Success factors for start-up CEOs

Micha, Nick and I had the wonderful opportunity to attend San Diego State University's Entrepreneurial Management Center (EMC) Open Forum this evening where Matt Reno, CEO of Reno Contracting and 2003 "Ernst & Young's Entrepreneur of the Year" in Real Estate, spoke about "Building Your Business".  What a phenomenal presentation delivered the way presentations should be delivered: with sincerity, simplicity, and poignant introspection.  Zero powerpoint slides, zero fluff.  Matt spoke from his heart.      

Matt's presentation sparked an interesting conversation between Micha, Nick, and I on our drive back to the office about entrepreneurship and building successful businesses from the ground-up.  Specifically, the topic was, "What are your top three success factors for entrepreneurs starting new businesses?" 

Here are the top three success factors that came to my mind:

1. Alignment- the most essential work of a CEO is to align his/her parts.  In other words, what your business stands for must be aligned with the people working for you and with the system of which the organization is built on.  From the top level this includes aligning your strategy with your fixed and variable costs, and on the base level this includes an unfaltering commitment to your core values (which becomes exceedingly difficult to uphold as the business grows). 

2. Character- lots of people have asked our company how we have nurtured such an amazing team as a start-up consultancy.  Want in on this secret?  Well here it is: we don't hire those with the best skills.  When we interview, we don't look for the best marketer, best coder, or best designer.  We hire the best people.  People of character.  This includes integrity, ethics, passion, and learning capacity.  Similarly, this also includes refusing to work with certain clients.  As Matt said so deftly put it this evening, "we don't work with jerks."  For budding companies, character remains paramount.  Be people-focused and find the best fit for your team.   

3. Conviction- a leader must have the utmost conviction in what s/he is doing.  There is no compensating for the deficit created by the lack of conviction from your leaders; you can't make up that ground.  This doesn't mean your leaders should be austere.  In fact, the opposite is true.  Conviction in its purest form is balancing flexibility and adaptability with the courage to be unrelenting in your pursuit.  It's bending without breaking.  And at the highest level, it's having the guts to push through. 

These are my three success factors for start-up CEOs.  They are interdependent and co-existent.  You can't have just one or two of the three.  As far as I'm concerned, it's three-for-three, or all-for-naught. 

Let's hear your thoughts.  I'm tagging Micha and Nick to post their outstanding insights.  And Mike and Ryan, as young successful business people I know you both have great perspective as well. 

- Johnny

Comments

[Mike Alfred]

Thanks for sharing these thoughts. I was also moved by Matt's sincerity and openness. Another interesting trait that Matt displayed that I have also seen in a number of other great leaders is modesty. Matt was almost self-denigrating in his approach. He often referred to himself as if he were simply a lucky construction guy who managed to find his way to the top. By using modesty, he brings his top lieutenants closer and builds loyalty. Egotistical leaders often drive their best people away because they are unable or unwilling to give the positive recognition and affirmation that top managers often need.

[Johnny Chan]

Mike,

That's a great observation. Matt's top lieutenants sat close to him at the presentation and you could tell there was an immense reciprocity of respect among the team. He was certainly self-effacing and modest when talking about himself, yet lavish in his praise of others. I guess it comes from being confident enough to recognize that stepping up in business doesn't mean that you have to step on anyone.

[Nick Urbani]

Well this is a trap for mediocrity- How am I supposed to follow The Johnny Chan and Mike?? Cheat by saying something Johnny taught me, thats how:

Marketing as Strategy
The small start up and the multi-national can both benefit from realizing that marketing is not a functional silo. Marketing and strategy are very closely related, if not the very same thing. Marketing should transcend all business activities from product development and manufacturing to customer service and human resources. Explore your 3V's:Value Customer(who?), Value Proposition(what?, and Value Network(how?). Start at the who? then work backwards towards your solutions(what?) and then adapt the businesses processes and systems. Executives have picked up the bad habit of focusing on core competencies and delivery systems(how?) then moving down to solutions and then finally customers. Be concumer centric is an old cliche that many executives agree with, but fail in putting it to use.

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