ue bot icon

Daily Leadership Thought #170 – Fifteen Common Business Mistakes

July 11, 2011

Free Man in Black Suit Jacket Using Macbook Stock Photo

Mistakes happen, but it’s good to learn from them and even avoid them if possible.

There is a great benefit to working with a wide variety of clients for many years.   You start to recognize patterns, seeing what works and what gets organizations in trouble.  I have compiled the following list of common business mistakes (many of which I have made myself):

  1. Hoping for different results using the same strategy and/or tactic that isn’t working
  2. Ignoring your business and/or marketing plan once it is completed; even worse, not having a plan to begin with
  3. Not developing and managing to key performance indicators (KPIs) and failing to make sure that everyone in the organization is on the same page as to what success looks like
  4. Not planning and managing to multiple financial scenarios (and knowing which way you are trending): best-case, expected-case, and worst-case scenarios.
  5. Not realizing that there are no real expense reduction strategies that will properly address a sales issue. You can’t just cut your way out of a business development problem.
  6. Not fully respecting the fact that “CASH IS KING” and that it will often erode more quickly than you can replace it. Cash reserves are a requirement, not a luxury, if you want to be able to weather any storm or embrace any major opportunity.
  7. Treating your profit center(s) like a cost center. Spending money faster than you earn it (both personally and professionally).
  8. Failing to understand that debt responsibly managed creates leverage and that debt improperly managed creates a burden that only compounds over time.
  9. View business development as an expense rather than an investment. Reaching new customers and/or markets requires allocating the necessary funds.
  10. Hiring and/or keeping substandard talent that plays a key role in the business; forgetting that “you are your people”
  11. Failing to become knowledgeable about the competition (including your competitive advantage) and staying that way; market ignorance is never bliss
  12. Failing to measure and understand the importance and interrelationship of both employee and customer satisfaction; happy employees and customers aren’t mutually exclusive, in fact, the opposite is usually true
  13. The leaders of the organization don’t see the value of their own ongoing professional development. Thinking and learning are more important than just doing as you grow the business and take on more responsibility
  14. A tendency to explain away poor results rather than taking them seriously and/or responding aggressively enough. The business performance improvement curve only gets steeper over time
  15. Not appreciating the fact that the answer isn’t always to work harder and longer. A long-term lack of work-life balance will affect everyone in our lives negatively and will tend to lead us to suboptimal decision-making