Everything is critical to an entrepreneur when building a small business to make sure their efforts result in a profit. In a very early stage company, many elements and areas of the company are being put in place for the first time. As more people are brought on board and systems are put in place, it takes time for areas of the company to function as cohesive units. Both chemistry and momentum are very important in this process. And therefore it is very important that the founding entrepreneur not go down side roads that take them away from their core business mission and focus.
Here are some common side roads that a small business owner may wander on to that causes valuable time to be lost and small business resources be diverted away from their business building:
Waiting for a contract that never comes
As a small business owner, you have met with a prospective customer or strategic partner, but it is taking too much time for them to respond and move the discussison to the next level. A common side trip is waiting on a response for a contract or relationship that slows momentum. Then when the contract does not materialize, valuable time and effort has been eaten up. Keep working your options and alternatives when being forced to wait upon an important response. This will prevent valuable momentum from being lost.
Turning a Business into a Social Program
This is probably one of the more common side trips a business owner goes down. As employees are added, a range of personalities and skill bases are brought on board to expand. The owner must be vigilant to confront poor performance and not be drawn into lessening his or her standards for his business, thereby changing the focus of the business away from its original mission statement of excellence. This is particularly difficult for a less experienced entrepreneur manager who is confronted with an employee who has personal problems that draws sympathy. Very often these problems become the focus of attention of other employees which can have an impact on morale and performance in a young growing company. It is difficult to address, but must be done for the company to grow.
Being Loyal to Employees that have not Earned Loyalty
Your best employees are usually emerge from those employees that you have invested in training and personal and professional development. Unfortunately, some employers keep investing in employees long after that employee has failed to display loyalty to the company. Be cautious about relying upon and investing in an employee who is out the door at 5pm regardless of the issue at hand or the employee that other employees don't respect. These individuals are not exhibiting the appropriate commitment to your company. Owners sometimes fail to take advantage of an opportunity to promote or hire in new and better talent by being too loyal to a mediocre performing employee. In a young company with a small number of employees, this can have a big impact.
Not Seeking the Right Support for a Long Term Challenge
Entrepreneurship is a solitary experience, yet ironically successful business building is all about making the company about more than just one person. Many founders and business owners make the mistake of not bringing in the right talent to complement their own skill base that will provide ongoing support over the long term. This support can be in the form of a key employee, a business consultant, a mentor and even a spouse. It is important for the owner to have reliable support for the numerous and unrelenting mental challenges they will face to achieve long term business success. Don't go it alone.
Worrying over Pennies, while Thousands are lost
There are pennywise, poundfoolish business owners out there. They focus too much on the trivial expense in front of them day to day such as the cost of copy paper, but are unable to do a cost benefit analysis of certain opportunities and decisions that may impact a company's profitability in the thousands or tens of thousands. The best example of this is underpaying employees---the pennywise owners wants to get the most out of each employee for the least amount. While the more sophisticated business owner is selectively investing in high performance employees to achieve significant productivity on a relatively nominal investment. Saving money is extremely important in building a business, knowing how to invest is even more critical. Know the difference.
Fighting Needless Disputes that have Little Positive Consequence
Business building is about being agressive. In some instances an entrepreneur's positive energy may turn against them when they needlessly pursue disputes or conflict too long. A trivial business dispute with a contractor or employee may escalate into litigation over a small sum of money that takes countless hours to pursue. Know when to walk away from a mistake and cut your losses. Don't turn positive agressive behavior into negative counter productive actions that holds back a whole company for a petty dispute.
Bringing Family & Friends into the Business Who Don't have the Right Skills
A successful business will attract the attention of people. Family and friends will regularly approach a business owner for a job or refer friends who are seeking employment. Some of a company's best hires are those people who are referred from trusted sources. A mistake is made where the owner feels obligated to hire a family member or friend when they know the skill base of that individual is not appropriate for the job description. As covered in Jim Collins' Good to Great, you need the right people, on the right bus, going in the right direction. Failing to keep a high standard for hiring undermines that credo for success, particularly when pressured from family and friends.
Focus is key to building a successful small business. Most of the accomplished business owners I know have an enormous amount of discipline in staying focused on what is needed to move their business forward. A large part of business building is identifying actions or activities that produce positive results and then doing them over and over again in a systematic way. Sounds simple to do, but distractions commonly occur that take the entrepreneur onto unproductive side trips. This can be for an extended period of time that yields little or no progress to the company. This also takes them away from what was working successfully.
Be vigilant about be taken down roads that are away from your stated business mission. The road back is very hard and very long.
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About Jeanne Gray
Jeanne Gray is founder of NJEntrepreneur.com and has been an entrepreneur for most of her career. She now works with small business owners to create strategies for growth. This includes small business advice on establishing their business goals and prioritizing their activities to achieve the greatest success. She may be reached at 908-917-9900 or
jgray@njentrepreneur.com
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