Strive for Progress, Not Perfection

How often have you heard someone say “I am perfectionist.” It might be good, but it is not helpful for Entrepreneurs.

Entrepreneurs are generally impatient. They need to see the fruits of their invention right away. If they wait to perfect it, they get bored and move on to something else. The market will not wait either – getting it to the market first is the name of the game.

As Entrepreneurs grow their business, they should be striving for measurable progress on established goals rather than perfection at a point in time. Sustained progress in the right direction is desirable than perfecting some aspect of the product, process or service without overall forward movement.

An idea that is ninety percent complete and implemented is better than something that is not put into practice as it waits to be perfected.

While perfection might be appropriate for artists and scientists, Entrepreneurs need to be progress driven! Show leadership by demanding progress from your employees instead of perfection.

Ravi Patel

www.patelCFOservices.com

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Entrepreneurs as Mentors

When schoolchildren are asked what do they want to be when they grow up, the answer is entrepreneur. A recent Gallup poll shows that 77% want to be their own boss, 45% want to start their own business, and 42% want to invent something that changes the world.

In an era of role models such as Steve Jobs or Mark Zuckerberg, this is not surprising. However, these type of famous individuals are not available to mentor most students.

What role can and should Entrepreneurs play in mentoring such students? I am sure that successful Entrepreneurs had role models and mentors that guided them through their passion of becoming innovators. Do they then not have a responsibility to give back?

Most students might have a desire to be entrepreneurs, but have no experience or knowledge to better understand what it takes to be a risk-taker and grow a business. If groomed at a younger age with seasoning from experienced Entrepreneurs, these students have a better shot at becoming successful.

Entrepreneurs need to take leadership in exploring opportunities in their local communities as to how they can mentor aspiring students. After all, the spirit of innovation and entrepreneurship has to be kept alive. Who better to do so than ones that have already been through that journey?

Ravi Patel

www.patelCFOservices.com

 

Published in: on October 24, 2011 at 5:53 am  Leave a Comment  
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Reinforcing your Vision and Mission

Entrepreneurs – have you developed a Vision and Mission for your company? If so, that’s a great step one.

If not, you need to work on that. Since a lot of articles exist on how to develop a Vision and Mission Statement, I am not going to go into that here.

Having a defined Vision and Mission for your business is not enough. Communicating that to your leadership team and employees is crucial in order to obtain wide acceptance. The Vision and Mission that you developed is only a starting point, not the end.

Most Entrepreneurs, once aware of the need to do so, are diligent about developing their Mission and Vision. They even go through a formal process of publicizing it on their website and brochures and communicating it to their employees.

However, how often is the Mission reinforced to your stakeholders, especially your employees? If infrequently or none at all, there is a strong possibility that your overall business direction will be forgotten when your employees are deeply focusing on their daily tasks. Your Vision has to be their guiding principle too!

Reinforcing your Vision and Mission frequently is a necessary leadership step to ensure that the direction that your company should be moving towards is not forgotten.

Ravi Patel

www.patelCFOservices.com

Revenue Concentration Risks

When Entrepreneurs start their businesses, they might depend on one or a few clients for bulk of their revenues. This revenue concentration scenario is acceptable for the very early start-up stage of a company.

As the company’s revenues grow, hopefully the increase is from having more customers rather than only from additional business with the same clients. Diversification of the source of revenues is a critical factor in the long-term success of the company.

The risks of concentration of revenues from only a few clients or one or two big customers could be huge. If a significant portion of the revenues are derived from, say one customer, it could be devastating for the company if such business was lost, reduced dramatically, or even if there were payment problems with such receivables.

Entrepreneurs, at the appropriate stage in their company’s growth, would be well advised to diversify the sources of revenues such that dependence on a few clients does not end up hurting their business.

Entrepreneurs might need to determine a risk tolerance model to determine what is the maximum revenue concentration from one client that would be acceptable for their business. In addition, they need to also assess the acceptable revenue concentration levels from a small number of clients. Such risk assessment would have to take into account not only the business and financial stability of the customers, the length and quality of the relationships, and the competitive situation, but also their own company’s performance with such clients and the level of risk that the company can take without jeopardizing its survival.

Managing revenue concentration risk is a critical component of Doing the Right Things!

Ravi Patel

www.patelCFOservices.com

Published in: on October 10, 2011 at 5:56 am  Leave a Comment  
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Confronting a Crisis

Everyone faces a crisis situation once in a while. How do you deal with that crisis?

Some people choose to hide from a crisis and let others take charge. Others thrive on such situations because it gives them a rush and pumps them up. A few get too emotional.

Most successful people approach a crisis in a rational and deliberate manner. A crisis is no more than a high or critical priority management issue requiring situational leadership. Remaining calm and having a realistic plan to address the crisis is of paramount importance.

Input from other managers might be appropriate, but most often quick decisions are required to deal with the issues at hand. It is important to not only to develop a workable plan quickly, but also implement it fast to mitigate the potential damage. Flexible thinking is necessary and required changes to the original plan have to be swift.

Crisis situations always test Entrepreneurial leadership skills, but dealing with them effectively brings satisfaction and inspires employees.

Ravi Patel

www.patelCFOservices.com