The success of many small businesses today is the result of the actions of the previous generation. However, many second-generation business owners have failed to take advantage of the efforts of their ancestors. According to the US Small Business Administration, the failure of small businesses in family businesses is two-thirds.
Based on my experience as a business coach and first-generation business owner, this failure may be more about people failing than knowledge failure. These 7 errors can help you avoid the failure of many second business owners and achieve the business success you want.
- Ivory Tower Mentality - Knowledge Failure
- from
External customer relationship transfer - staff failure - from
Source of employee loyalty - staff failure - from
No plan - knowledge and staff failure - from
Behaving savvy - people fail - from
Assumption - knowledge and personnel fail
Successful first-generation business owners have the ability to send the next generation to university to improve business skills. Unfortunately, many professors at business schools have never worked in the real world, but have educated them on what they think should be, not reality.
The first generation of business owners knew that their business needed loyal customers and took the time to develop these relationships. The second generation of business owners believe that the relationship between their father or mother will be automatically transferred to them.
The loyalty of many employees in a family business begins with the first management team, not necessarily the company. When the second generation comes in, they think employees are loyal to the company.
The success of many small businesses comes from entrepreneurship, not necessarily planning. Since there is no plan to hand over, the next generation continues to conduct business without a reliable written business plan. In today's market, any company that does not have a new vision of its strategic plans and strategic action plans will find it difficult to survive.
Because companies are made up of people, managers need to understand the motivations that drive people to their full potential. For example, the current management team is crying poor and unable to raise salaries for employees, but when they buy new expensive cars, their actions can have a negative impact on employees. Employees don't mind new cars, but pay attention to luxury cars.
Today's second and third generation business owners have made many assumptions about their parents or grandparents, but this is not necessarily the case today. The assumptions include:
- market
- What motivates employees
- How long does the business take?
- Owner's rights
Many first-generation business owners operate according to core values, and men are as good as his or her words. Handshakes, not formal contracts, have greater value. Today's business owners do not seem to have the same deep-seated values as their ancestors. The lack of value can be summed up in one word - greed.
So if you really want the previous generation's efforts to continue, then see if you are making these mistakes as a second-generation business owner. Your small business success depends on what you are doing now, so you won't be two of the three companies that have experienced a complete business failure.
Orignal From: The second generation of small business owners are the seven misunderstandings for the success of the company
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