It is my pleasure to introduce guest blogger, James Allan. Enjoy his post below! -Seth Kahan
Terry Matthews is, by all rights, a visionary leader. He co-founded Mitel in 1972, and led it to a huge buyout by British Telecom in 1986. He then founded Newbridge Networks, and again turned his magic into a 7 billion dollar buyout by Alcatel in 2001.
He told his children that if they provide for their family, then they’re doing a wonderful thing. If they create a business which provides for many families, then they’re doing a truly great thing.
But this visionary leader is not satisfied merely manifesting his own visions. He has helped to create many more visionary leaders through his affiliate program. He has so far created 86 new businesses through this program, with an incredible success record: only 4 have failed.
So what system has the Welsh billionaire, who has earned his living in Ottawa, Canada, for the last 40 years, used to create this amazing record?
1.Get a Strong Leadership Team. Mr. Matthews doesn’t like to leave too much up to chance. Getting a strong leadership team means the deck is loaded in favor of early success. Not only does he want a committed management team, he also wants to have a strong board of directors to assist the management team as needed.
2.Hire New Grads. Since 1990, young people have had an incredibly hard time finding full time work. This is not due to Terry Matthews. He loves them fresh out of school. Their energy, enthusiasm, never-say-die attitudes and lack of external commitments are the perfect ingredient for start-ups. Once the leaders are ready, he lets the new grads go wild with the ideas they have.
3.Connect With Customers Early. Terry re-purchased Mitel back in 2001, and now can count on a global base of customers to connect the affiliate companies with. He’s got every vertical covered: hotels, schools, telecom, retail, beverage companies, etc. It’s important to connect with customers early so the technology stays focused. As well, cash flow is good for both employees and investors.
4.Let Employees Share in the Success. Mr. Matthews believes in allowing employees to be owners as well. His companies often distribute stock options to employees so that they can gain financially when the company does well.
5.Report to Shareholders Quarterly. Rather than hiding bad news, Mr. Matthews insists that employees and shareholders are kept up to date on successes and failures of the company. He believes that at least once every three months, those with a vested interest in the company should know the status.
6.Timing is Everything. You can’t go back to a customer a year after they’ve made a major purchase, and tell them you’ve got something better today. Mr. Matthews was infamous at Newbridge Networks for turning out requested technology with incredible speed, if it would attract key customers into long-term relationships.
Terry Matthews has created a system to allow visionary leaders to flourish. His system has turned the statistics (80% of most companies fail in 5 years) on their head. With technology being developed at breakneck speed, his record of turning out successful technology companies is even more incredible. But does he even think of resting on his laurels? Not a chance. He loves what he’s doing, and he’s enriching the business community while doing it.
Sources: https://vimeo.com/5064860, « Innovation in Tough Times with Sir Terry Matthews », MaRS Discovery District