Daily Leadership Thought #170 – Fifteen Common Business Mistakes

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

There is a significant benefit to working with a diverse range of clients over 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 at all.
3. Not developing and managing to key performance indicators (KPIs). 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 based on 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 weather any storm or seize any major opportunity.
7. Treating your profit center(s) like a cost center. You should avoid spending money more quickly than you earn it, both personally and professionally.
8. Failing to understand that debt, when managed responsibly, 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. There is a tendency to rationalise poor results instead of taking them seriously and/or fixing things aggressively enough. The business performance improvement curve only gets steeper with time.
15. Leaders often overlook the fact that working harder and longer isn’t always the solution. A long-term lack of work-life balance will negatively affect everyone in our lives and tend to lead to suboptimal decision-making.

Related articles

• Common Leadership Mistakes, part 2 (ascendbusinessstrategies.wordpress.com)
• Not All Businessmen Are Smart, You Know (baselinescenario.com)
• Common business mistakes with social media (thedigitalden.com.au)
• What Are The Most Common Mistakes That Small Businesses Make (smallbusinessbranding.com)
• Most Common Mistakes Which Should Be Avoided While Starting Small Business (smallbusinessfriends.com)
• Common Leadership Mistakes (ascendbusinessstrategies.wordpress.com)
• Learn From Your Mistakes (capacity-building.com)