Stakeholder Relationships

During this stay at home downtime for most businesses, it is essential for Entrepreneurs to identify their key stakeholders. Once identified, develop a plan to build and maintain relationships with them.

There are many stakeholders for each company – such as shareholders, customers/clients, suppliers, employees, bankers, accountants, consultants and advisors, local community leaders, industry colleagues, lobbyists, and so on.

Identifying your key stakeholders and having a comprehensive plan of maintaining strong relationships with them is critical for your long term success.

Do the Right Things!

Ravi Patel

Published in: on May 26, 2020 at 7:01 am  Leave a Comment  
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Look at the Bigger Picture

Given the current shutdown of businesses, Entrepreneurs must be stressed out regarding all that they have to do when everything opens.

The well-known Pareto Principle of 80/20 could be helpful.

A lesson from that principle is for Entrepreneurs to focus on the big things they need to do and not worry about all the small details. Delegate the small stuff to others. If one dwells on small things, there is little time to work on the larger, more important things in business.

Similarly, if you are dedicated to bringing back revenues, focus on the 20% of strategies and tactics that would generate 80% of the returns. The same philosophy should be applied to keeping employees,  customers and suppliers safe.

Do the Right Things!

Planning for a Crisis

As the Coronavirus pandemic shows, crisis events never happen at an opportune time. They always happen when we are the least prepared.

It now behooves Entrepreneurs to think ahead and develop with their management team a Crisis Management Plan. Such a plan should anticipate events that could result in a crisis or crises; develop alternate scenarios to respond to such situations; designate key personnel to manage different options; and conduct training and practice sessions to rehearse potential responsive actions.

While hindsight is often accurate, it is  usually too late. A little foresight can mean the difference between success and failure.

Ravi Patel

 

Published in: on April 7, 2020 at 6:59 am  Leave a Comment  
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Are you Looking for Funding?

All Entrepreneurs, especially start-ups, are in need of money. What are the key things you need to do first when looking for funding?

1.   Ask for a specific amount. Don’t state ranges or be vague. If you do not know the specific amount, it does not speak well of you understanding the financial needs of your business. It is okay to ask for slightly more than you need to provide for contingencies, but still look for a specific amount.

2.   Outline exactly how you are going to use the money. If you do not have a well-defined idea of how you plan to spend the funds, it does not provide a high level of confidence to potential investors/lenders. However, resist going overboard and itemizing each and every item. You should have that for your own use, but do not need it when looking for funds especially in the initial meeting.

3.   Present a realistic argument of how using the funds will build a business that will generate positive cash flows. This will be the essential selling point. Investors or lenders are not only interested in knowing how they will be repaid (with upside), but also whether the business can become a self-sustaining cash generator. Again, the idea is not present a thick business plan with fluff, but rather a well-defined and articulated strategy backed by realistic projections.

Spend some time in working on the above three requirements before you start looking for funding.

Ravi Patel

Published in: on March 17, 2020 at 7:00 am  Leave a Comment  
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Lessons from Music

There are a number of similarities between creating melodious music and Entrepreneurs developing a fine-tuned business.

Creating a melody requires the correct musical notes. While a spectrum of notes is available to all, picking the right notes to create a musical piece is critical. One or more wrong notes and the resulting music is noticeably out of tune.  Similarly in business, an Entrepreneur has access to various resources – markets, clients, management team, employees, facilities, investors, suppliers, advisors and so on. Creating the right blend of these resources, just like selecting the appropriate notes, will allow the development of a beautifully functioning business. A wrong choice or decision here and there ruins the musical piece or a well-oiled business machine.

Playing only the correct musical notes does not make a melody; the notes have to be played to the appropriate beat. The business activities of a growing organization have to be running at the right pace. You cannot have some parts of the company forging ahead while others are lagging. Moving towards the goal at a managed pace leads to success.

Entrepreneurs do not have to be musicians, but applying lessons of music might help them in successfully growing their businesses.

Ravi Patel

Invest Wisely

Businesses require investments. Entrepreneurs are aware of the capital necessary to start a business – whether it is for working capital, machinery, equipment, or so on.

