THE ENTRECODE BLOG
The five common mistakes that entrepreneurs make that you should avoid
Working with entrepreneurs over 35 years I have noticed a familiar pattern in the mistakes they make that affects the success of their business.
- No strategy. Entrepreneurs often have a short attention span dealing with the immediate challenges they face. They confuse strategy with long term financial planning which they usually avoid. Strategy is the DNA of the business, deciding the mission, vision and values gives the business an identity and adds real value.
- Find it difficult to let go. Entrepreneurs often want to try to do everything themselves. They need to learn to pick the right people and to delegate. This mistake limits the growth potential of many businesses. Ironically, the more they delegate the more they control.
- Too busy working IN the business to work ON it to make it better. Once entrepreneurs learn to let go to grow they can stand back and work on the business to improve it. Without this input the business stays the same.
- Not building a competitive advantage and competing on price. Entrepreneurs often make the mistake of trying to be different but they actually need to be better than the competition. Their product or service must be better than the competition in order to enjoy competitive advantage and higher margins.
- The net result of the above is often low or poor margins. The mistake then is to cut costs in marketing, service or quality in order to boost margins. Actually what they need to do is address 1 – 4 above then 5 will happen!
So, learn from those who have gone before and enjoy high sustainable margins.
How to develop a successful entrepreneurial mindset
Our entrecode© research discovered that entrepreneurs think and behave in unique ways that enable them to succeed. Here is the entrepreneurial mindset that creates success:
1. Getting into the Zone
Entrepreneurs have a strong achievement drive which usually comes from difficult early life experiences i.e. failing at school. They are determined to prove they are not failures – “I am OK.” They develop a compelling vision which is a picture of what success will look like which they find inspiring and helps them stay focused – “keep your eyes on the prize.” Finally, in this section they are action oriented, preferring action to procrastination - “just do it.”
2. Seeing Possibilities
Entrepreneurs are strategic thinkers in that they can see the market and competitive landscape. They trust their intuition in creating possibilities and are options thinkers so they can usually find a way forward, they rarely get stuck – “plan A failed, so plan B or plan C.”
3. Creating Superior Opportunities
Superior opportunities are those which enjoy defendable competitive advantage, have high sustainable margins and attract investors and media interest. These are created by finding customer problems, solving them and then selling the solution to everybody else. This is the core of successful entrepreneurial activity – “solve a problem and create a friend for life.”
4. Stay in the Zone
Entrepreneurs work hard at not being busy fools. They stay focused on the key priorities, maintain a positive attitude when things go wrong and avoid distractions. They are good at recovering from setbacks – “persistence is the key.”
5. Opening up to the World
Entrepreneurs engage in purposeful networking with people who can help them build their business. They seek to create alliances and partnerships in order to grow – “networking not notworking.”
6. Building Capability
Entrepreneurs learn by doing and build teams who can support them. They invest in processes and systems that enable the business to function in a consistent manner – “complimentary values, different skills.”
Success as an entrepreneur has little to do with business planning, budgets, meetings, job descriptions or policies. It’s about how you think and behave. So develop the entrecode© mindset and get going, better still, read entrecode© – Unlocking the Entrepreneurial DNA and fly!
How entrepreneurs use signposter networking to build their businesses
Networking has been shown in many studies to be highly correlated with successful business growth.
Entrepreneurs network in a very cost effective and productive way. Here is how you do it:
- Identify who the signposter(s) are in a sector you want to get into. A signposter is somebody who knows everybody personally, is respected and influences people.
- Meet the signposter and build a relationship, identifying any challenges, issues or problems they personally face and offer to help them.
- If you are successful in solving their problem they may open up their network contacts to you. They can call them on your behalf and get you an introduction. The rest is up to you.
Signposter networking has been shown to be 50 times more effective than attending functions and handing out business cards to all and sundry. So have a go yourself and see what results you can produce.
