There is one and only one responsibility of business; to use its resources and engage in activities designed to increase its profits so as it stays within the rules of the game.
—Milton Friedman
In this chapter, many of the themes discussed elsewhere will align. Understanding your perspectives of resourcing and resource management is critical to running a successful business and building a solid platform for growth and expansions. A great deal of the principles discussed will be applicable throughout the entrepreneurial journey, irrespective of business type or size.
As a series of start points:
• Make sure you understand yourself—have a clear self-understanding of why you want to embark on your entrepreneurial adventures. For example, you may consider your current and aspirational skills and competencies, your areas of expertise, your aims and desired outcomes, and your hoped-for work–life balance. Entrepreneurship will mean that every part of your life will change; you need to maximize the chances of everything working out well for you and other stakeholders, including family and employees. Ongoing self-awareness is essential.
• You need to have an idea, your idea: This idea will fortify every aspect of your business. Your idea and your vision for your business make you different and unique from your competitors. Ultimately, your idea justifies the reason for your business’s existence and provides a platform to build on.
• Your dedication and drive are crucial: For many entrepreneurs, especially in the early stages, long hours and some erratic working schedules are the norm. This commitment, your commitment, requires your time and ultimately sacrifice. You will also need to support and understanding of your family and friends.
• Expertise, possibly from a range of sources, is usually essential, especially in your early days: Advice may be sought for the legal, finance, and marketing strategies of your business. Critical issues to consider include your business name, registration of your business, any required permits to trade, trademarks, copyrights and patents, obtaining a license, and opening a business bank account. As you go through any period of expansion, expertise in trading outside domestic markets, HR, and employment law may need to be sought.
• There is a need to plan, for the short, medium, and long term (this is covered in more detail in Chapter 6): Your business plan is a document that will continually be appraised and need to continually evolve. To retain its value and to have meaning, your business plan needs to be regularly reviewed and updated to accommodate inevitable internal and external changes.
• How you will structure your business: For example, will you be a sole trader, set up a partnership, or set up a limited company. This may well be an area where professional advice will prove invaluable. This is an area to keep under review, some business models lend themselves to certain types and size of business, and if you are planning or going through expansion, your structure may need to change.
• Your business needs capital: Your capital is your acquisition or access to various sources of funds, that is, money in the bank (liquid funds) or money you can access. As has been referred to in previous chapters, there are many sources of funds, including your own savings (bootstrapping), grants, loans, private investor finance, crowdfunding, or family.
• You need a place to work, a suitable venue that is commensurate with the stage of evolution of your business: Your workplace needs to be appropriate with your type of business, your image, and brand. Your place of work also needs to be accessible to your customers, employees, colleagues, and any other stakeholders. Accessibility can of course be face to face and/or via technology.
In the early days of your business, and as a good practice dictates, every day after, cost awareness and control must be a top a priority. So, if you are seeking premises, find out the rental costs, the utilities, and other costs before committing. Also be careful of any other costs you may occur and keep this area under review.
• You need to have something to sell—your product or service offering. So, research, design, production, packaging, market testing, distribution, and legal compliance are some of the key stages of your entrepreneurial journey. Quite possibly you will need to source expertise, guidance, or a second opinion along the way.
• Depending on your scale of operations, you may need to build a team—perhaps, an employee, a business partner, or freelancer. When building your team, it is really important to establish a shared vision, clear goals, and clarity of roles and responsibilities. Involving others also offers you the opportunity to build your business culture and sets a foundation to build on in terms of adding new employees. If a vision and culture is already established, it will be more straightforward to add new employees to your business.
• You need customers: No customers mean no business. Your marketing strategies are therefore another key component of your success. Ultimately, your business’s future and very survival depends on its ability to generate sales and income.
Over time, when all goes to plan, your business will prosper and potentially grow. Today, your effective use of social media is crucial as is your (internal and external) customer service. You need to be prepared to compete in an ever more uncertain and volatile marketplace and business environment.
• Embracing feedback from all directions adds immeasurable value: Invite ideas, involve others, and seek opinion that may in some cases be different to your own. Often, a different perspective can lead to a better outcome. Ultimately, all stakeholders will have views and listening and being receptive will serve you well. This is also an approach that can gain you brand advocates, people who will spread the positive message about your product and service offering. Also remember that negative feedback can also be extremely valuable. Those offering such comments may well be trying to be helpful; furthermore, they may have a very valid opinion that is worthy of your time to consider further.
Understanding the People Resource
As you go through the entrepreneurial journey, there may well be a time where you have to think about hiring new staff. This may be from the beginning or in some cases as you go through a period of growth or expansion.
It is important to note that this can be an advantage to your business as it either leads to expanding the knowledge and skillset available or simply means that you need more people to meet demand. However, it also comes with great responsibility. As an employer, there are a number of areas to consider such as holidays and sick leave, and as an entrepreneur, the success of your business is relied upon by both you and your employees. Ultimately, if there is a success, you all share that success, but if things go off track, the business potentially closes, and there is potential for a large amount of people who lose their jobs. So, this is not an area to be taken lightly.
In terms of deciding whether to hire, it will largely depend on what type of work you need help with, and whether it is a seasonal type of work or something more permanent. This will largely depend on the type of business and the quantity of demand. But this is an important consideration, and you don’t want to hire full-time staff for three- to four-month demand and end up with employees with nothing to do.
It is also important when hiring to be really clear about what type of person you are looking for—not just in terms of qualifications and experience but also in terms of character and whether they will fit into your company culture. This is an important concept to consider in terms of staff retention. If you have a positive culture that encourages participation and opportunities for development as well as having a fair and transparent reward and recognition strategy, employees will be more likely to stay (or at least less likely to be actively looking to leave).
As you expand, it may be a consideration to put management teams in place for parts of the business. This may be due to increased volumes of demand or because specialist support is needed in certain areas. An example of this could be hiring a marketing or social media expert to head a team in that area. Another example could be hiring a HR expert to manage areas such as staff welfare. This can be beneficial, particularly if you are adding expertise and filling a skills gap in your team. However, in the early days, usually a team is relatively small (potentially one or two people), so there must also be a realization that if you add levels of management, there will be increased ideas and input and also a dilution of the entrepreneur’s level of control. This can work both ways, but it is important to do your research and ensure you are getting good-quality people that you can trust and give that you are comfortable to give level of responsibility.
However, it is important to note that being an employer means added responsibility for payroll, annual leave, sickness and absence, health and safety, and various other aspects of employment law. Irrespective of management teams or how you divide business areas, the entrepreneur has overall responsibility. These areas will have an impact on your business in one way or another and must be taken seriously.
In conclusion, during this brief chapter, we have tried to collate a range of themes discussed elsewhere in more detail. One of the primary purposes is to try and demonstrate how so many different actions need to be adeptly and consistently aligned when you look for entrepreneurial success. Any business, of any size, will run a lot more smoothly when the various, and sometimes many, moving parts run together in an efficient way.
You need a relentless drive that others may not have to give yourself a maximum chance of success. Your vision will inspire you and your key stakeholders. Your business needs a clear, yet adaptable strategic vision and you need to pay attention to every single detail. Importantly, you will have a willingness to continually learn, to continually improve, to self-develop, and to inspire the same for those around you.
I’ve learned, like with anything else, business is only as good as your connections and your resources. And some of the resources that I have are the fact that I work with huge artists.
—Daymond John