Being a “composer”
Becoming an entrepreneur is not something you can do effortlessly. But you can become an entrepreneur following the rules of the consumer market, and at the same time breaking them. This is something that only people with non-standard abilities and ways of thinking can allow themselves to do.
The crucial quality of a future entrepreneur is the ability to “compose” the process. An entrepreneur must be a “composer” or aspire to become one.
It is great for a burgeoning entrepreneur to combine the qualities of a “creator” and an “organizer”. A businessman must not only be able to “create a melody”, but also to “organize” its production and marketing, moving from the handicraft stage to one of modern structured production.
Creativity, aimed not only at producing goods and services, but also their marketing is the cornerstone, or one might even say, the philosopher’s stone of entrepreneurship.
Many examples of success on the market are based on exceptions, and it is those exceptions that modern gurus use as the basis of their training programs in business schools. However, the reality of business is way beyond the examples of Coca-Cola, McDonalds, Microsoft, Ford, Trump or Steve Jobs.
The overwhelming majority of aspiring entrepreneurs do not understand how it’s possible to create a miracle such as the internet.
Entrepreneurship is a daily routine, full of headaches and hard work, which very rarely turns into a celebration of unexpected financial success. Moreover, success must never be a one-time thing, but a matter of years of stable growth. A business process can be compared to an escalator that only moves downwards. Want to be successful? Walk upwards! Want to get ahead of the others? Run without stopping!
So, your business has taken off, you reached your first success – you allow yourself to buy an expensive car and an elite house, guided, at times, not only by your own desires, but rather by established traditions…
A villa, a yacht, VIP-resorts, exotic countries… Out of fear of losing it all, the entrepreneur holds on to the steering wheel of their business so desperately that it gives them white knuckles. But as long as you are driving on your own, you remain a manager. This kind of a “split personality” – the owner and the manager – is like being a composer, who spends most of his time at the piano, but simultaneously acts as a musician in the orchestra of his own creation. To avoid wasting energy that can be channeled into creativity, the “entrepreneur-composer” must only “compose” the business, and the management itself can be delegated into the hands of a hired manager.
Success in the competitive struggle is a result of constant growth, as well as an ability to suggest new interesting methods of promoting your products and services, and constant renewal. If at the same time the entrepreneur remains a “composer”, they will always be one step ahead of their opponents.
However, there is a limit to any development, so we are inevitably facing the following question: how can you determine your maximum? Should you be satisfied with owning a cigarette stall, a hairdresser’s, or a small bakery? Is there a possibility of running a life-long small-sized business, limiting your expenses at the very beginning? Originally no one thinks about how high they will rise, but even those who sell homespun stockings, or stamp metal, want their products and their mastery to be recognized by the maximum number of people.
Recognition is measured in demand. “I want to produce something worth a dollar, but I want every person on the planet to buy it” – this is the kind of thinking appropriate for a burgeoning entrepreneur.
– Business case —
…I have witnessed a number of my friends open their businesses and suddenly their ambitions change and develop in new ways. One such company is now working with tent materials and has become one of the strongest and most well known in its segment. When they started, the business owners (a married couple) sold shoes bought wholesale and sold retail, accumulating experience, competence and the original capital. They visited Italian plants, increased the number of sales points, but at a certain moment they suddenly decided to sow tents for motor trucks.
Why would they shift into a totally different field? The answer is simple: they were unable to resist growing competition within the shoe business. And their “composing” talent told them to change the market, channel their efforts into a field where the competition was not so harsh.
At that time, the market for tents was empty and growing. At first, they decided to collaborate with “Kamtent”, a company from Tatarstan, but pretty soon an independent company “Nizhtent” was born. In the course of the first decade, “Nizhtent” not only became a dominating company in its region, but also started developing in other parts of Russia. The equipment they bought, and their production sites with dozens of well-trained employees, allowed them to step into making pavilions from tent and other special materials, and later rent them out. All that was possible because they chose to leave the “narrowing” shoe market and move to another guaranteeing them stable business growth.
I started by selling spare parts, but one day strolling through a market, I noticed that dashboard components (there were over a hundred of them) were sold separately, and all the parts, including the tiniest ones, were in stock. Adding up the price, I realized in the same market a full dashboard was two or three times more expensive. So I bought all the components, assembled a dashboard and sold it at the nearest consignment shop, thus doubling the capital I had invested in the components.
In a few months several dashboard assemblers were working in my shops, and in the following years my fledgling business produced thousands of dashboards for the growing automobile market.
Just as one cannot write a score without notes, or become a composer without an ear for music, an entrepreneur can never develop and expand their business without education and discretion.
I have travelled and studied a lot, and visited various business-schools. One training program in Switzerland was based on a very useful slogan: “Pry!”
Pry and learn: the path that others have already walked is something to be studied as quickly as possible. It is very important to get to know the process intimately, to try and come to grips with everything that is connected with supplies, to find out how dealers and distributors work in the field that you are interested in, what are the legal norms, the taxes and the limitations, what licenses are required, and how your products or services should be licensed.
– Business case —
…A buddy of mine, having already become a successful entrepreneur in the wholesale and retail food trade, decided to start a second business. In no time at all he bought equipment for the production of toothpicks and opened a small workshop. He had learned the technological process somewhere and reasoned that having over fifty shops (and the experience of selling large batches in other friendly retail networks), it wouldn’t take long to make his toothpick business a profitable one. Unfortunately, neither his business experience, nor the perfectly copied technological process helped him, because, as it turned out, he did not have the entire “score” for the process of producing toothpicks. It was very important to determine certain things. How much was the cost of a cubic meter of timber? What quality timber should be used? Was there a possibility for regular cooperation with a serious supplier and how should one deal with packaging?
He opened that production line because he owned a small forestry, which could provide him with cheap timber of any size and quality. But it transpired that timber logging, production of toothpicks, packing and selling them are separate businesses that vary in profits, volumes and complexity. When the entrepreneur combined them, the result he got was a failing toothpick business he subsequently had to sell along with the logging business. As for food retail, he is still very successful in this field.
Once I decided to help someone build a business from scratch. I was sure that in order to do that it was enough to use certain knowledge that I had, chose the right product and a place to sell it, and everything would work. We chose the German leather brand “Picard”, bought a sufficient amount and wide range of products directly from the plant, and with the highest possible discounts, brought them to Russia, went through customs, and opened two sales points. Successful sales continued for only ten months, while the owner of the business was in charge herself. However, then she had to delegate management to a trusted top manager. After a while the business stopped bringing profits and was finally shut down.
However “correctly” a business is organized, it should be managed by its owner. No consultant will ever arrange a business so that it keeps bringing continual profits without any participation from the entrepreneur, because as the “play” of the business is being written (a business process is never embalmed), only an “entrepreneur-composer” can make changes and be consistently successful. But the business process itself will never be over.
