Ideas are not enough, the context is also important

16/11/2012

Economy



What do you really need in order to do business? Whenever I have been asked this question in the past, I have always found it natural to look back at my own experience and to answer accordingly: a good idea, a lot of determination, a pinch of good luck (and timing).

However, a recent study by the World Bank made me re-assess a fundamental element that tends to be ignored when judging the activity of a business: the context. One statistic really stood out: a typical business with 35 years of experience in the United States is now, in terms of number of employees, ten times bigger than it was 30 years ago. In India, it is a quarter smaller.

In other words, if genius and a garage were ‘enough’ to create Microsoft, something else was needed in order to turn it into a business with nearly 100 thousand employees. For example, access to liquid and disposable credit, to infrastructure, services, consultancy resources and education. A business will not grow if its surrounding environment is unable to support it. The benefits it produces, although appreciable, will continue to be enjoyed by a limited number of people.

Context is therefore decisive for the success of businesses and private initiatives. In practical terms this means, that particularly in periods of crisis and difficulty, it is not possible to survive alone. We survive only through working together as a team, where individual demands and conflictuality are kept in check, a team which is capable of creating the conditions necessary for a complete re-launch of the country. It is in everyone’s interest to work in this direction.