Business owners and entrepreneurs are a very special breed. In general, they are highly motivated, they like a challenge, they have a desire to make an impact and a difference. However, despite their best efforts, business owners sometimes make mistakes that can hinder their organizational growth.
Jeff Clarke, a Partner with Avail CPA who has been working with owner-managed businesses since 1995, has observed a consistent set of mistakes from business owners across a range of industries. As an accredited Mindshop advisor, he agreed to share some of his insights on the five most common business mistakes that he sees business owners make time and time again.
Living strictly in the urgent zone
Business owners are busy. There is no question. But as a business owner, as busy as you may be, are you carving out time to proactively work on your business? Clarke sees a great many business owners who do not carve out this important time.
“It’s critical to find time to operate in a management capacity,” Clarke shares. “Taking the time to advance and work on business goals as opposed to constantly working in a state of deadline-driven crises. This is something I see often, where business owners get so busy working in their day-to-day functions and tending fires that they miss sight of how they are advancing their big picture vision. Having that clear direction and plan is so imperative.”
Make the time to plan. It can be a true gamechanger for your business.
Underestimating how much people really do matter
One of the best ways that business owners can streamline their time in order to be able to spend time in a management capacity is by having the right people in place.
“It’s a tough market right now,” Clarke points out. “This is a common theme that I keep hearing. So, business owners need to take a hard look at their recruitment and retention strategies. Consider how you are helping your talent to build their capabilities, are you giving them challenges and opportunities? It really does go beyond salaries; employees are looking for ways to contribute. What is your corporate culture, how are you looking after your people? This can be easy to overlook and, especially in this market, it’s so important.”
Business owners know their business really well. So, it’s a matter of truly understanding where the skill gaps are and where their time is best spent, and then staffing accordingly.
A lack of systems and processes
Aside from not having the right people at the table, another common issue is not having well-developed systems and processes in place. “As an organization grows, it needs those institutional-level processes that go beyond the business owner,” Clarke states. “These processes take a long time and some effort to develop, they don’t just happen organically. They are key to growth though.”
Every business, regardless of size or industry, needs to have effective processes in order to grow and be successful. Processes help businesses streamline their operations, improve communication, and make better decisions. At its core, business is all about efficiency. Creating and following processes enables businesses to operate in an efficient manner and grow at a consistent rate.
Failing to revisit your Now-Where-How
The Now-Where-How process is a Mindshop tool that Clarke uses on a regular basis. “Now-Where-How is a strategy tool. The idea behind it is that people know where they are now, we are this big, this is what we do. Then there are issues and barriers, and the impulse is often to just start fixing these barriers. Jumping from now to how. The Now-Where-How process challenges business owners to back up and look at where they are going before they just jump in and start fixing a bunch of things. Having that clear plan and that clear direction of where you are going is so important and so many businesses are lacking that.”
Seeking out the right advice
Business owners should seek out the right type of advice. “Are you looking for a consultant who simply gives you the answer, or a facilitator that helps you arrive at the answer through a discovery process that explores challenges and issues that impact the success of your business?”
“Business owners don’t always know what to ask their accounting firms for,” Clarke points out. “What they should be looking for in a firm is an advisory mindset that goes beyond the day-to-day accounting basics. They should be looking for an accountant who has a passion for improvement and continuous learning. And who will facilitate, rather than consult.”
Avail is part of WealthCo’s Integrated Advisory community, a collection of entrepreneurial-minded CPA firms that are leading the new era of financial advice. Avail is a perfect example of an organization that plays a facilitator, rather than a consultant role.
Learn more about the Integrated Advisory network and the evolving advisory role of our partner CPA firms.
A member of WealthCo’s Integrated Advisory community, Jeff Clarke is a Partner with Avail CPA. The Integrated Advisory community consists of a network of progressive CPA firms, along with best-in-class professional advisors, service, and product specialists, who work together to deliver an elevated and holistic client experience. One that optimizes both their personal and professional lives with an integrated financial strategy designed to help clients reach their goals.