Bringing Creative and Operational Talents Together
How do self-make billionaires differ from the rest of us? It’s more than money. Successful entrepreneurs look at the world differently. They envision how ideas can become great businesses, they think and act in ways that generate creativity and effective leadership, and they have patience. They also tend to team with others with the skills to manage, organize and optimize human endeavor.
Researchers looked at the 2012 Forbes list of the world’s billionaires, and identified those who had made their own fortunes rather than inheriting them. They selected 120 they thought mirrored the geography and industries represented in the larger sample, and set about learning everything they could about them. John Sviolka, who heads Global Thought Leadership at PricewatehouseCoopers LLP and Mitch Cohen, vice chairman at PwC, describe their research in stories in Business + Strategy. They expected to find many like Mark Zuckerberg and Jeff Bezos, who had deep understanding of technology and markets in a fast moving sector of the economy, but they didn’t. They were surprised to find many were serial entrepreneurs, who made fortunes on second, third and even fourth businesses in an established market.
They found five habits of mind common to all the successful entrepreneurs they researched.
Empathetic imagination, they write, combines knowledge of a field, awareness of critical trends, and underexploited customer need, and creative empathy with the customer. As one example, they cite Judith Faulkner, who as a grad student in computer science founded Epic Systems, one of the world’s leading vendors of electronic heath record systems. She knew patients needed continuity in treatment and doctors needed efficiency, the authors say, and her empathy for both enabled her to design for both needs. Another entrepreneur with empathetic imagination, they say, is Lynda Resnick, who with her husband Stewart, developed a way to juice and market pomegranates just when people were looking for foods with antioxidant power. Her POMWonderful reached $165 million in annual sales five years after it was launched.
A trait the authors call “patient urgency” enables entrepreneurs to recognize that good ideas may take time, and that they can be building toward their goal while waiting for the right time in the marketplace. In a podcast posted on the Strategy + Business site, they talk about how the real estate developer Stephen Ross envisioned a redeveloped Columbus Circle in New York well before it became upscale.
Inventive execution, the authors say, is the ability to bring creative and operational departments together. Doing this means applying design principles to all facets of a business, not just the publicly visible. For instance, Tim Brown in a Harvard Business Review article, explains how Thomas Edison realized success of his newly invented light bulb needed power generation and transmission systems, so he designed and created those too.
Sviolka and Cohen say entrepreneurs take a balanced view of risk. They look at the benefits of taking or not taking a chance along with consequences of missed opportunities. The authors describe how Cheung Yan came to the U.S. from China and started a company that within 10 years became the leading exporter of paper. She bet her life’s savings, but she also realized the U.S. had better resources, including reams of recycled office paper, and less official corruption.
Most of the highly successful entrepreneurs, they found, teamed with others who knew how to optimize advantages. They describe people who have the creative vision as producers, and those who know how to execute as performers. In their article on Two Types of High Potential Talent, they emphasize successful organizations need both. They say most success doesn’t come from solitary genius. In their podcast, they vice the opinion that solo albums by Mick Jagger and Keith Richards were awful, but “together they magic.”