Share this fact with a friend
Four Primary Characteristics of Successful Entrepreneurs 1. Passion for the Business: The number one characteristic shared by successful entrepreneurs is a passion for their business, whether it is in the context of a new firm or an existing business. This passion typically stems from the entrepreneur's belief that the business will positively influence people's lives. Passion is particularly important for both for-profit and not-for-profit entrepreneurial organizations because, although rewarding, the process of starting a firm or building a social enterprise is demanding. 2. Product/Customer Focus: A second defining characteristic of successful entrepreneurs is product/customer focus. This quality is exemplified by Steven Jobs, the co-founder of Apple Inc., who wrote, "The computer is the most remarkable tool we've ever built . . . but the most important thing is to get them in the hands of as many people as possible." This sentiment underscores an understanding of the two most important elements in any business-products and customers. While it's important to think about management, marketing, finance, and the like, none of those functions makes any difference if a firm does not have good products with the capability to satisfy customers. 3. Tenacity Despite Failure: Because entrepreneurs are typically trying something new, the failure rate associated with their efforts is naturally high. In addition, the process of developing a new business is somewhat similar to what a scientist experiences in the laboratory. A chemist, for example, typically has to try multiple combinations of chemicals before finding an optimal combination that can accomplish a certain objective. In a similar fashion, developing a new business idea may require a certain degree of experimentation before a success is attained. Setbacks and failures inevitably occur during this process. The litmus test for entrepreneurs is their ability to persevere through setbacks and failures. 4. Execution Intelligence: The ability to fashion a solid idea into a viable business is a key characteristic of successful entrepreneurs. Commonly, this ability is thought of as execution intelligence. In many cases, execution intelligence is the factor that determines whether a start-up is successful or fails. An ancient Chinese saying warns, "To open a business is very easy; to keep it open is very difficult." The ability to effectively execute a business idea means developing a business model, putting together a new venture team, raising money, establishing partnerships, managing finances, leading and motivating employees, and so on. It also demands the ability to translate thought, creativity, and imagination into action and measurable results. As Jeff Bezos, the founder of Amazon.com once said, "Ideas are easy. It's execution that's hard." For many entrepreneurs, the hardest time is shortly after they launch their firm. This reality was expressed by Jodi Gallaer, the founder of a lingerie company, who said, "The most challenging part of my job is doing everything for the first time." To illustrate solid execution, let's look at Starbucks. Although Starbucks is not growing as fast and profitably as it once did, it is still a remarkable success story. The business idea of Howard Schultz, the entrepreneur who purchased Starbucks in 1987, was his recognition of the fact that most Americans didn't have a place to enjoy coffee in a comfortable, quiet setting. Seeing a great opportunity to satisfy customers' needs, Schultz attacked the marketplace aggressively to make Starbucks the industry leader and to establish a national brand. First, he hired a seasoned management team, constructed a world-class roasting facility to supply his outlets with premium coffee beans, and focused on building an effective organizational infrastructure. Then Schultz recruited a management information systems expert from McDonald's to design a point-of-sale system capable of tracking consumer purchases across 300 outlets. This decision was crucial to the firm's ability to sustain rapid growth over the next several years. Starbucks succeeded because Howard Schultz knew how to execute a business idea. He built a seasoned management team, implemented an effective strategy, and used information technology wisely to make his business thrive. These fundamental aspects of execution excellence should serve Schultz and Starbucks when it comes to dealing with the competitive challenges facing the firm in 2011 and beyond. In contrast to what Schultz has accomplished at Starbucks, the cost of ignoring execution is high, as explained by Bob Young, the founder of several entrepreneurial firms. When asked "What was your hardest lesson or biggest mistake?" Young replied, "In my first two businesses, my interest was always in 'the new thing,' so I wasn't paying attention to details. As a result of my lack of interest in getting the repetitive stuff right, we never achieved the profitability we should have."