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  • Great experience working with you to gain clarity of what needs changing in my business. Stephen Jordan Access to Africa - 25 August 2011, Marketing Module

Work on your business, instead of in it

Entrepreneurship is about creating value. The time, effort and money spent on starting and growing a business must be driven by the eventual sale of the enterprise.

This, according to the Aurik Business Incubator’s Pavlo Phitidis, is something many entrepreneurs have lost sight of.

With a BCom, MBA and significant business experience, Phitidis expected his ventures to make him a millionaire. When it did not happen, he decided to find out why.

Of the eight businesses he and partner Carien Engelbrecht were involved in, two failed, four were sold and two ended up on the stock exchange.

While not a bad track record, he realised that the last four businesses took much longer to mature and cost them much more money.

“Entrepreneurship is not an academic discipline. It is about acting,” he says.

There is an expectation in the market that time will lead to a successful, growing business. But if certain systems and processes are not implemented, a venture can remain in the start-up phase for 80 years.

Businesses generally move from the start-up phase into the early entrepreneurial phase. From there, they must enter the growth stage in order to become mature and profitable.

Aurik has focussed on helping business owners implement the systems and processes that enable growth. But that must be done in a manner that essentially takes the entrepreneur out of the picture.

Over the years, Aurik has assisted more than 450 enterprises with monthly turnovers of R50000 to R500000.

Phitidis says no one will buy a business if its value is intrinsically linked to one person.

If the goal is to eventually sell an operation, it is the entrepreneur’s responsibility to create a venture that does not need him.

During the start-up phase, an entrepreneur refines the product while scrambling to secure clients. As the business grows, the owner is usually overwhelmed by everything that needs to be done. He needs to employ people to help run the business.

People need to be managed and guided, and you need to create systems and processes that direct the staff. Unfortunately, most businesses take a haphazard approach to this critical exercise, restricting growth.

Phitidis found that, by taking a structured approach to development, one could shorten the time needed to create a growing and sustainable business that can be sold for a profit.

“You need to work on your business, instead of in it. It is not a time thing.”

Once you have implemented systems and processes in all aspects of the business, it can technically be run by anyone, including a new owner.

He adds that these systems and processes also create a platform for future growth, where a business owner simply cannot manage the entire operation single-handed.

“Don’t trust people, trust systems,” Phitidis says, adding that this is of particular importance during the start-up phase when you start hiring people.

Without the systems in place to guide staff, an employee will continually wait for instruction, which creates friction in the operation.

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  • Great experience working with you to gain clarity of what needs changing in my business. Stephen Jordan Access to Africa - 25 August 2011, Marketing Module

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