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What is a good indicator of having reached ‘the top?’ Is it market share in your domestic market or market share globally? Is market value of your firm a prudent indicator? Or being considered the ‘best place to work’ a good yardstick? While there can be no single benchmark, the quest for ‘reaching the top’ continues to drive each one of us—be it a student, or a sportsperson or an organization.

I relate to Aamir Khan’s statement in the recent blockbuster movie 3 Idiots which essentially said, “Strive for excellence and success will follow.” The really successful organizations (or individuals) never really seem to be ‘striving’ to reach the top. For them, success is incidental, Excellence is the focus. In business terms, at YES Bank, we are working towards creating the ‘best quality bank of the world in India.’ YES it is highly motivating for my team when we recently achieved the milestone as the fourth-largest private sector bank in the country, but candidly, we recognize that size and scale and accolades thereof are just a means to an end, and not the end in itself.

Having said that, getting to a leading position is an important accomplishment in your entrepreneurial journey. However, the rise to the top will also bring with it the responsibility to maintain the leading position.

Historically, few companies have survived the leadership position with transitioning times. A look at the Fortune 500 list shows over 1,800 companies have appeared on the list since 1955, when the list was first published. Some of the biggest and celebrated names today were not even existent, and some of the largest names have fallen victim to increased competitiveness.

In a more globalized and interdependent world economy, you will need to steer your business backed with robust strategies to maintain your firm’s leadership position. As an entrepreneur, you should be able to visualize likely future challenges and take timely actions to actualize them.

While there can be various strategic, tactical, competitive, regulatory, human factors and other explanations to this churn amongst the top companies, empirical evidence will suggest that the companies that stay at the top for over two decades, are also those that had an explicit (or tacit) focus on ‘quality.’

Leadership through innovation
Corporates today are challenged by innovations originating from across the world, both from within and at times outside your industry. For instance, growth of mobile handsets with in-built cameras is impacting the growth of the digital camera industry. Further, with a conducive entrepreneurship ecosystem, even small-sized companies are challenging the larger companies or changing the industry dynamics through their innovative business models. Travel portals such as MakeMyTrip, Yatra etc. are homegrown innovations that have changed the way this industry was operating before by bringing service convenience and transparency to the customer.

Hence, it becomes imperative to continuously innovate to move from your current strengths to future strengths by propagating innovation in your company. In innovation-driven organizations, the CEO is the true ‘chief innovation officer.’

Create global corporate mindset
The core drivers of globalization are ‘alive and well,’ and the key will be to seize the opportunities of an interlinked world economy. The free global flow of information (and relatively free goods and capital) has already resulted in radical pricing transparency and new networks of engaged consumers, and this is only the beginning. Disruptive changes in consumer behavior will offer opportunities and have great impact on business over the next decade. To benefit from these opportunities, develop a ‘multi national’ mindset at all levels of management and global/integrated organization structures.

Differentiate or die
Most companies spend time in replicating the business models or approach of the leading company. It’s imperative for leaders to differentiate their firm from the competitors, or else lose the enterprising edge they command. The differentiators need to be built around the unmet needs of the customer, add tangible incremental value and should be difficult to replicate.

Make prudent investments
You need to constantly invest and stay ahead of the curve. Equally important is to direct these investments in accordance with the focus areas of your company. In FY ’09, when the global economy faced an unprecedented challenging environment, most banks and financial services companies introspected inwards for corrective actions. However, we at YES Bank visualized ‘Opportunity in Adversity.’ We strategized and sustained pursuit of our differentiated business strategy, continued to invest significantly in building our human capital and the YES Bank brand.

Nurture and retain talent
Human capital is the single-most important asset that an entrepreneur carries along his journey to build a world class institution, and it’s critical to constantly invest in, mentor and retain this talent. In my previous article on “Planning Leadership Transition,” we covered the multiple aspects that an entrepreneur should consider to develop his winning team.

Corporate governance
An entrepreneur generates conditions for wealth creation. This also entails a big responsibility to create this wealth legally and ethically. Work towards building an institution driven by best practices, built on ethical best practices. Corporate governance is not just about compliance and an agenda for discussion in board meetings. The foundation of excellence is the measure of the faith and trust that the institution commands amongst all its stakeholders.

Earning, retaining and growing institutional faith and trust is the result of the cumulative efforts and contribution of each and every member of the organization, made through their individual interactions with customers and all stakeholders.

The trust of stakeholders is built by conducting business in a manner which is ‘regulatorily compliant’ and ‘ethically appropriate.’ ‘Regulatory compliance’ means following the regulations in letter and spirit.

‘Ethically appropriate’ means conducting business which is in the best interest of both the organization and the customer, where there is no chance of jeopardizing reputational risk.

©Entrepreneur March 2011

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Rana Kapoor, YES Bank