Contributed by Jason Fry, the president and CEO of Zotes Products, LLC.

As entrepreneurs, each of us faces myriad challenges. These challenges not only stretch our capacities, patience and ability to keep employees focused on the company vision, it also allows for alternate ways of thinking to begin creeping into our company culture. One of the most important business lessons I learned was the four-phase approach to business taught to me by my grandfather Don Pickett, a very successful entrepreneur. He taught me that every company has four phases, and your ability as a leader will be judged on how well you keep your company in Phase 1.

• Phase 1 (Creative Stage) – This is the phase where all great ideas, concepts and passions are developed. Each of us has had a thought that turned into an idea that quickly became exciting to us, as we believed that we could actually take this new idea and translate it into the marketplace. Passion, energy, excitement and development of an idea to concept happen at this stage. This is where the fun occurs at the initial stages of a startup or new business. Soon after Phase 1 has taken place and you have a product or service that has been developed from an idea, we all enter into the next phase.
• Phase 2 (Management Stage) – Now that we believe we have an opportunity in the marketplace and have set out to conquer the world with it, we start by putting management behind the process with employees, policies and procedures. This is crucial to our development, but it will automatically lead to the next phase, unless your company culture is centered on remaining in Phase 1. My experience has been that when we stop focusing on the creative aspect when developing our business, the next phase will introduce itself to us.
• Phase 3 (Blame Stage) – This is now the culture of the organization as employees begin to blame management for educating or explaining objectives incorrectly. Management begins to blame employees for not following policy and procedure, and pretty soon all the focus of the company is internal, while they linger in the blame stage. If this mode of operation persists and is allowed to grow, it won’t be long until you reach Phase 4.
• Phase 4 (Burial Stage) – Once the internal focus is on the internal ways of doing business, then before you know it your customers feel it, the products or services are neglected, and your company becomes stagnant. The burial stage re-enforces all the negative qualities that never existed in the basement or garage. No one could convince you that success was not the end result. Your passion was on fire and your vision was soaring. The only way to keep your business out of the “burial stage” of Phase 4 is to never allow it to reach the other two phases.

Keeping your partners and employees in Phase 1 is a challenge, but it will allow you to never stop thinking like you did in the early stages of your business. Phase 1 is where passion, ideas, brainstorming and improvements exist. Every employee should have to touch this area of the business. Staying in Phase 1 is a challenge, but one that is worth the constant nurturing it takes to remain there. My definition of success does not know the difference between work and play. In my experience, staying in Phase 1 is the only way a business can truly be successful.