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Levels of Development
Beyond the general design principles what other
considerations are there for the business artist that seeks
to create a business of exceptional value?
We believe that there are six levels of development in any
closely held business. These are as follows.
The Self Proprietor
The Operational
The Strategic
The Entrepreneur
The Industry
The Global
The art of business is an approach that focuses on finding
beauty at each level of design. A beautiful company
regardless of its level of development is one that attracts
attention and has the greatest chance of succeeding. Beyond
the three general principles of design there are specific
considerations that determine the beauty of a firm and it is
these with which we are concerned.
The Self
Proprietor
In level one, the self-proprietor level, we learn by
personally doing it, recording it, profiting in it,
delivering value, building a following and recording a
profit . We begin to learn how to deal effectively with
customers and employees. We learn how to price and collect
for our products and services. We begin to build our mental
model of how a business works versus just understanding the
technical nature of our products and services. We prepare
ourselves to make a transition from artisan to business
owner. It is during this stage that we crate our vision and
purpose. Your goal is to create a mono business unit that
works as a mono unit and is complete and beautiful. You get
it to the point where it operates beautifully day in and day
out. Just when this happens you are ready for a transition
to the next stage of development or not. You can certainly
stay at this stage if the economy will let you. Many move
forward to create more profit and value while others have to
move forward because they are too small to remain
competitive and attractive. The key is that you can move
forward and still retain the beauty of your original
creation. You simply have to keep your design principles in
mind for the larger scale of enterprise. It is just like a
painter scaling up his picture from a thumb nail sketch.
The Operational
Level Two is the most demanding for most closely held
business owners. This is the operational stage where they
take their original beautiful idea and begin to scale it up.
They have to do a lot of thing that they may find
uncomfortable or non-appealing. Among these are the addition
of a lot more employees, constant training, more systems and
technology and a loss of direct contact with all of the
customers and all parts of the business at all times. They
move from being the business to running the business. New
business skills are required and everything has to be kept
in balance. This stage is the dark night of the soul for
most closely held businesses. The owner artist must empty
himself or herself of the need to be in control of it all
and let go to others in the business. Why does anyone do
this and how does this contribute to value. The answer is
that the business will have its greatest value when it no
longer is dependent on the owner. This is just the first
step in that direction. A lot of closely held businesses
will either neglect this stage or not spend enough time
developing it before moving on to the subsequent stages.
This is an invitation to disaster. If you haven’t built your
business model at this stage you will not be successful in
subsequent stages. In fact you will be setting a time bomb
in place.
The Strategic
The third level is the one where the business artist begins
to get more strategic. Up until now most closely held
businesses will have been built in traditional ways.
Traditional products and services along with tradition ways
of selling, distributing are thematic for the first two
stages. It is like the artist learning the basic principles
of his or her craft. Once you have your business model
working, however, you can begin to get more creative. You
now know the traditional principles well enough that you can
break the rules, invent new and better ways of doing things
and create for yourself a differentiation. This is where you
begin to accelerate the value building in the firm. You will
begin to earn more on each dollar sold because your offering
is better or unique. Many business owners are excited about
this type of work and leap into it before they learn the
basics. This compromises their ability to actually deliver
on the new strategy and may spell the end of a firm. The new
is great but is must be built on a sound traditional base of
knowledge and skill. They say that a great painting is the
result of great drawing ability. While painting is different
from drawing it is dependent on it. In the same way
successful strategy can only be executed with a good
business model. Together they form a thing of beauty.
The Entrepreneur
The Entrepreneurial level is level four of our building.
Once you have successfully differentiated yourself from the
market you will get operating at earnings levels higher than
average. This positions you to have money to invest in new
or existing ventures. Buying other businesses and merging
them into your own business model is a logical next stage.
You will be able to buy them based on their lower earnings
model and convert them to your high performance model. Again
you will be adding value not only to your firm but also to
the marketplace in general. You will be expanding our span
of control over a greater segment of your industry and will
set new benchmarks for firms dealing in your products and
services. The ends result of this in perhaps an IPO. If you
can generate enough market share and have a good sound
business model you can create a work of great beauty at this
stage. You will also have a greater public profile to admire
your offering.
The Industry
If you elect to go beyond the entrepreneurial level you will
most likely begin to work at the Industry level. Beauty is
created at this level by seeking to get the entire industry
to embrace your principles of business art. You begin to
promote a new school of thinking within the industry. You
may elect to write a book, go on the speaker circuit or work
at the National political or governmental level. The
principles are the same but the potential impact is greater.
The canvas is very broad and all of the world wants your
work. As long as you can keep your wits about you and not
get carried away with your won success you may at this level
do your best work. This is a level of service and in service
you will find a new beauty.
The Global
The final level is like the last level of spiritual quest.
Few make it in their lifetime but it is certainly worth the
trip. The final level is one of the highest level of beauty.
Here you may create an entire new industry. You may seek and
find a cure for a problem that has plagued your industry or
businesses in general forever. You will have, through
diligent effort, accumulated all of the knowledge and
experience you need to begin to reflect and create solutions
at will. This level is not for everyone and you may have
become well satisfied at a lower level. But for the one who
is on the quest of the ultimate adventure in business this
level holds rewards like no other. The key at this level is
to ask the right question and seek to solve it. Make it a
big question and do not shrink from the work necessary to
solve it. You have spent a lifetime working toward this
moment and the final reward will be the answer you discover.
It will be your final work of art and your final
contribution. It will be your hallmark.
So these are the principles of design and the levels of
structure through which you may pass. Where do you stand at
the present moment? How does your business stand up to the
three major design principles? Where do you stand on the
journey through the six levels? How do you get on the
journey and execute in the best manner to build a beautiful
business and a great work of art. One that has the greatest
value. The J.R. Hull Co., can help you discover these
answers for you or your client. Begin the Journey with the
initial questionnaire and find out where you are and what
lies before you in your quest.
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