What it takes to be your own boss

OK. Let’s be honest. At one time or another in our lives we confront the question: Do I want to continue life as an employee or do I want to become a successful entrepreneur?
Recently, I met a very successful Florida banker. He had just turned 50 and had a good income and great bonus history. Then he heard in the corridors that his bank was for sale. He also heard that the potential acquirer was notorious for summarily replacing acquired V.P.s with their own, especially if the acquired V.P.s were 50 or older.
So, 30 years in the business, 30 years with one bank. Now what? To be truthful, he’s deliberating as this article is being written. He is contemplating, "Do I wait for the proverbial ax to fall or do I make the move before it happens?" In short, "Should I find a way to go into business on my own?"
It’s a huge decision that can be extremely rewarding or a real bust. I wasn’t a banker and I wasn’t 50 years old when I made my decision. I was too young to realize the consequences of failure, I guess. But I would like to talk to you this month, as our season is once again changing, about whether you should consider a seasonal life change.
Ever heard the term "a lifer"? In the Air Force where I proudly served, it meant that if you did things right and kept your cool, you could stay long enough to retire and get a good pension. But it also implied that you would not "rock the boat." For many, the lifer role was just fine.
The same thing is true in American industry. Except that in American industry a lifer perspective is more often a terminal viewpoint. Unless you are really good, really competent, really competitively current as an employee, there are simply no long-term employment guarantees. My relatives in the civil service, as was true in the Air Force, don’t face these issues. Unless they break the law, chances are they will retire at a fairly young age and earn a guaranteed government pension, up to 60% or more, of the average of their salary for the past five years.
Let me try to talk from the gut on this question. Because there are no formulas, there is no prescription to follow that will lead to the right decision for you. I offer a series of questions that might help you make a decision, if you are at that point in your career where you know that change is imminent and you would prefer to be in the driver’s seat.
Risk orientation. A lifer does not like risk. This is not a criticism. It is a fact. It is not likely that a person of this nature will venture off on their own. Could this be you?
Financial Strength. Before you decide whether to launch yourself as an entrepreneur, the reality is that you need enough financial power to live for at least a year on your savings or investments. Usually, you must seriously curtail your lifestyle. For example, you must be willing to sell your home and downsize. You must be willing to forgo that annual vacation to someplace warm. You must be willing to relocate, if relocation presents the best opportunity for future success. You must be willing to live by a strict budget and reduce discretionary debt, such as credit card debt, as soon as practical. Could you do this?
Commitment. People who break out on their own go at it with a vengeance. Work hours become an irrelevant issue. They put in the time to get it done. In TEC, we have entrepreneurs in their 70s still putting in 70-hour work weeks. Even though they have made their millions, their commitment to continued success is a driving force that keeps them going and totally "unretired." Would you be willing to commit?
Research. People who make the break and make it successfully don’t do it by accident. Going to the Holiday Inn to hear a "get rich quick" real estate motivational seminar, or signing onto an Internet multi-level marketing scheme-both of which offer instant success — are all destined to lead the na•ve entrepreneur to instant failure. Instead, the trip to the other side should involve, at minimum, researching the following:
1. What are my strengths? What are my weaknesses? What will fit my strengths while minimizing my weaknesses?
2. What offers an orderly process to build a sound business plan, to engage a legitimate training curricula to increase my chances of success?
3. Who can I talk to who has "been there and done it" so I can learn from their mistakes and trial balloons.
4. Can I make the change into a new personal venture without undue sacrifice to my family?
5. Finally, can I engage a business-risk partner to help me in the transition?
How do you size up?
Health. Both physically and mentally, being on your own is taxing to say the least. It’s lonely when the only person you can turn to is you. Sure, family and friends are great support mechanisms, but only to a point. Our TEC members tell us this is perhaps the greatest value of TEC. Among your peers you are not alone.
There are certainly more points to consider when contemplating such a major life- altering change. But you know what? Many of us have done it, and many will continue to do so. Want to join us?
Until next month, here’s to your happiness — as employee in this life and, perhaps, as an entrepreneur in this life as well!
Harry S. Dennis III is the president of TEC (The Executive Committee) in Wisconsin and Michigan. TEC is a professional development group for CEOs, presidents and business owners. He can be reached at 262-821-3340.
April 16, 2004, Small Business Times, Milwaukee, WI