25% entrepreneurs have defined second line of command: Ascent-EY report
Only 25 per cent entrepreneurs have a defined second line of management, according to an Ascent-EY report, titled ‘How ready are entrepreneurs for the journey of scalable growth?’ The report was released at the first experiential learning conclave, themed ‘Growth. Disruption. Entrepreneur’, hosted by Ascent, a peer-to-peer platform for entrepreneurs.
It was unveiled by Harsh Mariwala, Chairman, Marico, and Founder, Ascent; Uday Kotak, Executive Vice Chairman and Managing Director, Kotak Mahindra Bank; and Pinakiranjan Mishra, Partner and National Leader – Retail and Consumer Products, EY.
According to the report, although driving scalable growth is challenging, it is not impossible. Entrepreneurs often feel stretched in all directions as the business starts growing, and at times they find themselves in uncharted territories. While the journey is interesting, it is a lonely one for the entrepreneur.
The report stressed on the importance of entrepreneurs focussing on and investing in building capabilities around the discussed seven key drivers right from the beginning of the venture. It is never too late to relook at some areas where dedicated attention is needed to accelerate growth going ahead.
Also, being part of support groups will help entrepreneurs to build insights and resolve challenges, develop innovative solutions, build connections and, more importantly, have companions on their growth journey.
Commenting on the report, Harsh Mariwala said, “We are proud to partner with EY and hope that entrepreneurs across India, as well as globally can gain valuable insights from the report. For me, the biggest and most interesting take away is the fact that investment in different processes which support customer centricity, leadership planning and operational efficiency, has a multiplier effect on the business and provides disproportionately higher returns to the entrepreneur.”
The report aims to understand entrepreneurs’ readiness for scalable growth and the challenges they face in doing so across seven parameters – customer, leadership, people, operations, finance and transactions, risk management, and technology.
Pinakiranjan Mishra added here, “Entrepreneurs need to understand that achieving growth is not enough; it also needs to be scalable for long term sustainability and success. Amongst the seven drivers of the growth maturity model, they seem to be doing quite well in understanding customers and managing operations. Entrepreneurs will also need to focus on the other five drivers in order to be successful.”
The report found that people who invest in these seven drivers see a higher financial success as compared to others. For instance:
· Companies that offer customer-centric solutions (75 per cent respondents) have twice the average revenue size of companies that do not have such solutions
· Companies that have set up a strong second line of management (25 per cent respondents) have 3.5 times higher average revenue size compared to companies who do not have a second line of management
· Companies who have a total rewards mechanism (10 per cent respondents) have 15 per cent higher employee productivity when compared to companies who do not have total rewards
· Companies who segregate core and non-core activities (75 per cent respondents) have approximately four times higher average revenue size vis-à-vis companies that do not segregate
· Mid-sized companies who have investors on board register 1.7 times higher growth compared to companies who do not have investors
· 50 per cent of the companies with a strong corporate governance structure (10 per cent respondents) have managed to attract external investors, as opposed to approximately 10 per cent companies who do not have a corporate governance structure in place
· Companies who used technology to drive growth have registered three times higher average revenue size compared to companies that do not use technology.
Ascent, with EY as its Process Partner, announced the winners of the Ascent Awards 2016, recognising their own members in three categories:
Entrepreneur of the year: Sanjaya Mariwala, OmniActive Health Technologies
Business Innovation of the year: Atul Tibrewala, Cartridge Junction (India) Pvt. Ltd.
Growth Strategy of the year
Early Growth Stage: Siddharth Upadhyaya, My Fitness Wallet Pvt. Ltd
Mid Growth Stage: Chaaya Baradhwaaj, BC Web Wise Pvt. Ltd.
High Growth Stage: Vikram Bhatt, Enrich Salon
The Ascent Conclave 2016 brought together the country’s best thought leaders, change-makers and innovators and the speakers included Uday Kotak (Kotak Mahindra Bank), Ronnie Screwvala (Founder, Unilazer Ventures and Swades Foundation), Vijay Shekhar Sharma (Founder, PayTM), Falguni Nayar (Founder, Nykaa), Ashish Hemrajani (Chief Executive Officer, BookMyShow), Sandeep Singhal (Co-founder, Nexus Venture Partners), Neeraj Kakkar (Chief Executive Officer, Hector Beverages), and Sasha Mirchandani (Chief Executive Officer, Kae Capital).