It’s the American dream. Rise up from nothing and with gumption, oceans of sweat, and a head full of smarts, set yourself at the helm of a business that makes you fabulously wealthy and able to do any darn thing your whimsy desires. To those few who achieve it, whether saint or robber baron, comes the grudging respect of all around them.
Each generation puts its own spin on the dream. The current vogue is to begin with an idea at your kitchen table and form an entrepreneurial venture that gets bought up by some mega-corporation for a dazzling figure. #b#Michael Griffith#/b# stands as poster child for such a dream. His 1997 launch of Chirex Inc., a pharmaceutical ingredients supply firm, led to an explosive growth and sale to global pharma giant Rhodia Group for a cool $520 million in a mere four years. Griffith’s two latest pharmaceutical ventures have experienced similar success.
Griffith will present “Positioning for Growth” at the Association for Corporate Growth on Thursday, March 3, at 6 p.m. at the Westin at Forrestal Village. Cost: $60. Visit www.acg.org/newjersey.
Griffith grew up with his own family example of the American success dream. His father came straight off a Kansas farm and enlisted in the U.S. Army as a motor pool mechanic — and retired as a major general. Young Griffith spent his life as a military brat, settling for brief stints all over the globe before returning to his home state and Kansas University to earn his bachelor’s in 1982. He also holds a master’s in management from Northwestern University.
Griffith headed for Wall Street, joining Bankers Trust as a high yield securities underwriter. He later handled equities. In 1997 he founded Chirex. When acquired by Rhodia Group in 2000 the company had 620 employees operating in the U.S. and U.K. In 2004 Griffith gathered two fellow Chirex execs and founded Aptuit Inc., a global pharmaceutical development firm that in four years boasted 2,700 employees serving one in four major drug firms worldwide. Since last April he has served as CEO of Laureate Biopharmaceutical Services, a contract drug developer and manufacturer based at 201 College Road East.
“I think the one thing that puts success in perspective,” says Griffith, “is that so much of it depends on luck. A lot of guys will do everything exactly right and fail. Such is life.” That said, Griffith’s own pathway shows that while chance plays its role, there are a lot of ways to better the odds.
#b#Plan for success.#/b# “I know this sounds sort of simplistic,” Griffith says, “but to be successful, you must plan for success. So many entrepreneurs take a short-term, bet-hedging focus.”
It’s wise to hold a mindset that’s cautious about cost, but not one that’s cautious with outcome, he says. It goes beyond dreaming big. It involves laying the company’s first bricks with the realization that you are building a global entity.
Planning for swift growth and unlimited expansion governs every decision, from choosing a company name that translates well internationally, to selecting systems that accommodate businesses worldwide. “As you get bigger, you will find that your customers change,” says Griffith. This may involve providing different packaging, delivery scheduling, or product size. Prepped for growth means keeping the old systems in place to suit original customers while developing the flexibility to cater to new needs.
Capitalization strategies play a vital role in such an explosive growth-planning process. Initially, entrepreneurs tend to grab at any willing funder regardless of how much control is ceded, or what their sell-off agenda might be. Provided the program of expansion is realistic, the entrepreneur must allow that to set the calendar. Funders who cannot coincide must, however regretfully, be dismissed.
#b#Success is collective.#/b# “Real success comes from groups,” says Griffith. “When I build a business, I want a culture, more than a skill set. I want people who can be comfortable with the uncertainty of changing situations because they trust each other.” For a CEO like Griffith, it is not the science or the product that drives the business into success, but rather the business process that gives wings to the product.
This approach replaces narrowly focused specialists with multidimensional team players. The HR professional should be comfortable with the financial picture to realize his effect on the overall corporate outcome. In such a cross-working team, communication flows freely. Nothing is on a “need-to-know basis.” All information is shared.
Of course, not everybody fits every team. What does a leader do with that individual who is trying to create a fiefdom or works against the team’s natural energy? Griffith responds: “They are gone in an instant. I don’t tolerate it. Weeding out such destructive people is part of any business, and I will pull that person out, even if he is top scientist or top producer.”
Despite the initial abruptness of this remark, any worker pushed into an uncomfortable situation is going to be neither happy nor productive. Perhaps you are freeing him to find another team where he is more likely to flourish.
#b#Financial balance.#/b# Probably the greatest single factor in maintaining expansion, Griffith says, is to keep raising money one step ahead of the need. This is a delicate and ancient juggling act. Ideally, a company seeks just enough funding to lubricate continued growth, but not so much that the cost of capital crushes its progress. Recently many venture capital firms have sought to nudge companies across a rapid sell-off finish line by showering them with cash resources far beyond current needs.
The hope behind this lavish loaning is that “they’ll grow into it.” But more often, instead of growing big and strong, the company merely chokes on the excess.
Conversely, under-financing initiates a downward spiral. Everyone knows that when you are out of money, you are out of business. Thus, when a firm is strung out on finances, it becomes management’s sole concern. “Companies in this situation tend to strike at any bait, thinking only of immediate payback,” says Griffith. “And that invariably leads to wrong decisions.” Planning where your next loan is coming from and how large it should be sets the appetite for more beneficial funds.
Even with the right vision, product, people, and resources, achieving today’s American dream is elusive. Ask any entrepreneur, successful or not, about the sleepless nights, the regretted decisions, the sacrifices, and the countless delays. The dream is indeed demanding, but perhaps that is what makes trying for it more rewarding.