08 Nov 3 Major Mistakes Business Owners Make While Running Their Business
In a world full of statistics and ego business owners are driven by the latter and wish to avoid becoming the first. Did you know that over 60% of businesses fail within 8 years? Now, most will wonder why is the number so high? We all know that the 1st year is the toughest. Once you made it through your 1st year odds for success should be in your favor. Or not? Why are the odds against the average business owner? Is it the lack of funding, lack of sales, lack of clients, poor marketing, bad location, and tough competition? While anyone of these outside causes may be a contributor towards failure the reality will surprise you. The real problem isn’t any outside reason; it’s an inside job. Mainly caused by ego. Lead your business with ego and you will find yourself among those terrifying statistics. Here are the top 3 major mistakes business owners make when running their business;
- Being cheap. Not investing in staff, marketing and training. I touched on this in my other article 7 Steps To Gain and Keep Your Employees’ Trust. You get what you paid for. In my 12 years of being an entrepreneur I noticed one thing, stingy business owners either pay at least twice for the same job done due to being cheap the 1st time or get squeezed out of the business by those that understand the value of investment, especially when it comes to their own staff. High caliber personal isn’t more expensive then a low caliber and less qualified employee when it comes to overall production and payroll. Why pay $20 an hour to a committed and qualified employee and when you can pay $12 an hour to someone that never did that task before but will once you teach them? Right? Wrong! You may be thinking you’re saving $8 an hour and roughly $360 a week but in reality how much business are you losing or not acquiring because it is being handled by a not really qualified employee? We may be talking about thousands of dollars of new business or repeat business here. The adage of “penny smart and dollar foolish” goes perfectly well here. Also, how often do you train your staff? When was the last time you had an expert, consultant or coach train your staff? Or perhaps you wanted to send your key players to a seminar or some training event in your field but didn’t because you figured “hey, what is the point? I don’t even know how long they will last here, I’d rather save that money and pay for that executive chair with a massager I always wanted”. Yep, ego is the driving force here.
- Not hiring coaches or consultants. Thinking that you know it all will only bring you the results you already have. As a business owner you need to constantly evolve, learn and seek mentors. Your enthusiasm, knowledge and ambition got you to where you are today but you always need to upgrade your level of thinking to get to the next level. And there is always a next level. Hiring coaches and consultants to bring your game to the next level is the smallest price you’ll pay compared to all other investments. You may be great at what you do but a coach makes you better. Michael Jordan was always Michael Jordan for 7 years until Phill Jackson showed up. Only then Jordan was able to win the championship, 6 of them. Kobe Bryant was playing alongside O’neal for 3 years without a championship; we are talking about 2 future Hall of Famers here (as of this writing, O’neal will be on that list in 3 days) until Phill Jackson showed up as their head coach.
Understand this, whatever obstacle or challenges you’re going through today in your business or even your personal life someone already went through it. They are willing to share their experience and the way to tackle that problem with you. Experience is the best teacher but it’s best to learn from other people’s experience rather than your own. Also, a coach or consultant is not emotionally attached to your business and they will provide an honest assessment along with bottom line training/advice as a 3rd party. Although they did not financially or emotionally invest in your business they are however vested in your results. Your results due to their participation are a testimonial for all of their future clients.
- Doing everything yourself. From personal experience and seeing countless of other entrepreneurs make this mistake I can tell you this much, not delegating will cost you more than you can bargain for. The reason for wanting to do everything yourself comes from fear of delegation. We think we can do it best, there is no one more capable or qualified than us. That’s a bunch of garbage in reality. When you want to do everything yourself you become the go-to person in your enterprise for everything. You WILL create a bottleneck scenario and everything eventually will come to a screeching halt. Not to mention that you will suffer mentally, physically and your personal life (family, social…what’s left of it) will take a major hit.
Ask yourself this question; when you 1st thought up of your business venture did you picture yourself building a business so you can enjoy the rewards from it? Like spending more time with family, drive a nice car, go on vacations whenever you want, live in a nice home and actually enjoy it, having time freedom? How is that all possible if you’re doing everything yourself and afraid to delegate? Let’s face it, you created yourself a high paying job and not a business. Yes, you may not have a direct boss over you telling you what to do but you’re now governed by all your tasks and employees…those are your bosses now.
Whether you want to expand and duplicate your business or just want to succeed with one location the goal of any business is to create leverage. So you can have that time freedom you always wanted. Your business has to be sustainable with or without you, and it has to be duplicable in the event you want to expand your office to other locations, franchise it or sell it as a ready to go system so the next owner can see the potential of duplicating it.
Think of yourself as a professional recruiter. Your job is to cast a vision, recruit (hire) qualified team members and sell the vision. Establish a training platform that everyone can plug into and delegate. Will it be done right away? Of course not. But it will never get done if you’re continuously doing everything yourself.
The reward from a self-sustaining and leveraged business is far more valuable then the satisfaction of pleasure of ego driven activity.
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