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Entrepreneurial Skills

The Skills You Need to Start a Great Business

Entrepreneurial Skills – What You Need to Start a Great Business

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Successful entrepreneurship takes hard work, dedication and a wide skill set.

Do you have what it takes to be a successful entrepreneur? It certainly helps to have expertise in your field. Aptitude and flair play a part, too. But the key qualities are creativity, resilience in the face of challenges, and the social skills needed to build great teams.

If you want to start your own business, you need to learn the specific skills that underpin these qualities. Entrepreneurial skills can also be a major asset if you're in a job role where you're expected to deliver new business or build new products.

Whether you've seen a gap in the market, or losing your job has forced you to reassess your career, this article explains the skills you need to make it as an entrepreneur, and explores resources that you can use to develop the skills required for success.

What Is an Entrepreneur?

Being an entrepreneur usually means starting and building your own successful business, although people with entrepreneurial skills can thrive within larger organizations, too. Entrepreneurs generally take a creative, innovative approach, and they may take risks that others would avoid.

Regardless of how you define the term, becoming a successful entrepreneur isn't easy, so be prepared to do the "hard yards," even after you've learned the skills we describe below.

Many researchers have studied the subject, but there are no definitive answers. What we do know is that successful entrepreneurs tend to have certain traits and skills in common:

  • Personal characteristics.
  • Interpersonal skills.
  • Critical and creative thinking skills.
  • Practical skills and knowledge.

The following sections examine each area in more detail, and look at some of the questions you will need to ask yourself if you want to become a successful entrepreneur.

The Personal Characteristics of an Entrepreneur

First, examine your personal characteristics, values, and beliefs. Do you have the mindset to be a successful entrepreneur? Ask yourself these questions:

  • Optimism: Are you an optimistic thinker? Optimism is an asset, and it will help you through the tough times that many entrepreneurs experience as they find a business model that works for them.
  • Vision: Can you easily spot areas for improvement? Can you quickly grasp the "big picture," and explain it to others? And can you create a compelling vision of the future, and then inspire other people to engage with that vision?
  • Initiative: Do you have initiative, and instinctively start problem-solving or business improvement projects?
  • Desire to lead: Do you enjoy being in charge and making decisions? Are you motivated to lead others?
  • Drive and persistence: Are you self-motivated and energetic? And are you prepared to work hard, for a very long time, to realize your goals?
  • Risk tolerance: Are you able to take risks, and make decisions when facts are uncertain?
  • Resilience: Are you resilient, so that you can pick yourself up when things don't go as planned? And do you learn and grow from your mistakes and failures? (If you avoid taking action because you're afraid of failing, our article on Overcoming Fear of Failure can help you to face your fears and move forward.)

Interpersonal Skills and Entrepreneurship

As an entrepreneur, you'll likely have to work closely with others – so it's essential that you are able to build good relationships with your team, customers, suppliers, shareholders, investors, and other stakeholders.

Some people are more gifted in this area than others, but you can learn and improve these skills. The types of interpersonal skills you'll need include:

  • Leadership and motivation: Can you lead and motivate others to follow you and deliver your vision? And are you able to delegate work to other people? As an entrepreneur, you'll have to depend on others to get beyond the early stages of your business – there's just too much to do by yourself!
  • Communication skills: Are you skilled in all types of communication? You need to be able to communicate well to sell your vision of the future to a wide variety of audiences, including investors, potential clients and team members.
  • Listening: Do you hear what others are telling you? Your ability to listen and absorb information and opinions can make or break you as an entrepreneur. Make sure that you're skilled at active listening and empathic listening.
  • Personal relationships: Do you have good "people skills"?Are you self-aware, able to regulate your emotions, and respond positively to feedback or criticism? Our article on Emotional Intelligence offers a range of strategies for developing these crucial attributes.
  • Negotiation: Are you a good negotiator? Not only do you need to negotiate favorable prices, but you will also need to resolve differences between people in a positive, mutually beneficial way.
  • Ethics: Do you deal with people based on respect, integrity, fairness, and trust? Can you lead ethically? You'll find it difficult to build a happy, productive business if you deal with staff, customers or suppliers in a shabby way.

Tip:

Evaluate your people skills by taking our How Good Are Your People Skills? self-test.

Critical and Creative Thinking Skills for Entrepreneurs

As an entrepreneur, you need to come up with fresh ideas, and make good decisions about opportunities and potential projects.

