Bob’s Ramble: The Recipe for a Successful Business

I’m often asked if there is a formula to creating a successful business. I’m happy to report that the answer is yes. It’s a good thing because it is these recipes that can save a tremendous amount of time and anguish in the business building process. There are many tried and true business adages that help us along the way but in this ramble, I’m going to lay out the basics of how to create a successful business.

Most people think it starts with an idea but, in fact, it starts with a problem. There is a compelling argument, that I adhere to, that no person or business buys anything unless trying to solve a problem. So, the way to create a business idea is to find a problem that is big enough that you can create a real business by solving it. By looking for problems, which are all around us, it generally provides an entrepreneur with choices to evaluate without reliance on some “lightning bolt” idea.

Once you have identified a problem worth solving, the process of building a business is a fairly simple recipe and well documented by many authors. In order, one documents the mission, vision, org chart, responsibilities, accountabilities and reward systems. This can take quite a while to do and entrepreneurs are usually socializing their “big idea” to see what peers think of the idea. She or he is also thinking about who could be involved with this enterprise and how it could be funded. The Mission is a statement of what the organization will stand for. For Invoice Cloud’s Mission, please click here. The Vision is a series of statements made in the present tense but reflecting what you believe will be true in the future (say three years from now). An org chart with responsibilities for that organization (again three years from now) can be created, with clearly articulated accountabilities for each position. For example, one could have a VP of Sales in the Org Chart, who’s responsibilities are to generate $3 million in revenue, manage a team of 3 people that she recruited, increase revenue by at least 30% per year, etc. Reward systems are generally compensation and/or equity (options) in the organization.

One point that needs to be made is that the people you recruit to work with is by far the most critical choice you will make. Choose wisely!

Comments or suggestions?