Since starting out as a co-op student at GM in 1980 at the age of 18, Mary Barra has become the highest paid, and arguably most successful, CEO in the automotive industry. Unlike many of her counterparts, her educational and professional background are centered around engineering, and her approach to leadership has reflected that of an engineer. Since assuming her position as the CEO of General Motors, Barra has been named the 5th most powerful woman in the world by Forbes, received an honorary doctorate from Duke University, and was featured on the cover of Time’s “100 Most Influential People in the World”.
In their first few years of operation, small businesses are in a very precarious position. Not only do entrepreneurs need to go through the bureaucratic, strategic, and mundane work of getting their business running, they also need to satisfy startup investors and lending institutions, and attract new investment. Those who don’t often rely on personal savings and investments by friends and family members to launch their businesses, which places them under even more personal pressure.
When they’re trying to launch a new business, entrepreneurs have a lot to worry about. Developing a business plan, securing funding, conducting market research and testing, and doing the logistical work of setting up a business is only the start. After that, you need build and lead a team that’ll satisfy your customers, and grow your business into an innovative and ultimately competitive operation.
In the past century, most jobs required workers to focus on and apply a single well-defined skill-set in a relatively static and predictable way. Currently, and in the future, workers are going to need additional soft skills to improve their flexibility in the workplace.
Small businesses face an uphill climb when it comes to finding and retaining top performing talent. Experienced and talented workers often tend to aim for jobs with high rates of pay, excellent employee benefits, and job security with a clear path for advancement. Unfortunately, all of these are difficult for startups and small businesses to provide, particularly compared to what larger competitors can offer.
When she joined Ventas in 1999, Debra Cafaro found herself at the head of a business on the verge of financial collapse. Just 10 years later, the company was named the most successful publicly traded company in the first decade of the new millennium. In the past 19 years, she oversaw and implemented a strategy that brought the company’s market capitalisation from $200 million to over $24 billion.
Most small business owners launch their businesses using a fixed amount of capital, often their personal savings or a business loan. To give themselves as much time as possible to establish their business and become profitable, entrepreneurs tend to work with very tight budgets, keeping costs trimmed down as much as possible. Unfortunately, for many businesses, that means keeping wages low, and often hiring entry-level employees that aren’t fully qualified in hopes of saving money. Often, this turns out to be a mistake.
Though many small businesses rely on equity investment for their startup funding, most entrepreneurs still use their personal savings, private loans from friends, and financing resources to launch their business. This leaves them with a small, fixed amount of capital with which to establish themselves. As a result, most small businesses operate on very tight budgets that leave little room for extraneous spending, and that leaves businesses vulnerable to cash flow issues.
Business owners don’t start companies with the hope of just getting by. Rather, entrepreneurs pour their time and resources into their business because they’re passionate about what they’re doing, and they want to realise a greater vision. That means not just establishing their business, but growing, innovating, and taking a leading position in their industry. Doing so successfully, however, is tricky, and requires a lot of preparation.
Time is the most precious, and most limited, resource that small business owners have. There are never enough hours in the day to tackle all the responsibilities an entrepreneur needs to stay on top of. Early on in a business’ life, businesses don’t have dedicated teams to deal with payroll, sales, marketing, legal issues, production, or management. Instead, business owners find themselves trying to do all these jobs to varying extents.