The world of business is one that can be very rewarding to some but not so much to others. Of course, there are numerous factors that determine which end of the spectrum a business ends up; however, a level of carefulness is required when making business decisions. This is especially true when said decisions can have large implications whether they are positive of not.
There have been and continue to be promising business that find themselves in precarious positions or find themselves having to close their doors due to their making of ill-advised decisions. Do yourself and your business a favor by learning from the mistakes of those in the past and not making any of these downright horrible mistakes in business.
Turning a Blind Eye to Staff Concerns
This is a mistake that has resulted in several companies losing some of the best talent they had. While it is true that you need to plan for business continuity and that you cannot allow any one staff member to hold your business at ransom, you need to know when to strike a balance. It is understood that you can’t allow an employee to dictate how your business is run, however, you also need to maintain a workforce of the best talent you can get your hands on.
Once concerns are being voiced and they are objectively reasonable, do everyone (including the business) a favor and try to have them addressed in the best way possible. In fact, it’s a good idea to keep staff members in the loop as the change progresses.
Ignoring Paradigm Shifts
This is not to be confused with simply ignoring actions taken by competitors in your industry. A paradigm shift exists when the way the industry works is changed and, therefore, requires adjustments on the part of the businesses with it so they become aligned with the new way of functioning.
A good example of this is what used to be the media rental industry. Blockbuster was once at the pinnacle of success with their rental system. Netflix had a similar business model but began to change it to support digital media streaming. Blockbuster’s refusal to do the same even though the writing was on the wall is the reason it no longer exists.
Managing Risk Poorly
The risk to reward ratio has existed at the center of business decisions for ages. One of the mistakes many firms make is the skipping of proper risk assessment. Some medium to large business firms dedicate resources to this function as they have dedicated risk departments.
The key thing to remember about taking a risk is that the outcome is not linear nor is it predictable. This means you need to prepare well for the worst. If your business takes five high risk decisions, decision makers need to accept and prepare for the possibility of all five decisions going horrendously.
The problem comes into play when this preparation is not done, and risks are not properly assessed. Finding out your firm cannot handle a negative outcome of a risk after said outcome has occurred is usually an indication that something has gone horribly wrong.
Being Unresponsive to Customer Issues
This is perhaps the easiest way to shoot your business in the foot. While staff members are responsible for keeping the internal wheels turning, customers provide the monetary medium that allows your entire operation to exist. Even big companies are not exempt from level of damage high levels of customer frustration can cause.
While you don’t necessarily need to operate as if the customer is always right, it is imperative that you listen to and address negative concerns as well.