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Wednesday, July 11, 2012

Entrepreneurial Traits to Start and Run a Business

Entrepreneurial Traits to Start and Run a Business
By Dean Pax Lapid 

I had the opportunity to do a workshop called “Planning for Early Retirement” last week that was attended by 30 faculty and administration staff from an established university in Manila. It was difficult to encourage these ‘retirees’ to pump all their hard-earned money into a business. During the workshop, I was confronted with two interesting questions: 

1.) How much should one invest in business? and

2.) Are there essential traits to start and run a business?

On the first question, I cautioned the retirees to only invest “business” money based on a personal formula (age you want to die minus current age). The basic principle here is that the younger you are, the more risks you can take. The closer you are to “kicking the bucket” (72 years old is the Filipino average) the more cautious you should be.

In my case, 90 (age I want to die happily) - 55 (current age) = 35 percent, meaning I can only invest one third of my liquid assets in any of my new venture. When I retired, I got a hefty retirement (22 years of work) that I invested in an IT company (US private limited corporation) doing SAP (ERP package) projects in North America. I lost 500,000 only with the consolation that it was shared with my Fil-American partner.

The bad thing was that it was in US dollars! Life is good and God is good that I have recovered from that big loss and even got more eventually! On the second question about entrepreneurial traits, I shared the story of a mentee – Carline who was my graduate of 2006. These were interview notes done by Dr. Leah Macatangay, also former dean of ESA. Let me share the story of Carline that I gave to the retirees…

Woman’s Opportunity in a Man’s Business

Carline believed that it was more of destiny and duty that made her pursue a hardware business. She did not exactly choose it but rather received it from her family. Being the eldest child, she had been singled out to eventually manage the hardware store located in Valenzuela City.

Carline’s father had set it up many years back to cater to the residences and buildings in that area. After Carline’s graduation in 2006, her father handed the business over to her and decided to retire. Carline asserts, “I believe that even if I am a woman, I can manage the business the way that men manage it, with the infusion of hard work, the things that I have learned from school, the advice of my father, and my own experiences.

Nowadays gender is not an issue anymore in the choice of job. Our capabilities cannot be measured by gender. I believe that we can do a lot of things if we believe in ourselves and of course, with hard work and prayers.

When I learned that I was tasked to manage our family business, I did not find it easy to accept because I had different plans for myself. But it was my responsibility to take the managing position since my father wanted to retire already. It was a tough decision to make but eventually, I learned to appreciate and even love the hardware business.

Sometimes you cannot choose the opportunity that knocks on your door. If the opportunity does not correspond to your passion, are you going to let it pass? I grabbed the opportunity and learned the business with hard work. I was able to manage it because I kept an open mind and made the best of the situation. I’m glad that I had accepted it. I can say that it had been the right choice to pursue the hardware business because I have realized this is where I want to be.

Preparedness and Mentoring

Carline recalled that she learned a lot from school in terms of running a business. “Managing a business is not an easy task; one has to be fully dedicated to it. I learned that one has to consider several things: capital, vision for the near and long-term, target market, location, price, customer satisfaction, the market, the industry.

I observed that people previously used advertisements like TV and radio ads to promote their products. But I believe that today, satisfying customers is what marketing is all about. If we are able to satisfy customers, it means that our business is doing alright. The main goal in putting up a business aside from earning is to be able to satisfy customers.

Something that I treasured most from school were the lessons of Dean Pax Lapid. He was my professor from Venture Planning to Venture Initiation, during my senior year from Venture Management to finally Venture Assessment. It wasn’t easy to be a student of Dean Pax but it really was worth it because of the invaluable knowledge I obtained in managing a business. 

Managing with Her Team

It was a bit difficult to be young and female and running the business, especially in the Chinese culture, as well as dealing with suppliers and customers who were male, much older, and more experienced than her. She had to try to mature quickly and be serious and responsible enough in order to be taken seriously. 

As for her employees, she tried to deal with them as a team. They were older than her and had been working in the business for almost 20 years. She respected them and they respected her because she was proving herself to them that she could run the business competently, with their cooperation. 

She had been managing the business the way she thought that it should be managed. She acknowledged that problems will always be present but she believed that in every problem there is always a solution. With respect to decision-making, Carline learned of the importance of weighing things before making a decision. She learned to deliberate on the advantages and disadvantages and to consider the consequences of an action before making a decision. 

In 2008, Carline was able to put up a second branch of the hardware store. She set up the branch in Meycauayan, Bulacan. Because of the proximity of her warehouse, she was able to offer lower “city” prices even if her competitors were offering higher prices due to the provincial location. The branch is doing well and is establishing itself in the area. Carline’s vision for her business is to expand to more branches and to create new concepts such as additional products offerings. 

At her steady pace, Carline is headed straight for that destination. 

Here’s My Summary on Why Carline Has Been Successful: 

* She knew what I’ve been harping all along that “Luck is the ability to recognize an opportunity and take advantage of it”. Luck is preparedness + opportunity. 

* She had the belief in her capabilities to organize and execute the courses of action required to manage prospective situations especially with customers and her employees. 

* Finally, Carline had the ambition and persistence to be a woman entrepreneur in a man’s business and carry on the family legacy out of duty. I’d say it was more out of love and respect for her parents. 

Lessons of entrepreneurial success can be shared but the ability to implement these lessons in each individual situation is something else. I feel proud as her mentor that Carline has cemented and nailed our lessons on entrepreneurial traits and has painted her success now and in the near future! 

I pray that you may have the PASSION, PERSISTENCE and POTENTIAL to PROSPER your dreams. God bless you all! 

About Dean Pax Lapid 
Dean Pax
Dean Pax Lapid is the former Dean of Entrepreneur School of Asia. He is also a Professor of Entrepreneurship at Asian Institute of Management, one of the most prestigious business schools in Asia. He is a prolific entrepreneur, creating one new business a year.

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