10 Mistakes Business Owners Make
Most people start out in business with a great idea or something they’re good at – they don’t necessarily think about running a company or managing a team. It can be a rollercoaster ride, pushing you far outside your comfort zone and forcing you to get involved in things you never thought you would ever touch.
Over the years I’ve been working with business owners and leaders, I’ve gathered together 10 Mistakes Business Owners Make. These are the most common mistakes I see in business owners of all shapes and sizes, across different industries and at all stages of their business journey. I want to share them with you in the hope that this knowledge will make your own journey easier.
1. Not having a plan – Having a great idea is a good start and so is being prepared to take a risk. But just rushing headlong into starting a business is an exhausting and inefficient way of proceeding. Without a plan, how will you know you’re on track? Without a plan, how will you be able to communicate progress? Without a plan, how will you know if you’re veering off track?
2. Believing your own hype – When you start a new business it’s very common to believe that no one can do things as well as you – after all it’s your idea, your product or service, and no one else will ever understand or care as much as you. If you’re smart, you’ll hire people who’ll make decisions and challenge your ideas rather than simply do a job.
3. Hiring too quickly and firing too slowly – Your team is the most important element of your new business ‘jigsaw’. Many business owners avoid hiring or getting help until they are completely overwhelmed, and then panic and hire the first person who crosses their path. One bad hire can seriously de-rail you, especially in the early days, so focus on finding people with the right attitude and values. Someone who is not right for the team will end up draining you and your business. If you get it wrong, end it quickly, professionally and humanely.
4. Blurring the lines – If you do decide to go into business with a friend or a family member, make sure that roles and responsibilities, goals and financials are clear. Even though you’re sure it will never happen, discuss how either of you would exit the partnership. Even the best of friends can fall out over an informal handshake where each person has a different memory of what was agreed.
5. Selfish vision – Many owners are so focussed on their goals that they fail to realise that their people are not with them. In order to buy into the future you can see, your team will need to understand you and why you do what you do. With all your passion and enthusiasm, customers will not immediately flock to your door, and even when they do find you, they may not immediately ‘get’ the uniqueness of your idea or product. Remember that this is not about you – it is about your customers and how you solve their problems.
6. Lack of trust – You started off with such a great team – what happened? Effective communication is key to establishing and maintaining trust, but too often this is put into the ‘nice to have’ rather than ‘essential’ category. Your team need to understand what is happening in the business, they need to feel that they can contribute, challenge and collaborate. Make it part of your company’s culture to recognise and celebrate mistakes as learning opportunities.
7. Poor cash management – It’s amazing how often new businesses run out of cash, even when they have revenues and profit. Especially in the early days, cash is very definitely king – you need to know how much your business needs to keep the lights on. By all means have an accountant to do your tax returns but keep a tight grip on expenses, especially in the early days. Cash is just as important as profit. Don’t be too slow to go out to the market and seek funding. If you cannot find anyone else to invest in your idea, then maybe it’s not such a good one…
8. Failing to systemise – Many owners are consumed by the daily crisis and never find enough time to focus on what’s important in their business. Their business is likely to be freewheeling with no direction or focus, at the mercy of every crisis and drama. It takes practise and discipline to change this behaviour. In order to scale your business, you’ll need to systemise – all core processes need to be mapped out and documented. Get your team involved, encourage cross-training and knowledge-sharing. Make sure that everyone in your business feels responsible for consistency and continuity.
9. Micro-managing – Even when you have, in theory, delegated work to your team, it’s too easy to spend your time micro-managing. You have to learn to let go. Help your people, trust them to do their jobs and let them make mistakes. It’s hard, especially when the business is your baby, but it’s the only way that your business will be able to grow. If someone is always telling you that everything is fine, I would be wary! In business things are always breaking – that’s usually the only way you learn and grow. Ensure you put metrics in place so that you’re dealing with facts and not just what people tell you.
10. Not asking for help – Many entrepreneurs are terrified that their ideas and approaches will be stolen from them and so they avoid countless opportunities to get feedback from potential customers and partners. Get your minimum viable product out there as soon as possible – test, refine and repeat. It’s so easy to get completely consumed by your business and to feel full of fear and anxiety. Having an experienced mentor or coach can provide the necessary challenge and perspective. Joining a community can be a great way to realise that you’re not alone. Share stories and learn from each other – the support you receive and give will be invaluable.
If any of these 10 Mistakes strike a chord and you’d like to start a conversation, please get in contact.
Lisa Zevi – Co-Founder of REAL Business Builders