The Entrepreneur's Ever-Changing Role
FastTrac, Kauffman Foundation
Although no one perfect blueprint exists for you to follow at different stages in your business's life cycle, some common stages occur across businesses. Your role should evolve along with the needs of your business.
Initial conception stage- Entrepreneurs are usually making all the decisions at this stage. Their efforts are focused on identifying business opportunities to pursue and creatinginitial strategies and operational plans. Your reputation will drive your success at this point. It will attract customers who buy, entice prospective employees to knock on your door, and prompt important individuals in your industry to think of ways to work with you.
Start-up stage- After the business is launched, entrepreneurs struggle to survive while managing things on their own. Their work focuses on modifying the products or services to meet customer needs, experimenting with marketing activities, and struggling to get customers. During initial hiring, focus on the values and mission of the organization. You should look for people whose core values match the company's.
Early stage- The business has attracted customers but struggles to increase sales at this stage. The entrepreneur begins to rely on other management members and key personnel. Smart entrepreneurs often hire a professional marketing person at this point. Your leadership role must begin to move away from micromanaging and toward visionary leadership and goal-setting.
Growth stage- Even though the markets are established, many companies experience continual cash flow challenges at this stage. New investors, customers, and staff are added quickly. Sales management is critical. Manufacturing companies need to hire a production manager. You may want to bring in someone else to take over the operations of the company while still retaining your role as the visionary leader, primary goal setter, and public face of the company.
Rapid growth stage- When the business outpaces industry growth rates and has established itself as a viable on-going concern, it is often time for a professional management team to be put in place. At this stage you can maintain your role as visionary leader or find specific niche roles to play depending on your inclinations and organizational needs.
Maturity stage- The business has well-established markets with multiple products or services. It experiences increased competition and saturation of the market. At this stage you'll be working with a full management team to fulfill the vision and goals of the company and preserve the business so it will continue to be healthy and increase in value.
Innovation or decline stage- The final stage of any business emerges when it must innovate or lose market share. All levels of the organization must be actively involved in innovation. In concert with the management team, you will have to drive change or the organization may die.
© 2007 Ewing Marion Kauffman Foundation. All rights reserved.