The most effective business builders are able to identify markets that are growing and sizingable, and they can then fit new products and services to these markets. According to a study, 20% of companies that scale successfully build new businesses have clear processes compared to only 25% of companies that don't. This rigorous approach is crucial to ensuring that the early excitement of a business venture is channeled into measurable milestones and deliverables. An agile approach called sprint cadence supports rapid progress.
In the last decade, business building has become a top priority for incumbent companies. As the COVID-19 crisis has upended assumptions in many industries, business building has become more important than ever. It requires companies to create new capabilities and new models in order to adapt to changing customer needs and grow organically. The strategy requires a deep understanding of the market and an effective strategy to acquire customers in the long term. While M&A is still an essential part of a growth playbook, organic growth often yields higher excess returns than dealmaking.
The most critical difference between successful and unsuccessful business builders is their leadership style. The most successful business builders tend to cite a large and growing market, while those that are less successful tend to cite a small market and lack of growth. The most important difference between a leader and a laggard is how they lead their team. It is a natural that leaders are expected to set the example and lead by example, while managers should be able to provide coaching and guidance.