing too many things at the same time rather than doing too few things very well. Stay focused on the mission. 8. Success comes only from hard work. We all know that there is no such thing as overnight success. Behind every overnight success lie years of hard work and sweat.

People with luck will tell you there’s no easy way to achieve success–and that luck comes to those who work hard. Successful entrepreneurs always give 100% of their efforts to everything they do. If you know you are giving your best effort, you’ll never have any reason for regrets. Focus on things you can control; stay focused on your efforts, and let the results be what they will be. 7. The road to success is going to be long, so remember to enjoy the journey. Everyone will teach you to focus on goals, but successful people focus on the journey and celebrate the milestones along the way.

Is it worth spending a large part of your life trying to reach the destination if you didn’t enjoy the journey? Won’t the team you attract to join you on your mission also enjoy the journey more? Wouldn’t it be better for all of you to have the time of your life during the journey, even if the destination is never reached? 6. Trust your gut instinct more than any spreadsheet. There are too many variables in the real world that you simply can’t put into a spreadsheet. Spreadsheets spit out results from your inexact assumptions and give you a false sense of security.

In most cases, your heart and gut are still your best guide. The human brain works as a binary computer and can analyze only the exact information-based zeros and ones (or black and white). Our heart is more like a chemical computer that uses fuzzy logic to analyze information that can’t be easily defined in zeros and ones. We’ve all had experiences in business where our heart told us something was wrong while our brain was still trying to use logic to figure it all out. Sometimes a faint voice based on instinct resonates far more strongly than overpowering logic. 5.

Be flexible but persistent–every entrepreneur has to be agile to perform. You have to continuously learn and adapt as new information becomes available. At the same time, you have to remain persistent to the cause and mission of your enterprise. That’s where that faint voice becomes so important, especially when it is giving you early warning signals that things are going off track. Successful entrepreneurs find the balance between listening to that voice and staying persistent in driving for success–because sometimes success is waiting right across from the transitional bump that’s disguised as failure.

Rely on your team. It’s a simple fact: No individual can be good at everything. Everyone needs people who have complementary sets of skills. Entrepreneurs are an optimistic bunch, and it’s very hard for them to believe that they are not good at certain things. It takes a lot of soul searching to find your own core skills and strengths. After that, find the smartest people you can who complement your strengths. It’s easy to get attracted to people who are like you; the trick is to find people who are not like you but who are good at what they do–and what you can’t do.

Execution, execution, execution. Unless you are the smartest person on earth (and who is), it’s likely that many others have thought about doing the same thing you’re trying to do. Success doesn’t necessarily come from breakthrough innovation but from flawless execution. A great strategy alone won’t win a game or a battle; the win comes from basic blocking and tackling. All of us have seen entrepreneurs who waste too much time writing business plans and preparing PowerPoints. I believe that a business plan is too long if it’s more than one page.

Besides, things never turn out exactly the way you envisioned them. No matter how much time you spend perfecting the plan, you still have to adapt according to the ground realities. You’re going to learn a lot more useful information from taking action rather than hypothesizing. Remember: Stay flexible, and adapt as new information becomes available. 2. I can’t imagine anyone ever achieving long-term success without having honesty and integrity. These two qualities need to be at the core of everything we do.

Everybody has a conscience, but too many people stop listening to it. There is always that faint voice that warns you when you are not being completely honest or even slightly off track from the path of integrity. Be sure to listen to that voice. 1. Success is a long journey and much more rewarding if you give back. By the time you get to success, lots of people will have helped you along the way. You’ll learn, as I have, that you rarely get a chance to help the people who helped you, because in most cases, you don’t even know who they were.

The only way to pay back the debts we owe is to help people we can help–and hope they will go on to help more people. When we are successful, we draw so much from the community and society that we live in that we should think in terms of how we can help others in return. Sometimes it’s just a matter of being kind to people. Other times, offering a sympathetic ear or a kind word is all that’s needed. It’s our responsibility to do “good” with the resources we have available. Measuring Success I hope you have internalized the secrets of becoming a successful entrepreneur.

The next question you are likely to ask yourself is: How do we measure success? Success, of course, is very personal; there is no universal way of measuring success. What do successful people like Bill Gates and Mother Teresa have in common? On the surface, it’s hard to find anything they share-;and yet both are successful. I personally believe the real metric of success isn’t the size of your bank account. It’s the number of lives in which you might be able to make a positive difference. This is the measure of success we need to apply while we are on our journey to success.