What does it take to open a business?
Enormous amount of determination, resourcefulness and resilience. But It takes much more to keep its doors open. This is why 99% of business ideas never come to life, and over 20% of businesses never last a full year.
When businesses fail, the most often-cited tactical reason is undercapitalization. Then there are external reasons like the economy or competition. There could be faulty strategies or operational errors. Not enough marketing. Bad customer service. Bad locations.
The economy and competition have little to nothing to do with the success or failure of a business. Strategic and operational errors are only symptoms of a deeper issue.
The key difference-maker in businesses is the psychology of the business owner.
Being a business owner can bring with it a great sense of achievement and pride, a boost to the ego. But the ego can put the business owner out of business quicker than anything else. The ego itself is not an enemy. It has different functions.
Though we hear the word ego used in a negative context, it has many positive and important functions. Through our egos we gain our sense of self, judgement, and focus. We can cultivate relationships and achieve mastery in anything through our egos.
Without giving you a psych lesson I will say: the ego acts as a filter for everything we're exposed to.
Ego, and which filter we use, can be why some business owners will thrive and some will not survive.
Here are six ways destructive use of ego shows up in business dealings:
Business owners often get tied down in details and forget to focus on the bigger picture. They spend more time on operations than looking outward to grow their businesses.
I don’t suggest to give up control of your business, but rather creating real ways of control. If you have to be there to vet every decision and oversee every detail, you don't have control of your business. Instead, your business has a choke hold on you.
When you’re truly in control, things get done with or without you.
Put systems, processes and the right people in place to execute the minor details. This requires an upfront investment of time, energy and other resources. But it will free your time, energy and mental space to see the aerial view of your business and grow it.
Micro-management masquerades as attention to detail, being hands on, or even leading by example. Micro-management is a close relative to excessive control discussed earlier. Business owners who micro manage are often self-centered rather than growth centered. They derive their sense of power from parachuting over every detail and decision.
You must hire the right people and give them the autonomy and power of decision making. This raises their confidence and their performance. Less micromanagement also creates self accountability, rather than dependence. Giving some autonomy to your team creates mutual trust and respect. Trust and respect is imperative if you want to find and keep the great people in your business.
Learning means you are deficient.
Countless restaurant owners tell me about their umpteen years of restaurant ownership experience. They talk about their vast experience, while holding P&Ls that are bleeding red numbers.
They think previous experience guarantees them success in their current business. These business owners develop I know it all attitude. They solve today’s problems with yesterday’s answers. They become resistant to change and innovation. They think learning something new is a weakness. After all, they already know everything there is to know. This is how experienced business owners get stuck.
On the verge of losing their business, they reach out to me for help. In today's ever changing world, a know-it-all mentality can be fatal to your business.
The blame game.
Business owners often play the blame game when things don't go their way. Being at fault can be the biggest blow to the ego. Blaming other people or circumstances is the knee-jerk way to self-protect.
The truth is, if the business is alive and growing, mistakes will happen. When the business owner doesn't take responsibility, neither will his or her team. The blame game destroys the required trust that allows the whole team to operate as one. As a business owner, the first thing to own is responsibility for putting together your team. Your business is a reflection of you and the decisions you've made. Own it and focus on a solution, not on finding a scapegoat.
Success is an external concept.
Some business owners have an external measure for success. They get in business for financial rewards, even though the owner is miserable. They make decisions that are good for the short term to get fast results. They chase results at any cost.
External success is often short lived and yields no real fulfillment. Money and outside attention may get you going for a while, but it will not keep you in the game long term. Business owners who thrive operate with a deeper purpose.
Their real drive is congruent with their intrinsic values. These business owners know, success is an internal feeling, not an external concept.
Getting great results in business supports and further develops their positive character traits. They are proud of themselves for their courage and effort. They don't need outside admiration to feel a sense of accomplishment or importance. External validation or not, deep down they know they are worthy and deserving. They sleep well at night because they don't take shortcuts. Money is not the main motivator, and results at any cost is not a worthy investment for them. They pick a field which is fulfilling to them. They build a solid businesses founded on integrity and self worth.
Being a business owner requires confidence in yourself and your product or service.
At the same time, a business owner must be able to look outside of themselves. They must look into the hearts and minds of their clients, their teams and their shareholders.
Inward-focused business owners often put their self interest ahead of their customers. They remain rigid in their approach to change and growth. Business owners who are only focused on themselves can not grow their businesses. Growth is a byproduct of thinking outside of yourself.
I met a restaurant owner who didn’t understand why her restaurant was not buzzing 24/7. She proudly explained her heritage and her labor intensive menu, made almost entirely from scratch. Her disappointment was that her guests don't even value it. She also made it clear that changing anything was not an option. She believed in serving the food she liked, and expected her patrons to like it.
Your business may be your business, but your business is not about you. It's about enhancing your clients' lives. Get out of yourself and focus on your clients. Only then your clients will support your business.