The Difficult Decisions Every Entrepreneur Must Make
There’s no point in avoiding it: when you choose to become an entrepreneur, you must accept that you’re going to have to make a variety of really tough decisions down the road. These decisions could occasionally cause you to lose sleep at night. It’s all a part of being the owner of a company. But if you consider these decisions ahead of time, you can at least mentally prepare yourself to handle them whenever they should arise within your company.
Here are some of the most difficult decisions that you may have to make with your business at some point. Perhaps you have already made them at least once.
- How to deal with difficult employees. Employees can cause problems in a variety of ways, ranging from ineffectiveness to disobedience to bullying in the workplace. The first time this happens in your
company, it can be extremely difficult to know how to deal with it. Know that if you are unable to resolve the situation through talking with the offender or taking minor action, there is the potential that you will need to terminate the employee. This is never an easy decision, but you must be prepared to do it should it become necessary. However, you also must realize that your culture, which is a product of your mission, vision and purpose, are responsible for accepting this employee during the onboarding process as well as the review process of their performance. So when you fire an employee you need to understand some of that is on you as the owner of your culture. Not fun!
- Saying goodbye to difficult or unprofessional clients. Let’s say you have a client that comes in and gives a lot of business to your company, but is extremely difficult to work with and often has a rude or unprofessional attitude. Is it really worth the headache for you to continue working with them? I’ve known a lot of businesses over the year that have a strict “no jerks” policy, and when their clients violate this policy they cease working with them. It can be difficult to voluntarily say goodbye to a client, especially when you’re a small company, but you always have to weigh what it will cost your business on more than a financial level to keep a difficult client around for the long run.
- Whether or not you should expand. There are so many businesses that fail not because they don’t get enough business, but because they weren’t able to handle expansion at the rate they thought they could. If you’re doing well with your business, great! But don’t rush the expansion process. Take everything slow so that you can manage that growth incrementally. Don’t get blinded by the excitement of the expansion opportunity—growth is only good if it is manageable.
- Seeking Capital or Debt Financing. Your growth is limited by the cash or liquid assets you have available to you for marketing, new hires ahead of new product launch, retraining current staff and key mergers and acquisitions. Whether your options are leveraging with bank loans, lines of credit, friends and family or venture capital the first time you realize this is what you have to do is very trying on the nerves. The bottom line is that not all debt is bad debt, you just have to be able to grow profits faster than the interest rate. Investors will demand accountability and are easily pleased when they receive a return on investment beyond plan.
- Recognizing you own the problems. Your company's problems could be employee related, vendor linked or inefficient productivity. Certainly you can find the root cause, isolate it and attack the
problem with a solution that fits. It is easy to blame the root cause. But leaders and small business owners must look in the mirror and recognize they own the outcomes as well as the problems that impact those outcomes. This reality can be difficult to swallow.
- The Stockdale Paradox. When you can “maintain unwavering faith that you can and will prevail in the end, regardless of the difficulties, AND at the same time have the discipline to confront the most brutal facts of your current reality, whatever they might be,” you are embracing what Jim Collins calls the Stockdale Paradox. [source: Good to Great by Jim Collins]. How does this apply to you, someone trying to drive change? Simple. Ask yourself: Have I ever given up on a change I wanted or needed because I played the optimist and allowed myself to break my heart, my will to drive change? Sadly, I’ve had people quit driving change because of the simplest of defeats [source: Good to Great by Jim Collins]:
- They were let down when a top manager, who has never delivered on a promise of support, fails again to support them. (And they thought this time would be different. Nope.)
- They thought the change would be complete well before the summer was over and now it’s late into the fall.
- They tried and failed to change something in the past and refuse to try again.
- They think driving change should be more happiness and less frustration (often it isn’t), or
- They think others (name the group) should help more and complain less. (They rarely will.)
You have not been defeated by some outside enemy when you quit, when you allow yourself to break, or when you refuse to face the Stockdale Paradox, accept it and persevere; you have defeated yourself [source: Good to Great by Jim Collins].
Do you need help making the difficult business decisions that present themselves on a regular basis? Speak with us at Viral Solutions for assistance.
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