When these enterprises thrive, they spur much-needed job creation. Here’s how business owners can achieve significant organic growth.
Russell Knudsen has been crunching some new numbers. Knudsen is the cofounder and director of corporate finance for ePower Engine Systems, a small business that recently developed a hybrid drive train modification that significantly improves the fuel efficiency of large trucks. He is also one of 625 entrepreneurs and executives in more than 100 small and medium-sized enterprises (SMEs) from a broad range of industries who took part in Gallup’s Entrepreneur Acceleration System (EAS) in Nebraska in 2011.
There’s no shortage of innovation and perceived market opportunities in the U.S.
ePower’s leadership knew there was significant interest in its technology but had set rather modest growth targets for the first five years. The EAS program led Knudsen to realize that was a mistake. If ePower was able to expertly manage its own performance and establish powerful relationships with customers, sales of its product could take off much more quickly. Knudsen accelerated the company’s production schedule and now believes the company can grow from 20 employees this year to as many as 500 in 2015.
Like many other EAS participants, Knudsen credits the program with helping expand his company’s horizons — in fact, ePower’s technology offers a nice metaphor for the program itself. The EAS uses Gallup’s expertise in behavioral economics to upgrade the management “engines” of SMEs that have significant potential for sustainable growth.
In The Coming Jobs War, Gallup Chairman Jim Clifton notes that there’s no shortage of innovation and perceived market opportunities in the U.S.; what America and many other countries need most is more entrepreneurial capacity to convert those ideas into winning business models, thereby creating jobs. That urgent need is what the EAS is designed to address.
Gallup partners with the program’s sponsors in a given community — which may include government, financial institutions, universities, and other organizations working to promote economic vitality — to recruit SMEs that have the potential for significant growth. Entrepreneurs who take part in the program participate in a series of workshops led by Gallup subject-matter experts, then work with Gallup-trained mentors on company-specific action planning. The curriculum is focused on five areas:
Leveraging entrepreneurial strengths. Gallup’s research indicates that a person’s entrepreneurial ability, motivations, and attitudes are the most important drivers of a new business’ survival and growth. They may be even more important than the original business idea to the business’ ultimate success. In recognition of this, the EAS program begins by identifying the business owner’s entrepreneurial talents. Next, the top five talents of each company’s executives are identified using Gallup’s talent assessment, the Clifton StrengthsFinder. Once the talents of the entrepreneur and the core team are identified, Gallup produces a talent map, which the mentor uses to support the entrepreneur to build a strengths-based team. Successful strengths-based development results in various positive business outcomes.
Creating a road map for growth. Mentors and Gallup consultants help participants outline a vision for the future of their enterprise. They spell out the goals that give the business and its employees a sense of purpose and direction and create a detailed plan to achieve those goals.
Building an engaged workplace. Entrepreneurs learn about management principles and the workplace conditions necessary to ensure that employees are engaged, or highly motivated and emotionally connected to the company. Engaged employees can help their businesses maintain stability and momentum through the early stages of growth, which are often challenging.
Growing an engaged customer base. Adding new customers is key to long-term, sustainable growth, so the curriculum introduces participants to the concept of customer engagement. Participants gain insights into how to help their employees understand customers’ needs and establish enduring customer relationships.
Establishing performance management metrics. Participants work with mentors and Gallup consultants to determine a set of relevant indicators, including key behavioral economic measures. These metrics enable participants to closely monitor their business’ progress toward key goals and growth targets.
Each of these areas addresses vital components of business development — the make-or-break “human factors” that other business incubators often fail to address. The program’s mentor-based model gives Gallup the capacity to work with local and national governments, financial institutions, and other individuals or groups pursuing sustainable economic growth initiatives and to reach thousands of SMEs in a given area.