Effectively managing a startup company requires a certain amount of expertise combined with a sufficient amount of both business and practical experience. Startup companies are often fragile flowers that need the proper nutrients in order to bloom and create profits. However, they also need to be managed correctly so that they will produce spectacular results.
So let's take a look at five important strategies for managing startup companies:
Focus On a Small Target
By concentrating on a particular niche or specialty that you are extremely familiar with, you can make your specialized knowledge go to work for you. In fact, you can turn your small business into a great success story in a very short amount of time. When any smaller startup attempts to compete against a large corporation, there is simply no way to be able to keep up with its massive advantages.
However, by specializing in a particular area of the market where you excel, you can attract all of the customers who will gladly pay more in order to purchase goods and services that are more relevant to the specialty market that they are interested in. This type of strategy has been proven to work with many different kinds of situations, so it is an idea that has withstood the test of time.
Avoid Being Altruistic
Many entrepreneurs want to change the world because they see problems that they want to fix. Although this often fuels the motivational factor needed to effectively manage a startup business, it can often spell disaster. Successful business models rely on making a sustainable profit. This has got to be your primary concern. If it is not, then you are asking for trouble.
Avoid Being a Charismatic Figure
If you should become sick or incapacitated in any way, then your startup business should be able to continue without you. The best companies are much bigger than their owners and leaders because it is teamwork that makes them successful. For example, businesses like Acuity, Citibank, and Boston Consulting Group are great at what they do because all of their working parts know how to correctly function as a single unit. A charismatic leader is not required.
Bureaucracy Is Good
Quite often, the best business decisions are made only after a lot of thought and careful calculations have been performed. This usually involves a process that requires a lot of minds working together. It is also important to note that there need to be checks and balances on many of the issues that are often solved by an experienced group of experts making compromises so that no hasty decisions by a single individual will have a chance to damage a business.
Don't Rely On Animal Spirits and Emotion
Merely motivating your team with great speeches and clever catch phrases will only go so far. These types of techniques often fail after a slight amount of misfortune. Instead, your team needs specifically defined goals. In addition, when these goals are met, cash rewards are highly appropriate and will motivate your team far greater than any emotional encouragement.