Introduction
The term entrepreneur is used to describe an individual or group of individuals who identify a prospect and creates brand or organisation to follow it. Adolf Dassler, the founder of Adidas company, is one such as entrepreneur. His entrepreneurial journey to introduce his new brand started at his mother’s house. Through the implementation of proper strategies, Adidas scaled the heights of success to become a global competitor. Adidas is the leading sportswear producer and marketer in Europe. Adidas company is also ranked number two largest sportswear globally after Nike with Under Armour coming third. As by 2016, Adidas was worth 19.29 billion Euros. What an interesting entrepreneurial story to uncover for this great company!
Timmons’s FORT Model of the Entrepreneurial Process
Entrepreneurship is a process which involves several activities, functions, and operations aimed at discovering opportunities and constructing companies to pursue them. (Bygrave 2013). Wickham (2004) says that the main purpose of the business process is to generate value or improve value to goods or services. The Timmons’s FORT model defines the procedure of crafting a new enterprise. The opportunity and the skill to spot and scrutinise any potential opportunities form the driving force of Timmons’s model. The concepts of FORT model are defined as; Founder, opportunity, Resources and Team factors.
Founder Factor
The founder of the venture is the entrepreneur. His or her job is to ensure the deal or opportunity is seized to the end. In other words, the founder takes charge of the “success equation”. The founder possesses several of the following skills; quick to learn and teach others, ability to deal with adversity, resilience, integrity, honesty, ability to build an entrepreneurial culture and dependability. The founder is encountered with ambiguity, uncertainty, and risks which require critical evaluation to know whether to take a risk or averse (Low & MacMillan, 1988, p.189). The homework of creativity, problem-solving mechanisms, and coming up with strategies belong to the founder. He or she pays due diligence in analysing the strengths and weaknesses of the venture. He is responsible for answering these questions, “what is wrong with this opportunity”, “what is missing” and “what can we do”.
The founder is responsible for choosing the right combination of resources such as technology, team management and inputs to produce the final product. Staying on top of the competition, eliminating unnecessary financial risks and adopting the latest technology is among the founder’s top priorities. He designs the kind of change and change agents necessary to fuel the operations of the venture. In this sense, the founder plays a critical role in managing change (Timmons & Spinelli, 2009, p.113). In a nutshell, the founder manages and redefines the equation of risk and reward while striving to achieve sustainability of the venture. Sustainability has become paramount in modern business context and thus, creating a positive legacy and fulfilling corporate social responsibility is all that a founder strives to achieve.
The Opportunity Factor
The FORT model of entrepreneurship assumes that entrepreneurship is “opportunity driven”. The market can also avail critical opportunities. However, a seemliness good idea is not always viable or feasible regarding business, and thus the potential market demand defines the potentiality of the business idea. The business opportunity or idea becomes viable if it attempts to add value to the existing products or creates new ones (Nasution, 2011, p.339). Creating unique, attractive, timely and durable products and services goes hand in hand with customer satisfaction. The Timmons’s model is different from the conventional entrepreneurship models as it begins with an opportunity (Timmons & Spinelli, 2009, p.109). The traditional entrepreneurship models often begin by creating a business plan and then identifies an opportunity. In Timmons’s model, financing and business plan receive secondary credit and only appear after an establishment of an excellent opportunity.The model assumes that a viable business opportunity is easily financed while the ultimate determinant of whether the business plan fails or passes is the identification of a business opportunity.
The Team Factor
The team composition comes after the identification of an opportunity. The entrepreneur puts together the working team and gathers the necessary resources. The shape and size of the team are determined by the nature and scope of the opportunity. The Timmons’s model assumes that a good team ultimately determines the success of the business (Timmons & Spinelli, 2009, p.104). Typically, a bad team can “waste a great idea”. Team resource becomes the vital resource that can unlock higher business potential given a particular opportunity. A good team efficiently manages growth-related pressure ensuring the business does not receive unnecessary internal shocks.
According to Timmons’s (2009), the team performs the roles of removing uncertainty and ambiguity related to the opportunity through the application of creativity and provision of leadership for the management of the available resources efficiently. The team interacts with capital markets and exogenous factors which constantly change and thus adjust their activities to keep up with the pace of the changes. This is the point which the founder’s ability to form a good team is put to the test. Entrepreneurs must also know that great teams are scarce and therefore, the founder must train and coach any new talent to gain more competence. The essential qualities that the team should have included; commitment, adaptability, creativity, relevant experience, risk tolerant, motivation to achieve excellence and time locus of control.
The Resources Factor
The FORT model insists on bootstrapping or beginning the venture with limited resources as the venture raises up to gain competitive advantages. This notion is contrary to traditional idea that holding extensive resources reduces the risk of establishing a business. The main advantages of bootstrapping include; lowering market costs, inculcates the art of leanness and discipline in the enterprise and promotes innovative resources to attain more productivity with limited resources (Timmons & Spinelli, 2009, p.105). Leasing equipment instead of purchasing them is one of the useful application of bootstrapping. Usually, the size of the opportunity determines the number of resources needed. In spite of the fact that economic resources are scarce, an organisation pursuing a viable opportunity backed up by strong team management will not struggle to attract money and other unique resources.
