Over the years, I have done a lot of work with entrepreneurs. As a six-time entrepreneur, I have had lots of direct experience with setting up and building a business. I do not claim to have a corner on wisdom when it comes to getting a business off the ground and shepherding it through those very tough initial years but I have been able to help others navigate the shallows better then I did. There is no substitute for an experienced guide and there is real value in seeking one out before you set foot on the entrepreneurial path.
Every entrepreneur, when first starting out, will inevitably make a myriad of mistakes. Some are simple mistakes, whilst others may be detrimental to the success of their business. In order to avoid making such mistakes, it is highly advisable for every entrepreneur to enlist the aid of a Business Coach. The five most common mistakes are really five reasons why entrepreneurs need executive coaching services.
1. Having Only One Major Customer – Complacency: If more than 50% of your revenues comes from any one major customer, your business may be lead to financial failure. It may be easier and more profitable to deal with a smaller number of big customers but your business is vulnerable when only one of your customers contributes most of your cash flow. Ignoring business development brings real risk to the long-term viability of any business. Because you will become so busy with that one major account, you may fail to develop additional customers and revenue streams. However, when that one major customer leaves, your business will be on the verge of collapsing. A qualified Business Coach will teach you how to use that expanding account to benefit your business and to be on the look out for new customers.
2. Failing to Conduct Adequate Market Research: Many entrepreneurs are so enthusiastic about their product or service that they fail to conduct adequate market research. A Business Coach will teach you the importance of testing out your idea by talking to potential customers to find out first if anyone wants to buy it – and what your competition really is. If you receive enough positive responses, a Business Coach will show you to develop and turn the market research it into a profitable business plan.
3. Creating Equal Partnerships: In order to have a successful business, every entrepreneur needs to make sure that they have the correct support structure in place by building an effective and appropriately compensated team. In some cases, entrepreneurs start up their new business with a friend or partner. Sometimes they split the business 50/50. Although that might seem fair at the beginning, a Business Coach will advise you against it. Through the course of your business, both your personal and professional interests will diverge and this may create a hostile working environment since both party’s veto power can stall the growth and development of the business, and neither will ever hold enough votes to change the situation. I once had to undo an equity distribution among four people who happened to present when the company was launched. Two of them had no further involvement and a third was part time – and disruptive. The experience taught the entrepreneur a lesson. It is highly advisable to hire on a permanent Business Coach to act as an outside advisor and tie breaker by allotting them at least a one percent share.
4. Poor Focus: A common mistake of most entrepreneurs is that they attempt pursue every interesting opportunity that comes their way. They falsely believe that more is better and seize every prospect, instead of focusing on their core product and service. Any good Business Coach will show you that concentrating and focusing your efforts on your niche market is a surefire way to increase your profits. A Business Coach will help you in determining which ideas would work best for your business and will not allow you to spread yourself too thin.
5. Not Admitting Mistakes: As soon as a mistake has been made, it is vital that you admit it immediately and redress the situation. If not, that mistake will start to increase and may cause your business to fail. A Business Coach will usually be able to point out a mistake before you have even contemplated it and will stop you from throwing good money after bad.
Working with entrepreneurs is a real challenge – and, more than occasionally, the source of real accomplishment. The entrepreneur is most often the reason a business succeeds – and the reason that it fails. A Business Coach can move the odds in favor of success.
© Dr. Earl R. Smith II