In a free enterprise system, getting rich is everybodys dream. Some want to become rich for the amenities and the trophies wealth offers: lavish houses, luxury cars, elegant yachts, expensive clothes, dining extravaganzas in the best restaurants in town, and traveling to exotic destinations. Others want to become rich for the financial freedom, the independence, and the security wealth provides: the freedom to spend more time with friends and family and to explore their full potential; the independence to work when they want as much they want, without a boss over their head; and the security, the peace of mind that comes with the creation of a safety net against the uncertainties life saves for them and their families down the road. A third group lusts to become rich for the power and fame wealth brings. A fourth group wants to become rich for the opportunities wealth offers to contribute to society, to indulge philanthropy and help the poor and the needy, to build things that will last beyond this life. But how can one make this dream come true? How can one become rich? What does it take?In the old industrial economy, people became rich the company-builder way, by setting up large companies and having other people work for them. Thats how the King of Steel Andrew Carnegie amassed his wealth in the last quarter of the 19thcentury. He built the largest steel company in the world and had scores of people working in his steel mills under the close supervision of legendary managers like Bill Jones and Henry Clay Frick who didnt hesitate to use force to make sure that workers pursued Carnegies dream rather than their own. The King of the Automobile, Henry Ford (NYSE:F) followed a similar path. He, too, created a large corporation where thousands of people worked in his T-model assembly lines under the close supervision of scores of upper, middle, and lower-level managers within the scientific management model invented by his engineer Frederick Taylor; and so did the King of Oil John Rockefeller and his Standard Oil Corporation, employing legions of workers in drilling, pumping, refining, and shipping oil.In the new post-industrial economy, people become rich the business-builder way, by building business rather than companies, by helping other people work for themselves, build their own business, become rich, and make them richer in the process. Thats how Silicon Valley scientists-entrepreneurs became rich. Frederick Terman, Robert N. Noyce, Gordon E. Moore, William Hewlett, and David Packard (NYSE:HPQ) amassed their fortunes by helping other high-tech scientists-entrepreneurs amass theirs. Venture capitalists like Ned Heizer, Jim Markkula, Bill Drapper, Eugen Kleimer, Tom Perkins, and Andy Bechtolsheim became wealthy by serving as financiers and mentors to high-tech start-up entrepreneurs. Andy Bechtolsheim helpedLarry PageandSergey Brinbecome rich by launchingGoogle(NASDAQ:GOOG), a venture that turned him rich, too. In a few years, he saw his $100,000 turn into over billion dollars!Bostons Route 128 business builders followed a similar path. Georges F. Doriot and the investors of the Boston-based American Research and Development Corporation (ARDC) became rich by making rich Ken H. Olsen, founder of high-tech start-up Digital Equipment Corporation (DEC). In a few years, ARDCs $70,000 investment in Olsens DEC turned into $350 million.Microsoft(NYSE:MSFT) founder Bill Gates and Apple (NASDAQ:AAPL) founder Steve Jobs amassed their own fortunes by helping scores of engineers and marketers become entrepreneurs, who in turn helped other engineers and marketers become their own entrepreneurs, work at their own pace often in their own place, sharing the risks and the rewards with him. Ray Kroc became rich by creating a franchise organizationMcDonalds (NYSE:MCD), helping franchisees build their own business; making money for themselves and for Ray Kroc in the process. Multi-level marketers Richard DeVos and Jay Van Andel became rich by sharing their business experience and expertise with others and helping them build their own business network, others who in turn helped the next layer of people to build theirs, and so on.When asked why they want to get into insurance business during their interview with a major insurance company, Eric and Patrick gave sharply different answers. Eric replied, Getting into insurance was a quick way to make money while Patrick replied, getting into insurance was a way to help people address their financial problems. And when asked how they would pursue and achieve their goals, their answers were sharply different, too. Eric replied that he would sell insurance to everyone he could get hold of the phone and come up with the first payment and that he would become a millionaire and retire in a few years. Patrick replied that he wanted to get into the insurance business because it was his life dream. He wanted to build a business to help his clients understand their financial objectives and constraints and come up with a financial plan to match the two. Two weeks later, Patrick did get the job, but Eric didnt.Erics and Patricks story underlines and highlights the first rule for becoming a successful business builder:Have a clear vision, a set of ultimate goals you want to reach, an idea of the contribution you want to make to peoples lives; and