The Secret to Entrepreneurial Success
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We often hear dire warnings about the high failure rates of start-ups and smaller businesses. What we don't hear about is how remarkable it is that entrepreneurs so often beat the odds and grow successful enterprises, even though they generally lack the resources that bigger companies have ready access to. Entrepreneurs often do the apparently impossible. Just how do they do it?
I think the secret ingredient is caring. If it's your business, you care about it in a way no hired-gun executive ever can. And that caring extends to the people who make up your workforce and customer base as well. I was thinking about this secret ingredient of entrepreneurial success the other day when I got an interesting note by e-mail from someone seeking advice. He wrote:
I think of my business as an extension of my family and try to take good care of my employees and customers. But as the business grows, my advisors are encouraging me to take a more businesslike approach. They want me to begin charging higher prices to customers who can afford to pay more instead of continuing to give deals to my best customers, and they say I should get rid of some of my more loyal employees in favor of younger, cheaper workers. Do I have to get tougher to grow my business?
Entrepreneurs often feel the pressure to adopt big-company ways as they grow. Some of those ways are appropriate--for instance, you can't continue to do shoe-box accounting beyond a certain size. But some of those big-company practices are best avoided if you don't want to lose your edge in the entrepreneurial success game.
The toughest thing to do in business is to truly care about your company and the people it affects, and then make decisions based on those feelings. Trust me, businesses grow when someone cares. That's the "secret" ingredient in running a successful entrepreneurial venture.
I'm reminded of a news story I followed recently about a famous San Francisco bakery that makes sourdough bread from a recipe and the original "mother yeast" dating back to its founding in 1849 by Isadore Boudin. The company stayed in the Boudin family (and carried the Boudin name proudly on all its products) until a larger company made them such a generous offer they couldn't resist selling. That was in 1993. The company that bought them out also acquired other local bakeries and brands. But it eventually sold off most of the brands and shuttered some of the local bakeries. When the Boudin brand and ovens came back on the market this year, the original family stepped back in and re-acquired them.
Why? Because they care in a way the corporate owners apparently didn't--which means the family is more likely to nurture this business and make it grow and prosper. How do I know they care? Because Steven Giraudo, whom local papers in San Francisco describe as "the family patriarch," continued to stop by the old family bakery every morning at 3:30 to make sure the morning's batch of bread was made correctly, even though his family no longer owned or ran the bakery. For nine years, the family "kept the faith" and continued to care about the quality of its bread, and San Franciscans (myself included) breathed a sigh of relief when we learned it was back in the safe hands of family members again.
Why relief? Because sourdough is a San Franciscan tradition and delicacy. And because the corporate owners had already sold off several old-time brands to a much larger national bakery that, some fear, will not maintain the traditions and quality we care about.
As for whether my e-mail friend should penalize his most faithful customers and employees in order to cut short-term costs, well, what would someone who really cared say to such proposals? Obviously that's no way to nurture a business.
If you're an entrepreneur who worries that you care too much, just remember that care is as important an ingredient in growing a business as, well, the yeast is in baking a loaf of bread. When nobody cares enough to keep your special culture of yeast alive, what happens to the company? That should help you remember the right direction to take.
Alex Hiam is a trainer and consultant and the author of Motivating & Rewarding Employees: New and Better Ways to Inspire Your Peopleas well as Marketing for Dummies. His new book, Making Horses Drink, is now available from Entrepreneur Press and major bookstores.