An African approach to the SME Challenge.
What drives you? Why you do what you do matters as much as what you do.
Entrepreneurs have many reasons for starting their businesses. The reasons may include passion and purpose, making money, having a marketable skill, or a gap in the market. Whatever motivated an entrepreneur when they started a business will offer both a great driver for success in the business and a great danger in the form of a blind spot. Successful entrepreneurs learn early in life to leverage the drivers and watch out for the blind spots.
Concerning passion and purpose; have you ever met that amazing fundi who does a super excellent job but can never quite finish their work on time? Have you ever met that entrepreneur full of energy and bubbling with ideas on their project but just does not have enough money in the bank? If you have met any of these two kinds of entrepreneurs, then you have met the passion or purpose driven entrepreneur. Their number one priority is the product, the service, and customer satisfaction. They are consumed by the job and the output must not only be excellent, but it must also be outstanding. These entrepreneurs pour their heart on to their business and put the customer first before profits. The beautiful side about entrepreneurs who are passionate, and purpose driven is that they always produce excellent outputs for clients and they go beyond the call of duty whenever presented by challenges. They innovate and are always producing products or services on the cutting edge. The danger of their motivation is that they lose focus on profits and find that they have given the client more than the client paid for or they have taken longer on the project than they should have and as such have eaten into their profit margin. If you are a passion or purpose driven entrepreneur, you need to ensure that you always have a reasonable profit for every product or project you engage in.
Entrepreneurs driven by money are on the opposite side of the spectrum to the passionate ones. These entrepreneurs went into business to make money in spades. They are the wheeler dealers, brokers, traders, connectors etc. They are incredibly good at removing inefficiencies for value to flow freely between suppliers and customers. They figure out ways to make money while providing value. The danger of their motivation is that they sometimes focus too much on where the money is at and if they don’t make it quickly they give up and try something else. Sometimes they are attracted to higher risk ventures and end up losing their capital. If you are motivated by the desire to make money you need to watch out for moving from deal to deal and take a long term approach to business success while ensuring that you always give your clients value for money.
Marketable skills refer to those things that one can do that can be converted into business. Marketable skills may include baking, design, clothe making, painting, teaching, driving, professional skills such as accounting, engineering, architecture, medicine, etc. Starting a business based on a marketable skill is one of the easiest ways to start a business as one gets customers based on the quality of their output and the experience they have in the skill. The better you are at your skill the more you can charge customers to access the skill. Some skill-based entrepreneurs normally get stuck at the lowest level of the skill and do not grow to attract higher paying clients. They remain in the bracket where they started and thus are locked on the income level where they started. Also the skill often relies on the business owner and they can remain as one wo/man shows and never grow into a business. If you are a skill-based business owner, you need to think about how to recruit and train employees and build systems that can ensure delivery of service/product when you are not there. You need to pass on to your employees the specialty that you have.
Opportunity driven entrepreneurs remind me of the umbrella selling hawkers. They are good at spotting gaps in the market and are quick to offer a service or product that fills in the gap and often make a good return on their effort. They have innovative solutions that fit into current needs and find customers quickly in the market when they get their product/solution right. One of the challenges that face them is duration of the opportunity and converting some opportunities to long term business. They also sometimes discover that the opportunity wasn’t as lucrative as they imagined. If you spot an opportunity and want to grab it be sure to test your assumptions and ensure that you can convert the opportunity into a long-term business.
Do not let your motivation get in the way of your success. It all starts with why but succeeds when you know the blind spots presented by your why.
This article was written by Chris Odongo, Strategy expert at the SNDBX, a one-stop-shop collaborative space that brings together 31+ different professional service experts who work together to help entrepreneurs to grow and scale and entrepreneur support institutions to succeed in their programs.