Entrepreneurship and the challenge of being successful

Posted by Driely Barbosa
at Friday December 6th, 2013.

One of the great nations that experiences and encourages entrepreneurship is the U.S.A.  It is able to take advantage of the results of companies today, such as Google, Facebook, and Apple, as well as yesterday’s Standard Oil Company, Microsoft, Ebay and others. In the U.S. the entire structure favors people to be entrepreneurial and because of that reason it is called the land of opportunity. Yale University, as well as several other renowned schools, have MBA programs on this topic.

In Brazil, potential entrepreneurs are inspired by the recent successes in the U.S. They are risking more because of the current economic climate which has shown an internal market warming. The entrepreneurial wave has been supported through speeches from the government, evidence by the numbers. The IBGE showed in a recent survey that 50% of public companies in Brazil have less than a year left to survive. This entrepreneurial wave is so obvious and so present in governmental development strategies that reputable foreign magazines such as The Economist discussed the issue with President Dilma in an exclusive interview.

Entrepreneurship is excellent for the nation. It basically encourages people who have an idea to implement it, thus generating value from nothing. This value generation makes organizations remain extremely competitive and the national economy generates wealth.

But what happens to that business after the project is implemented? How does it stay in business after the first year? There are several challenges to being successful, not just being an entrepreneur. There must be conditions for businesses to start, grow, and develop sustainably.

If on one hand 50% of companies in the country today have less than 1 year of life, 50% of the remaining companies fail to last 3 years. This could be divided into two reasons:

  • Governmental issues, which still lacks financial incentives, such as lower interest rates for funding, streamlining of procedures for opening and maintenance of businesses, tax reduction and restructuring, high logistics costs, and lack of skilled labor.
  • Internal management issues, where entrepreneurs lack the knowledge for good management (and of course good planning, strong control of performance metrics, evaluation of results and fast decision making).

For the problems of government order, the expectation is high.The current and future governments must continue to take actions that enable entrepreneurship. These actions need to be robust and have a short implementation period so that it is beneficial to the country.

On the point of order management, today in the market there are consulting companies that are true schools of management, they implement and train the customer on how to have a good and robust management system. There are also tech companies that are offering technological solutions that perpetuate and internalize this consulting knowledge. With these tech solutions, the customer can therefore maximize the value of consulting without maintaining the high investment advisers for a long period of time.

With the aid of government actions, good management and leadership (persistence, perseverance and good ideas) the country will increase the success rate of these great entrepreneurs that rise each year. This will enable Brazil to excel its growth to become an improved and wealthier country.

Written by Ivan Cruz Junior,

Business Development Director at Mereo Consulting

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