While there is no foolproof method for building a business, many aspiring entrepreneurs feel that having a good business plan, the motivation and the capital is all that is required to “make it.” While true, there is more to success than that. Success can mean a myriad of things to different people and businesses. It is likely that when asking 10 individuals what their definition of success is and what defines a successful business, there would be 10 different answers. In this article, New Jersey Business sits down with a handful of business mentors and consultants to dissect the components and characteristics that successful businesses share.
When starting a business, “it boils down to one thing,” says Vincent Vicari, regional director of the New Jersey Small Business Development Center (NJSBDC), based at Bergen Community College in Hackensack. “Is there a market for what you are doing and will people pay you to do it?” What this means is that the product or service that a business is providing has to be in demand, either where the business is physically located, or, where it ships its products to, whether across the United State, or overseas, for example.”
“It’s about innovation and how to create a demand in the marketplace for what’s needed,” says Michael Coletti, partner at WeiserMazars LLP, who handles owner-managed businesses and advises them on financial and business decisions. “A business could have the best product or best service, but if nobody wants or needs it, it is not going to sell very well, or be utilized.”
How does a business know what is needed and how can it successfully enter the marketplace?
“Successful businesses need a strong and well-thought-out business plan and also need to conduct the research necessary to find out where the market lies,” Coletti says. “That could come from seeking out the help of professionals like business advisors, attorneys, investment bankers and people who have access to capital, to help entrepreneurs get to where they want to go, especially if they have a great idea or good product.”
According to Jerry Creighton, executive director of the New Jersey Institute of Technology (NJIT) Enterprise Development Center, an important ingredient that successful businesses share are leaders who can build strong relationships. “I feel that relationships – when starting and running a business – are the key to making everything happen. And by relationships, I mean development, vendor, customer and other various work relationships. It’s having those strong leaders who know how to build relationships, and use those relationships to build and hire other leaders and a team within a company. A business can have a good product, technology and service, and a good plan in place, but if it has a lousy team that can’t work together, then nothing is going to happen.”
Susan Scherreik, founding director, Center for Entrepreneurial Studies at Seton Hall, shares Creighton’s sentiment and says that leaders of successful companies aren’t afraid to hire people smarter than themselves. “There are many companies who are felled by a leader who wants to be the smartest person in the room and wants to micro-manage everything,” she says. “Good leaders want to hire people smarter than they are, inspire others to build top-notch teams and then let them do their job. They know they can’t do everything alone and they give people the freedom to take the lead when necessary.”
Scherreik adds that another trait successful companies share is that its leaders are passionate and enthusiastic individuals. “Leaders who have a clear vision and feel that they are changing the world are vital to the success of a business,” she says. “And, that passion and enthusiasm trickles down to employees and then to customers. The leaders have a certain vision for the company, and because of that passion, employees, in turn, buy into that vision.”
“It is a leader’s passion, the value of their personality, their service, their conviction, their love of the thing that they do that aids in a business’s success,” NJSBDC’s Vicari adds. “If it is a cleaning service, they need to admire a house that they just cleaned, look back and say, ‘I did a good job today.’ If it is a manufacturer, they have to open a box of the product they produced and say ‘I’m proud of what’s in there.’ If they don’t have a love of the task that they do or the commodity that they produce, they are going to find it extremely hard to come to work every day, which can directly relate to how successful they become or if they become successful at all.”
Not only is having strong, smart and passionate leaders vital to success, but the company culture that those leaders instill to attract and retain talented employees, while keeping them happy in the workplace, can be just as significant.
“Business leaders have to think long and hard about establishing a strong company culture,” says Dawn Mueller, an adjunct professor of marketing and innovation at Fairleigh Dickinson University Silberman College of Business, and a marketing professional. “Many businesses think that a good culture just ‘happens,’ but what I have observed with successful companies is that culture was something that they took the time to think about, create, implement and work to sustain, especially as a company grows.”
Mueller continues, “Are companies about the people? Do they treat employees like human beings? I think the most successful companies focus on the ‘whole person’ and say to employees, for instance, ‘I know you’re going through a tough time right now in your personal life, what can we do for you?’ These companies, the leaders and the management that recognize that their people are more than just what they can contribute to the business, will not only keep employees happy, but will also make them more productive and will attract even more talent to the company.”
Walt Guarino, president, ERC Group LLC and a business consultant at Practicomm LLC, adds that the culture of a company plays an “extremely vital role” for successful businesses and that “these businesses are authentic from the start.
“Businesses know a lot about their goals, their culture and what they want to achieve. Successful businesses are true to a cause and reward employees for a job well done,” he says. “I think that is extremely important in the recipe of a successful company.”
However, Guarino mentions that the most successful companies have the willingness and ability to quickly shift direction as the market and other various needs dictate.
“Even though a company can have a set goal and a set culture from the get-go, often times, those things can change,” he says. “That is not a bad thing. In fact, it should be expected and planned for, even though sometimes it is hard to predict. It is the way a company reacts that defines its long-term success. It has to be flexible and nimble enough do what it takes to get in line with trend changes and market explosions. The ability to change direction comes with the gregarious attitude that everybody within the company is working together to be authentic to achieve its goals.”
NJSBDC’s Vicari mentions that successful businesses have to face challenges head on, whether it is embracing competition, dealing with unexpected events or being able to put customers and clients first and foremost, regardless of what circumstances may arise.
“Do not look at the competition as the enemy,” he says. “Competition can be a great source for business to improve upon its products and services. … They can become a great source of referral and may even handle your excess capacity in a pinch. Or, if you face an unexpected disaster, like a storm or flood for instance, you may have to rely on the competition. It is important to have a contingency plan for unexpected occurrences, because successful businesses provide products and services to customers no matter what happens. It is about keeping them happy.”
Technology has also played an interesting role in the success of businesses – especially in the past decade or so – with the explosion of social media and the public’s desire for instant information. Not only has technology played a role on the company floor in producing products quickly and more efficiently, as an example, but technology has become prominent in communicating with customers and in marketing products and services.
“Technology is in all the different facets of businesses today,” WeiserMazars’ Coletti says. “From advertising, to how processes run in the facility and even in the back office. Companies who haven’t utilized technology in the past need to start embracing it today and evolve for continued success.”
“Everything today is moving so fast with technology, the Internet and social media, that it may be a challenge for many companies to keep up,” Seton Hall’s Scherreik says. “The successful companies are the ones that can adapt to it all, can use technology to their advantage, can promote and market themselves in the social media landscape and reinvent themselves if need be. It may be difficult to utilize and adjust to, but what is on the horizon will create more opportunities for those companies. Nobody knows what the world is going to look like five years from now, so embracing it is important.”
While there are other components involved in owning, operating and building a successful business, what works for one company, may not work for another. Every business is different, with varying goals and varying definitions of success. As Fairleigh Dickinson’s Mueller says, “Businesses should create their own definitions of success, while looking towards the world’s most respected companies and professionals for guidance.”