The reason(s) why you are failing in business.

A painful conversation with Steve

I had a conversation with my client named Steve. Steve was feeling frustrated with his lack of growth and decided to seek my help after seeing a junior business associate become more successful than him in a shorter time span. 

“Denise, Adam has only been working at it for two years and is killing it! Meanwhile I have been in business for over 10 years and I struggle every month the pay the bills. Adam told me that he needs to move into a larger space to accommodate all his new clients. What is wrong with me or my business?” 

Steve was not speaking from a viewpoint of jealousy but rather confusion. What was Adam doing differently than Steve? They both worked in the same industry and offered the same services. In addition, their clientele were similar and there was enough business to go around. We cannot speculate Adam’s success, but we can discuss the reasons why Steve was not successful as he could be. 

Why are you failing in business? Let me count the ways.

There are many reasons why a business may fail to grow. A business with a great plan, sufficient seed capital and experienced leaders are not guarantees for success. A business owner must examine all potential pitfalls. Below are some of the most common reasons why businesses fail to expand and grow:

  • Not hiring junior level employees to take over your work
  • Complicated systems and procedures
  • Disinterested in the needs of the customer
  • Failure to network with other businesses
  • No internet presence
  • Failure to offer value for services
  • Heavy reliance on existing clients to support the business.
  • Enjoy the comfort of dysfunction

Not hiring junior level employees to take over your work 

Unless your business requires multiple employees to function, most entrepreneurs start off working alone. There is nothing wrong with this in the beginning of the business journey. Accountants, artists, carpenters, and event planners do need nor require an army of extra hands in order to get work done. If they need extra help, then they can hire a virtual assistant for part time work. 

Ceiling fans and low level work

While the self employee may have systems and procedures to do the work, they fail to transfer the work onto others. This reason is not due to low funds but rather due to their lack of trust of others. These entrepreneurs fear that their staff are unable to replicate their level of quality. And this is a fact. For example, a master electrical engineer who has been working at his craft for 20 years has a superior skill set compared to a recent graduate. There is no competition or comparison. 

Here is some food for thought. If you are a master electrician, do you want to only take simple tasks. Why not hire someone to change the ceiling fans while you wire a new building? Which is the best use of your time and talent? Your electrical company will still get offers for a mix of simple and complicated jobs. Young staff need experience and you have available work they can do for you. It is a win-win because the client pays less for the job and you get paid because the younger staff work for you.

Systematize your training procedures

Procedures are written instructions on how the work is to be done properly. Business owners need procedures so they can transition their work onto others. You may balk and say that procedural training seems ineffective. You may say, “I spent months and months of time training people and overseeing their work, but they still screw up the work.” I may ask you these questions:

  1. Do you hire staff with a qualified skill set? For example, I am a lawyer in a law firm. I would not hire a paralegal who flunked out from paralegal school. It does not matter if she is enthusiastic and positive, she is not a qualified candidate. Do not hire cheap. Hire quality. 
  2. Do you have a peer reviewed training procedures? It may make sense to you but not necessarily others.
  3. If you have procedures, do you have benchmarks to make sure they have satisfied a certain level of quality? 
  4. Does that system of procedures include a list of knowledge, skills and abilities that an employee must master by a certain time frame?
  5. Did you allocate a certain time frame to train and coach each employee? 
  6. Do you have a signed training agreement? If so, how often did you review the agreement with the employee?

These are just some of the questions I may ask you regarding your prior procedural training and on-boarding process. 

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Complicated systems and procedures

Some entrepreneurs have the opposite problem regarding procedures and systems. They have too many procedures. Their procedures rival anything I had seen when I worked for the federal government. You may have inherited the system from the prior owner or created it through the course of time. Either way, you have a stack of rules and procedures that few people understand neither the purpose nor the necessity. 

I just want a toasted bagel and coffee, please. 

I once lived nearby a local coffee shop. It was a small mom and pop operation. The products were not fantastic but it was close and convenient. I usually asked for a buttered and lightly toasted cinnamon raisin bagel and medium black coffee. This is not a strange request. They were products offered on their menu. But every time I ordered it, it felt like it would be easier to extract teeth. 

The first problem was the double confirmation process. I as well as another person needed to repeat out-loud the exact order. Their point of sale system did not have a screen to show the contents of my order. I did not mind because my order was simple, but I wondered how they handled long or complicated orders. I also wondered how they dealt with customers with thick accents or limited understanding of English. 

