I have met and talked but mostly listened to entrepreneurs of every kind and at various stages of their new ventures; from London to Boston, Cadiz to Santiago and most certainly Kuala Lumpur. I have heard their fears and concerns. Some were planning to start, some had failed and a few were well on the path to growing their new businesses. It is easy enough to distill the challenges faced and to formulate a way forward. But the greater challenge is in the doing. And that, quite evidently, requires a change in the mindset. To move an idea from its conceptual beginnings into a robust actionable plan requires some tweaking of the thought process. It requires a change from inside the hopeful individual (I say individual as, at this stage, to describe him or her as an entrepreneur is too optimistic).
Countries that work to provide the very best infrastructure and funding alone will not go very far. It’s akin to Daron Acemoglu and James Robinson’s (authors of ‘Why Nations Fail’, 2012) striking revelation of the dangers of extractive (which benefits few) as compared to inclusive economies (which empowers and benefits many). It is the mindset difference of one political approach against another that results in economic institutions that may or may not stand the test of time. So is it with entrepreneurial thinking. It must change. It must meet the new challenges and overcome some natural instincts which call on us to be extractive rather than inclusive. We may create start ups but they will not stand the test of time. So what do we need to move forward?
An opportunity to move forward will require;
- A Sobering Test Of New Ideas. Innovative ideas by entrepreneurs are many. But are they all good? Are they sustainable? Have the downsides been properly assessed and addressed? This requires a methodical instrument based on sound principles. The Barney Sustainable Competitive Advantage test is one such approach. Add to that the Longtailed, Replicability and Scalability tests and one can immediately reveal the potential of a new idea. And these tests can be taught and effectively applied by students and wannabe entrepreneurs. It provides them opportunities to self assess. They can then seek assistance from the right people and it ensures they ask the right questions.
- Overcoming The Fear Of Criticism. There is a natural disdain for criticism amongst us. This fear can either delay action or worse still cause an action that is expensive and has no way of succeeding. One way to overcome this is by sharing. Constantly sharing your idea, regardless of criticism. Discussion and sharing provides for a realistic assessment of your ideas. Most people link their ideas to themselves so closely that any criticism of the idea becomes a criticism of them personally. A good entrepreneur has a high level of prudent objectivity. They welcome the scornful shredding of their ideas. They see their idea as a thought that needs to withstand criticism to be considered robust. For them it is a criticism of solely the idea and in no way is it a criticism of themselves.
- Managing The Fear Of Business Failure. Again this is an instinctive survival instinct that should kick in. Overcoming this is by weighing the opportunity costs of one’s new start up. Will I have to give up my job? What is my earning potential? And as well explained by Babson President Leonard A. Schlesinger and Charles Kiefer, in his book ‘Action Trumps Everything’ (2011), what is the acceptable loss? This question brings a degree of realism and calls for thoughtful reflection. Thus ironically the element of fear actually makes for a better and more focused entrepreneur.
- Being Creative And Action Oriented. Entrepreneurs must be both creative and action oriented. Without action nothing happens. Once you understand what the downsides are entrepreneurs need to go out and do it. The doing should be done in baby steps. That means if you want to supply 1000 tons do 1 ton as a trial. Make a prototype and look for your customer before throwing in your total investment. Make less (in quantity and profits) to know more! Find one actual customer (not your mother or relative who loves you) before you even think of scaling up. Sell the idea, the product or the service and get it bought. This exercise will shore up a heap of challenges but these challenges will appear well before you make your total investment. And the bonus is that it will also show up many opportunities you did not know existed.
- Don’t Just Start Up But Jump Start. Today the opportunities in Malaysia are many. What makes entrepreneurship exciting is the opportunity for an entrepreneur’s new business idea to go national, regional and global. Today for us it’s about opportunity-driven entrepreneurship (fortunately) as opposed to necessity-driven entrepreneurship. Therefore your business idea should have an inbuilt global DNA. Initially it may be dormant; but its potential will allow you to dream. It makes your daily challenges seem small and worth taking on.
- Being Passionate And Goal Oriented. Successful entrepreneurs have a passion that is not driven by merely ringgit and cents. They want to change things. Innovative ideas that have revolutionized the world give them a buzz. They want to improve and change the lives of the downtrodden. Their notion of a good idea is something that adds value to community, makes social change and improves lives. They don’t just want to survive; they want to live to the fullest but in a balanced and fulfilling way.
In Malaysia today we have few options left to us. We have to compete, innovate or forever be left trailing in the dust of neighbouring business trail blazers. Today the Red Queen effect (an analogy taken from Lewis Carroll’s book ‘Through the Looking Glass’ where the Red Queen and Alice constantly run but remain in the same place) is felt all the more. We run just to stay in place. So run we must. And the way to do that is to take our first step. It will open up a vista of scenarios that we never could anticipate by just planning. The ‘Corridor Principle’ (by Robert Ronstadt) takes over. It says that because the entrepreneur starts a new venture it sets him into other ‘corridors’ or new opportunities that would not have been considered had that step not been taken. Thus the right thinking provides the right action that will pave the path for your learning and success.