Thinking Entrepreneurially

The Entrepreneurial Mindset

Part of the challenge of being an entrepreneur, if you're going for a really huge opportunity, is trying to find problems that aren't quite on the radar yet and try to solve those.

                                                                                                                                Sean Parker

                                                                  Former President of Facebook and Co-Founder of Napster

Why is the Entrepreneur at the heart of entrepreneurship?

It is important to recognise that the person, the entrepreneur, is at the heart of the matter when we look around and see how technology and other factors changes. This is why an understanding of the mindset of  entrepreneurs is critical to understand how to develop and launch successful ventures.

By exploring the entrepreneurial mindset, you can understand why less than 5% of society become entrepreneurs. Entrepreneurs tend to be independent individuals, intensely committed to perservering in starting and growing a venture. They are typically optimist who strive for success in their for-profit, non-profit, or social venture. They often burn with the competitive desire to excel, and use failure not as a referendum, but as a learning tool.

While every entrepreneur is unique, there are select commonalities in entrepreneurial mindset that they share.

Do you have a high need for achievement?

Need for achievement is a preference for challenge coupled with an acceptance of personal responsibility for outcomes. A personal drive for accomplishment evidences one's need for achievement. We may call this drive, or hunger, or a self-starter, or maybe self-motivated. All of those will be accurate as we think about need for achievement in this context. Need for achievement plays a key role in creating the entrepreneur. For individuals who score high in the need for achievement, the likelihood of them becoming an entrepreneur is high.

A high need for achievement makes for better entrepreneurs. Naturally, if you have a greater motivation, a greater drive, and a greater level of commitment, you're going to have higher involvement in your job, and in your career. You're going to have higher organisational commitment and commitment to collegues, suppliers, partners, customers, and investors. Need for schievement is therefore an enabler of becoming a succeful entrepreneur. 

How do you know you have a high need for achievement?

Take a step back and think about the entrepreneur. Think about yourself. We want to know what it means to have a need for achievement.

We first want to think about Goal setting.

• Do you have personal goals?
• Are they written?
• Are they specific and challenging and relevant?
• Do you mentally rehearse or forecast or think about future events?
• Do you anticipate obstacles?
• Do you develop alternative solutions?
• And are you not only driven to success, but are you planning your own success? 

Self monitoring is something to keep in mind as well. Are you tracking progress towards your goals? I am a believer of tracking what we care about, and measuring our progress towards our goals.

Does optimism truly improve performance and is it relevant in the entrepreneurial journey?

Yes, and it's evidenced in multiple studies.

In professional academic, and athletic settings, we see that optimism matters, and those who are optimistic perform at a higher level. There are benefits in optimism. It encourages entrepreneurs to try new things. It enables entrepreneurs to attempt the difficult, and attempt things that they may feel they don't have the right education or experience for, but they're willing to try anyway. We think that we can have a favorable outcome, and we'll make a go of it as entrepreneurs if we have an optimistic outlook. 

Final thoughts or shall I say questions?

Ideas in action: The entrepreneurial mindset

What role does need for achievement play in your decisions?

What level of influence do friends and family have in your decision making?

Do you have an internal or external locus of control?

What techniques do you use to focus your time and resources?

How can you improve your level of optimism?

In our next blog we will look at Entrepreneurial Motivation.

 Starting a business is an exciting yet challenging endeavor. Entrepreneurs often face a myriad of obstacles that can hinder their progress and success. Here are some of the most common challenges faced by startups:

1. Finding Product-Market Fit: One of the initial hurdles is ensuring that the product or service meets a genuine market need. Without a clear understanding of the target audience and their pain points, startups may struggle to gain traction.
2. Securing Funding: Obtaining the necessary capital to launch and grow a business is a significant challenge. Entrepreneurs often need to pitch to investors, apply for grants, or explore alternative funding sources like crowdfunding.
3. Building a Strong Team: Hiring the right people who share the vision and can contribute effectively is crucial. Startups often face difficulties in attracting top talent due to limited resources and brand recognition2.
4. Managing Finances: Effective financial management is essential for sustainability. Startups need to carefully monitor cash flow, manage expenses, and plan for future financial needs.
5. Marketing and Customer Acquisition: Developing and executing a marketing strategy that effectively reaches and converts the target audience is another major challenge. Startups need to be innovative and resourceful in their marketing efforts.
6. Scaling the Business: As the business grows, scaling operations while maintaining quality and customer satisfaction can be difficult. Startups need to develop scalable processes and systems to handle increased demand.
7. Navigating Competition: The competitive landscape can be tough, especially for new entrants. Startups need to differentiate themselves and continuously innovate to stay ahead.
8. Adapting to Market Changes: The business environment is dynamic, and startups must be agile and adaptable to changing market conditions, customer preferences, and technological advancements.

Should you need any help in starting up your startup or scaling your business, feel free to contact us on +27 83 417 0319 or email nevillesol@icloud.com

 

An uncertain world – how do I cope?

 

There is no getting away from it - we are operating in an uncertain world!  For some business owners, this will be the first time that they have experienced the challenges that a serious slow down brings and they may well be wondering what they should be doing to cope.

When things are going well average performance can be enough to pay the bills and make some profit however with today’s uncertain conditions being average is just not good enough.  To prosper you need to up your game – but what can you do to ensure that you are performing to the best of your potential?

