Entrepreneur Mistake #1
In working with entrepreneurs for more than thirty years, I concluded that Mistake #1 was being too entrepreneurial.
How can a business owner be too entrepreneurial?
The same characteristics that can lead entrepreneurs to success can also cause the business to get into trouble if they go too far. It all comes down to balance. Balancing entrepreneurial instinct and drive with thoughtful strategic planning and analysis will lead to better decisions and more effective action plans.
That means avoid being too opportunistic, too optimistic, too impatient, too confident, too decisive, or too creative.
To consider each of these risks of being too entrepreneurial in more detail, following is the extract from Don't Do It the HARD WAY, Part 2, Chapter 1.
It can be hard not to pursue every potential sale or customer opportunity that is presented to you, but successful entrepreneurs build their businesses by remaining focused on their strategic objectives and the action required to achieve them. Time and resources are easily wasted on chasing rainbows if you are not sufficiently selective and don’t insist on sticking to the plan.
Both current customers and new prospects will continually present unexpected opportunities. If they are asking for it, you should do it, right? Well, maybe not.
Can you do it well? Profitably? Better than the customer’s currently available alternatives? You don’t want everybody to be disappointed at the end of your detour into new territory and you don’t want the customers to now conclude that maybe you’re not as good as they thought you were.
Your Go/No-Go decision on whether or not to pursue any new opportunity should be based on how well it fits with your two most important strategic objectives:
- Leveraging your competitive strengths, and
- Building long-term business value.
Those are the selection criteria that will keep you focused.
It is important to be optimistic and think positively, but a little paranoia may be wise too. Remember the chairman of Intel, Andy Grove, titled his memoir, Only the Paranoid Survive. Mark Zuckerberg has been credited with the same mentality in driving the astonishing growth of Facebook.
Keep a wary eye on the market and monitor your business performance constantly. No news is not good news; you’re flying blindfolded. Don’t miss or ignore the warning signs of bumpy weather approaching.
Don’t expect too much too soon. It seems like everything takes longer than it should and most entrepreneurs have high expectations of themselves and their team. But don’t keep changing the plan or trying something new just because you’re not there yet. If you’re making progress and the end goal is still valid, don’t give up too soon.
Entrepreneurs usually have great confidence in their instincts and their intelligence. The mistake is to neglect or ignore market feedback and analysis of the facts. Also, being action-oriented, the tendency is to react and ‘fire’ before the ‘ready, aim’ stages are complete. Painful surprises can result.
Temper your self-confidence with a little humility – ask for help and get input from others with a stake in the issue before you rush ahead.
Entrepreneurs are expected to be decisive and demonstrate leadership. But both can be overdone – deciding too quickly and providing too much direction, so that employee input, initiative and creativity are stifled.
Often the decision does not need to be made so quickly and the implementation will go more smoothly if time is taken to assess the feedback and answer the questions before commitments are made and the wheels are put in motion.
Back in the 1980`s, the Japanese style of management was the primary model for success and one of their recognized tactics was to talk, and talk, and talk about the solution before implementing it.
The result was a much smoother and faster implementation than for the stereotypical decisive American manager, who decides quickly and starts implementation without sufficient prior consultation.
Many entrepreneurs are driven to ‘Do it my way’; that’s why they love running their own business.
But sometimes alternatives have not even been considered and a better way exists. The creative solution may require improvising and learning on the fly, but maybe the best solution is sticking with what works, until it stops working. Or it may be a mistake staying too long with a solution and neglecting to evolve and grow by optimizing systems and processes and installing the best practices and latest technologies available in the industry.
Not everything needs a creative new solution that’s unique to you and your business. Maybe you’re not that special.
Remember the key words of balance and perspective. The intent is not to dampen the energy, enthusiasm, and confidence required for entrepreneurs to succeed, but to avoid the risks of being too entrepreneurial.
Be better. Do Better. Be an Enlightened Entrepreneur.
Del Chatterson, your Uncle Ralph
Learn more about Enlightened Entrepreneurship at: LearningEntrepreneurship.com Read more of Uncle Ralph's advice for Entrepreneurs in Don't Do It the Hard Way & The Complete Do-It-Yourself Guide to Business Plans - 2020 Editions.
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