There is no leader without flaws and neither is there an organization that is perfect. Corporate leadership however needs to realize that according to the late Dr. Edwin Cole “the character of the kingdom emanates from the character of the King”. Leadership has a major role to play in ensuring that the organization survives any economic weather that seeks to destroy the ship. In fighting economic woes and pressures, there are however corporate sins which are tantamount to you digging a grave and writing an obituary for your business. I am probably mentioning these not as a way of exonerating myself as a leader but pointing something that I have done or seen first-hand.
1. Failure to see value in employees – no matter how amazing your vision or idea is, it requires more than just the founder to get it off the ground. You need to ensure that you hire the right people or at least people who can be trained to give you value. Having them on your team is not a guarantee that they will produce value; take a step further and ensure that you value their contribution and reward them accordingly left your business becomes training ground for other companies or markets.
2. Investing blindly without due diligence – no entrepreneur throws money around like grain. You are not in business just to gain the title of business man or woman. You are in a business because you want to make money. Before you run with your ideas (or fantasies) you need expert advice on feasibility of the idea. Before any mergers and acquisitions please read widely about the business you want to acquire lest you be deceived into buying a shell that may never develop into something of value.
3. Refusal to move with the times – the business landscape is forever changing. Your business probably has smarter, faster and more agile competition than it had 2 years ago. Consumer appetites keep evolving. Spending culture is forever changing as well. As a smart entrepreneur your role is to keep studying the trends and immediately positioning your business to remain relevant to the customer. Mobile Technology is bringing another fresh form of competition. If your business was to manufacture cameras or take photos you now have families having their own state of the art mobile phones taking better pictures on the go. Adapt or die.
4. Taking customers for granted – Your business exists to solve a customer need. Getting a customer is one thing. It is a costly exercise but keeping one happy is a venture you need to invest in. Customers can easily move next door because there is now a multiplicity of options. Customer centricity remains a key element which determines if people will stay with you or not. Never assume that customers are still with you. Do surveys from time to time. Do “brand health” checks using independent companies. It is easy to go bankrupt as customers leak one at a time until you have no-one to serve. Customer remains king / queen as the old adage goes. Pay attention to their cries even those cries that are not outwardly expressed.
5. Paying lip service to quality issues – The business environment is very turbulent the world over. Markets are shrinking, competition is biting every day. As such, business people tend to try and “cut corners” as a way of staying profitable. In Zimbabwe we have seen customers rising to complain about how quality of products have gone down over time. If one customer takes to social media to complain about your quality of products and services, bear in mind they have a sphere of influence that feeds from their palms. Sooner or later your brand goes down the drain. You have yourself and your team to blame. A pork pie making company in Zimbabwe had a rude awakening when one customer started posting about the reduction in the amount of meat in a pie. They have since corrected this but it cost them a lot to repair damaged trust as the complaint went viral in no time.
6. Dicing with financial indiscipline – You can tell who a person really is when there is enough money around them to spend on anything they want. You then see priorities shifting. As an entrepreneur, the biggest you can ever make is assuming every dollar in the bank is yours and therefore you start making personal decisions on money that is not even yours. That is greed. It is easy to spend the tax authorities’ money on holidays only to come back and experience serious garnishes. We have seen a proliferation of companies closing down all because they used money meant for other statutory obligations. We have even seen law firms spending trust funds meant for customers. Whatever line of business you are in, only spend that which is yours.
7. Lack of Corporate Governance – This is closely tied to sin number 6 above. I would like to single this one out completely. Businesses grow and succeed to the level of leadership they have. The board oversees the organization setting policies and helping with strategic direction. However, there are boards that exist to meet and have coffee while the house burns. There are CEOs who tell the board what to do especially if the CEO is the founder. This defeats the whole purpose hence accountability, transparency and effective decision making flies through the window. As a founder, pick people whose voice you respect, people who can tell you to your face when you stray not people who will applaud you for your dumbest decisions just to stay in position as a board member. If your organization is ungovernable then you either remain a “brief case” organization or you prepare to close shop someday, soon.
What are your experiences? What have you seen in your own world? Share with us in the comments section. Let’s talk about this.