Article: John Rosling – The Secrets of the Business Alchemists. 

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How to Build a Sustainable Wealth Generative Business by not Worrying About Profits.

When, at height of the dot.com boom, I co-founded an internet greeting card business in another part of London, a young commodities trader called Nick Jenkins founded a similar business.  Whilst Nick built Moonpig to a £120m valuation, ours ended up swiftly and ignominiously, in the Receivers Court.  What did Nick know that we didn’t?

In writing ‘The Secrets of the Seven Alchemists’ (2014 Harriman House), I set out to answer this question. In interviewing highly successful entrepreneurs I began to understand something extraordinary. That, though real business success is a strange alchemy, there is actually a formula. And it can be replicated in large organisations as well as small.

The key can be found in how successful entrepreneurial leaders see their business. In how they focus their attention and structure their  activities. In broad terms it’s about focusing not on what is showing up today but the context that drives it, not on outcome but on source that creates it, not on how but on why.

In more practical terms, what distinguishes successful entrepreneurial leaders from mere business operators, is their focus is not on today’s revenue but on the underlying assets that drives itrealising that profit is simply an outcome of getting the fundamental intangibles of the business right. This isn’t to say profit and particularly cash are unimportant. Its just that if you focus on these its hard to find the time and space to look for growth and opportunity.

Really successful entrepreneurial leaders, in companies big and small, find ways to ensure others are empowered and motivated to deliver the today, while they look beyond. And in doing so they create growth, opportunity and wealth.

  1. It starts with why.

Great businesses understand why they do what they do and build extraordinary performance cultures around it.  It’s not about the money.  Ajaz Ahmed who built AKQA into a $500m business says  ‘making money has never been our intention and yet, commercially, we outperform our competitors. From day one, our clear intention has been to ‘help our clients to create the future’”.

As a practical reflection of this, Roger Philby of the Chemistry Group has always had in his business a Head of Amazing, tasked to make the company simply the best place in the world to do great work. Every performance business should have a Head of Amazing.

  1. The power of autonomy.

Central to a performance culture is a belief in giving people freedom; not controlling them.  As Reed Hastings of Netflix says ‘responsible people thrive on freedom and are worthy of freedom’. Aligned and self-responsible cultures create agile and independent thinking. That creates growth and wealth.

  1. Expect more.

Performance cultures employ talent wherever they see it and measure and enforce capabilities. These are hard working cultures.  This is not exploitative; the company offers real fun and fulfilment and the employee offers in return an exceptional level of commitment and performance. To quote Hastings again ‘adequate performance receives a generous severance package’.

  1. Doing 3 things better every day.

Great businesses are perpetual innovators. They move fast and are never satisfied with what has worked in the past. They are obsessed not by the product but how the customer experiences it. I was struck by how Keith Abel, even as CEO of a £50m business, still manned the in-bound Order line to talk to customers when he could.

  1. Systemise and then to move on.

To quote Ajaz Ahmed ‘innovation isn’t just about the product. You have to improve every aspect of the business.  We are obsessed with innovating our system to be better; systemise what you can and use human beings to add creativity’.

  1. Know what you are the best in the world at.

An autonomous team and a systemised process allows leaders the time and focus to make breath-taking leaps. But to be successful these must be based on a visceral understanding of what the business genuinely does best. This is about focussing not on the products but on the unique IP and knowledge that sits behind them; on assets not revenues.

  1. Embrace failure.

Truly understanding what makes the business brilliant creates the confidence to persist, seeing opportunity and not fear. Keith Abel comments about his business ‘did it work straight away? No. It didn’t. It was a disaster. It took six months to get it right but we bashed away at it’.  For Spotify the mantra is similar; ‘fail fast’ they say. Be fail friendly. But learn from it!

  1. Be curious.

Time and intellectual freedom gives the true entrepreneur the opportunity to create and pursue radical ideas. An enquiring disposition and wide interests make them natural connectors. They will meet another entrepreneur on an aeroplane and a new business opportunity will develop from the conversation.

 

John Rosling is author of The Secrets of the Seven Alchemists’ (Harriman House 2014), CEO of Contexis, a serial entrepreneur, speaker and lecturer on entrepreneurship with a passion for helping corporates think more entrepreneurially (and transform how they connect with SME customers and partners). He started his career in Unilever and Diageo. 

About the author

Founded Like Minds in 2009. Andrew is a serial entrepreneur and angel investor. He founded design agency Icon in 1983 (sold to AGI Media) and Eyetoeye, one of the first digital agencies in the UK, in 1994. He advises start-ups and digital agencies on business development and is an Evaluated Consultant for Finpro, the export arm of the Embassy of Finland. He was elected a Fellow of The Royal Society of Arts in 2000.