Building a business is no easy task. It’s not only the foundations that matter, but also consistency in scaling businesses so that it doesn’t become stagnant and lose its foothold in the industry. As with any first endeavor, there are high entry barriers in many industries. In such a scenario, traversing a tumultuous path can be made easier with some guidance and a holding hand.
Following this spirit, NICEorg brings to its entrepreneurs a guide on building and scaling businesses. This article is based on the NICE Samvaad live session by Ms. Apurva Purohit, co-founder of Aazol and former CEO of Radiocity. She’s also the author of two national bestselling books – Lady, You’re the Boss and Lady, You’re not a Man. Ms. Apurva holds a Bachelor’s degree in Science (Physics) and completed her PGDM from IIM- Bangalore. She was recently awarded the Distinguished Alumni Award from IIM Bangalore in 2022.
The Plateau Problem
Enterprises start with energy and excitement brought forth by the entrepreneur’s effort, and this, along with the buzz and excitement of new products, can cause a big jump for the company for the first few months, maybe even a year. However, the lack of traction will cause it to become stagnant and stuck or even cause a sales drop. If the entrepreneur cannot get out of this plateau, they will fall into a cycle where they won’t be able to scale, leading to no employment and, further, no demand creation. This is where most businesses fail; hence, getting out of the plateau is one of the biggest hurdles an entrepreneur will face.
Many entrepreneurs tend to give up too fast at this stage or lack the experience to build a solution to get out of this plateau, which leads to this high rate of failure. This plateau also hinders startups from scaling businesses. The question is, how do you get out of this?
The main problem is not knowing how to carry out execution properly. Strategy is a significant first step, but it must be implemented and executed correctly to succeed. Strategy and execution go hand in hand; execution alone can’t happen without a strategy. This can happen with startups, but it also extends to MSMEs and sometimes mature businesses – especially when another company takes over, causing internal mistrust, uncertainty, and change. Therefore, it’s crucial to understand that while 80% will get the strategy right, the defining factor that sets one apart is the 20% that get implementation right.
How to get implementation right?
Get your F1 right
In this field, the words vision, mission, and inspiration are used interchangeably, and often they get all muddled in our heads. This is why having clarity has become so important. F1 stands for your first financial goal. It’s the main goal you chase and adhere to throughout your journey.
Ms. Apurva narrates an incident from her childhood to drive the importance of clarity of your primary goal. She tells us about when she and her friend tried out for the college football team. Her friend didn’t have much clarity on what she wanted, just that she wanted to try out for the team, and hence went on to try out for the flashiest position of center forward, which obviously had the most people trying out for it as well. However, Ms. Apurva tried out with the single goal of joining the team regardless and got into the team when she tried out for the goalkeeper position and even went on to play in the nationals.
Thus, having a foremost goal gives one a sense of clarity – be it maximizing profits, reducing debts or scaling businesses. It provides a path for one to build a strategy that might change based on the performance of the company. But be it prioritizing EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) or topline, you look towards achieving that specific goal. Keep in mind that focus will also mean sacrifice – sacrificing specific opportunities, not getting swept up by the tides, and instead looking at a long-term permanent goal.
Create Building Blocks
In 1911, explorers Robert Scott and Amundson led two teams to march to the South Pole. They both had different strategies to tackle the problem at hand. Scott proposed that on days with good weather, everyone walks 40 miles but on days with bad weather, everyone walks 20 miles. On the other hand, Amundson suggests that everyone walks 20 miles daily regardless of weather and external conditions.
Which group did better? Amundson’s group. His strategy broke the problem into mini problems with more straightforward solutions. The solution didn’t depend on external conditions but on inner strength and skills, thus building discipline.
By breaking it down into doable, bite-able chunks, Emerson built discipline. He gave the team visibility on what they had to do while focusing on what they could do and not reacting to weather conditions but an internal matrix. Thus, while leading a team, one needs to focus on the internal things each person can control, like better deliveries, accountability, execution, etc., which can only be achieved through determination and rigor.
Adding the ‘how to do’, to the ‘what to do’
After figuring out the financial objective, one must outline what to do with the customer but, more importantly, how to do it. This includes the internal processes and the learnings the team will go through.
Ms. Apurva gives the example of the Mid-Day team. With the need for publications and printing presses declining, they had to start driving their team towards building a digital version of their products. They had a clear goal and created the digital product, yet this wasn’t translating into digital subscribers. This was when they realized that the journalists and editors were used to working with physical paper. On a digital medium, the process is very different, requiring constant stories to stay up to date. This led to them rearranging and learning the processes to build an ecosystem that gave digital products, which translated into getting subscribers.
Expect something? Then inspect it
Often, strategies fall flat because we don’t have any metric or system to quantitatively measure them. This could include postmortem reviews for mechanisms and converting everything to measurable goals. The reason for this is when you put forward a strategy, its language and perception make everyone understand each other differently. This converting it all to quantitative math provides a standard indicator for everyone to base progress on.
The question arises, but creativity or language can’t be converted to math. But it can be; one only needs to think out of the box. For example, Ms. Apurva tells us about the research her team did at Radiocity around a set of songs. They gave scores to songs based on certain parameters and would only play high-scoring songs according to this performance indicator. Thus, the way to measure the goal may change, but it is possible to quantitatively mark progress regardless of the goal and work and adjust accordingly.
Simple yet Effective Communication
The emphasis on communication is manifold today than it has ever been. It stands true, but a nuance to this that most people overlook is that when you tell a crowd or team of people something once, as an average human, they have probably absorbed 20% or less. So yes, communication is essential, but it is important to do it in a way the other understands and takes in everything you have said. To do this, breaking the information into smaller pieces at a time, simplifying it, and repeating it can help the audience absorb much more information. At the same time, remember to be confident and vocal about your opinions in a leadership setting to ensure you get your point across.
Kehna, Karna, Nibhaana
Leaders need to walk the talk, but at the same time, they need to do it consistently and constantly. Teams have an expectation from their leaders and CEOs. For example, if you tell the teams that you will be fair as a CEO, then that policy applies to everyone, even you. This helps the leader and executives build a bond of trust among themselves, and by setting an example, the team will try to live up to and meet the same commitments.
It helps develop a good quality organization from the inside.
At the end of the day, businesses are all about people and the culture built by the employees. This also covers the ethical aspect of running a business and the integrity one has. Uncertainties in the environment can create insecurities, but building a core culture and value systems can help bring everyone together. This, along with focus and the above-outlined points, can bring out the best execution with amazing results and even help scaling businesses and maintaining consistency.
Stay tuned for more tips and takeaways for entrepreneurs to grow their cultural enterprises.
Watch the entire session here.