How to avoid your first and possibly biggest business mistake
If you aim to start a business based solely on your prior job skills or qualifications you may be making your first and possibly biggest, business mistake.
Many new business owners are shocked to find that performing the role they are used to from their employment is only one part of their to do list. As a result, many have become disillusioned at spending less time doing what they are good at and more time dealing with things they don’t like.
Misunderstanding what business ownership entails can lead to unhappiness, feeling trapped, reduced motivation and, eventually, business failure.
Don’t let this be you!
Two assumptions can lead you to make a business mistake before you even start.
Some new business owners make a big mistake based upon two faulty assumptions:
1. because you are good at your current job, you will be successful as the business owner doing the same thing.
For example, because you are the best Chef does not mean you will be a successful Restaurant owner.
2. because you enjoy your current job, you will enjoy owning a business in the same sector or industry.
If you enjoy being a mechanic and fixing cars that does not mean that you will enjoy owning a mechanic shop.
Sadly, while your job skills or qualifications are important they are only part of the business success equation.
Your skills and qualifications may predispose you to successfully conduct the operations part of the business or do the “core work”. However, a common business mistake is to believe that being good at your core skill alone will bring business success. It does not!
The reality is that you must allocate time and effort to a host of critical activities to grow your business, not just what you are good at.
Being a successful business owner requires you to acquire additional knowledge and skills and regularly step outside your comfort zone.
Critical business functions explained: avoid a business mistake
While operations are an important part of any business, there are also a series of critical business functions that must get done. They must be done to a high standard and in harmony (working together) for any business to thrive.
Ignoring any of these functions will cause problems sooner or later. Some of which can be catastrophic. For example, avoiding the sometimes onerous task of collecting payments from customers could cause a cash crisis and eventually insolvency.
Another example might be not spending enough time on marketing and sales. The result is that your sales pipeline might run dry.
In it, we highlight some of the critical functions that are typical in many businesses.
- Business Strategy & Model
- Products & Services
- System & Processes
- Human Resources
- Risk Management
Do startups, micro-businesses and small businesses have critical business functions?
Yes! Even running a micro-business requires critical activities. Sole operators or micro-business owners try to squeeze all of them into the weekly routine. This classic business mistake can lead to the business owner working excessive hours and feeling overwhelmed.
Have a read of this article about your business knowledge, skills, and any gaps you may have.
As a business grows, it can rapidly become impossible for one person to cover all the business functions and critical things begin to suffer. In this situation, outsourcing becomes the owners best friend!
So, there you have it. Your biggest potential business mistake is failing to recognise that these critical business functions need doing. And, they need to be done to a high standard if the business is to succeed.
You need to plan and decide who will do them, whether you, a business partner, an employee, a freelancer, or a subcontractor.
No-one is an expert in everything and so the trick is in working out which tasks you can handle and which ones someone else needs to do. It’s easy to become overwhelmed. So be realistic about the amount of time you have available.
If your core business operation relies solely on you, then how will you fit everything in?
Think like a business owner to avoid your first business mistake.
Adopting a business owner mindset is an important way to avoid this potentially crippling business mistake. After all, starting your business with your eyes open is much better than doing so blind.
By adopting the correct mindset from the beginning and preparing yourself for running a business, some positive things will happen. One of them is you will be more likely to properly allocate your time to critical things that will enable your business to thrive.
An entrepreneur’s mindset is about embracing the idea of working on things outside of your comfort zone, whether they be dealing with difficult customers or being responsible for selling or making uncomfortable decisions.
In summary, simply providing a great product or service does not guarantee you will have a successful business. In 2021, Customers expect a great product or service. If you don’t provide that as a minimum they will simply go elsewhere.
Growing a new business relies on you identifying the problem you are solving and providing a great solution. From there you must actively manage and steer the business to success.
Some other mistakes that you can avoid as a new business owner.
If you are considering having a business partner then listen to this episode first about choosing the right business partner.
Another aspect that new entrepreneurs often overlook is the impact of their business on their family and friends.
Try our Entrepreneur Personality Quiz to get some more insight into preparing for business ownership.
Before owning a business and the things you need to know has more content written by business owners for business owner!