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20 Common Entrepreneurial Mistakes To Avoid

20 Common Entrepreneurial Mistakes To Avoid

Building a business from scratch is definitely not an easy task. As an entrepreneur, you will make a lot of mistakes and face failures along the way — not a big deal as long as you are ready to learn from your mistakes and try to avoid them in the future. That’s how most entrepreneurs learn and grow. But once you are in the business game, you can’t afford to make blunders constantly. You have to play real smart to win a competitive edge over others and for that you must be aware of some fatal entrepreneurial mistakes that can ruin your business!

1. Trying To Be A Know-It-All

Never play a know-it-all, especially if you have just stepped into the business world. Why? Simply because you are not! Running a business is all about learning and gaining knowledge. It’s really not possible to keep up with the dynamically evolving market, if you don’t try to learn. So whether you have experience of doing business or you are a startup, make the most of every opportunity that helps you broaden your vision.

2. Starting The Business Without Infrastructure

It’s true that now you can start your own business without any setup — but definitely not without an infrastructure. Planning is probably the most important aspect that lays a strong foundation for your business to grow — and if you are not focusing on the infrastructure if your business, you are making a terrible mistake!

3. Choosing The Wrong Partner

First of all you don’t necessarily need a co-founder, if you are starting your business on a small scale. With strategic planning and organization, you can handle your business yourself too. But if you think that its too big of a responsibility for you to handle alone and you need a business partner, then be really careful in picking the co-founder. Make sure that the co-founder is mentally compatible with you — you need someone intelligent to make important decisions, so choose someone who can compliment your entrepreneurial skills and support your ideas.

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4. Focusing On Growth Only

Your business can’t grow, if your strategies are not dynamic. As an entrepreneur, you have to think in multiple directions while making decisions. If you are focusing on business growth only, and not on the quality of services, it will impact your business eventually. Achieving a balance between growth and quality is the key to success in business.

5. Expecting Customers To Spot You

Do you really expect customers to find and follow you when the market is already buzzing with so many entrepreneurs offering promising services? Definitely not! If you want your customer base to expand, you will have to be where your customers are.

6. Underestimating The Importance Of Technology

Regardless of the nature of your business, you must be technology savvy if you want to be a successful entrepreneur. That’s because today technology is everywhere, and you can’t keep up with the competition if you don’t make the most of technology.

7. Obsessing Over Competition

Acquiring success as an entrepreneur is not just about worrying about the stiff competition in the market. Of course it matters, but you have to focus in other important aspects too, like self-evaluation and understanding the mindset of customers. As Mark Cuban once said, “Focus on building the best possible business. If you are great, people will notice and opportunities will appear.”

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8. Financial Mismanagement

If you are not managing your finances, your business can crash down like a house of cards. You have to spend really wisely — hiring a financial advisor can be really helpful in avoiding financial blunders.

9. Expanding Without Planning

Expanding the business without any planning is another common mistake entrepreneurs often make. The “Jack of all, Master of none” policy never works in business. Expand your business only when you are financially stable and have a strategic plan.

10. Not Hiring Competent Employees

Your success heavily depends on the competence of your employees. So put in your best efforts to pick the best fit for your business.

11. Ignoring Customer’s Response

One way to evaluate your business is asking customers to give feedback. Often entrepreneurs don’t understand the impotence of customer’s response, but it can really help you spot your weaknesses and understand what customers expect from you.

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12. Missing Viable Investment Opportunities

Entrepreneurs who wait for the “right time” to invest don’t stay long in the business game. Opportunities will not knock on your door — you will have to spot them and make the most of all viable opportunities.

13. Denying Professional Help

If you need help, admit it! Learning is an ongoing process and there is nothing bad in seeking professional help. Entrepreneurs,who deny help and try to resolve issues on their own end up making blunders.

14. Not Keeping Up With Market Trends

You don’t want to be left out, do you? The marketing is changing dynamically and you can only keep up with if you stay updated about current trends. Elon Musk offers this great advice: “Constantly think about how you could be doing things better and keep questioning yourself.”

15. Investing Too Much On Workplace Setup

Invest wisely: wasting your capital on workplace setup when you don’t even need it, can affect your bottom line negatively.

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16. Not Spotting Target Audience

You must know your target audience to reach them. You can’t communicate and form a bond with your customers unless you understand their mindset and for that you need to know who your target audience is.

17. Poor Marketing

Your marketing strategy should not be for a specific group of customers. Successful entrepreneurs focus on dynamic marketing strategies that address all types of customers.

18. Choosing The Wrong Platform

Choose the platform that’s most engaging when launching your products. For example, you can choose social media to market your products because almost everybody is active in social media these days.

