• Thought leadership and opinion pieces from Aperio FMCG Consulting.
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Have corporates lost the entrepreneurial spirit?

Some of the greatest enterprises in our history were based on what most with a corporate background would consider a harebrained scheme. All corporate organisations started out as an entrepreneurial idea and at the core of entrepreneurship is the pursuit of opportunity and turning opportunity into a tangible result that smacks of success.

By Michael Wood, founder and director of Aperio, a business consulting company focused on accelerating growth of FMCG brands in South Africa and Sub-Saharan Africa.

The most noteworthy examples of wild card entrepreneurs dealing winning hands include: Richard Branson, Founder of the Virgin Group, Steve Jobs Co-Founder and CEO of Apple, Elon Musk, a South African-born inventor of the Tesla Engine and founder/CEO of SpaceX, as well as  Arianna Huffington, Co-Founder and Editor-in-Chief of The Huffington Post. While these are simply a few examples we need to remember that these gentlemen are rare examples of entrepreneurs who stuck around to help their seedling companies turn into the corporate giants they are today. 

Typically, the lifespan of most corporates founded by entrepreneurs follows a characteristic growth pattern: The entrepreneur has a concept/core idea and pushes to get the realisation of this opportunity off the ground. Once this idea has taken root, a skilled team moves in and develops the opportunity from a start up to an established and viable business with exponential profit potential. However, as is the nature of most entrepreneurs they soon move onto new ventures, or adventures often leaving the business behind. This is not a bad thing, but part of the entrepreneurial spirit. Those left behind are now free to implement processes and establish a managerial framework to create a self-sustaining and profitable entity.

While corporate structure and framework is stable, it does leave businesses vulnerable to stagnation. New ideas and innovation often take a backseat to policy and procedural line items. The saying, “can’t see the wood for the trees,” comes to mind. Businesses need to understand that the danger of this “security” is that product/service models become stale and the business loses touch with the natural evolution of their target market. The inevitable happens, profits drop and growth grinds to a halt. 

I believe that corporates can bring back their top game if they are willing to embrace the qualities that give entrepreneurs their inspired motivation that creates opportunity. These changes do not have to lead to a total structural overhaul but will simply empower the business to evolve with the market, and in some cases establish leading trends. 

Top three entrepreneurial habits corporates can adopt: 

1. Be nimble, be quick: Don’t get bogged down by corporate bureaucracy. We all know that the decisions making process takes time in the commercial world, but businesses need to be cognisant of how rapidly trends are moving. We are in the technology age and are governed by the internet of things and unlimited data options. If your product/service is not abreast of customer wants and trends you’ll become obsolete in a matter of months; today’s market no longer affords the luxury of months. Corporates have access to reams of market research and have the human resources to act quickly when opportunity presents itself. Do not hesitate to go out and make it happen!

2. Don’t stifle innovation: Perhaps the most relatable example I can give here is the advent of the touchscreen in mobile technology. Many mobile brands/manufactures did not believe that the touchscreen trend would impact the mobile market so greatly and scoffed at the concept taking off. Those who stifle innovation and don’t embrace it will lose market share they will never get back. This creates gaps for hungrier companies to thrive. Examples of companies that embrace innovation and have seen it pay off include: Apple, Google, Twitter, Salesforce.com and Amazon. If you would like to discover why, this article on forbes.com will prove an interesting read.

3. Embrace Risk – a little: Risk is not that kind of four letter word, but some would consider it a “risky” term to banter about the boardroom. In fact most companies tend to avoid risk to such an extent they actually actively disregard potential profit streams. Remember there is a team of experts behind you to help your organisation mitigate risk factors. Elon Musk managed to lead a company to accomplish what no other American firm has been able to do in the past 50 odd years: build a new, promising car company, Tesla. In 2008 Musk invested his last $35 million in his vision. The gutsy move paid off and Tesla is now worth $2.5 billion. The company continues to push ahead by taking calculated risks. 

“I believe that drudgery and clock-watching are a terrible betrayal of that universal, inborn entrepreneurial spirit.”

Richard Branson

 

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