an emotional skydiver—is often overstated when describing the types of people who make good entrepreneurs. Many people who don’t think of themselves as embracing risk become entrepreneurs. The key is that although a successful entrepreneur takes risks, those risks are measured. While entrepreneurs frequently go out on limbs, the ones that make it generally test that limb first to make sure it has a good chance of bearing their weight.
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Great entrepreneurs expect change
Change is inevitable, but one thing that sets successful entrepreneurs apart from others is their willingness to adapt to, embrace, and even leverage change for their own gain. Many entrepreneurial companies, especially those involved in technology, have change at the very core of their existence. Still, for every business, change is inevitable.
Even companies that were created on the basis of innovation often become staid over time. Once they have established customers, channels, business units, and models, it’s easy for them to get complacent. Their employees become used to doing things the way they always did. When companies are mired down in doing things the same old way, they become rich targets for newer, entrepreneurial companies to go after.
The best entrepreneurs—the ones who succeed over decades—recognize that they must keep responding to change, reinventing their companies, continually innovating.
In planning for change, keep in mind the kinds of conditions that will affect your business’s future.
REAL-WORLD RECAP
Changes that will affect your company
■ Technological changes
■ Sociological changes
■ Competitive changes
■ Market and marketing changes
ENTREPRENEUR’S WORKSHEET
Think Like an Entrepreneur
The most successful entrepreneurs possess numerous key characteristics. Not all entrepreneurs have all of them, of course. But check the traits that apply to you. Work on developing the ones you’re missing.
☐ You see opportunities where others see problems. When you encounter a need that isn’t filled or a flaw in a product, service, or even our society, you look to see if there’s a way to solve it.
☐ You are driven to succeed. You’re so motivated to achieve your goals that you’re prepared to overcome obstacles that would likely discourage or stop others.
☐ You are a self-starter. Rather than waiting for someone to issue instructions, you can take initiative. When you’re interested in something, you don’t need others to tell you what to do.
☐ You are persistent. You don’t give up on things easily. You can handle setbacks and keep on going.
☐ You are innovative. You can think “outside the box” when attempting to meet challenges.
☐ You are energized by challenges. The idea of having to solve a problem, create something new, or build something from nothing, spurs you rather than deters you.
☐ You take control of your own destiny and bear responsibility for your own actions. You don’t blame others for what happens to you in life. You can honestly accept responsibility for the results—both positive and negative—of decisions you make and actions you take.
☐ You are willing to give up the security blanket of a “regular” job. You don’t mind working without the safety net of a regular paycheck or the benefits and social structure that an established employer provides.
☐ You accept and embrace change. Change is inevitable, yet in the entrepreneurial world, change comes even faster and more frequently. But rather than fearing it, you welcome it and enjoy the excitement of the ride.
☐ You can be a team player. No great entrepreneurs succeed on their own. You’re able to work with others to achieve a common goal. You’re capable of listening to others’ ideas and incorporating the good ones into your own thinking.
☐ You understand the importance of making a profit. You know that all your best intentions and actions are for naught if you aren’t actually making a profit—that is, bringing in more money by selling a product or service than it costs you to provide it. You’re not embarrassed by the idea of making money.
■ Technological changes. It’s impossible to predict the exact technological developments that will affect your industry, but you can be sure that you’ll face such changes. Even if you make old-fashioned chocolate chip cookies, you’ll find that advancements in oven design, food storage, and inventory control software will place competitive pressures on your business. Competitors’ technological advances may cause significant downward pricing pressures on you.
■ Sociological changes. Evaluate demographic and lifestyle trends in light of their potential influence on your business. In the cookie business, for example, consumer interest in natural foods or the number of schoolage children in the population may influence the number and kind of cookies you sell. What sociological factors have the greatest impact on your company? Keep your eye on trends that represent true change; be careful not to build a business on passing fads.
■ Competitive changes. New businesses launch every day. How hard is it for a new competitor to enter the market, and what are the barriers to entry? The Internet has enabled companies all over the world to compete against each other, increasing the number and type of competitors you may face.
■ Market and marketing changes. Consider how your company deals with these outside changes. Also anticipate major internal changes, such as growth, the arrival or departure of key personnel, and new products or services. No business is static. Planning a company to be agile and responsive to change will make the inevitable changes easier.
Does failure mean you’ve failed?
History is filled with stories of entrepreneurs who’ve failed at first. Bill Gates and Paul Allen started—and failed at—a computer company before they started Microsoft. Steve Jobs was fired from Apple; went on to start a new company, NeXT, that was widely considered unsuccessful; then was brought back to Apple and led it to become the most valuable company in the world. The founder of FedEx, Frederick W. Smith, while a student at Yale, got a “C” on a business paper outlining his idea.
Great entrepreneurs know how to fail
One critical key to entrepreneurial thinking is to learn how to think differently about “failure.” True, nobody wants to fail, but, for most entrepreneurs, some failure is inevitable. Or at least it is if you ever hope to succeed. Virtually all success depends on trying things that may fail.
Successful
