How Do You Compare With Todays Market Leaders?

By Tim Tasker, Partner, Ernst & Young LLP

How do todays entrepreneurs build an exceptional enterprise? Its no easy task, considering the economic challenges, competition and risks in the market but confronting these challenges is what it takes to build the household names of tomorrow.

At Ernst & Young, weve developed a framework of business imperatives to help entrepreneurs take their companies from emerging enterprises to next-generation market leaders. Excerpts from three important focus areas are below.

Stage I: The emerging enterprise

Managing finance: Securing and managing risk capital should be the goal. Emerging companies should develop a well-thought-out business plan to attract funding, while identifying and evaluating available funding options. After securing capital, emerging enterprises should establish the finance function to deliver management and investor information.

Managing risk: Addressing the short-term risks is the immediate concern. It is important to identify risks that are critical to short-term business goals, focusing on intellectual property and legal risks first.

Operational effectiveness: Establishing core competencies is key to designing a seamless business operation. Focus on building a supply chain model and a flexible operational structure.

Stage II: The rapidly growing enterprise

Managing finance: Obtaining and managing sufficient expansion capital are the next stage of the game. It is the time to recalibrate expectations for the business, updating the business plan and capital requirements to secure additional funding.

Managing risk: Adapt to a changing risk profile by identifying key financial, compliance, operational and strategic risks.

Operational effectiveness: Develop scalable, cost-efficient infrastructure to maximize supply chain efficiency and effectiveness.

Stage III: The next-generation market leader

Managing finance: At this stage, focus on optimizing the capital structure. Start thinking ahead by developing a funding plan for acquisitions and establishing a leading-class financial reputation.

Managing risk: Manage global enterprise risks. This is the big picture of a companys risk profile. Focus resources on the most important risks, while strengthening internal controls.

Operational effectiveness: Manage global operations. Identify cost-reduction opportunities throughout the supply chain and leverage income-generating assets. Ensure key operational and performance metrics are captured and monitored for the long haul.

What about you? Are you a next-generation market leader?

If yes, then consider a nomination for the Ernst & Young Entrepreneur Of The Year award program. Entrepreneur Of The Year is the worlds most prestigious business award for entrepreneurs. It celebrates entrepreneurs who are building and leading successful, growing and dynamic businesses, recognizing entrepreneurs through regional, national and global award programs in more than 140 cities in 50 countries.

To receive an application or nomination form, please call Rachel Anderson, Entrepreneur Of The Year Award Program Manager for the Pacific Northwest region, at + 1 206 654 7633, or visit ey.com/us/eoy

The deadline for the completed application form is March 18, 2011.

See coverage of last year’s winners here.