a set of basic values to rule your behavior and your relations in pursuing these goals. Making money should be the end, not the cause of the business you want to be in.As is the case with successful political campaigns, business campaigns begin with a sound vision, a mission, a set of ultimate goals business people want to reach, and a set of core values, an ethical code that rules behavior in pursuing these goals. But there is a major difference: In political campaigns, the center of the universe where the campaign is launched is the citizen, while in business campaigns the center of the universe is the consumer, the immediate and ultimate customer of each and every capitalist enterprise. This means that a sound business mission must begin and end with consumers; make a difference in the way consumers live; address and solve consumer problems, help consumers with their needs, income and time constraints, and product understanding; and anticipate and take advantage of consumer trends as shaped by income, technology, demographic and cultural factors, and government policies. Thats one of the secrets of each and every successful business builder, from McDonalds (NYSE:MCD) Ray Kroc to Microsofts (NYSE:MSFT) Bill Gates, from Apples (NASDAQ:AAPL) toStarbucks (NASDAQ:SBUX) Howard Schultz, to Amazons Jeff Bezos, and Amways Rich DeVos and Jay Van Andel. They all addressed and solved consumer problems, taking advantage of emerging consumer trends. In the early 1960s, Ray Kroc addressed and solved the problem of tight consumer income and time budgets by offering low-cost quick meals to young baby-boomers who couldnt spare the time and the money for dinning in conventional restaurants and to working families who had little time for home-cooking. Bill Gates addressed and solved the problem of computer usage complexity, making computers easier to understand for everyone, taking advantage of a number of emerging technologies that made computer hardware and software easier to use. Rich DeVos and Jay Van Andel addressed and solved a number of consumer problems with product familiarity and understanding, affordability, and convenient delivery. As Jay Van Andel puts it: the products we want must be ones that just about anyone is familiar with and can sell. The examples that come in mind are laundry and cleaning products. Howard Schultz provided consumers with a third place, a place away from home and work, where consumers can enjoy quality coffee a sip at a time with friends and neighbors. Niche market outfits like Traders Joe, Titan Foods, and Fairway filled the consumer need for diversity, while specialty stores like Whole Foods (NASDAQ:WFM) filled the consumer need for healthy groceries.A consumer-centered mission must be supported and reinforced by a set of core values that determine the rules of engagement in pursuing the business mission. One such value is economic freedom, free and open markets that allow people to pursue business opportunities across different regions and industries to shape their own destiny, so as to better their lives, the lives of their families, and the lives of the people in the communities where they live. Another value is wisdom, the understanding of possibilities and limitations of pursuing the business mission; the process of steering between the extreme patterns of behavior that may put the venture at risk; the application of scientific discoveries and tested business models to achieve full potential. A third value is courage, the daring to invent and to innovate, to pioneer new products and markets, steer between the extremes and vices of excess, cowardice, and recklessness. A forth value is self-control, the avoidance of greed, arrogance, and self-indulgence, the refusal to make promises that cannot be fulfilled. A fifth value is fairness, the equitable and just treatment of partners and associates, suppliers, and clients, and the general public; fairness is rewarding business associates according to their contribution to the value of the organization and spreading the wealth among the members of the society. A sixth value is the belief in the ingenuity and creativity of people and in the miracles it can achieve for themselves and society, when properly released. A seventh value is friendship the reciprocal affiliation that serves as the basis for alliance and cooperation among associates.People without a consumer-centered vision, people who want to enter a business to solve their own problems rather than those of their customers, are opportunists and rarely succeed to reaching the goals and developing a business; they can end up being the poison bait that infects, pollutes, and eventually destroys the organization that sponsors and supports them. People, who like Eric, see making money as the purpose cause rather than an outcome of launching an insurance business wouldnt hesitate to sell their clients unsuitable products, risking getting themselves and their organization into trouble with clients and regulators. People with a consumer-centered vision, on the other hand, people who, like Patrick, are in business to solve their clients problems rather than their own, are professionals, and often succeed in reaching their goals and developing a business in the process.In a free enterprise system, business builders must begin with a consumer-centered vision, a solution they want to provide for consumers, and a set of values to rule their behavior in accomplishing it. And they must share this vision with others.The Second Rule of the Business BuilderComment NowFollow Comments

