Top 10 Reasons Businesses Fail Number 1 – Owners Just Don't Get It
There are so many things that owners do wrong, that they are too long to list. Most problems have to do with owners’ egos. They are so consumed with impressing themselves that they are often blind to what is really going on in their business. They are too close to the business to see things clearly because everything they do or implement is a figment of their own imagination. There is a reason that authors have editors. If an author reads what they wrote, they read what they MEANT to write. If an editor reads what the author wrote, the read what the author TRULY wrote. Let’s list out some of the most common problems:
1. Usually business owners are very good at their particular trade, but it doesn’t mean they know how to run a business. Anything they implement in the business is based on their lack of knowledge. Prime examples of this point are doctors and lawyers. They are good at their trade, but bad at business. They should seek outside help.
2. Owners are stubborn and refuse to accept input from others. They refuse to take advice from anyone inside or outside of the company.
3. They are greedy. There is nothing wrong with wanting to be successful and make a lot of money. That is the reason why we are in “for profit” businesses. But being greedy often makes owners cheap. They refuse to spend the necessary dollars on quality products or services which costs them more in the long run.
4. They are scared of risk. Just because something is working well, doesn’t mean you shouldn’t try other things. Expanding to a new area or altering your products and services might provide more money than you are currently making.
5. They are too hands on. Revenues grow exponentially when you have people producing income for you. An owner doing all the work can only produce a limited amount of income. Your business is not unlike a pyramid (now called multi-level marketing, mostly to avoid regulations meant to stem that activity). Take our private investigations company. We can charge $75.00 per hour, so the most we can make with two owners is $150.00. But if we pick up additional investigators, we can charge $75.00 an hour, pay the investigators $25.00 per hour and pick up an additional $50.00 in company revenue per investigator. Make sense? But the investigators who are so stuck on the idea that they have to do the work to get it right are limited on how much they can bring in to the company.
I could go on and on with these examples. Let me close with a short story about a paradigm shift:
A boat is cruising along on a foggy night. They see a light of an oncoming boat. The navigator gets on the microphone and says, “You are in our direct path, please change course”. The other voice simply says, “I suggest you change course”. The captain who is listening grabs the mic and says, “This is Captain Smith of the US Navy, change your course”. The voice again comes back and says, “Sir, this is Ensign Brown and you should change your course”. With this response, the captain yells, “We are a US Destroyer, change your course now”. The voice come back calmly and says, “We are a lighthouse”. The ship changed course.
Sometimes all it takes is one additional piece of information to shed a whole new light on a situation. Don’t get trapped in linear thinking.