Wednesday, May 28, 2008

biz plan contd

Section V Management team

it is very important to put together a good management team in place, right from the word go. most entrepreneurs tend to hire people with lesser competencies simply because they are available at a lesser price. what then happens is that when the organization grows and the people who have been hired cannot grow with it, two scenarios are likely :-
either they have to be left by the wayside in which case all the time, money and knowledge invested in them by the entrepreneur simply goes waste; or the fact that they fail to grow with the organization can actually stop the organization itself from growing. both are unhappy scenarios for the entrepreneur.

the second show stopper is when the entrepreneur refuses to delegate to people with better competencies than himself. most entrepreneurs tend to be very possessive about their ideas and their biggest failing is that they believe that firstly they are as good at implementing as they are at ideating, which of course is a big blunder. secondly they believe that since it is their idea, nobody can do it better than them. which is an even bigger blunder.

successful entrepreneurs recognise early on that they cannot be good at everything, understand what they are good at and stick to doing only those jobs they are good at, and hire competent people to execute those jobs that they are good at.

this is how an entrepreneur build his team. i have heard entrepreneurs lament often enough that they cannot attract talent as startups dont have brand equity. this is true. but what is also true is startups, more than others, need evangelists in the team, people who believe in the biz as much as the entrepreneur does. obviously in a startup you cannot attract talent by paying more because in any case you are strapped for cash; nor can you attract on account of your name or credibilty, because those are yet to be built. so the only way you can entice people to work with you is to look for such people who are moved by ideas, who are willing to give up conventional comfort for the sake of a tremendous idea. ideas should not only move businesses, they should move people too, all stakeholders infact, customers, employees and investors.

as i keep saying, ideas are the starting point of all businesses.

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