10 Hard and Soft Skills You Should Have to Start Your Own Business
What do you need when you want to start your own business?
An idea and enough money!
That’s how most people would answer that question.
But the combination of a great idea with a good money injection is not necessarily successful in the business world. We’ve seen countless companies start off with cool ideas and decent budgets, only to forget they ever existed.
You want examples? Sure. Some of the businesses that failed quite publically include Kodak, Enron, Lehman Brothers… the list could go on and on. But these public examples were still big companies that used to be successful at some point.
What about the small businesses that launch and never see a day of glory? They make some income at start, and then start struggling. Think of a local perfume shop, beauty salon, or barber shop. Think of an online business. Some writing services, for example, will appear and disappear in a matter of weeks, while other cheap writing services will thrive for decades.
What’s the difference?
There are many factors at play. Yes; the local economy matters. Yes; the circumstances in the industry matters. But when you compare two similar services that started at the same time with a similar idea and similar finances, it boils down to one thing: the owner’s approach to the business.
You might have an idea and enough money to start your own business. But do you have the skills?
That’s the big question to ask.
WHAT SKILLS DO YOU NEED TO START A BUSINESS AND SUCCEED WITH IT?
Have you heard of hard and soft skills?
These are not just buzzwords. You need to develop your capacity in two dimensions if you want to succeed in any profession. For doctors or programmers, mostly hard skills are relevant. Sales professionals, on the other hand, focus more on their soft skills.
When you intend to start a business, both hard and soft skills are equally important.
So what are these skills, anyway?
- Hard skills are the skills you develop through learning. These are obvious abilities that can be measured. Think of math, typing, programming, presenting, graphic design… you get the picture. Each profession comes with its own requirements for hard skills. If you want to be a graphic designer, for example, you obviously need technical and artistic skills.
- Soft skills are not easy to measure. These are the ones you obtain not through general education, but through personal growth. The soft skills for most professions are more or less the same. They include listening, proper etiquette, stress-management, teamwork, leadership, and your ability to inspire other people. This is more about your personality rather than your professional qualifications.
The Balance has a nice infographic that helps us understand the difference between hard and soft skills. Check it out:
Now let’s relate these skills to a practical purpose: which ones do you need to succeed as a business owner?
MUST-HAVE HARD SKILLS FOR BUSINESS OWNERS
In the world of business, hard skills usually encompass budgeting/accounting and financial literacy. These are the types of skills you learn at business school.
Make no mistake; you still need practical experience to obtain these skills. Entrepreneurship is not something you can learn from books. You’ll learn the principles of accounting from a book, but will you be able to implement them without enough practice? It was a rhetorical question.
Now let’s get to the countdown: what hard skills do you need to develop before starting your own business?
1. Business Proposal and Business Plan Development
Who would’ve thought that planning and writing skills would help you start a company?
The truth is; not many people have their finances ready to go. Those are very, very rare situations. For most of us, a money injection from the outside is necessary.
And how do you get it? – By raising capital.
You’ll suggest a business proposal to potential investors. This is a well-written, detailed document that exposes your business idea and predicts its profitability through realistic financial projections, usually for a 5-year period.
Even if you do have the money and don’t intend to connect with investors, you’ll still need a business plan. This will be a realistic projection of your idea’s chances for success. The plan will give you a solid ground for taking specific steps for setting up and growing the Business.
- To develop business proposal and business plan writing skills, the best thing to do is take a course. If you’re at school and such course is available, take it and pay close attention to it! If not, Coursera is always an option.
- If you’re not sure in your proposal or plan development skill, you can hire a professional to do it for you. But keep in mind that close collaboration will be necessary. The expert will scan the industry to provide you with financial details. Your input will be necessary, since it’s your unique idea we’re talking about. You’ll need to place that unique idea in the appropriate business setting.
2. Financial Literacy
In other words – budgeting. You’ll need to know how much money flows in and flows out on a daily basis. You’ll need to learn to maintain the balance between expenses and income, so you’ll keep your business profitable.
A slight lack of prudence and discipline will make your business unsustainable. It’s exactly why so many new businesses head towards bankruptcy before seeing the light of day.
- First, learn how to manage your own finances. You’ll need to be aware of every cent you earn and spend. You’ll have to make a budgeting plan, so you’ll be in control of your budget all the time.
- Be aware of the business cycles! Most startups experience negative cash flows, simply because they have too much to invest in and they still haven’t made enough connections with customers. This should not disappoint you. You just have to plan enough cash to cover the regular expenses and pay the suppliers and employees during this period. And you have to work towards making your business profitable.
- Hire a good accountant. If you’re not an accountant yourself, then you need to hire one and you need a good one. You can opt for an accountant firm, a freelancer, or a full-time employee. Do whatever works for you, and make sure this is a cost-effective hire.
3. Marketing Skills
Yes; you may hire marketing experts to cover this part for you. But when you’re starting a new business and your budget is tight, do you really want to splurge right from the start?
Whatever you decide to do, keep in mind that hiring marketing experts does not mean you’ll be excluded from all marketing processes as an owner. You’ll at least need to cover your part of the work. I’m talking about personal branding.
The person behind a business is the reason for its success. You’ll be a leader. You need to present yourself as a leader that people would love to work for. From a customer’s perspective, they want to see you as someone whose business they would like to support.
- Take a digital marketing course.
- Google gives you a free one, so why not take that opportunity? You’ll learn about social media and SEO – the two most important aspects of today’s marketing campaigns.
- Start working on your personal brand.
- Create profiles on different social media platforms (don’t forget Google+). Start sharing posts that make you look professional, but charismatic as well.
- Share your opinions on trends related to your industry.
- Make connections with the right people.