19. Being Too Mainstream 

Be innovative! Implementing the same ideas that everyone else is using will not help you stand out of crowd.

20. Not Working On Entrepreneur Skills

Last but not least, keep striving for improvement. Never be satisfied with what you are today — you always have some room for improvement. Successful entrepreneurs observe their flaws and work on them. Your failures can lead you to the success you have always dreamt of, if you take them as lessons and now that you are familiar with common mistakes that entrepreneurs often overlook, try to avoid them!

Featured photo credit: RYAN MCGUIRE via gratisography.com

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Published on March 20, 2019

How to Write a Powerful Mission Statement for Your Business

How to Write a Powerful Mission Statement for Your Business

Have you ever felt lost in the minutia of your job?

As a business owner, I can relate to getting bogged down in the day to day operations of my business. Things like inventory, payroll, scheduling, purchasing and employee management take up the bulk of my day.

While these things are important and need to get done, focusing too much on the details can make you lose sight of the big picture. This is why having a good mission statement comes in handy.

What is a Mission Statement?

Put simply, a mission statement is an internal document that provides a clear purpose for the organization. It provides a common reference point for everyone in the organization to start from.

In other words, after reading your company’s mission statement, managers and employees should be able to answer the question “What are company’s main objectives?” For example, Southwest Airlines mission statement reads:[1]

“Southwest Airlines is dedication to the highest quality of Customer Service delivered with a sense of warmth, friendliness, individual pride, and Company Spirit. We are committed to provide our Employees a stable work environment with equal opportunity for learning and personal growth.”

In this single statement, Southwest conveys the company’s goals of providing the highest level of customer service as well as providing a good working environment for their employees.

Mission Statement VS. Vision Statement

While the mission and vision statements are related, there are subtle but distinct differences the you should be aware of.

First of all, a mission statement is designed primarily as an internal company document. It provides clarity and direction for managers and employees.

While there’s nothing wrong with sharing your company’s mission statement with the outside world, its intended audience is within the company.

While a mission statement provides a general framework for the organization, the vision statement is usually a more inspirational statement designed to motivate employees and inspire customers. Going back to Southwest Airlines, their vision statement reads:[2]

“To become the world’s most loved, most flown, and most profitable airline.”

This statement inspires good feeling from the customer while motivating the employees to achieve that vision.

What Does a Good Mission Statement Look Like?

When coming up with a mission statement, it’s important to take your time and do it right. Too often, people (especially entrepreneurs) just write down the first thing that comes to mind and they end up with worthless or (worse yet) a generic mission statement that is utterly useless.

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Remember, a mission statement should provide a common framework for everyone in your organization.

When writing a mission statement, you should always try to incorporate the following;

  • What we do?
  • How we do it?
  • Whom do we do it for?
  • What value are we bringing?

Now, you can see how tempting it is to just come up with something generic that ticks off those four boxes. Something like “We provide the best widgets available online for the consumer.”

After all, that did check off all the boxes:

What we do? Provide widgets.

How we do it? Online.

Who do we do it for? The consumer.

What value we bring? The best widgets.

The problem with this mission statement is that it could apply to any number of companies producing the same widget. There is nothing to distinguish your company or its widgets from any of your competitors widgets.

Compare that mission statement to this one:

“We provide the highest quality widgets directly to the consumer at an affordable price backed up with a 100% satisfaction guarantee. If our clients aren’t 100% satisfied, we’ll make it right.”

What’s the difference?

Both mission statements answer all the same questions of what, how, whom and value. But in the second statement, they are differentiating their company from all other competitors by answering the question “what makes us unique”.

Another way to read that is, “Why you should buy from us.” In this example, it’s because our widgets are of the highest quality and we stand behind them 100%.

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You might have noticed the statement didn’t say that we sell widgets at the lowest possible price. That’s because we are emphasizing quality and satisfaction over price.

A different company’s mission statement may emphasize selling widgets at the lowest possible price with little to no mention of a guarantee.

Hallmarks of a Good Mission Statement

1. Keep It Brief

Your mission statement should be no longer than three sentences. This is not your company’s magnum opus.

You should be able to distill the what, how, who and why questions into a succinct message.

2. Have a Purpose

A company’s missions statement should include the reason it even exists.

Make clear exactly what the company does with statements like “We strive to provide our customers with …….”

3. Include a “How”

Take this as an opportunity to differentiate your company from its competitors.

How do you provide a product or service that’s different or better than how your competitor provides it?

4. Talk About the Value You Bring to the Table

This is where you can really set yourself apart from the competition. This is the “why” customers should buy from you.