Image by AFP via @daylifeThe first year on the job as a financial planner was difficult for Patrick. He had a hard time calling up his prospects and arranging an appointment to review their financial objectives and constraints. He even had more difficulty to convincing the very few prospects that yielded to his calls to overcome procrastination and come to an appointment. His prospects seem hesitant to make a commitment to the financial plans he was proposing. The problem was that he kept his vision to himself, trying to succeed alone as one-man operation. In the second year, all this changed, however, as Patrick began to share his vision with others: his relatives, his friends, his neighbors, and his church people. Some were indifferent to his calls simply because they had no interest in the insurance business; others were skeptical either because they didnt have what it takes to succeed in this business or because he couldnt get his message across. But a third group was receptive because his message was clear, and they shared with him the belief that they could make a difference in peoples lives by helping them plan their financial future. By the third year, he had three associates joining him, associates who in turn recruited another six, and those six another 12. By the fifth year, he had made it to General Agent, building his own business by helping 21 associates build theirs.Patricks story underlines the second rule for becoming a successful business builder:You cannot reach your vision alone. You must share it with others who are willing to walk down the same path with you. Some will walk at the same pace with you, staying next to you. Others will walk at a slower pace than you and be left behind, while a third group will walk faster than you and get ahead of you. But you should all remember that you walk towards the same destination.As is the case of great political leaders, great business builders cannot pursue their dreams alone; they cannot amass and hold all it takes in their own hands. They must share the dream with others who are prepared to travel down the same path with them, and willing to contribute their own experience and expertise and to endure the hardships that stand between the starting point and the destination. This is true for both company builders and business builders, but with a major difference: Company builders share their vision with a few partners and associates. Andrew Carnegie, for instance, shared his vision with legendary manager Henry Clay Frick, Henry Ford with financier Alexander Y. Malcomson, George Eastman (NYSE:EK) with astounding businessman Henry Alvah Strong. Business builders shared their vision with each and every associate. Hewlett-Packard (NYSE:HPQ) founders Bill Hewlett and Dave Packard shared their vision with thousands of employees. Microsoft (NASDAQ:MSFT) founder Bill Gates shared his vision with Paul Allen, Steve Balmer, and thousands of engineers, managers, and marketers. McDonalds (NYSE:MCD) Ray Kroc shared his vision with Fred Turner and thousands of franchisees, sharing their cause, while Rich DeVos and Jay Van Andel shared their vision with millions of distributors who followed in their footsteps.Sharing the vision becomes even more important when it comes to developing complex products that require the integration of technical and marketing resources scattered both inside a corporation and outsidelike Apples (NASDAQ:AAPL) iPhone, Cornings (NYSE:GLW) fiber optic cable, and Salesforce.com (NASDAQ:CRM) and Oracles (NASDAQ:ORCL) software. In such industries, the successful development and launch of new business is an organizational capability rather than an individual or professional management capability, and such a lunch requires the integration of marketing and technical information. The development of computer software products, for instance, requires the integration of marketing and technical information scattered among hundreds of engineers and marketers both inside and outside the conventional borders of software corporations. Similarly, the design and development of hardware products requires the integration of marketing and technical information that cannot be owned or controlled by one individual alone or even amassed in the research lab of a single corporation. Thats why the dozens of start-up entrepreneurs who drove the IT revolution in the US and around the world have appealed to venture capitalists to acquire the funds and the management and marketing skills they were missing.Sharing the dream also becomes important in making products more affordable in a world dominated by large producers. Two consumers have more bargaining power than one; ten, more bargaining power than two; one hundred more than ten; one thousand more than a hundred; and millions more than a thousand. Thats why Ray Kroc shared Sharing the dream also becomes important in making products more affordable in a world dominated by large producers. Two consumers have more bargaining power than one; ten, more bargaining power than two; one hundred more than ten; one thousand more than a