As the business grows more investment might be needed. If the Entrepreneur only thinks of investment in material things, it might be short-sighted.

Long term success requires investment in softer areas of the business. For example, in order to have consistent results it is necessary to invest in developing robust business processes (not necessarily computer systems). This takes time and resources, but it is a wise investment.

Entrepreneurs need to make similar investment in their people. Identify the key potential people in your organization and invest in them. Urge them to improve their skills, train them in functional areas, and take a risk by giving them projects and assignments that challenge them. Investing in your people, just like other assets, will pay off in the long term.

Entrepreneurs need to identify all areas of their business to determine if they have invested appropriately in such areas to make them generate superior returns.

Ravi Patel

Published in: on February 11, 2020 at 7:02 am  Leave a Comment  
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Firing without Aiming

Some Entrepreneurs are passionate and innovative with a bias for action.

While a seasoned executive will take a calm, thought-out approach to decision-making, akin to “Ready, Aim, then Fire,” some Entrepreneurs like to make quick decisions rather than deliberate for very long. They jokingly call this approach “Fire, Aim and then worry about whether you are Ready or have correctly Aimed or not.”

Who is right? Entrepreneurs need to carefully blend both styles of decision-making depending on the situation at hand or surround themselves with advisors who can complement the Entrepreneur’s decision-making style. No one style is always correct!

Ravi Patel

Published in: on December 17, 2019 at 6:43 am  Leave a Comment  
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Will You Survive?

The law of the jungle “survival of the fittest” also applies to Entrepreneurs.

Entrepreneurs must find ways to survive in a competitive business climate. Having the best product or service, superior management, strong processes and so on are not the only things necessary for survival.

Imagine the cheetah – the fastest animal on earth. However if not alert, a lion or other predator will devour the cheetah. Being fast would not help then.

Similarly, having the best of everything is not enough for Entrepreneurs. Survival requires being alert, adaptive and quick to react to the changing circumstances. Relying on one’s past successes is not adequate for survival in the future.

Being fittest in this environment does not mean being the best. It requires having “street-smarts” to navigate competitive and economic challenges.

Are you fit enough to survive?

Ravi Patel

Published in: on October 29, 2019 at 7:23 am  Leave a Comment  
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Realistic Expectations

Entrepreneurs get into business to develop an idea into something really big.

While putting together their Business Plan, they have certain expectations of how this idea will be commercialized and the Revenues and Income that the business model would generate.

Entrepreneurs hire people and have expectations regarding their performance. Similarly they expect clients or customers, vendors, other stakeholders will work with them in certain ways.

Entrepreneurs need to be careful about not having false expectations or hopeful wishes when they develop their Vision and Mission. All expectations need to be realistic, rational, and take into consideration the factors beyond the Entrepreneur’s control.

Having false expectations leads to unachievable dreams and disappointment. Moderate your expectations to be realistic, so that when your expectations are exceeded one has a reason to be jubilant.

Ravi Patel

Published in: on July 9, 2019 at 4:15 am  Leave a Comment  
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Stand Still Sometimes

“Be not afraid of growing slowly, be afraid only of standing still.” – Chinese Proverb

Entrepreneurs do not have a problem of standing still. Rather, they are always on the move and wanting to grow – albeit too fast!

While the proverb emphasizes the point that one needs to keep on growing rather than standing still, Entrepreneurs sometimes need to stand still. Why and when is that appropriate?

Similar to a traveler stopping once in a while to get his/her bearings and ensuring they are headed in the right direction, Entrepreneurs need to do the same for their business. Instead of charging ahead with full steam all the time, stop, step back, and evaluate whether you are on the right path towards your Mission. Do you have the necessary infrastructure and leadership team to continue down the correct path (like a traveler assessing whether he/she has adequate supplies and fuel)?

The best time to stand still is when Entrepreneurs are not working in their business. Stand back and evaluate. Make adjustments as necessary and then continue your efforts to grow.

Standing still once in a while is good for you!

Ravi Patel

Published in: on June 18, 2019 at 4:28 am  Leave a Comment  
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