Application of the FORT model to Adidas Company
Opportunity Conception
Born in the Bavarian town in Germany, Adolf Dassler trained as a banker. However, his family began a local shoemaking enterprise which he joined to create footwear. Adolf, being a sports fan saw the opportunity to transform the slippers into soccer shoes and frivolous gymnastics. The opportunity brought in more money, and the family would soon open a small plant in 1926. The company was called ‘Dassler Brothers Shoe Factory’ (Elmuti et al., 2001, p.234). The team started by making shoes for tennis players but later ventured into making other sports shoes. The team saw the opportunity to invest in making athletic shoes and made the ‘first athletic shoe with arch support’. Adolf Dassler still identified the opportunity to make lighter spiked shoes using rubber and canvas instead of metal spikes (Ind et al., 2015, p.1). By grasping these opportunities, the Dassler brothers laid the path for future success. Soon later in 1928, the company would offer free shoes to support Olympic athletes at Amsterdam games. After eight years, a gold medalist, Jesse Owens would win the Berlin Olympics wearing the family’s athletic shoes.
Adolf Dassler Characteristics
During the period that Adolf led the company, Adidas was able to expand and extend to global markets in the field of the sports. The company thrived on Adolf’s philosophy of “only the best for the athlete”. His belief propelled craftsmanship in the company to innovate sports shoes and wears. Dassler, a competent entrepreneur, would take time to analyze the wear and tear of each used shoe brought to him by the employees (Ind et al., 2015, p.2). The collection of the used shoes served as Dassler’s way of helping him to identify and resolve production and design problems. Dassler had a strong understanding of his surrounding materials. Long after his death, the innovations of Adidas are inspired by Adolf’s philosophy. Dassler’s engineering mindset and his constant search for new solutions act as a guiding force to the current management.
The Team Behind Adidas
The management team, led by Adolf Dassler propelled the company to greater heights in the 1970s. After the death of Adolf, his wife and son in law took over the ownership of the company. Currently, the company has over fifty-three thousand employees globally. This broad base of skilled labour force keeps the spirit of innovation alive. Most efficient organisations have between three to six board of directors (Lowe & Marriott, 2006, p.48). Currently, Adidas has five executive board directors including the CEO Kasper Rorsted, Chief financial officer Harm Ohlmeyer, Global brands Eric Liedtke, Global operations Gil Steyeart and Global sales led by Roland Auschel. The board members are actively involved in motivation of employees and development of new talents. The company has become one place to seek employment for the majority of people (Ind et al., 2015, p.2). The marketing team is active in developing relevant marketing campaigns that deliver value to the company. Adidas team commits to continuously add value to customers, create value for the products and make profits for the business.
According to this analysis, a conclusion is drawn that the FORT model explains 80 percent of the success of Adidas. One of the significant additional factors for the success of Adidas is the formation of healthy partnerships and collaborations with famous people. For instance, in 2016, the company collaborated with Kanye West, a rap icon to introduce a new brand in North America which increased the company’s sales by 30 percent.
Conclusion
Successful venture creation must encompass proper entrepreneurial process. Timmons’s FORT model describes the entrepreneurial process. According to the analysis of Adidas, identification of the opportunity is the critical initial step towards creating a sustainable brand. The entrepreneur has to have skills to recognise potential opportunities and analyse their viability. The team factor is the driving force for the execution of the opportunity. Behind every successful company lies a strong team. In summary, entrepreneurship is about identifying opportunities, building the right team and creating value for customers. These are the essential processes of creating a successful venture.
Work Cited
Bygrave, William D, 2003. The Portable MBA in Entrepreneurship, 3rd Edition
Elmuti, Dean; Kathawala, Yunus, 2001. An overview of strategic alliances. Management Decision, Volume 39, Number 3, 2001, pp. 205-218(14).
Ind, N., Iglesias, O. and Schultz, M., 2015. How Adidas Found Its Second Wind. Strategy+ Business, 80, pp.1-5.
Low Murray B., MacMillan Ian C. 1988. Entrepreneurship: Past Research and Future Challenges. Journal of Management.pp.189
Lowe, R. and Marriott, S. 2006. Enterprise: Entrepreneurship and Innovation. Concepts, Contexts and Commercialization. Elsevier Ltd. pp.42-67
Nasution, H.N., Mavondo, F.T., Matanda, M.J. and Ndubisi, N.O., 2011. Entrepreneurship: Its relationship with market orientation and learning orientation and as antecedents to innovation and customer value. Industrial marketing management, 40(3), pp.336-345.
Timmons J.A and Spinelli S, 2009. New Venture Creation: Entrepreneurship for the 21st Century, Chapter 3, pgs. 101 – 117, McGraw Hill 8th Edition
Wickham, Phillip A. 2004. Strategic Entrepreneurship 3rd Edition: FT/Prentice Hall.