After the order was made, the cashier performed a double confirmation with the line cook. Often times there was something off with my order, either the bagel was toasted too deeply or in some cases, the bagel had jelly on it rather than butter. Once my coffee had cream and sugar, even though I wanted a simple black coffee. Their order creation system was a failure on multiple levels. Remarkably, their coffee shop is still running. 

The coffee shop was an example of a business with a poor procedural system. Feedback from customers and workers would have helped this business tremendously. A business owner needs to communicate with others to make sure their system works. Adding more levels of complexity does not help things. Often times excessive procedures in a system hurts rather than helps an organization. It does not matter how long or short your procedures are. What matters is that your procedure are easy to understand, implement and monitor. 

Disinterested in the needs of the customer

Feeling the blues because of the lack of blue hair. 

When I was 27 years old, I really wanted to dye my hair dark blue. I specifically wanted midnight blue hair. I asked my then hairdresser if she could accommodate my request. She refused. “You have a professional job, and no one works in an office with blue hair.” It was not too long after that I stopped seeing her. Even though she did an excellent job in cutting, treating and styling my hair, I felt she did not listen to me. Her vision for my hair was not in alignment with mine. A few years I saw a “For Sale” sign on the front of her store. Perhaps other ladies felt the same way. 

If a customer wants a task done and understands the risks and complications and you are capable of satisfying the request, just do it. It does not matter how silly and stupid it may seem to you. If someone is willing to pay for your work and you have the supplies, do not refuse the request. You may be overlooking untapped business opportunity. If my old hairdresser dyed my hair blue and I liked it, I probably would have told other potential clients of her work. She missed an opportunity to reach new clients. Let a lady be happy with her colorful hair.  

Failure to network with other businesses

Have you heard of BNI? They are the world’s largest networking and referral organization. They have over 240,000 members across 8,500+ chapters. Each BNI chapter has a member from a unique industry. Members meet weekly to learn about each other’s business, improve their communication and presentation skills and connect with others in the local business community. 

There are others ways to connect with nearby business owners if you do not want to join BNI. Consider rotary clubs, country clubs as well as your local chamber of commerce. You can also connect with other business owners online. Social networking sites such as LinkedIN and Alignable  are devoted to help professionals connect with others. You can disable the email notifications if you feel that you are receiving too many messages. 

Networking is not necessarily about gaining new clients, although new clients are nice, networking with others will help you to improve on your shortcomings and weaknesses. For example, a business associate once told me that I needed to monitor my facial expressions in public. It was all too obvious when I did not like what someone said. I’m still working on that one.

No internet presence

While you are online, why not have an online website? I am not talking about free websites from Google or Weebly. I have a free Google website, but it looks like a ghost town. I populated it with basic information solely to maximize my Search Engine Optimization (SEO). A business owner needs to have their own website where they have complete control of their content. 

Use your website to list your services, FAQ, blog, and everything else that a client or customer will need to make an informed decision on your company. For example, you want to go out to eat in a restaurant. Do you just hop in your car and drive around aimlessly looking for a restaurant with their lights on? Like most people, they search online and review the menu items as well as most recent reviews before they make a decision. Make it easy for prospective clients to learn more about you. 

Failure to offer value for services

While you are busy writing about your services, perhaps it is a good idea to survey your customers (or potential customers) to make sure you are offering products and services of value. There are many ways to receive customer feedback. Perhaps you can create a survey or poll on which services they like the most or least. You will never know if you are providing value unless you ask. 

Heavy reliance on existing clients to support the business

Bob cannot come here anymore

In addition to helping owners succeed, I also provide medical exercise training. After more than three years, Bob, one of my best clients chose to terminate working with me. His wife did not care to have a female trainer and preferred that Bob exercise with her. 

This was a blow to me on many levels, I genuinely liked Bob, but also, he provided me a significant source of revenue. It is very tempting to get hooked on one or two great paying clients. They keep the lights turned on so you work hard to keep them happy. But excessive focus on a few token clients comes at the expense of acquiring new business. While long term clients are great, a business constantly needs to accommodate new customers. 

Enjoy the comfort of dysfunction 

I just don’t know any other way to act

While you may recognize one or more problematic issues, you may not want to solve them. Sometimes we get comfortable with dysfunction because it is the only way we know how to work. Dysfunction never works long term, in your personal or professional life. You need to recognize if you or your employees are toxic and fix any problems. Your problems will not resolve themselves. Get the help now so that you can be able to see your business succeed and thrive. 

Did you ever find yourself in a business rut? What did you do to improve your situation? I would love to read it! Please write it in the comment section below. 

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