Wednesday, July 8, 2020

C-Suite Advisory

Common Business Mistakes Inhibiting Growth

David Sharrock

In my neighbourhood, there are a multitude of cafes and restaurants that open their doors, following hugely expensive fit outs and massive set up costs. As the weeks turn into months, many of them just see a trickle of customers. There is nothing wrong with their food, service or décor and ambience. The new owners stand by, ready for the rush of customers, displaying increasing anxiety and disappointment as this fails to happen.

Sadly and all too often, their dreams turn to dust and their doors close for the last time, usually without warning. Only the shell of the shop remains. I then muse about where those owners have ended up and am concerned about their financial and emotional state, having been forced to walk away. I can only imagine their heartache, pain and trauma.

Responsibility for mistakes:

It is frightening to think that any business can fail at any time, for any reason. Whenever a business opens its doors, it needs to grow in order to survive. In fact, mere survival is not an option because this means that the business will simply atrophy and eventually close its doors. The aim is for the business to thrive, preferably by growth that is sure, steady and manageable.

When a business fails, be it start-up or established, there is only one person responsible: the business leader. He or she has faced a multitude of issues and has made mistakes in deciding what to do or what not to do, causing stymied business growth. This is the hard truth.

Common mistakes to avoid or redress:

The good news is that business failure might well be averted if the business leader addresses the following common mistakes:

  • Struggling personally with emotional, physical, inner well-being or relationship issues which have a negative impact in the workplace
  • Finding it hard to face and overcome problems  in your business, just wanting to give up
  • Running the business by the ‘seat of my pants’, flying from one issue to the next, highly stressed,  and never quite sure about who is doing what
  • The business lacks vision for its preferred future
  • There are no articulated values or the values mean nothing, with internal behaviour unpredictable and random
  • Workplace culture is toxic, dysfunctional or less than ideal
  • Leadership skills are lacking
  • The business does not have the right people on your team with the right attributes, tolerates  problem team members and suffers mediocre performance
  • The business primarily exists to get what  it can from customers and to sell, sell, sell
  • No new ideas, failing to innovate with new and different products and services
  • No new business opportunities and gets no return from advertising and marketing
  • Dated, inadequate equipment and infrastructure
  • A haphazard strategy at best, with little to no effective planning for the future
  • Operating in the red, struggling to pay suppliers, a lot of slow paying or defaulting customers, and marginal profit.

Tips for averting these common mistakes:

Secondly, as the business leader, instead of making such mistakes, what might you do to facilitate business growth and see your business thrive?

  1. Undertake a candid self-appraisal of every aspect of your personal life, getting help to overcome personal struggles while forging life-giving relationships
  2. Develop resilience whenever facing problems or adversity, characterised by persistence, determination, courage, steadfastness and sheer indefatigability
  3. Establish a business system, with your whole team working to the system for the sake of consistent best practice
  4. Create and cast an inspiring vision of the future
  5. Ensure  that values become prominent so that behaviour is consistent  with core beliefs
  6. Introduce a vibrant workplace culture by tackling and replacing wrong behaviours, attitudes,  communication, relationships and decision-making
  7. Learn the skills necessary to become a highly effective leader
  8. Recruit for potential to build a high-performance team while showing the door to  problem team members
  9. Ensure the business becomes obsessively customer centric at each customer touch point
  10. Become more entrepreneurial, creative and innovative, coaching for those traits in your team
  11. Discover and create new business initiatives galore
  12. Gradually improve and update equipment and infrastructure needs, starting with the most important for greater efficiency and effectiveness
  13. Set a strategic direction for your business and work to a detailed strategic plan
  14. Consolidate debt, tighten credit control processes and seek professional guidance about profitability and pricing.

The responsibility for minimising or preventing mistakes in any business is that of the business leader who must accept that responsibility and take action. The very survival of your business is at stake.

Written by David Sharrock.

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David Sharrock
David Sharrock is the Managing Principal of Sharrock Pitman Legal, a Melbourne based, boutique commercial law practice. He is an accredited Business Law Specialist, an accredited Mediator, public speaker, and author of a new business work book titled Fighting for Enterprise Success: through the eye of the tiger. David is an opinion columnist for the CEOWORLD magazine.