Many people think that you're either born creative or you're not. But creativity is a skill that you can develop, and there are many tools available to inspire you.

  • Creative thinking: Are you able to see situations from a variety of perspectives to generate original ideas? Tools like the Reframing Matrix can help you do this.
  • Problem solving: You'll need sound strategies for solving business problems that will inevitably arise. Tools such as Cause & Effect Analysis, the 5 Whys technique, and CATWOE are a good place to start. You'll find many more in our Problem-solving section.)
  • Recognizing opportunities: Do you recognize opportunities when they present themselves? Can you spot a trend? And are you able to create a workable plan to take advantage of the opportunities you identify?

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Practical Entrepreneurial Skills and Knowledge

Entrepreneurs also need practical skills and knowledge to produce goods or services effectively, and to run a company.

  • Goal setting: Setting SMART goals that are Specific, Measurable, Achievable, Relevant, and Time-Bound will focus your efforts and allow you to use your time and resources more effectively.
  • Planning and organizing: Do you have the talents, skills, and abilities necessary to achieve your goals? Can you coordinate people to achieve these efficiently and effectively? Effective project management skills are important, as are basic organization skills. And you'll need a coherent, well thought-out business plan, and the appropriate financial forecasts.
  • Decision making: Your business decisions should be based on good information, evidence, and weighing up the potential consequences. Core decision-making tools include Decision Tree Analysis, Grid Analysis, and Six Thinking Hats.

Tip:

Take our self-test, How Good Is Your Decision Making?, to learn more.

You need knowledge in many different areas when you're starting or running a business, so be prepared for a steep learning curve!

They include:

  • Business knowledge: Ensure that you have a working knowledge of the main functional areas of a business: sales, marketing, finance, and operations. If you can't fulfill all these functions yourself, you'll need to hire others to work with you, and manage them competently.
  • Entrepreneurial knowledge: How will you fund your business and how much capital do you need to raise? Finding a business model that works for you can require a long period of experimentation and hard work.
  • Opportunity-Specific Knowledge: Do you understand the market you're attempting to enter, and do you know what you need to do to bring your product or service to market?
  • Venture-Specific Knowledge: Do you know what it takes to make this type of business successful? And do you understand the specifics of the business that you want to start?

You can also learn from others who have worked on projects similar to the ones that you're contemplating, or find a mentor – someone else who's been there before and is willing to coach you.

Tip 1:

As an entrepreneur, you must also learn the rules and regulations that apply in the territory or territories that you're operating in. These websites may be useful:

Tip 2:

Working in a business like the one you want to launch is a great way to learn the ropes. But be aware of non-compete clauses in your employment contract. In some jurisdictions, these clauses can be very restrictive. You don't want to risk your future projects by violating the rights of another entrepreneur or organization.

Is Entrepreneurship Right for You?

Before you proceed with your plan to become an entrepreneur, assess your skills against all of the questions and considerations above. Use a Personal SWOT Analysis to examine your Strengths and Weakness, your Opportunities, and the Threats that you may face.

Be honest with yourself about your motivations and the level of commitment you are prepared to give to your project – this could prevent you from making a costly mistake.

As you work through your analysis, you may feel that you're ready to plunge into your exciting new venture. Alternatively, you may decide to wait and further develop your skills. You may even decide that entrepreneurship isn't for you after all.

Being an entrepreneur can take a huge amount of time and dedication, so make sure that it feels right.

Key Points

While there is no single set of characteristics for being a successful entrepreneur, there are many skills that you can learn to help you succeed.

These can be divided into four broad categories:

  • Personal characteristics.
  • Interpersonal skills.
  • Critical and creative thinking skills.
  • Practical skills and knowledge.

Examine your own personal strengths and weaknesses in these areas and assess the time and commitment you'll need to "up to speed.".

Becoming an entrepreneur is a career decision like any other. So avoid the temptation to act impulsively. Do your homework. Reflect on your needs, your objectives, and your financial and personal circumstances, and take time to decide whether this is the right path for you.

This site teaches you the skills you need for a happy and successful career; and this is just one of many tools and resources that you'll find here at Mind Tools. Subscribe to our free newsletter, or join the Mind Tools Club and really supercharge your career!

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  • Over a month ago Midgie wrote
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  • Over a month ago Splendour wrote
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