Entrepreneurs are classic risk-takers. They are continually assessing the world around them seeking to identify problems in need of a solution. They work hard to address and transform these problems into opportunities to improve their world. However, in their haste to identify and seize those opportunities, many entrepreneurs rush into their businesses and forget to establish a long-term vision.
The history of the business world is littered with the empty shells of failed startups that burst onto the scene, but were unable to sustain their business model after their initial appeal wore off. Many of these businesses were started by well-intentioned entrepreneurs who were able to cast a compelling vision for the startup phase. But those same entrepreneurs were not able to transform their visions into a sustainable business model that was capable of withstanding the ups and downs of the external environment.
In order to build and lead a successful company, an entrepreneur must create a sustainable business. A sustainable business is one that can overcome negative market conditions when they are at their worst and can take advantage of strong market conditions when they are at their best. Sustainability is in part dependent upon the development of a vision that is used to guide the company to becoming a viable business. Maintaining a long-term vision will make the leader less susceptible to the emotional whims that impact the business on a daily basis.
Leaders who create sustainable businesses that weather the external environment do the following things:
- Create a long-term vision that they use to guide the actions of the business and its team members. Leaders cast a vision for their organizations. The vision creates a plan for where the company is going and what activities the members of the organization will engage in. It becomes a set of guidelines that the members of the organization use to navigate the external environment on a day-to-day basis.
- Look at key issues based on different sets of time frames before making critical decisions. Key decisions that have both short-term and long-term impact on the business will arise all the time. These critical decisions can affect issues such as cash flow as well as reputation and liability. In order to create a sustainable business, you must consider multiple time frames simultaneously. Making decisions based upon a single time frame may impact the long-term sustainability of the business.
- Believe that they are stewards and caretakers who are responsible for the continuation of the business after their tenure. Businesses are entities unto themselves. They are capable of being turned over to others to manage their operations. They have a life beyond those individuals listed as shareholders. A significant part of their value is in passing ownership from one shareholder to another. Creating a long-term vision for the business allows entrepreneurs, founders and owners to be able to see beyond their involvement to the point where they can hand off the organization to the next generation of owners. The business becomes sustainable as it is passed from one owner to the next.
In the early history of mankind, before the advent of GPS and other technological advances, sailors would depend on the stars to guide them. The North Star became the fixed and guiding point in the sky that would help steer early explorers back to their course in the event of a storm. Without the North Star as a point of reference, there would have been no way to re-orient the ship after the storm passed.When founding and leading a business, leaders should expect storms. Despite their best efforts, unexpected events will occur, which will make navigation temporarily impossible. Leaders are compelled to focus on the immediate conditions in order to navigate the external environment safely. Once the storm has cleared, the business leader must have a vision that they can use to re-orient the business. The long-term vision repositions the business and helps bring it back to its original destination. It allows for sustainability in the roughest of times.
Leaders must guide their organizations through the current environment while keeping an eye on the long-term vision. As with sailors, they must keep a weather eye for approaching storms while keeping their focus on the long-term vision so that the organization can safely reach its destination.
Young Entrepreneur Council (YEC) is an invite-only organization comprised of the world’s most promising young entrepreneurs. In partnership with Citi, YEC recently launched StartupCollective, a free virtual mentorship program.
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