START-UPS NEED TO WAKE UP TO THE IMPORTANCE OF BUILDING A CORE TEAM
It’s the quality and performance of the top few executives that decide the success of any new business, says S Srinivasan
FOUR months ago, Bangalore-based optical networking company, Tejas Networks, staged a coup of sorts by roping in 46-yearold Rangnath Salgame as its president. Mr Salgame had made his name by developing a $1 billion business in India for global networking giant Cisco. Technology industry veterans were surprised to see him move to a company with revenues of less than $100 million.
Mr Salgame had then said he was surrendering to his entrepreneurial impulse and the temptation to build a product company out of India. Tejas was lauded for getting a visionary leader for its core team. The next news, many expected to hear from the small company, was how it had crossed another revenue milestone.
But, the news that came out of Bangalore was different and stunned the industry. Mr Salgame suddenly quit Tejas under conditions that neither he nor the company explained. His profile was removed from the company website and Mr Salgame was tight-lipped. A job that was negotiated over a year crumbled in just 16 weeks. Was it a clash of vision, a clash of personalities or a systemic defect at Tejas? But one thing was clear: the core team that Tejas was putting together failed to stick together.
The incident highlighted how difficult it is even for a company, with a solid grounding, to build and keep a core team. For a startup, the difference between success and failure is primarily the result of the quality of its few top champions and their collective endeavour. But entrepreneurs often grapple with issues within this small group and lose much energy that could otherwise be spent on building the business.
“Some entrepreneurs think they need to know and do everything. This is wrong,” says business mentor Saurabh Srivastava, who has proven his team-building skills at a number of technology companies and also in the founding of software trade body, Nasscom. He says it is not practical for a business executive to have all the skills and strengths required to take a start-up to success. A small team with common beliefs is a key necessity.
Founders must evaluate their strengths and weaknesses objectively before deciding to build a core team, he says. This exercise will expose the gaps that must be filled and the areas that must be reinforced. MS Pillai, founder of Sadhana Centre for Management and Leadership Development, says that many great businesses have failed for want of a cohesive top team. “You may be anybody. But without collaboration, without mutual dependence within a small group of people with complementary strengths, it is extremely difficult for you to achieve lasting success,” he adds.
A human resource expert, who specialises in senior executive search, said one-man shows may be good enough to achieve the proof-of-concept in a business, but a core team, often with skills brought from outside, is necessary for the firm to move to the next level. “As an entrepreneur, you may be the initiator of business. But it is not the rule that you must be the leader too. The leader can be another person in your team,” explains founder chairman of Executive Recruiters Association and Sampoorna Computer People managing director Satish Doshi.
Many first-time business dreamers start with the support of family and friends. It is a natural choice for those who start operating out of their homes. This strategy has both positives and negatives, experts say. The founder can use a family member, who will fill up a talent gap and communication will be easy between them, but personal relationships and professional co-existence can weigh heavily against each other, they say. So, what are the golden rules of core-team building?
FINALISE MEMBERSHIP
Entrepreneurs must draw up a list of the most crucial skills necessary for the business and assign job positions to them, experts say. For instance, writers and creative talent may be crucial for a content company, but back-end process management may be the one crucial aspect for a travel agency. So, having a clear list of priority skills is the first step. The talent mix must be individually intensive and collectively exhaustive.
SET INSPIRING GOALS
Any business idea has to be larger-than-life and even slightly unrealistic, says Mr Doshi. If a business idea was easily achievable, why would anybody want to do it? A core team comes together when there is a larger purpose they all want to serve together. A lack of this inspiration will make it impossible to attract outside talent and may eventually lead to the company straying into unimportance.
SHARE AUTHORITY AND OWNERSHIP
If an entrepreneur builds a core team and then decides to keep all the strings in his palms, his colleagues will feel under-used and lose their connection with the company’s vision. The attitude to keep all the profits and all the power to oneself has destroyed many business aspirants. “The question is simple. Do you want to have full control over a small pie or part-control of a larger pie, where that part is significantly larger than the small pie?” asks Mr Doshi.
