3 Wrong Ways to Keep Your Business on Top
A prerequisite for any business founder or other leader is a strong drive to stay ahead of the competition. You must have a competitive spirit if you want to get ahead, a mentality that losing is not an option. We strongly support these positive leadership qualities. Problems arise when a company reaches a certain level of success and begins to deviate from the strategies and values that got them to where they are.
A business can lose its way and use precious resources and time engaging in the exciting and dangerous game of contemplating going in different directions. This is demonstrated by companies every year. Just look at the businesses you are surprised to see going out of business after having started strongly. This happens over and over again. Only ten percent of businesses make it ten years according to the Department of Commerce. And, only one percent of businesses make it twenty years. Since the majority of businesses in the United States are privately held, this statistic is humbling.
We have analyzed what brings down companies of every size. Below are the most common mistakes we have seen.
Making Overambitious Time Estimates
When establishing a timetable for bringing a new product to market, businesses may use faulty metrics based on having earned higher than average profit margins and having strong showings in niche markets. They figure they were able to move so quickly in one market, so it should be just as easy in a new market.
Many parts of a business must be expanded in order to gain an upward curve in a specific market. This could include sales, production, marketing, operations, and more. If an appropriate timetable is not funded and established, you will likely experience frustrating results as you try to step up all of these areas at the same speed of the established company.
Inappropriate Market Testing
Many businesses employ a full steam ahead methodology when they are bolstered by their current success. They do this rather than experimenting cautiously with variations on selective strategies in tiny markets. Speed can be a good thing, but take the appropriate steps first. The core strategy for successful businesses must be written down, then put to the test and refined, and only once the strategy has been proven will they give it the green light. B2Bs can learn from their consumer corporation brethren and test in micro markets.
Making Assumptions about the Market
You need to know the consumers in your market, what makes them tick, and everything else about your market. This entails actively researching your market and gathering customer information every day. It is only a matter of time before your competition mounts a challenge on your spot atop your industry. You should not bank on the assumption that your positional strength will continue to carry you forever.
Rather than coming up with new strategies, work on improving your current strategy. This can be the difference between becoming a statistic and setting trends.