Key Defects in Your Business (Oversights) Part 3 / by Kerri
The problems, excuses and barriers to achieving big hairy audacious goals boil down to three underlying defects. These three primary reasons are broad umbrellas covering dozens of other reasons.
- No strategic focus
- Risk averse
We complete the set here with the third reason.
Everyone who starts a business, launches a product, or opens a storefront takes a risk. It’s an inherent part of business that we take risks. So owners convince themselves that because they take the risk of being in business that they are risk-takers. That conclusion prevents consideration and recognition of all the myriad of fears, challenges, responsibilities and opportunities that they face and never resolve. Risk aversion can take many forms that are deeply rooted in our core values and our life experiences to date. For example:
- Afraid of failure. Fear of failure haunts many owners whose businesses – from the outside – appear to be thriving. Some fear of failure can be good – if it drives you to deliver, get resourceful and hit your numbers. But when fear of failure is a symptom of being afraid to take risks, that’s when fear of failure turns into a self-fulfilling prophesy. When owners don’t even recognize it, they make decisions based on the wrong reasons (e.g., what we did last year) and the wrong inputs (e.g., outdated research), because they’re still asking the safe wrong questions to justify their cautious decisions. (e.g., How can we get our clients to buy more replacements? vs. What can we do to provide a 100% solution for the client?)
- Afraid of the embarrassment of failure. When owners announce and broadcast their launch, their goal or their ambition for their business, their excitement and drive can boost the business to their first milestones. As more and more people start watching (family, friends, peers, competitors, vendors, clients, prospects, investors), pressure to deliver can get in the way of hitting the next milestones. Fear of the embarrassment of failure in the eyes of these people who trusted and respected the owners can be harder to face than an actual failure. So much so, that owners will do many things to avoid the perceived or potential shame. They’ll work harder at avoiding this embarrassment than at avoiding failure. In the extreme, they are paralyzed from setting, let alone achieving, real goals.
- Afraid of success. Yes, fear of success is a problem of being risk averse too. This too is a mindset issue to break through. But if it’s a blind spot owners continue to overlook, it’s a symptom of being afraid to take the risks that could result in really big successes. It’s also a symptom of self-sabotage. Fear of success, like fear of failure, can be a result of being risk averse.
- Afraid of wealth. Surprisingly, many people create amazing businesses of great value to their clients, with no intention or conscious effort to make money. They don’t want to be burdened by the responsibilities of wealth – in the business, in the community or maybe in their family. They just want to do their thing so they find ways to avoid structuring the business as a business or grow the business to its full potential, thus bypassing the opportunity for wealth.
- Afraid of trying for big goals. This can be tied to fear of failure, fear of success, or fear of the unknown. It may be tied to past experiences of success, or striving for big goals. But if the owner settles for small goals to avoid the risk of not achieving big goals, they are shortchanging the whole business.
- Fixated on and paralyzed by money or lack of cash flow. Money is a tool and a measure in business. It’s a medium of exchange that’s widely accepted and understood. But many owners are consumed by the cash flow statement and don’t share concerns or tradeoffs to be made with the team. That type of extreme control and privacy can restrict choices and hinder growth. To grow a business or to achieve goals, owners have to be willing to take reasonable risks and trust the team they’ve built to support goals and growth.
- Refuse to ask for help or listen to advice from an expert advisor or a board of directors.Too many entrepreneurs define themselves as the business and if they ask for help, then they must be a failure for “not knowing it all’ already! Stubborn, willful controlling owners can’t hear that people around them sincerely want to help, and want them to succeed. Truly the adage applies to business owners as well: “When the student is ready, the teacher appears.”
- Refuse to be accountable. Many people start a business with the mistaken idea they won’t have a boss any more to tell them what to do, how to do it or when. owners who rebel against the discipline of accountability can’t build a business of any size or success. In business, to thrive and prosper, you must recognize and accept that you are always accountable to your customers. And if you want the business to produce financial independence, you must keep your financial records in a very systematic, organized way, following all the reporting rules. Rebelling against accountability is playing at business, which is another way of murdering your business.
- Avoid making decisions. Owners who avoid making decisions, defer decisions, or allow the group to always take a consensus, are risking the direction and drive to achieve their goals. In their attempt to avoid confrontation, avoid risks, and minimize personal risks, they are putting the business at greater risk.
- Afraid to take initiatives, or try a different approach. There’s a difference between leadership and management. A good manager does not always make a great leader. The organization needs both. Great leaders must be willing to take chances in propelling the business ahead of the competition, to take the steps that lead to fulfilling their vision – even if it’s a risk. An owners who is resistant to change, or avoids trying something new, is setting up the business to be bought out.
- Don’t know what they don’t know and are afraid to ask/find out what they’re missing. The best owners and entrepreneurs are perpetual students. Owners who deny their blind spots and don’t reach up and ask for help are not being responsible to their business. They can’t see that this face-saving mindset is crippling their businesses for no good reason. What they don’t realize is that contrary to their risk-averse beliefs, they will actually elevate themselves in the eyes of all their stakeholders when they ask for help and learn from experts to fill in the gaps.
- Get paralyzed by guilt and embarrassment over their indecision, or not taking action. This is another one of those circuitous arguments. Being risk averse, often owners are indecisive, doubtful and reluctant to take action. This paralysis creates guilt, awkwardness and shame, which perpetuates inaction. It’s all because they don’t recognize their deep aversion to risk.
- Don’t know what they don’t know and deny it. Insisting on keeping blinders on and overlooking what they don’t know handicaps the whole business. When you do this out of ignorance the first time, you learn and grow and the business benefits. When you dig in your heels and deny it, you are increasing the risk of murdering your business.
“You’ve got to jump off cliffs all the time
and build your wings on the way down.”
— Ray Bradbury: American author
So if it is important for owners to have an entrepreneurial mindset, building their business and their team around their strengths.