HAVE A CLEAR LEADER
Many entrepreneurs assume they are the leader for their business. Experts say this need not be the case. The best entrepreneur hires people better than him or her and lets them direct the journey. This would lead to a situation where there could be multiple leaders within the team. The issue must be quickly resolved and one person assigned the task of leading the core team.
SET CLEAR RULES OF ENGAGEMENT
Great teams fail to deliver when they start quarrelling over a decision here or a plan there. Mr Doshi feels before the team starts its first discussion, the ground rules must be set on how the members are going to work together. It must be made clear that all criticisms and suggestions are welcome and none would be taken personally. Mr Pillai says there have been start-ups, where family members got together with good intention, but suffered a fracture in their relationships due to workplace stress. Complaints about some member not contributing enough or another taking advantage of the business abound in such enterprises, he says.
ACHIEVE ENTREPRENEUR-PROFESSIONAL MIX
All core teams have to start with high entrepreneurial focus, taking calculated risks and being flexible to move fast. But as the business begins to grow, there is an immediate need to put systems and processes in place. Professional managers free the entrepreneur’s time so that he can focus on the long-term strategy. Businesses often go haywire when they fail to bring in the discipline of professional management, Mr Pillai says. “A professional in a start-up team must be the personification of an entrepreneur himself. The professional need not have a Harvard-qualification, but must have passion to create something new.”
BE REALISTIC
When hiring an outsider, it is important to understate the benefits of being in your team, because over-promising will lead to failure and frustration, experts say. Mr Doshi says it is a good idea to leave a positive surprise, such as a better title, company-paid house or a training programme, open and unsaid at the beginning. People will like them that much better if they earn it for their performance.
Even after all this, it is possible that a core member could leave. It is a contingency that a start-up must learn to tackle, but the larger question the entrepreneur must address is whether it was because there’s something wrong with the business. “If the dream had been sold and the partner dropped everything to join you but still left midway, then something may be going drastically wrong. You must ask yourself if you are being fair as a leader. Are you tolerating competing agendas? Are you not able to give direction? Are you not able to resolve conflict?” says Mr Doshi.
Article Resource:
Author: Srinivasan S. is the Chief Editor in the The Economic Times, Mumbai and the article appeared in one of their successful columns on Entrepreneurship/Start-ups called "Starship Enterprise".
It’s the quality and performance of the top few executives that decide the success of any new business, says S Srinivasan
FOUR months ago, Bangalore-based optical networking company, Tejas Networks, staged a coup of sorts by roping in 46-yearold Rangnath Salgame as its president. Mr Salgame had made his name by developing a $1 billion business in India for global networking giant Cisco. Technology industry veterans were surprised to see him move to a company with revenues of less than $100 million.
Mr Salgame had then said he was surrendering to his entrepreneurial impulse and the temptation to build a product company out of India. Tejas was lauded for getting a visionary leader for its core team. The next news, many expected to hear from the small company, was how it had crossed another revenue milestone.
But, the news that came out of Bangalore was different and stunned the industry. Mr Salgame suddenly quit Tejas under conditions that neither he nor the company explained. His profile was removed from the company website and Mr Salgame was tight-lipped. A job that was negotiated over a year crumbled in just 16 weeks. Was it a clash of vision, a clash of personalities or a systemic defect at Tejas? But one thing was clear: the core team that Tejas was putting together failed to stick together.
The incident highlighted how difficult it is even for a company, with a solid grounding, to build and keep a core team. For a startup, the difference between success and failure is primarily the result of the quality of its few top champions and their collective endeavour. But entrepreneurs often grapple with issues within this small group and lose much energy that could otherwise be spent on building the business.
“Some entrepreneurs think they need to know and do everything. This is wrong,” says business mentor Saurabh Srivastava, who has proven his team-building skills at a number of technology companies and also in the founding of software trade body, Nasscom. He says it is not practical for a business executive to have all the skills and strengths required to take a start-up to success. A small team with common beliefs is a key necessity.
Founders must evaluate their strengths and weaknesses objectively before deciding to build a core team, he says. This exercise will expose the gaps that must be filled and the areas that must be reinforced. MS Pillai, founder of Sadhana Centre for Management and Leadership Development, says that many great businesses have failed for want of a cohesive top team. “You may be anybody. But without collaboration, without mutual dependence within a small group of people with complementary strengths, it is extremely difficult for you to achieve lasting success,” he adds.
