Entrepreneurship is made up of 2 sectors namely the science aspect which is what we learnt at school and colleges—accounting, human resources, management, medicine, engineering, law, risk management and more. This is fairly simple as its standardised for instance in accounting, we have accounting standards for guidance—the same for human resources or project management. There are basics followed throughout the world and there are tonnes of material from continuous researches. In Zimbabwe, we do not have a shortage of the science aspect of entrepreneurship as the college system produces surplus of talent in this regard.
The other side of entrepreneurship is the arts side and here anything goes. It is the art of making money! Although there are attempts to apply science to it but still the formula is not clear cut for if it was simple, then everyone would be a multi millionaire or even billionaire!
Which formula did Elon Musk use? Which formula did Strive Masiyiwa use? Some of the secrets are publicly known but this is half the story, there is a whole lot which the public will never know! How do you explain the timing, the grace or even luck and try to create a formula for it? How do you explain that 2 men go fishing, same place, same fishing tools but one gets more than the other? What formula results in big fish biting on Fisherman X and not Fisherman Y? Why do 2 ladies go to Mupedzanhamo, same time, same second hand clothing bales but one quickly sells and the other struggles?
There are continuous researches on the arts side with a lot of material coming up but still we have half the story of outliers. Why has Zimbabwe struggled to produce another Kirsty Coventry? Why have we taken decades to produce another Peter Ndlovu?
The thrust of this post however is on developing strong systems and it’s an area of deep concern as it involves a lot of dynamics.
Without strong systems, losses are the end result!
You can make a lot of sales but without strong systems=losses!
Major Components of Systems
- Procurement: Getting the best value for money from procurement
- Storage: Ensuring the best storage for goods limiting losses and ensuring less inconveniences for clients and staff
- Sales: Maximising sales ensuring efficient revenue collection
- Financial Management: Getting the best return on funds invested
- Your Strategy: Strategy that incorporates the business model that will ensure maximum return on funds invested.
It looks simple on paper but in reality it’s not! The systems depend on a team recruited, how they gel, the culture developed, experience in the field, ethics, motivation and more. How the team responds to market dynamics—speed of decision making and goal congruency. What if the team is not working with the same goal with those who invested funds? In the Zimbabwean context, most employees are interested in starting own business ventures. Some will just be buying time to mobilise resources and getting experience and access to business secrets. As soon as they get enough capital, they are out and go on to set rival entities!
Some kombi drivers have gone to buy own kombis using resources from others. How do you protect your business from such employees?
If you are running a bottle store and you are absent, employees can use your own premises during your absence to sell own stuff and getting profits without paying rent. What systems can you implement to safeguard losses?
If you are into farming, employees can sell inputs, sell farm produce or even work at nearby farms. How do you put in controls to protect your capital?
The formula is the simpler the operations, the better controls you can put,
- For instance if you sell buses, it’s easy to know 10 buses sold, how much profit realised,
- If running a supermarket with thousands of products handled, the more complex your controls,
- If you are running an entity for the first time, the bigger the red flag on your controls,
- If you are running an entity remotely, the higher the possibilities of losses,
Conclusion
Little attention given to systems by many start-ups as they have to overcome many challenges to set up businesses. The first hurdle is access to capital, when overcome, the second hurdle is access to markets, when overcome, next is system losses and most of these hurdles are not budgeted for.
Each hurdle comes at a cost and may even take one’s time and the worst part is you can have many hurdles need your time and focus at the same time. A vehicle engine problem, suspension problem and electronic problem right in the middle of Hwange National Park with lions and hyenas lurking nearby.
So last message—do a lot of researches, get inspired by those already in the field you intend to venture in, outsource system development and monitoring. Do not invest 100% of your funds in a business you have little knowledge and experience in how systems operate—invest gradually and continuously monitor where systems have leaks, plug them and upscale!