- Start blogging, too! Answer questions on Quora! That really helps with establishing your expertise.
4. Hiring Management
You’ll have important decisions to make as soon as you start the business. The people you hire will make or break your chances for success.
- Post a brilliant ad! You should attract great people to work for you. If you have to, you can rely on a writing service to write the job ads for you.
- Don’t just post ads and wait for people to apply. Recruit talent! Contact universities, so you can connect with their best graduates. Search for people to connect with on LinkedIn. Even if they already have a job, they may be passive candidates. You’ll have to convince them how you’d be a better employer than the one they already have. If you have a great business idea and you present it in an attractive way, you’ll have good chances of attracting talent.
- Be diligent with the resume reviews! Check and verify the most important parts of the candidate’s education and job history.
- Relax during the interviews! The candidates are nervous for a reason. If you’re nervous, it will be a very awkward situation. Just act naturally and don’t try to confuse them. Ask questions whose answers you actually need for the specific positions you offer.
5. Tech Skills
The need for tech skills is not limited to email writing, okay?
- You’ll need to learn how to use project management tools, such as Asana, so you’ll keep the team’s work organized. This is especially important if you’re dealing with remote workers. If not, you’ll still need to organize the tasks in one way or another, so you’ll at least need to handle Google Calendar.
- You should learn how to manage a blog and social media pages. We mentioned their importance under marketing skills, remember?
- Your business needs a website. If you can create and maintain it yourself, you’ll save tons of money.
- The MS Office suite is mandatory for you. You’ll deal with Excel a lot, but you’ll also need to use PowerPoint and Word quite frequently.
SOFT SKILLS ARE IMPORTANT, TOO
Is entrepreneurship really teachable? That’s a subject of a debate. You may go to business school and develop all above-listed hard skills, but you’ll still fail if you don’t have the needed soft skills.
A study from 2010 found that traditional entrepreneurship education plays an important role in a business owner’s success, but it’s not effective when it simply teaches knowledge on business creation. The researchers made a recommendation for business programs to focus more on practical entrepreneurship and encouraging students to develop soft skills.
Maybe the entrepreneurship program you attend does cover the practical aspects, and maybe it doesn’t. Maybe you don’t even plan to rely on traditional schooling but you still want to start a business. Whatever the case is, soft skills depend on your efforts; not on something someone would teach you.
These are the most important soft skills for a future business owner to work on:
1. An Ability to Inspire People
Modern leaders don’t give orders. They empower their employees to give the best they have.
Let’s say you connect with someone on LinkedIn because you want them in your sales team. This person already has a job. How will you attract them your way? You’ll have to express the vision of your business and make this person enthusiastic about it.
Once you have your team, you’ll want to make these people excited to show up every day. If it’s just a boring job that brings money, they will do the bare minimum to earn that money. But when they have an inspiring leader who pushes them towards professional and personal growth, they will do their best.
- Work on your speaking and writing skills. You can’t inspire people by staring at them, you know?
- Show up and do your part of the work. That’s called leading by example, and it’s what motivates the team members to be productive as well.
Yes; it’s a skill. It’s a leader’s capacity to take a challenge even if that means risking something.
In the world of business, risk is always a factor. You’ll need to make new hires, use new tools, invest in new equipment, try a new marketing approach… all this means investing money.
If you don’t have the courage to take risks that don’t guarantee a 100% successful outcome, you’ll just stay in the bubble of safety, which will burst once you start lagging behind all competitors.
Learn how to make cost-benefit analyses. That’s actually a hard skill, but it’s nothing if you don’t have the soft skill of courage. An analysis will give you the prospects for success, but you’re still the one who has to make that decision.
Should we even mention the fact that you’ll be subjected to a lot of stress before you even start this business? The idea itself is stressful enough and you know it.
When the responsibilities start, you’ll realize that you’re not the only one stressing out about all kinds of things related to the business. Your employees are stressed, too.
Overtime, stress turns into frustration, and frustration turns the company into an impossible place to work for. As an entrepreneur, it’s your job to stop that from happening.
- Learn how to see the big picture. Every single obstacle is just another step you need to take on the way to success. Whatever you’re experiencing now, remind yourself that you can always find a solution and move forward.
- How about some yoga for yourself and your employees? You can all attend a course at a local studio or invite an instructor to give you classes once a week. You’ll make this class part of the schedule, so you won’t force anyone to take an activity outside their work hours.
4. Communication Skills
First, you need to learn how to listen. Listening is the foundational aspect of successful communication. But it’s not everything. A great leader must also know how to speak, write, and present in front of an audience.
- Open up! Communicate with as many people as possible on a daily basis, so you’ll get comfortable to express yourself.
- Don’t try to be overly intellectual. People don’t like that. Skip the big words and just be you.
So that investment in paid Facebook advertising didn’t bring you as much traffic as you expected. You just noticed that a competitor has a marketing campaign that’s too similar to yours.
That new employee you hired doesn’t know how to write emails, so they block the communication channels.
You’ll face a million of situations like these when you start your business. You have to make plans, but you must also stay aware that you can’t plan everything. At one point or another, you’ll need to change direction.
- Analyze everything! Get the numbers and study them. If things are not going as expected, it means you need to change something in the plan.
- Stay open-minded to suggestions. Invite your employees to share ideas with you, so you can locate and fix the mistakes in the plan.
ARE WE DONE YET?
No. We’re not done. These were only the basic hard and soft skills an entrepreneur needs.
But a great leader’s personality encompasses many other talents. Most of all, it’s all about staying committed.
Do you have that passion in you? If you do, then you’ll just need to work on the skills and start that business already!
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The business dictionary defines retail management as the process of promoting greater sales and …