FEMskill CAREER GUIDE Life cycle stages

Page 1


Life cycle stages

Improvement of the economical /market situation of female entrepreneurs by providing them mutual mentoring and building communities bilaterally


Life cycle stages

THE UNPREDICTABLE For an entrepreneur, it is one of the hardest challenge to cope with the unpredictable not only as a human but as an entrepreneur as well. Unpredictable means the external fac-tor we have no influence on, but it affects our enterprise. No matter if this factor is a financial world crisis (2009) or even an epidemic caused by a virus (2020). Actually, every entrepreneur must be prepared for a lot more challenges such as risk-taking, responsibility, market changes, legal requirements, taxation, etc. In spite of that, it is worth thinking over on our career

path if an enterprise as a kind of career is the right choice for us. Based on the theoretical and practical experiences implied in the professional literature of enterprise development, this publication gives a brief summary of the enterprise types, the motives for starting a business, the existence as an entrepreneur and what we mean by career model. This publication is available in an electronic form in three languages (English-Hungarian-German) within the framework of FEMskill project.

ANTS, GAZELLES, TIGERS OR DINOSAURS? What kind of business do we have according to the researchers? The question was answered by professor Jรกnos Vecsenyi1 when he characterized the businesses according to his researches by business and changing skills and according to business-functional experiences by different behaviors. He associated the business types to different animal species introduces by their behaviors.

Four types are:

Ants: self-employed, micro-or medium-sized ventures, mainly female entrepreneurs.

Gazelles: fast-growing, dynamic, high-potential microand medium-sized ventures.

Tigers: dynamic, well-established, expanding mediumsized and macro- ventures, they may be family-owned businesses with more generations.

Dinosaurs: traditional and stagnating ventures

1 Jรกnos Vecsenyi (2010) professor, Budapest Corvinus University

More researches and questionnaire surveys deal with this issue and search for an answer to the question: Why do we start a business? According to the surveys2 conducted so far, becoming an entrepreneur can be triggered by the following reasons: in case of micro-and medium-sized enterprises, the main reasons why people become entrepreneurs are independency, wealth, subsistence, realization of dreams, reasonable/useful leisure activities, following traditions, proof (whom?). This is only a theoretical approach but how could we put it into practice in case of female enterprises? Why do Austrian and Hungarian women start business and how could they experience the first years? Why do Austrian and Hungarian women want to become entrepreneurs? According to a survey3, these are the main reasons why people start their own business. • Courage and opportunity: you have to be brave enough to set up your own business. • Missing career prospects and dissatisfaction: as an employee, the future entrepreneur was not provided any satisfactory chances of promotion, so she decided to get an entrepreneur. • Job shortage: the workplace has been closed. • Answer to the needs, mission and social responsibility: some female entrepreneurs have set the goal to find a solution for some personally experienced serious deficiencies or problems. • Influence on social events: a high number of women are strongly triggered by striving to make real social changes. (social enterprise) • Getting a “natural” entrepreneur: a lot of people can only imagine themselves as entrepreneurs, so they were not eligible for working as an employee. They chose individual freedom and independency. • Difficulties regarding the integration in the labor market after maternity leave: this is one of the main reasons why women set up their own business. • How to make balance and flexibility between work and private life: this is one of the main motivations for starting a business. 2 Vecsenyi: The challenges facing young entrepreneurs – entrepreneurship’s management of knowledge (2012) 3 Ifempower 2018-1-HU01-KA203-047766 project: Female entrepreneurs in Europe „Challenges, strategies, policies” according to final edition.

What is the enterprise like as a career opportunity in your life?

ENTERPRISE AS A LIFESTYLE Being an entrepreneur is not better or worse than being an employee, but it is basically different. The focus is on the other character. Entrepreneurship makes you independent and liable.

WHAT IS CHARACTERISTIC OF THIS LIFESTYLE? • Enthusiasm, endurance and trust in what you are doing- these features are inevitable in an enterprise. • It’s essential to have long-term goals which you can divide them into smaller tasks. That can be implemented in the short run. • If someone makes the decision to become an entrepreneur taxes must be paid from the beginning even if you don’t have any income. • The entrepreneur has to be aware of the fact that business goes and develops well if she manages is: the entrepreneur has to follow the processes, tasks and money matters. • You have to be prepared for the fact that you won’t have any opportunities to go on holiday or a longer vacation when you start your business or you should organize it in time. • Its advantage and disadvantage is that kind of freedom, which enables the entrepreneur to adapt to the rules set by her. She must able to work on her own, divide her jobs and sources.

