Andrew
Entrepreneurship Matters
Dr Kudzanai Vere
Starting and owning a business is everyone’s wish and dream but very few have the spine and tenacity to religiously go through the process.
We have seen a number of friends and relatives starting some form of enterprise within our vicinity and up to now, they seem as if they only started yesterday, no significant growth and improvement. I have personally restarted several times in my business and have picked up crucial business lessons along that journey. The biggest question is, why is that so?
We have heard a number complaining about our current economic situation and blaming it in part to lack of funding for our local entrepreneurs, micro, medium and small enterprises.
Though the statement is somewhat true, we have a greater majority who have failed institutions and relatives who had extended some credit facility to them in the name of capital.
We all know and understand that capital, business ideas, skills and the will to configure resources in the form of a business are necessary ingredients but they cannot sustainably work in isolation. This article talks about the pillars of a sustainable business.
Unique, sound and bankable business ideas
Sustainable business revolves around sound business ideas that have been injected with life. An idea is turned into business by massive and decisive action. Any business idea that doesn’t effectively speak into solving a social economic challenge is likely to fail.
It’s noble and highly expected of strategic business thinkers to have their businesses on paper first and critique them until they are convinced that they now speak to their cause.
An unsupported idea will remain a lifeless idea. Business ideas are tested for sustainability by thorough scrutiny and feasibility studies, once they pass this they then move on to the implementation stage.
Bankable business ideas always get funding. There are those with money but don’t have the wisdom to configure it into a viable business. Most financial institutions and at times relatives are eager to support bankable business ideas.
A bankable business idea is the one which when people gets wind of it, they see money. Your business idea must be solving pressing problems people are facing in the marketplace.
Initial and working capital
Every business needs capital and this is an indisputable fact. The source of capital can be another thing to talk about. As mentioned above, capital can come from different sources but not all sources are advisable for a start-up business and even for sustainability purposes.
Capital in simple terms is the money used to start a business, own funds or borrowed — it remains capital.
Borrowed capital for a start-up is risky as you would need to be much disciplined in terms of your spending.
If the debt is reasonably priced in terms of the interest rates you can be better off. The interest rate must not be punitive to wipe away all the profits that you would have made.
Savings is another option that one can use to finance their business. This is a safer source of capital though at times it might be difficult to save enough as inflows are normally constricted.
Human resources
The most brilliant business idea can only become a sustainable business through people. You, the brains behind the business are the first human resource the organisation will have but as the workload increases, you will need more than an individual.
You are bound to employ others to assist. This team helps you shape the organisation and makes it shine in the market. In the same vein, if you fail to attract the best people in the market, the same resource can also work against your dream and get everything shuttered.
Successful organisations world over are sailing mainly because of the quality of human resources they have. Most organisations hire for qualifications and skill with less regard on issues of character. The first two can be worked upon but character is a bit difficult. We have had many cases where organisations have been thrown under due to employee character inconsistencies.
The quality of your employees ultimately determines how far you will go. Without a passionate, committed and dedication workforce, it will be difficult to succeed and sustain your organisation.
Systems
A business system is a defined set of principles, practices and procedures that are applied to specific activities to achieve a specific result. Basically, it’s about detailing how things are done and coming up with a way of doing them.
We basically have two types of systems that can be used within a business that is the manual way of doing things that most SMEs use and the computerised one. We have a few who are now embracing the use of computerised systems to assist them to efficiently and effectively carry out organisational tasks.
Systems can be created for every area of your businesses. From making sales to building marketing strategies, even to managing the cleanliness of the workspace, systems can make all these tasks easier and more efficient.
Stocks (products/services)
Different markets have different problems and businesses are set up to proffer solutions to the various challenges people face. These solutions come in the form of either products or services. Without a product or a service to give to a market, then we are far from talking about business.
That idea you have must end up being a product or a service for it to have value. All the products and services that you see in the world were once ideas in some people’s minds which were processed further into products and services that are now benefiting the masses.
Products and services need to be continuously improved as market demands continue to evolve on a daily basis. Having seen their importance within the business set-up, they must be well packaged and managed to remain attractive to the market.
Sales
The conversion of products and services into money is the ultimate goal of any business. Those stock piles must become cash and that can only be achieved through sales. You might have a very good stock holding figure (stock value) and that is nothing to talk about if you cannot convert it in the shortest possible time to money.
We don’t pay salaries, rentals and bills using the services that we offer or the stocks in our shops. These things need money which comes as a result of effective selling strategies.
Standard Operating Procedures (SOPs)
In my article dated June 26, 2022, I emphasised the issue of standard operating procedures in small and medium enterprises. Most small players take these for granted and yet it’s the main reason they have remained stagnant. Without properly laid down operating procedures, smooth flow and productivity will be very difficult.
Standard operating procedures provide the policies, processes and standards needed for the organisation to succeed. They can benefit a business by reducing errors, increasing efficiencies and profitability, creating a safe work environment and producing guidelines for how to resolve issues and overcome obstacles.
Marketing
Marketing is a process that directs customers’ attention to the products and services you offer as an organisation. This process boost organisational performance through enhanced sales. In marketing, you’re literally exposing your organisation to your target market. The process refers to all activities a company does to promote and sell products or services to consumers. We normally talk about the marketing mix as a tool that organisations can use in their quest to conquer the market. The mix have product, place, price, promotion as the basic elements which can be increased depending on your thrust.
Research & Development
Research and development (R&D) is when businesses gather knowledge to create new products or discover new ways to improve their existing products and services. Larger companies may have their own research and development team that will test and refine products or processes before commercial use. The word research and development is yet to make sense in the small and medium enterprises as it is in large corporates.
We can only have better markets, better products, better systems and better people through research and development. Large corporate have separate budgets and departments responsible for their research and development for they know it’s a pillar for their sustainability. Everything is changing on a daily basis and so should be your systems and overall way of doing things.
Conclusion
In as much as the majority are venturing into businesses, very few are making it to running sustainable entities due to failure to erect all the pillars I have discussed about in their businesses. Capital alone cannot make it neither can a competent team makes your business sustainable. Every pillar need to find its place in the whole matrix for your business growth and sustainability.
The writer, Dr. Kudzanai Vere is an entrepreneur, author of four books, business and personal development, multiple award winning entrepreneurship and business coach. Dr. Vere has coached more than 5000 entrepreneurs globally and continues to impact people in the areas of entrepreneurship, business and personal development. He is the CEO of Kudfort Group./Contact Dr Kudzanai Vere for transformational entrepreneurship and business coaching and training on [email protected] or +263 719 592232
Tinaye Agere
Online Reporter