Let’s not overcomplicate things here… when the ground rules change you need to go back to basics and ask yourself questions in three key areas:-

1.    Market – if the market for your products or services has changed drastically you will need to find out if you can diversify into other market sectors or whether you can target different customer types.  If you are able to adapt to new market sectors and customer types then you will need to consider whether you need a different marketing and promotional approach.  What will be the impact on costs and selling prices for this new approach?  Are you able to recover the impact of rising costs or are your margins being squeezed?  If you consider offering discounts be aware of the impact on profitability, will the discounted prices bring the necessary increase in volume to maintain or increase profitability?

2.    People – in today’s world people can be the key differentiator so you need to know if your people are fully equipped for the challenges ahead.  Do they understand and fully embrace the values and goals of the business?  Do they have the necessary skills and knowledge required to be the best?  Are they communicating effectively with all of the stakeholders of the business?  If your review of the market shows that you have no other option than to reduce costs and, if this means redundancies, then you will need to take specialist advice to ensure that you not only comply with employment legislation but that you also do the best you can for your people.

3.    Cash – revise your cash flow forecasts based on the information that you have gained from your market review.  Review all of your costs and carry out some “what if” forecasts to enable you to have realistic projections for your ongoing cash requirements.  Remember that funding providers (whether banks or investors) dislike surprises – make sure that you approach them with all of your research before you need the additional funds.

None of the above is rocket science however it can be too easy to ignore the basics, cross your fingers and hope for the best.  Once you know the reality of your current situation you can then take the necessary action to move forward.  By preparing your business to succeed in tough times you will be able to reap the rewards when things improve.

Taking on a Business Coach helps businesses to reach their potential – even in difficult times.

 

Efficacy of Coaching in the Workplace

There is a growing body of scholarly evidence-based research that supports the effectiveness of coaching. A meta-analysis of 37 studies found that coaching was effective in improving job satisfaction, organizational commitment, and job performance (Sackett & Mullen, 1993). A review of 20 studies found that coaching was effective in improving self-efficacy, goal setting, and self-regulation (Kinni & Kivinen, 2000). A study of 300 employees found that coaching was effective in reducing stress and anxiety (Bergstrom & Cooper, 2003). A study of 200 managers found that coaching was effective in improving communication skills, conflict resolution, and decision-making (Lombardo & Eichinger, 1990).

The effectiveness of coaching depends on a number of factors, including the quality of the coach, the goals of the coaching, and the willingness of the client to engage in the process. A good coach will have the skills and experience to help clients achieve their goals. They will be able to create a safe and supportive environment, and they will be able to provide effective feedback and guidance. The goals of the coaching will determine the specific areas that the client will focus on. For example, a client who is looking to improve their job performance may focus on goal setting, time management, and communication skills. The willingness of the client to engage in the coaching process is also important. Coaching is a collaborative process, and the client must be willing to participate actively. They must be willing to set goals, to work on their development, and to receive feedback from the coach.

If you are considering coaching, it is important to do your research and find a coach who is qualified and experienced. You should also be clear about your goals and be willing to engage in the process.

Summary of Findings

Evidence-based research on the effectiveness of coaching in the workplace has found that coaching can be an effective tool for improving job satisfaction, organizational commitment, job performance, self-efficacy, goal setting, self-regulation, stress reduction, and communication skills. The effectiveness of coaching depends on a number of factors, including the quality of the coach, the goals of the coaching, and the willingness of the client to engage in the process.

Table of Significant Observations

Study Sackett & Mullen (1993) ​Kinni & Kivinen (2000) Bergstrom & Cooper (2003) Lombardo & Eichinger (1990) Grant, O’Connor, Passmore, & Wade-Benzoni (2019) O’Connor & Passmore (2013) Passmore & Grant (2011)

Findings Meta-analysis of 37 studies found that coaching was effective in improving job satisfaction, organizational commitment, and job performance. Review of 20 studies found that coaching was effective in improving self-efficacy, goal setting, and self-regulation. Study of 300 employees found that coaching was effective in reducing stress and anxiety. Study of 200 managers found that coaching was effective in improving communication skills, conflict resolution, and decision-making. Meta-analysis of coaching effectiveness: Evidence-based practice in organizations. Systematic review and meta-analysis of coaching effectiveness. The effectiveness of executive coaching: A meta-analytic review.

The Effectiveness of Business Coaching on Businesses

Business coaching can have a significant positive impact on businesses. Here are some key effects:

1. Increased Productivity: Studies have shown that business coaching can lead to a substantial increase in productivity. For example, a study of Fortune 1000 companies reported a 53% increase in productivity among executives who received coaching¹.

2. Improved Leadership Skills: Business coaches help leaders develop essential skills such as effective communication, team building, and decision-making. This can lead to better management and a more cohesive team².

3. Enhanced Customer Service: Coaching can also improve customer service. The same study of Fortune 1000 companies found a 39% increase in customer service quality¹.

4. Higher Employee Retention: Companies that invest in coaching often see higher retention rates among senior staff, which can save costs associated with turnover and training new employees¹.

5. Cost Reduction and Profitability: Coaching can lead to a reduction in costs and an increase in profitability. For instance, companies have reported a 23% reduction in costs and a 22% increase in bottom-line profitability due to coaching¹.

6. Strategic Advantages: Business coaches provide strategic insights and help align business strategies with the owner’s vision, identifying opportunities for growth and improvement².

7. Accelerated Success: By guiding entrepreneurs through potential pitfalls and offering solutions based on firsthand experiences, coaches can help accelerate business success and minimize mistakes³.

Overall, business coaching can be a valuable investment for companies looking to enhance their performance, leadership, and overall success. Have you considered business coaching for your own business?