•The question is not when and

where she works but if she can carry out her tasks in due time and good quality. • If she does a good job, she gets the remuneration for the implementation of the tasks and the reference which allows that her customers will apply for her services in the future as well and recommend her to other potential customers. • If there are some periods of time when the business is very busy with a lot of responsibilities and it’s hard to keep the deadlines. In some other periods there are less tasks. According to that the income is also lower. The entrepreneur must be able to plan and handle this situation both financially and emotionally.

• It’s very important being flexible and be able to adapt to the changing conditions fast and handle the rollercoaster feeling.

• In addition to the professional skills, she also needs social skills, she must be able to handle people.

• She must be able to manage herself, “sell herself”, the product/service, which forms the basis of the enterprise.

• She must be able to take risks. • She may expect an incalculable factor as well.

• She must have good communication skills because she is not only responsible for the implementation of the tasks but also for keeping in touch with the customers.

BESIDES, THE LIFESTYLE OF AN ENTREPRENEUR IS INTERESTING AND WARRIED. It implies a lot of challenges but solving the problems provide the experience of success. This is a kind of lifestyle which enables you to make you dreams come you. It suits people who have the required level of self-confidence and a high level of independence. This people should be able to manage the changing circumstances and the uncertainty. These kinds of entrepreneurs shouldn’t consider the conditions to be problems, but challenges. In this case, it is worth entering the unique world of enterprises and building career in the economy.

LIFE CYCLE MODELS, HOW the features of micro and medienterprises as well. AdizCOMPANIES GROW AND DIE. um-sized 4 Most of the life cycle models represent the life cycle of businesses from the setup of the company, then many life stages come as the company become ripe, and in the end, closes with the termination of the company. We should thank Anna Huszty Salamon for creation of the life cycle model applicable to enterprises. This model combines the Hungarian and foreign models by considering

es and Greiner, the world’s leading management experts have developed a methodology that describes the typical life cycle every company goes through. They compare company growth to human growth where a company grows, ages, and ultimately dies. There are 5 stages and each brings its unique set of challenges: courtship (infancy and go-go), creativity, direction, delegation and collaboration.

4 Adizes’ six life cycle stages (Adizes 1992). Larry E. Greiner’s model called evolution and revolution as organizations grow has five stages: creativity-direction-decentralization-coordination-cooperation (1995)

Breast-wheel model5 The model of Salamonné (2006) has been completed by Andras Horvath. Mr.Horvath was searching for a theoretical solution with the aim that no existing enterprises have to be assigned to the model, but the model is able to adapt to the life cycle of the enterprise.

Therefor was born a process-oriented breast-wheel life cycle model, which provides high degree of freedom of expression of life cycle periods. Actually this model has to new elements which are called cogitative and correction phases.








Figure: Breast-wheel life cycle model (2017), András Horváth

5 András Horváth: Modern Growth Lifecycle Management Models for Micro, Small and Medium-Sized

The cogitative phase:

The correction phase:

Is an interim period before the foundation of the enterprise or during the lifetime of the enterprise. This phase includes decisions regarding the development of new directions.

The company is able to move through the life cycle stages, but by an occasion of a major crisis – as stepping on a joker field – could find solutions using the correction phase.

Basically the breast-wheel model is not cyclical, establishing the approach that enterprises may have the opportunity to consider after the currant life cycle the direction which approach could be the best strategy.

Like a living organism, each enterprise grows and develops according to a predictable and repeating conduct pattern. This process varies from enterprise to enterprise but some expectable problems which can be linked to certain stages or changes between different life cycles can be identified6. As for development stages, each organization has to face special challenges and the success7 of the company depends on the answers given to this issues. The analysis of the life cycle model can contribute to the success of the company. The correction phase works as a Joker field in this model. If the entrepreneur steps on this field, she can analyze and consider the situation and the new strategy and may

look for solutions. The entrepreneur can do the analyses by her own but it is advisable to involve an independent expert (consultant), business coach or entrepreneur’s tutor in the process of searching for solutions. Making use of her theoretical and practical experiences gained during the life cycle of her own business, the mentor can provide help to other entrepreneurs. The mentor stripes to show the right direction, assist the entrepreneur in finding the right solution and strengthen the female entrepreneur in the position. If you think you have stepped on this Joker field and you need guidance, please visit the mentoring program of the FEMskill project!


„Remember that just the moment you say, ‘I give up’, someone else seeing the same situation is saying, ‘My God, what a great opportunity.” /H. Jackson Brown, American author.

6 Tatár et al 2012 7 Adizes, 2012


Author: Rita Potápi (2020.)

Impressum: Publisher: Kisalföldi Vállalkozásfejlesztési Alapítvány Editor: Sándor Borbély Graphic and design: PANNAKO Date: 2020.

This e-booklet has been made in the framework of the FEMskill (ATHU127) project implemented in the INTERREG-V Austrian-Hungarian Program. The project is put into action with the assistance of European Regional Development Fund.