Classic Business Errors – the Race to the Back of the Pack
One of my favorite slides in presentations that I make is entitled “Classic Errors.” With hundreds of clients and years of experience as an entrepreneur, I have discovered that many business owners are interested in learning what “not to do” as much as they are in ascertaining “what to do.” Since I am a huge fan of the Indianapolis 500 mile race, I like to use the analogy that all the participants in this great race perform at a very high level. The cars are incredibly fast and the drivers are superior in talent – but only one can win the race. So what sets up a team to win the World’s Greatest Race? The short answer is error elimination. The teams that make the fewest errors are the ones in position to win the race. They lead the pack. The same goes for businesses. There are a cluster of solid competitors, so how does one separate themselves from the field? The following is a list of eight classic business errors:
“Shotgun Marketing” occurs when a business really has no idea of who they are targeting when they spend their advertising budget. They just pick up a tool and use it hoping they hit a potential customer. Usually they miss because they don’t know who they are targeting and the effort is a failure.
“No Marketing” happens after a series of volleys of shotgun marketing occurs. The owner realizes he has wasted his money and just stops marketing, thus handicapping the future of his business.
“Cheap Pricing” happens because an entrepreneur knows that their customers like good deals and this will bring them in. The error in this case is the fact these entrepreneurs often don’t know their costs and so there are no profits forthcoming from the discounted sales.
“Stuck in a Rut Syndrome” is observed primarily in established businesses that get comfortable running their business the same way over a long period of time. Eventually their sales decline because their customers and the marketplace have changed while the business has not. Meanwhile the competition has adjusted and is attractive to the consumers in the marketplace.
“Multiple Owners” often translate into “Multiple Decision Makers” which leads to “Poor Decision Making.” Partnerships without defined roles and salary parameters are on a path to failure. This I have witnessed many times. Suffice it to say that there can be only One CEO and this One must be foremost capable of leading the business. These roles must be agreed to in advance and their authority must be recognized by the other partners.
“No Web Presence” is an error that amazes me, yet we learn that a huge number of businesses do nothing to participate in one of the most exciting, cutting edge, and affordable marketing opportunities ever known in the business world. There are hordes of prospective customers searching on the web for solutions to their problems and yet these businesses choose not to engage them.
“It’s MY Business” owners sometimes berate, scold, and / or expose their customers to negative connotations about their business. They may also overlook that their customers are looking for an experience that the entrepreneur should provide – but doesn’t.
“No Money” is why businesses close. Usually it is a result of poor planning, budgeting and funding and shows its head when it’s already an established virus running rampant through the business. This is often the summary result of the other named errors listed above.
These classic errors are a sure way to put a business into the back of the pack and they may even cause it to crash and burn!