Founders need a bit of grit for the fight
First published in the Financial Times on 5th November 2013.
Resilience in an entrepreneur is more important than brilliance
On certain days business can feel like a war of attrition. Meetings, calls and emails bring an endless stream of difficulties: customers going broke and not paying their bills, rivals poaching staff, property disputes, suppliers demanding price increases, employee grievances, frauds, accidents, collapsing deals and so forth.
It could be argued that struggle is at the heart of enterprise: in a free market, competitors battle it out to seize share from others. Management talk is full of phrases such as “aggressive expansion”. In among that melée a leader is tasked with generating a profit. Why on earth would such an activity not be constant combat? Any entrepreneur should be good at coping with the stress that inevitably arises from such conflict and striving. But how does one put the various challenges into proportion? Which are trivial and which are a crisis?
In the 1960s, two psychiatrists invented a table called the Holmes-Rahe Life Stress Inventory, which rated 43 events as factors in causing illness, going from 100 points for the death of a spouse to 11 for a parking ticket. It includes obvious tragedies and problems such as divorce, jail and personal injury. So I have devised a special stress rating for business owners and bosses – the Johnson-FT Entrepreneur Life Stress Inventory.
My proposed 10 most stressful incidents rank like this:
- Personal bankruptcy
- Company insolvency
- Partner disputes
- Loss of principal customer or contract
- Major fraud
- Large fire
- Substantial litigation
- Sudden new regulation/taxation
- Significant IT failure
- Strike action.
Readers might care to add to the list or make alternative suggestions for the top 10.
Drawing up the list reminded me that entrepreneurs need more than just an appetite for risk. They must actively relish strife, or at least prefer it to the tranquil life. For the clashes and rivalry of business are its essence. No commercial undertaking has ever succeeded without contest and hassle; a calm and pressure-free progression to the top is a fantasy. And a high proportion of start-ups fall by the wayside, accompanied by anxiety over sense of failure and financial loss.
So why take on all those responsibilities and embrace such financial dangers? I believe certain personalities thrive on the cut and thrust of it all – they are adrenalin junkies.
But it is also the case that working for yourself has advantages. One of the chief causes of stress is a feeling of helplessness. By contrast, entrepreneurs are attempting to take charge of their destiny. They are in control of their surroundings far more than most employees.
Meanwhile, in some large companies, the executive suite can afford to take an enlightened attitude by permitting extended medical leave when one of their number succumbs to exhaustion.
But not many founders I know who are running their own companies would be able to take a few months off because of fatigue. Someone has to make sure the payroll is met. The buck stops with an owner in a way that it never does with a hired hand. And that is why resilience in an entrepreneur is more important than brilliance – grit trumps almost every other trait.
The best cures for stress are not modern pharmaceutical prescriptions but the ancient answers: love, laughter, family, exercise, rest and simple joys such as music and friendship.
To me, doing nothing is not the best solution: instead the right response is stimulating mental and physical exertion that contrasts with the day job but still requires intellectual effort. Unfortunately, modern communications means no one can escape the siren call of work for long. I am sure “always on” devices add to the burden of leadership.
But if business can sometimes be a catalogue of grief, there are sublime moments too – when you feel you are on the winning side and building something enduring. Then all the worry can seem a price worth paying for an independent and adventurous life lived boldly.