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Building A Venture Team and Planning for the Next Generation

  • Writer: ZPerry78
    ZPerry78
  • Sep 5, 2018
  • 4 min read

@Rawpixel

Leadership- influencing/ inspiring others to work to achieve a common goal, while giving freedom and power to achieve said goals. The characteristics associated with leadership include the ability to be innovative, passionate, a risk-taker, adaptable and understanding.


A business is like a construction project, where the leaders are the architects and the managers are the builders. Leadership without management is unbridled and management without leadership is uninspired. Although leaders create the entire business, managers are the ones to keep it operational.

One without the other leaves the business going nowhere- effective leaders exhibit:

  • define and reinforce the vision of the company. Create set of values and beliefs for employees

  • establish a culture of ethics/ develop strategic plan for SCA/ respect and support employees

  • set example for employees/ authentic/ create trust within org/ build credibility/ challenge employees

  • provide resources for them to achieve goals/ communicate/ value diversity/ celebrate success

  • encourage creativity/ maintain sense of humor/ motivate by training and giving freedom to achieve

  • create environment that encourages performance/ become catalyst for change/ develop leadership talent

  • Servant leadership style- leader takes on the role of servant first and leader second

Building an entrepreneurship team: hiring the right employees

  • Reduce employee turnover rates- provide rewarding & challenging work/ pay employees fairly/ provide training opportunities and mentoring relationships/ offer flexible schedules/ provide simple rewards/ conduct exit interviews for areas for improvement

  • How to hire winners- commit to hiring the best talent/ elevate recruiting to a strategic position in comp (look inside company first/ look for employees with whom your customers can identify/ encourage employee referrals/ make employment ads stand out/ use multiple channels to recruit talent/ recruit on campus/ forge relationships with schools and other sources of workers/ recruit retired workers/ consider offbeat recruiting techniques/ offer what workers want)

  • Create Practical job descriptions and specifications

    • Job analysis- firm determines the duties/ nature of jobs to be filled and the skills/ experience requirements

    • Job description- written statement of duties/ responsibilities/ reporting relationships/ working conditions/ methods and techniques/ materials and equipment used in the job

    • Job specification- written statement of qualities / traits (education/ skills/ experience)

  • Plan an effective interview (give insight into applicants qualities/ personality/ character)

    • involve others in the interview process/ develop open-ended questions for every candidate

    • create hypothetical situations about potential situations in the workspace/ their handling

    • Situational interview- interviewer gives candidates a typical job related situation/ response

    • probe for examples in past experience that demonstrate necessary traits and characteristics

    • have them describe recent success/ failure and how they dealt with them

    • arrange non interview setting/ allows several employees to observe candidate in formal setting

  • Conduct the interview- breaking the ice/ asking questions/ selling the candidate on the company

  • Contact references and conduct a background check

Create an organizational culture that encourages employee motivation/ retention

  • Culture- distinctive/ unwritten/ informal code of conduct that governs an organizational behavior/ attitude/ style

    • building pos. org. culture has a direct positive impact on the financial performance of an organization.

  • Respect for work and life balance/ sense of purpose and fun/ engagement (recognize/reward/ communicate)

  • Diversity/ integrity/ participative management/ learning environment

  • Job Design

    • Job simplification- breaks work down into simplest form/ standardizes each task

    • job enlargement (Horizontal job loading)- adds more tasks to a job to broaden scope

    • job rotation- cross training employees/ give them skill sets for multiple tasks to perform

    • job enrichment (vertical job loading)- building motivators by increasing planning/ decision making/ organization/ controlling functions that workers perform

      • Skill variety/ Task identity/ Task significance/ Autonomy (freedom)/ Feedback

    • Flextime- arrangement where employees work normal hours/ flexibility when they start & stop

    • Job sharing- work arrangement for 2+ people share a single full time job

    • Flexplace- work arrangement for employees to work somewhere that is not a traditional office

    • Telecommunication- employees working remotely use modem comm. to connect electronically

  • Motivating employees to higher levels of performance: rewards/ compensation

    • Pay-per-performance compensation systems- employees pay depends on their performance

    • Profit sharing plan- reward system where employee receives a portion of the company's profits

    • Open book management- entrepreneurs share openly their financial results with employees

    • Stock Options- plan under which employee can purchase shares at a fixed price

    • Cafeteria benefit plan- employers provide certain benefits/ allocate $ amount to select benefits

Management succession: passing the torch of leadership

  • How to develop a management succession plan- select successor/ create a survival kit/ groom them/ promote an environment of trust and respect/ cope with financial realities of estate and gift taxes

  • Buy/ sell agreement- co-owner contract stating a buyout incase of a death/ disability of the other

  • Lifetime gifting

  • Setting up a trust- contract between grantor (founder)/ trustee to hold assets for beneficiaries (heirs)

    • Revocable trust- trust that a grantor can change/ revoke during their lifetime

    • Irrevocable trust- trust in which grantor can not require the trustee to return the assets held

  • Estate Freeze- strategy that minimizes estate taxes by creating 2 classes of stock for a business: prefered voting stock for the parents and nonvoting common stock for the children

  • Family limited partnership- strategy that allows bus. owning parents to transfer company to children (lowering estate taxes) while still retaining control over it themselves

  • Exit strategies (Selling to outsiders/ insiders) Insiders:

    • Leveraged buyout- managers/ employees borrow $ to purchase bus/ use $ from ops to pay debt

    • Employee stock ownership plan- managers/ employees contribute a portion of wages over time towards purchasing shares of company stock from founder until they own the company outright

 
 
 

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