FROM ACCOUNTANT TO SOFTWARE DEVELOPER

Steven Cohen is a unique business executive. His casual dress sense and straightforward way of talking hides the fact that he is an exceptional entrepreneur who helped build one of South Africa’s biggest software companies, Softline Pastel.

Cohen is a chartered accountant turned software developer, who, in partnership with Ivan Epstein and Alan Osrin, grew Softline from a small company in the late eighties to a household name in accounting software a few years later.

In 1997, Softline listed on the Johannesburg Stock Exchange and this capital injection helped to grow the company through numerous acquisitions - which included VIP Payroll Systems and its major competitor Pastel Software. In 2003, Softline delisted from the Johannesburg Stock Exchange and was acquired by The Sage Group.

While the company showed tremendous growth in the nineties, which culminated in the JSE listing, it brought with it a big challenge. Instead of focusing on customer satisfaction and selling their products, Cohen in his new role as financial director had to sell the company for the sake of the share price to analysts and investors.

“These investors do not have a clue about employee well-being, they just want to see that their dividends are going up,” said Cohen. The fact that staff happiness was not as important as short-term gains for investors was one of Cohen’s biggest battles.

Key to success

Cohen also downplays his success, stating that he never sat back and marveled at the size of the company. Instead of focusing on what he and his partners have created, he is concerned about the happiness of the programmers working with him, whether they will bring out exceptional products, and customer satisfaction.

“That was always my driving force,” said Cohen. “It was never a hierarchical system where I thought: look at how big it is.”

He believes in a flat company structure, where employees have the freedom to make decisions and work without the need to be managed. “If I must manage you, I should not be employing you,” said Cohen. His attitude towards meetings is similar, where wasting time on long, unnecessary discussions is discouraged.

Cohen is now using his extensive business experience to assist young entrepreneurs, which includes being part of the Small Business Awards on 702 with Sage One. He also regularly writes and talks about entrepreneurship. In one of his recent columns, Cohen shared three vital truths about running a business.

“Management textbooks and the business press are full of advice about creating entrepreneurial business models, shaking up markets, and offering gamechanging customer experiences. As exciting as those opportunities are, there are some important and less glamorous truths about building a business that every entrepreneur should know. Too many of us learn them only through hard experience,” said Cohen.

The three truths

The first truth is that while it is sensible to start with a business plan, reality will almost always have different ideas for your business. “Be ready to adapt your business plan in response to the needs of your customers, a changing business environment, and a fluid regulatory space,” said Cohen. He said a business’s brand, where your revenue comes from, its customers, its cost base, and other elements of a business will keep changing. The second truth is that even business owners are answerable to higher authorities. “Entrepreneurs need to play well with others. You will enjoy a great deal of independence and satisfaction from your own business, but owning a company is not an escape from accountability.”

As a business owner, your new bosses are your customers, SARS, creditors, financers, and potentially a range of industry and government regulators.

The third truth is that a great business starts with getting the fundamentals right. “Thus, start out by putting the right processes, procedures, and systems in place. Good cloud-based computer systems that bring best practices for HR and accounting into your business are surprisingly affordable and can help you run a great business,” said Cohen.

By keeping these truths in mind when starting and growing a business, Cohen believes that the path to creating a sustainable venture is much easier. ■

“These investors do not have a clue about employee well-being, they just want to see that their dividends are going up”