Unsuccessful startups: How not to repeat other businesses’ mistakes
from experience in the development of startups and the transformation of mature companies in the direction of managed growth, we concluded that some root problems prevent us from acting consciously and soberly assessing the prospects of our own and our business.
Incompetence can be simply defined as a lack of understanding of one’s boundaries of knowledge or ignorance in a certain area. It is unlikely that someone in their right mind would agree to play golf for money with a world golf champion. But, business is much more complicated and in real-life managers, owners and employees, making decisions based on their own experience or superficial knowledge, are often mistaken in their competencies, which leads to overestimated self-esteem and to make decisions of questionable quality.
Ignoring the rules
Failure to understand their role and area of responsibility, contribution to the achievement of a common goal, or all the consequences of action and inaction leads to extremely low sensitivity to the context and its changes. If the head or manager of a company thinks linearly, in a non-linear world, ignores important aspects of the business, the interests of customers, partners, investors, or employees, is not ready to take responsibility for himself, then his way of thinking will harm the whole project.
Fear of uncertainty or fear of failure
The winner is the one who is unaware of the inevitability of failure. In most cases, what we fear does not happen in real life. This partly
confirms the fairness of the advice that in any case, it is better to do, make mistakes and learn from mistakes than just do nothing.
Here we mean those misunderstandings, cognitive traps, common stereotypes and publicly available recipes for “symptomatic treatment”, previous accidental successful and unsuccessful experiences and everything that influences the formation of a leader’s “way of thinking”, under the influence of which important decisions are made. But, as doctors say, not knowing the cause of the disease – the patient cannot be cured, symptomatic treatment can only alleviate suffering, creating the illusion of good health, but does not in any way affect the speed or possibility of recovery.
This is the one when all the mistakes in company management are reduced to arguments: the market is not growing, not the season, prices are high, there are no customers, the product is bad, employees do not want to work, sellers do not sell, there are no competent specialists in the market, there is no money for marketing, etc. And also, solutions: let’s lower prices, give ourselves additional
installments, hire sellers who will sell, change an advertising agency or launch more advertising.
As they say, haste is needed only in two cases. Hasty decisions and actions without a real state of affairs and prospects for the future.
A good example is the preference for momentary gains over the future. The well-known ‘Marshmallow Test’ by Walter Michel can be cited as an illustrative example. The bottom line is that the children were asked to eat one marshmallow now or wait fifteen minutes and get two. For several years the experimenters recorded the successes and failures of the subjects, and it turned out that children who showed restraint, in general, achieved more in life. Sometimes it is worth waiting or giving up the immediate benefit, so that after a while, much more.