7 Tips in Startup Management That Will Save You!
When it comes to the word “startup,” you may remember the famous apps, programs, and websites that rely on technology and have earned a lot of money. But in fact, the primary meaning of startup is much broader than technology-based businesses. In management science, any new activity is called a startup. That’s why startup management is an extensive topic.
This article discusses seven important management tips that help you manage your startup or, in another world, your new business.
Management is a set of core values and judgment. That is why one must remain faithful. The best manager is the one who has the best feeling about the method he chooses and then emphasizes it. One can have role models, but should not look like another. Be yourself, be natural and sometimes smile!
Adapted from Warren Avis, Entrepreneur, Pilot, Founder, and CEO of Oveyscar
Learn More: The High Value of Technology Startups: What Is the Reason?
Tip 1: Find a Good Model for Your Startup
An essential part of startup management is finding a suitable model based on creative ideas. It doesn’t matter if your startup is in its seed stage or is entirely mature. You always need modeling.
Modeling is not strange or complicated. Each of us uses the modeling process for our everyday tasks. Let’s discuss it with an example:
When you plan to travel, your modeling would be something like this:
- Deciding to travel
- Specifying the exact destination
- Checking available facilities
- Thinking about the routes to the destination
- Discovering recreation facilities
- Specifying dangers that may threaten you on the way.
Consequently, your plan will be something like this:
Calculate travel expenses, exact departure date, means of travel (car, train, or plane), tickets, book a hotel or other accommodation, specify fellow travelers, or even plan to travel alone.
When we look closely, modeling is something we do almost every day. But when it comes to startup modeling, we may avoid modeling. Remember, you should not skip this critical step under any pretext. Do not start anything without modeling.
Learn more: Financial Model Definition, Component, and Benefits
Tip 2: Know Your Mental Model.
You absolutely will manage your startup based on your mental model. You may wonder what the mental model is. The mental model is our way of thinking; It is the basis on which we decide and act. A personal, internal image of external reality that people use to interact with the world around them. Our knowledge, experience, sight, and hearings are among the things that form our mental model.
Learn more: Mental Model and Its Role in Strategic Management and Decision Making
It is interesting to know that a dysfunctional mental model is the main cause of many business failures. So, we have provided you with some notes that help you make practical changes to your mental model:
Learn more: Leadership Skills for Managers
Do Not Be Fooled by Meanings.
“The oldest and strongest emotion of mankind is fear, and the oldest and strongest kind of fear is fear of the unknown.”
H. P. Lovecraft.
Man is afraid of the unknown. For this reason, he wants to create an equivalent meaning for them to turn the unknown into familiar things. Sometimes these semantics become problematic for an entrepreneur who is exploring the capabilities of his new idea. Startup management needs to see the facts and their potential.
Examine your product, idea, or thought from a few steps away before making new judgments or meanings. Try to look at the good or bad story you have encountered without any pre analysis. New answers lie in new perspectives.
Your Mental Model Is About Your Mind; It Is Not Always the Reality
Mental models are a simplified form of the outside world. They help us communicate more easily with the world around us. That’s why in management science, all mental models are considered unreliable. However, they can be helpful or harmful depending on how we use them.
Do not make your startup management dependent on your mental model. Expand your horizons. The thinking that is praised today will be blamed tomorrow. Increase your flexibility. Use mental models and ways of thinking only as long as they are helpful to you and your startup. Remember, prejudice prevents you from thinking correctly.
Mental Models Are Sometimes Hidden
A large portion of our behaviors, both in startup management and in our personal lives, are directly and strongly influenced by the mental models developed in the past and even through childhood. We may even have them engraved on our memory forever. As a result, we can mistake them with the concept of “me.” For example, mental models may lead us to believe: “I am weak” or “I am incompetent.”
If your parents were unkind or strict with you as a child, their behavior may have been recorded as a mental model in your subconscious. This mental model will always be with you, even when you manage your startup. Having such a mental model, you may behave in two ways:
- When you want to introduce something new to your team:
You may experience stress and anxiety and refrain from sharing the necessary information. As you can’t predict the reaction of those around, you retreat and fall into the trap of your mental model.
- When your team members come up with new ideas
In the second case, when others come to you to express their ideas, that dusty mental model is activated again. But this time, it works in reverse. You may have seen examples of these encounters; When a very strict boss rejects the best possible idea on absurd pretexts.
Know yourself and value this self-knowledge to get rid of these invisible mental models or at least control them.
The image of the world around us, which we carry in our head, is just a model. Nobody in his head imagines all the world, government, or country. He has only selected concepts and relationships between them and uses those to represent the real system.
Jay Wright Forrester, Founder of Systems Dynamics, Professor at MIT, USA, and a Systematologist
Tip 3: Have an Entry and Exit Strategy
Another essential part of startup management is building or using strategies that help you in a crisis. Many managers do well in the entry part. When it comes to developing product, marketing, and sales plans, they work hard. However, they miss the most important thing: to formulate a strategy for critical times. This is where the skill of looking a few steps ahead comes in handy.
The architect who sketches skyscrapers designs emergency staircases and fire-fighting systems with the utmost precision. On the other hand, the sailors still wear life jackets with all their experience and skill in swimming. You, too, must anticipate and execute a powerful way to deal with critical times. But, beware of some deviations: do not overdo the exit strategy design. Startup management needs to keep a balance. Although it is essential to formulate an exit strategy, you should not address it more than your entry strategy. The way out is important when the main building is constructed.