hundred; and millions more than a thousand. Thats why Ray Kroc shared his dreams with thousands of franchisees who joined forces to develop a business brand that everyone now knows and is familiar and to get a better bargain for supplies, everything from beef and hamburger buns, to paper cups. Thats why Rich and DeVos and Jay Van Del shared their vision with thousands of successful distributors who joined forces to get better product prices for themselves and for every consumer who joined them: the larger the network, the better its bargaining power and the bigger the gain for everyone.You cannot reach your dream alone. You need to join forces with others prepared to travel the same path and share the same experience with you. Some will catch up with you; others will be left behind, while a third group will get ahead of you, but you should all remember that you travel to the same destination, you are part of the same network.The Third Rule of Building a Business

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Two couples, John and Jessica and James and Tiffany, joined Amway at the same time. Both couples had the dream of becoming entrepreneurs by making shopping easier, more convenient, and more affordable for other consumers, amassing wealth at the same time. And both couples shared their dream with others wiling to travel the same path with them. Yet John and Jessicas dream was a chimera, a temporary enthusiasm that faded away with time, failing to deliver lasting results for themselves and their group. Simply put, John and Jessicas problem was that they failed to keep their sight on the dream, to nurture and develop their network. James and Tiffanys dream, on the other hand, was more than a temporary enthusiasm. It was a burning desire that grew with time, turning into an iron will and determination to deliver results for themselves and their associates. For this purpose, James and Tiffany made themselves the center of a network organization, a form of collective entrepreneurship that allowed them and their associates to nurture and grow their business beyond any limits they had ever imagined.The story of the two couples highlights the third rule for becoming a successful business builder:Execute: Keep your sight on the dream, the business you want to build, and get the job done. Develop a network, a form of collective entrepreneurship that allows you and your associates to nurture and grow your business.Setting up an organization has always been important in pursuing and achieving a vision. Yet different business visionaries build different organizations. Late 19thand early 20thcentury company builders built hierarchical organizations, that is, top down organizations to exploit people by controlling their behavior. Late 20thand early 21stcentury business builders built network organizations, that is, non-hierarchical bottom-up organizations to liberate people by helping them build their own business.Network organizations consist of a core and a collection of peripheral units standing at the same level, competing and cooperating with each other. In this way, network organizations spread decision-making authority among all of their members rather than concentrating in to the top management. But decision-making authority in networks is divided between two levels, the core of the network (first level management) and the periphery at each network unit (second level management). First level management functions as an interior and an exterior department of central government to handle common network affairs. Second level management functions as a collection of local administrations handling their own internal affairs, managing their own business.Two-level management allows network organizations to enjoy a number of distinct advantages. First, it is centralized enough to reap economies of scale: the advantages associated with a large organization that pulls together a number of services shared by its members: business mentoring and networking; administrative, legal, and accounting support; marketing and advertisement. But it is also decentralized enough to reap economies of scope in personnel recruitment, local taxation, and financing. Second, the regular interaction between network units and the support office and among network units creates economies of synergy, the benefits associated with individual excellence and community dedication. Third, two-level management allows network organizations to have both a global and a local presence at the same time. This creates the competitiveadvantages associated with a large scale of small production batches that cater products to local and regional markets. Fourth, the sharing of similar experience and the institutionalization of business networking create an entrepreneurial mind-set, and a community of common fate. This issue will be further addressed in the next chapter. Fifth, networks can respond to changing market conditions and technologies far more rapidly than conventional hierarchical corporations. Sixth, there is a lowering of the business discovery cost for entrepreneurs who join the network. Seventh, each network node can become the center of a new network. This means that network organizations can grow and expand indefinitely, without the constraints and limitations of traditional hierarchical organizations.