How can your company become the next business of the year? Following are some best practices I have observed as a Mergers & Acquisitions specialist:
You have to put in the hours. Malcolm Gladwell has written it takes 10,000 hours of “deliberate practice” before becoming world-class in your chosen field. While no one knows for sure who first coined the aphorism, “The harder I work, the luckier I get,” it has passed into common usage. (It may have been Thomas Jefferson.) There simply are no shortcuts when establishing and building a successful business. Hard work is a requirement.
Ability to adapt to changing circumstances. While this has always been true, the need for peripheral vision and quick reflexes has never been greater. Climate change, technological upheaval, category disruption, international competitors, governmental uncertainty and loosening social adhesion all contribute to a dynamic business environment. Only those companies able to continually reinvent themselves today will survive past tomorrow.
Consistent messaging. Even though change is constant, a successful company must communicate consistent messaging in all of its marketplaces. Of course, before doing so a company must first determine what its unique message will be. By hiring skilled communications professionals and retaining experienced communications firms, a company is more likely to get messaging right.
360 degree view of the playing field. While tunnel vision may work when studying for a big exam or achieving a singular goal, business success requires the ability to see the complete picture. Information rich decisions regarding business definition, talent recruitment, sales management, supply chains, site selection, product line and hundreds of other key issues can pave the road leading to success.
Sufficient capitalization. Although Uber has already burned through $11 billion since launching in 2009, it still has $7.3 billion cash on hand. Although there is no way of knowing if Uber will ever turn a profit, many hugely successful start ups such as Amazon burned through great amounts of cash before becoming profitable. Every successful business depends on a sufficient level of capitalization. This is simply Financial Management 101.
Long term view. George Lucas, according to legend, knew how the first series of Star Wars movies would end before shooting the first film. Mad Men’s creator, Matthew Weiner, knew the show’s principal character Don Draper would travel to an ashram in the show’s final episode even when first pitching the show to the AMC network. In similar fashion, successful businesspeople will typically express a coherent vision of the future.
Market sense. I had an acquaintance who described certain successful business people as “having magic in their fingers.” They possess intuition that helps them to see around corners and anticipate trends. One can argue that the most accomplished magicians create trends by force of their own will. Whichever is the case, a deep sense of the market can help a business leader gain a step on the competition. Advanced success will mean there is no competition, as you will have transcended the category.
Belief in yourself. Before Derek Jeter was the starting shortstop for baseball’s New York Yankees, he would count pitches thrown by starting pitchers on his minor league team. He envisioned a position of leadership and authority for himself even before he had been called up to play at the major league level. Before peers and colleagues will recognize you as being a business leader, you must first believe in yourself.
Desire. Sitting behind someone else’s desk is easy. While it may at times feel you have the weight of the world on your shoulders, you don’t. This is not the case for business owners, whose decisions affect the livelihood of employees who are in turn responsible to their families. Lines of credit, rent bills, machinery leases and aggressive competitors can all take turns keeping you awake at night. These concerns and responsibilities must be matched by an equal measure of desire.
A robust network of contacts. In this digital age it is easy to lose sight of the importance of face-to-face personal contact. E-mail, texting and instant messaging do not build the strong bonds that can be achieved through actual contact. Even so called weak contacts, which describes casual acquaintances, have been shown by studies to engender empathy. I knew a man who liked to say, “Good friends make good business.” I agree.
Luck. I include luck in this list not because you should count on it, but because you should admit its existence. By doing so you will permit yourself the gift of forgiveness when bad things happen for reasons entirely beyond your control. Let’s also return to the well-worn aphorism, “The harder I work, the luckier I get.” Luck rarely visits those who sit around waiting for it. Getting lucky is most often what comes from keeping busy.
Success is not a right; it is a privilege that is hard won.
Michael Lamm is a Managing Partner at Corporate Advisory Solutions, a boutique merchant bank headquartered in Philadelphia and serving Lehigh Valley businesses. Michael can be reached at email@example.com or 202-904-7192.