Entrepreneuring

Entrepreneuring being all the rage these days, I was intrigued to discover an anonymous publication on the subject dating back to 1980. Anonymous, but I know who wrote it - I did. It was based on the nine attributes of the entrepreneur, as described in the Harvard Business Review at the end of 1979. Here they are:

• A high level of drive and energy
• Enough self-confidence to take carefully calculated, moderate risks
• A clear idea of money as a way of keeping score, and as a means of generating more money still
• The ability to get other people to work with you and for you productively
• High but realistic, achievable goals
• Belief that you can control your own destiny
• Readiness to learn from your own mistakes and failures
• A long-term vision of the future of your business
• Intense competitive urge, with self-imposed standards

I still think this an extremely cogent and broadly correct menu. What appealed most was the fact that all nine attributes can be developed: they are not genetic like the shape of your nose or the colour of your hair. Having said that, they are plainly the attributes of remarkable people - like the entrepreneurs I selected to illustrate each of the nine.

The heroes were Miguel Torres,the Spaniard whose drive and energy created the world’s fastest-growing wine business; Bill Hewlett and David Packard, whose self-confident but careful risk-taking built an electronics business second only to IBM; William Morris, the financial genius who used price cuts to dominate the British car industry; Gottlieb Duttweiler, whose Migros cut-price grocery business was based on turning employees and customers into partners; and Marcel Dassault, who mastered French aviation by achieving impossible targets.

Then there’s Akio Morita, whose immense faith in his destiny created the worldwide Sony brand; Camillo Olivetti, whose readiness to learn from them turned his many mistakes into springboards for success; Ruben Rausing, whose Tetra Pak became one of the greatest private businesses, by fulfilling the founder’s long-term vision; and Robert Bosch, another private genius, who believed in neutering the competition - so that ‘the only alternative to Bosch is Bosch’.

Would I have chosen the same list today? Torres is having to face much more successful competition from other wine makers in Spain and outside. Hewlett-Packard survived a CEO who took badly calculated, immoderate risks. Morris Motors has long since disappeared into the wreck of the British car industry, which has itself long since disappeared. Migros is thriving. Dassault is still flying high in civilian and military markets. Sony has its problems, but not with the brand - still the strongest in world consumer electronics. Olivetti has gone into Telecom Italia. Tetra Pak and Bosch remain great businesses.

On the whole, the heroes have shown that strong entrepreneurial foundations can carry a company into long-term success far outliving its founders. The worst performance was that of Morris - did his lack of engineering expertise in the end outweigh his monetary genius? Looking at this case and the other eight, the customer franchise and its maintenance have proved to be decisive. As Torres always used to say, ‘First they must taste my wine’. If the taste is great enough, so is the business. The British car industry committed suicide by losing touch with its customers as the industry changed, which is a fatal sin for the entrepreneur.

I’m pleased to report that the sponsor of my essay has used all nine attributes to achieve mighty millions - the private equity leader, Apax, whose boss Sir Ronald Cohen plainly deserves to be a tenth hero. But remember the advice above. If you lack any of the nine, how are you going to develop the missing ability - and when?