Do you offer the lowest prices? Fastest delivery? Exceptional customer service? Whatever it is that sets you apart and gives your particular products, services or company an advantage talk about it in the mission statement.

5. Make Sure It’s Plausible

It’s okay to shoot for the stars just to settle for the moon, but not in a mission statement.

Being overly ambitious will only set you and your employees up for failure, hurt morale and make you lose credibility. You will also scare away potential investors if they think that you are not being realistic in your mission statement.

6. Make It Unique and Distinctive

Imagine if someone who knew nothing about your business walked in and saw how it was operating, then they read your mission statement. Would they be able to recognize that mission statement was attached to that business? If not re-work it.

7. Think Long Term

A mission statement should be narrow enough so that it provides a common framework for the existing business, but open enough to allow for longer term goals. It should be able to grow as the business grows.

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8. Get Feedback

This is very important, especially from managers and employees.

Getting their input can clarify how they currently see the company and their role within the organization. It’s also a good way to get people “on-board,” as studies show that people are more likely to go along with an idea if they feel included in the decision making process beforehand.

9. Review Often and Revise as Necessary

You should review the missions statement often for two reasons.

First, as a reminder of what the essence of the company is. It’s easy to forget when you are in the day to day grind of the business.

And two, to make sure that the mission statement is still relevant. Things change, and not everything can be anticipated at the time a mission statement was written.

For example, if a mission statement was written before the advent of the internet, a company that use to sell things door to door now probably has a website that people order from. You should always update the mission statement to reflect these changes.

The Value of Mission Statements: Why Go Through All of These in the First Place?

It may seem like a lot of work just for a few sentences that describe a company, but the value of a well written mission statement should not be discounted.

First of all, if you are an entrepreneur, crystallizing the what, how, whom and value questions will keep you focused on the core business and its values.

If you are a manager or other employee, knowing the company’s basic tenants will help inform your interactions with both customers and colleagues alike.

Strategic Planning

A relevant mission statement acts as a framework for strategic planning. It provides guidance and parameters for making strategic decisions for the future of the company.

Measuring Performance

By having the company’s mission in a concrete form, it also allows for an objective measurement of how well the organization is meeting its stated goals at any one time.

Management can identify strengths and weaknesses in the organization based on the criteria set forth in the mission statement and make decisions accordingly.

Solidifying the Company’s Goals and Values for Employees

Part of a well run organization is nurturing happy and productive employees.

As humans, we all have an innate need for both purpose and to be part of something larger than ourselves. Providing employees with a clearly defined mission statement helps to define their role in the larger organization. Thus, fulfilling both of these needs.

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Now I’m not saying that a mission statement can overcome low pay and poor working conditions, but with everything else being equal, it can contribute to a happier and more productive workforce.

To Hold Management Accountable

By creating a mission statement, a company is publicly stating its highest values and goals for the world to see. By doing so, you are inviting both the public and your employees to to scrutinize how well the company lives up to its ideals.

So if you state that you only provide the highest quality products, and then offer something less, it’s fair for both the public and the employees to question, and even call for a change in management.

If management doesn’t take the mission statement seriously, no one else will either; and the legitimate authority that management rely’s on will be diminished.

To Serve as an Example

This is the opposite side of the coin from the previous statement. If the highest levels of management are seen taking the mission statement seriously and actively managing within the framework of the statement, that attitude filters down throughout the organization.

After all, a good employee knows what’s important to their boss and will take the steps necessary to curry favor with them.

Finally, use the company’s mission statement as a way to define roles within the company. You can do this by giving each division in the company a copy of the mission statement and challenge the head of each division to create a mission statement for their respective departments.

Their individual mission statements should focus on how each department fits in and ultimately contributes to the success of the company’s overall mission statement. This serves as both a clarifying and a team building exercise for all parts of the organization.

Final Thoughts

Developing a mission statement is too often just an after-thought, especially for entrepreneurs. We tend to prioritize things that we perceive will give us the biggest “bang for our buck.”

Somehow, taking the time and effort to sit down and think seriously about the what, whom, how and value of our business seems like a waste of time. After all, we got in the business to make money and become successful, isn’t that all we need to know?

That mindset will probably get you started okay, but if you find yourself having any success at all, you’ll find that there really is such a thing as growing pains.

By putting in the time and effort to create a mission statement, you are laying the groundwork that will give you a path to follow in your growth. And isn’t building long term success what we are really after?

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Featured photo credit: Fab Lentz via unsplash.com

Reference

[1] Southwest Airlines: About Page
[2] Fit Small Business: 10 Vision Statement Examples To Spark Your Imagination

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