How to Lose a World-Class Strategy in Three Easy Strokes
Many leaders of middle-market companies—especially if they’re the founders—have a never-ending desire to stay ahead. They love the thought of winning, and likewise, hate the thought of losing. These are terrific positive leadership qualities and we strongly support them. The problem however is that they often forget the strategy that drove their company to its current success has already proven itself a winner. So, continuously contemplating new and different directions—although exciting—makes little sense because it could use up precious time and resources and cause the company to lose its way.
Just look at the myriad of companies that start strong and then find themselves going out of business. Why does this happen over and over again? According to the Department of Commerce, only one out of 10 businesses make it to year 10, and of those that do only one out of 10 will make it to year 20. These are horrible statistics since the majority of U.S. businesses are privately held.
There are three common mistakes business owners make, and they can kill any company of any size or success.
1. Use flawed assumptions. If you read this blog regularly you know we often talk about the absolute need to “Know” your market, your customers in your market, and what makes them tick. Not knowing is like going into battle with a blinder over your eyes and yet, how many companies have actively researched their market in the past 12 months? Or, how many have a best practice in place to gather customer information each day? Even with a commanding lead in a given market, it’s only a matter of time before your competition comes up with a brilliant alternative to challenge your offering. If you have assumed that your positional strength will always carry you through thick and thin, that’s an assumption we would not want to bank on.