Learn more: Startup Exit Strategy- Exit Options for Venture Capitalists and Founders
Tip 4: Always Analyze These Three Cycles
To manage your startup, you need to learn more about three basic cycles that underpin any business. These three cycles include the business life cycle, the industry life cycle, and the market life cycle. Let’s discuss them in more detail.
Business Life Cycle
Generally, the business life cycle consists of four phases: startup, growth, maturity, and renewal/rebirth or decline. This cycle starts when a business idea is concluded, continues with the manufacturing and launching of the product, and finally ends by the cessation of production.
One of the most important decisions a startup manager must make is about the correct time to move from one stage to the next.
Learn more: What is the software development lifecycle, and why is it important?
Industry Life Cycle
The industry life cycle stages are just the same as the previous cycle. However, as your business is considered as part of this cycle, the industry life cycle is much more critical.
According to Michael Porter’s five forces model, competition among existing competitors, bargaining power of customers, the bargaining power of suppliers, the threat of substitute products, and the threat of new entrants are the things you need to study before entering an industry.
As your startup life depends on this cycle, the industry life cycle and monitoring its changes is another critical task in startup management.
Market Life Cycle
Every product has a market, and every market reaches its end one day. Different causes can underlie this decline. Sometimes technological advances marginalize the product. Furthermore, compelling alternatives may change the old market to create a new position for themselves. As a startup manager, you always have to do three things to deal with this cycle:
- Observe the market
- Identify your current position in the market
- Predict your future position in the market
When you know where you are and where you need to go, you can make the best choices as a business manager.
My most important experience as a manager is to look at the employees of a factory as a valuable commodity and the most important asset for success. It is not the robots and machines that make an organization successful, but the people who are constantly coming up with new ideas.
Based on Werner Niefer, Chairman of the Board of Mercedes-Benz in 1989
Learn more: How to Calculate The Startup Market size?
Tip 5: Decide to Expand When Times Are Good
Every business grows, and every growth requires anticipation and planning. Startup management involves identifying the right time and the right way to expand your business. Remember that growing, expanding, and developing is not a cross-sectional activity. Startups growing is a daily and ongoing process.
However, no matter how carefully you plan, you still need to find out some issues by trial and error. Without stepping on a new path, you cannot predict its exact obstacles and needs. So, courage, boldness, and big ideas, as well as suitable tools, are what you need to manage your startup.
Learn more: Startup Growth Rate; The Critical Key Performance Indicators for a Startup
Tip 6: Use Your Sellers’ Mental Model to Grow Your Product
The customer’s mind reading is one of the wishes of every businessman. The problem is that sometimes the customers do not know what they want! To solve this conflict, managers have developed special methods to identify the tastes of their customers. To correctly manage a startup, you need to put yourself in the customer’s shoes and look from their point of view. This helps you identify hidden patterns in customer behavior.
Meanwhile, one of the exciting ways to discover these valuable hidden patterns is to analyze your sellers’ mental model. The sellers of your product or service are closer to the customers than anyone else. They can easily look at the product through the customer’s eyes. It is not far-fetched either; who better than the seller of a product knows its strengths and weaknesses? They have to discover valuable information about the product to convince the customer to pay money.
Hold regular meetings with your sellers and listen to the customers’ subtleties and points of view from their language. Succeeding in startup management requires the art of hearing.
Tip 7: Do Not Mistake Customer Respect with Customer Orientation.
Many businesses have difficulty understanding these two concepts. They waste a lot of time, money, and motivation because of this misconception. Customer orientation is a strategy, but respecting the customer is part of the operational processes of your business. Let us explain these two concepts a little more.
A satisfied customer is the best business strategy of all
Who Is On the Tip of The Compass? You or Your Customer?
If you want to be a good startup manager, you need to deal well with your customers. If you have trained your employees to be respectful to the customer, willingly take back items that they are not satisfied with, or do anything else to make them leave you satisfied with a smile on their face, you have done your best to respect the customer.
However, this good behavior has nothing to do with customer orientation. As long as you see yourself as the center of your business, you can not apply customer orientation. Customer orientation means looking at the customer as the only valuable asset of the company. You must address all services, solutions, and instructions to satisfy this valuable resource. If necessary, startup management should even change the company’s service flow or launch a new product line to retain customers.
Customer orientation is a complex strategy that goes far beyond bringing a smile to a customer’s lips. Most existing businesses and startups don’t go beyond customer respect. They may don’t realize that the customer is the only available capital their business has. Sooner or later, all companies will realize that the right way to manage a startup is customer orientation. The customer is the ultimate source of capital and the core value of a business.
An Overview of the Seven Key Points in Startup Management:
- Making a model of your ideas is an integral part of startup management. If you ignore this step, all your efforts for progress and profitability will be wasted.
- As a startup manager, you need to make time for your personal growth. Remember that you live what you think.
- Always look at the bigger picture. This will help you to choose the right strategy.
- The business life cycle, the industry life cycle, and the market life cycle are three cycles that you must constantly monitor.
- Do not postpone the expansion of your business to a specific time. Grow slowly but steadily.
- The closest mental models to customers are salespeople. Always try to listen to their opinions.
- Customer orientation is a complex strategy; Do not equate it with respect for the customer.
Take Action, Not Talk.
Seven points or seventy points do not matter. You must apply these tips to startup management. Management science is constantly evolving, and new methods are being introduced for old problems. For someone who always leaves room for learning, question marks are temporary things.