A human resource expert, who specialises in senior executive search, said one-man shows may be good enough to achieve the proof-of-concept in a business, but a core team, often with skills brought from outside, is necessary for the firm to move to the next level. “As an entrepreneur, you may be the initiator of business. But it is not the rule that you must be the leader too. The leader can be another person in your team,” explains founder chairman of Executive Recruiters Association and Sampoorna Computer People managing director Satish Doshi.
Many first-time business dreamers start with the support of family and friends. It is a natural choice for those who start operating out of their homes. This strategy has both positives and negatives, experts say. The founder can use a family member, who will fill up a talent gap and communication will be easy between them, but personal relationships and professional co-existence can weigh heavily against each other, they say. So, what are the golden rules of core-team building?FINALISE MEMBERSHIP
Entrepreneurs must draw up a list of the most crucial skills necessary for the business and assign job positions to them, experts say. For instance, writers and creative talent may be crucial for a content company, but back-end process management may be the one crucial aspect for a travel agency. So, having a clear list of priority skills is the first step. The talent mix must be individually intensive and collectively exhaustive.
SET INSPIRING GOALS
Any business idea has to be larger-than-life and even slightly unrealistic, says Mr Doshi. If a business idea was easily achievable, why would anybody want to do it? A core team comes together when there is a larger purpose they all want to serve together. A lack of this inspiration will make it impossible to attract outside talent and may eventually lead to the company straying into unimportance.
SHARE AUTHORITY AND OWNERSHIP
If an entrepreneur builds a core team and then decides to keep all the strings in his palms, his colleagues will feel under-used and lose their connection with the company’s vision. The attitude to keep all the profits and all the power to oneself has destroyed many business aspirants. “The question is simple. Do you want to have full control over a small pie or part-control of a larger pie, where that part is significantly larger than the small pie?” asks Mr Doshi.
HAVE A CLEAR LEADER
Many entrepreneurs assume they are the leader for their business. Experts say this need not be the case. The best entrepreneur hires people better than him or her and lets them direct the journey. This would lead to a situation where there could be multiple leaders within the team. The issue must be quickly resolved and one person assigned the task of leading the core team.
SET CLEAR RULES OF ENGAGEMENT
Great teams fail to deliver when they start quarrelling over a decision here or a plan there. Mr Doshi feels before the team starts its first discussion, the ground rules must be set on how the members are going to work together. It must be made clear that all criticisms and suggestions are welcome and none would be taken personally. Mr Pillai says there have been start-ups, where family members got together with good intention, but suffered a fracture in their relationships due to workplace stress. Complaints about some member not contributing enough or another taking advantage of the business abound in such enterprises, he says.
ACHIEVE ENTREPRENEUR-PROFESSIONAL MIX
All core teams have to start with high entrepreneurial focus, taking calculated risks and being flexible to move fast. But as the business begins to grow, there is an immediate need to put systems and processes in place. Professional managers free the entrepreneur’s time so that he can focus on the long-term strategy. Businesses often go haywire when they fail to bring in the discipline of professional management, Mr Pillai says. “A professional in a start-up team must be the personification of an entrepreneur himself. The professional need not have a Harvard-qualification, but must have passion to create something new.”
BE REALISTIC
When hiring an outsider, it is important to understate the benefits of being in your team, because over-promising will lead to failure and frustration, experts say. Mr Doshi says it is a good idea to leave a positive surprise, such as a better title, company-paid house or a training programme, open and unsaid at the beginning. People will like them that much better if they earn it for their performance.
Even after all this, it is possible that a core member could leave. It is a contingency that a start-up must learn to tackle, but the larger question the entrepreneur must address is whether it was because there’s something wrong with the business. “If the dream had been sold and the partner dropped everything to join you but still left midway, then something may be going drastically wrong. You must ask yourself if you are being fair as a leader. Are you tolerating competing agendas? Are you not able to give direction? Are you not able to resolve conflict?” says Mr Doshi.
Article Resource:
Author: Srinivasan S. is the Chief Editor in the The Economic Times, Mumbai and the article appeared in one of their successful columns on Entrepreneurship/Start-ups called "Starship Enterprise".
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