Susana C. Santos
Senior Vice President, Conference Organization, United States Association for Small Business and Entrepreneurship
While many small businesses are started by a solo entrepreneur, it has become increasingly difficult to grow and scale a new venture without a team. Whereas hiring experts and using advanced data tools help to identify new markets for your business expansion, small business owners tend to rely on their intuition and gut feeling when it comes to building the right team. Yet this is not the best approach.
So what makes a successful team that can help take your business to the next level? Prior scholarly research highlighted the importance of three main aspects: prior experience, competencies, and passion.
Prior experience
Prior startup experience, together with product and industry knowledge, predict new venture success and growth. Oftentimes, small business owners bring on board their business friends, family members, and co-workers who share similar backgrounds and experiences, resulting in a fairly homogeneous human and social capital within the team.
While this strategy can be beneficial to promote faster and unified decision-making in the team, it also constrains the team’s pool of resources, creativity, and willingness to explore. As such, diversity in the team members’ functional experiences (i.e., industry, marketing, financial, management experience) is more beneficial for enlarging the scope of action of your small business.
Competencies
Entrepreneurial skills and competencies (i.e., soft skills such as vision and resilience) of the team members are positively related to the successful performance and potential growth of small businesses. When two or more people create interdependent relations with the common goal of growing a small business, their individual capabilities are heightened, refined, and enhanced as a team competence.
While the collective cognitions, attitudes, or capabilities of teams may facilitate agreement and reduce conflict, they can also harm an individual’s metacognition – knowing what you are good at doing and what you are not – and deteriorate performance. Thus, when teams are forming , small business owners must be aware of the importance of complementary skills and competencies while preserving idiosyncrasies in the skill set of each team member.
Passion
Finally, team passion matters for the performance of your business. Higher levels of positive collective emotions and shared identity among team members are related to better team processes and improved outcomes. Regardless of how any particular team member experiences their individual passion, the critical question is how passionate the team is for growing and expanding the business. Small business owners should cultivate collective affect for developing a business among all the team members, as this has positive implications for future performance.
Yet diversity of passion among individual team members can also emerge, and this negatively affects team dynamics due to conflicting emotions and identities regarding the strategic vision for the future of the business. Accordingly, small business owners should also consider passion diversity when bringing new members on board and how that can disrupt the status quo of the team and consequently, the business performance in the long run.
The exact blend of prior experience, competencies, and passion in your team is the secret sauce for building and sustaining the “A-team” necessary to take your business to the next level. Experience and knowledge, combined with complementary soft skills and a shared vision and passion for the future of your business is your best path toward success.