Engineers and Entrepreneurship
By: Ryan Malone
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Original article found at The Engineer
Five essential business skills for engineering entrepreneurship
Ana Avaliani of the Royal Academy of Engineering discusses why it is critical that we close the business skills gap to drive engineering enterprise.
You might have a great engineering innovation, but do you have the skills to turn it into a successful business? This is a very common challenge for the engineering startups we work with at the Enterprise Hub, especially among businesses born out of academia.
Business acumen is a crucial component for any successful venture, yet recent research from the ScaleUp Institute shows us that many entrepreneurs lack these essential skills. The good news is that these enterprise skills can be learned.
Ana Avaliani at a Enterprise HUB Showcase with Hub member Atif Syed
From starting a business to scaling up, an ability to lead is vital to successfully navigate the business world. Leadership skills are often overlooked by founders looking to grow a business. When asked to rank in order of importance, engineers highlighted access to funding and customers above leadership.
Yet what many engineers fail to recognise is that developing leadership skills can be key to overcoming many concerns related to their businesses. They underpin everything from the ability to make a knock-out presentation to securing a new round of funding, to the strategy and planning that can open doors to new markets.
Here are five essential skills for which leaders often seek training through our SME Leaders programme:
Engineers who are good leaders are savvier when it comes to a whole host of skills, including; navigating complex economic and regulatory environments, managing stakeholders effectively and capitalising on growth opportunities through effective negotiation. Good negotiation skills are crucial in helping you get the best deal possible for your business; whether that means winning a new contract, or securing new funding, being able to lead your team through negotiations will have a direct impact on your bottom line.
- People Management
It’s not uncommon for founders of engineering start-ups to find themselves as “accidental managers” – all of a sudden they are responsible for hiring staff and managing people as well as leading the business. The ability to attract and retain the right skills and experience has consistently been highlighted as one of the biggest challenges our Hub Members face when it comes to future growth. People sit at the heart of every business; to improve performance you must ensure that you not only hire talent that bridges the skills gap in your workforce, but that you also create an environment that allows them to thrive.
- Strategy development
Strategic planning is essential for SMEs that are looking to scale up. Setting a strategy provides a long-term sense of direction, a roadmap to get there and establishes milestones along the way. It is distinct from day-to-day business and delivery planning. A strategy reminds businesses – especially those scaling-up – of their purpose and allows room for further growth. In order to make the most of strategic planning, businesses need to set careful objectives that are backed up with realistic, quantifiable benchmarks for evaluating the results. Benchmarking is incredibly important; it helps you to look up and learn from the successes and failures of other businesses, which in itself can accelerate growth.
- Financial management
For any business to operate successfully it must be financially sound. This is especially important during periods of growth when businesses tend to spend more than they earn. Access to finance is still seen as an obstacle to SME growth – while three-quarters of scaleups rely on external finance to support their growth – four in ten scaleups still feel they don’t have the right amount of funding to meet their ambitions. Access to the right types of finance is therefore crucial for SMEs looking to scale up – organisations like the Enterprise Hub help provide access to multiple streams of funding through an extensive network of investors and grant schemes.
Networking doesn’t come naturally to all, but it is certainly a skill that should not be underestimated. Networking can not only help with securing funding and investment, but it can also help expand your technical knowledge and advice during challenging times. Importantly, networking also provides you with the opportunity to be part of a community of like-minded engineering entrepreneurs who are keen to help you capitalise on growth opportunities.
The Royal Academy of Engineering’s Enterprise Hub has always recognised that good business and leadership skills are essential when it comes to growing a successful engineering and technology company.
That’s why we have set up our SME Leaders Programme to provide up to £10,000 towards the cost of a training course to develop leadership skills of business leaders in areas such as sales, marketing, HR and regulation.
This is supported by crucial leadership coaching and mentoring and an extensive network of experts and investors – ensuring that business leaders emerge with the necessary skills, confidence and contacts to successfully scale up their businesses.