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Avoid The Critical Failings/Mistakes That Entrepreneurs And Quite A Few Senior Managers Make – Key Insights

A college degree in entrepreneurship and even work experience does not prepare an entrepreneur for the complete reality of starting a company and all the knowledge that is needed to make it successful. And it is impossible to be the best at everything you try to do. Even if you have started your own business, you will find that you have some weaknesses. But you shouldn’t follow the example that some entrepreneurs make, as well as senior managers, which is to ignore their weaknesses. You cannot wish a weakness to go away over time nor can you ignore it

If you just ignore key weaknesses, things will never get better, and you won’t improve as an individual and worse, you may actually cause your startup company to fail. The key is to be aware of your weaknesses and put a plan into action to at least neutralize them.  Read on below and assess which of the following you need to improve.

Know the Numbers. Not every entrepreneur can read a balance sheet.  And even if you do have a co-founder or key employee who handles the money side of your business, you should have a clear understanding of the financial aspects of the business.  Don’t ignore it because you just don’t have an aptitude for accounting.  It’s critical that you know what’s going on. Reach out into your network and sit down with a professional accountant who can explain the financial aspects of your business to you. At a minimum, hire a part-time finance MBA from the local university to give you a tutorial.

Managing People. Most people are not born to be a manager of people. It’s a learning and experience-based process that progresses over time. So, don’t expect to know it all just because you start a company. Get comfortable with your communication skills as this will be critical. Look for an advisor who can counsel you on your management skills and give you advice for tough decisions. Above all, know what your strengths and weaknesses are when it comes to managing people and create a plan to minimize weaknesses and grow strengths.

Train and Delegate. As a founder, you cannot grow a company and be involved in every little decision. How do you know if you are a micromanager?   One, you have a hard time delegating work. Two, once that work has been delegated, you still look for ways to get involved in making the decisions. Three, you might try and prevent other employees from making important decisions regardless of their knowledge and experience. The key to being a better manager is self-awareness. Trust the people you have hired and let them earn your trust.

Sales at all Costs. When you first start the company, you are hungry for sales as cash is the lifeblood of the business. However, not all sales are good sales. You need to understand your gross margin and even your cash flow on every sale. A large sale may be no good if it requires lots of resources up front and the client has indicated they pay in 60-90 days. You should also evaluate each potential sale in a way that progresses the company forward. Consider ditching or pivoting products and services that are not selling. Above all, constantly talk to customers and get important feedback on why they are buying from you and why not.

Good Listener. Quite a few entrepreneurs are potential overachievers. They can also have strong points of view. This might be great when you are starting the company and trying to get investor dollars or recruiting a valuable employee. However, this is not how you build a company. You need to have solid communications with a large variety of people including clients, investors, vendors and employees. Your strong point of view might not be so helpful here as you need input and advice. So, one of the most critical skills you need to develop over your entire career is the ability to listen. Sounds simple but it’s hard.

Patience and Decision Making. As you start your company, it seems like you are making 1,000 little decisions every day. So, you get used to the notion of making rapid decisions without too much thought or analysis. This might work in the early days as you are getting the company off the ground. But once you have 50 employees and a $5 million business, you need to develop a better decision-making process that may involve more people and take a little more due diligence. Because rash decisions you make now could really hurt the company strategically. The little decisions you made in the early days might not have crippled the company but a poorly thought-out strategic decision now could actually ruin the company.

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