by Nancy Laws Featured Contributor
Deadly Business Mistakes—Strategy, Execution, and Culture. Some years ago, Peter Drucker wrote an article 4 describing 'Five Deadly Business Sins' that have driven many companies into deep strategic and financial trouble. His characterization of these 'sins' included.
- 7 Deadly Business Blogging Mistakes to Avoid Posted by Tony Zayas Posted 5 years ago August 5, 2015 Business blogs are a fantastic tool to get more visitors to your website, market your products and services, and generate leads.
- في هذا المقال، تعرّف على 6 أخطاء يجب تجنبها مبكرًا في لعبة Seven Deadly Sins: Grand Cross مثل نسي حسابك وجمع البطاقات بشكل عشوائي والتخلص من المعدات وغيرها.
I am passionate about business and helping my clients not only grow, but to enjoy the process. Working with Fempreneurs and Mompreneurs is a unique experience that helps to catapult the empowerment that comes with business to a whole new level.
One thing I am honest about, however, is the reality of running a business. The easiest part of the business process, from inception and beyond, is that “lightbulb” moment. The moment that you finally get that perfect idea for a business, from that moment on, you will be challenged like never before, and only a few make it to the other side successfully.
The entrepreneurial mindset requires passion, sacrifice, a fierce devotion to our vision, and thick skin. You will look like the odd one out among your peers, you will have a work ethic that few will ever understand, but will help you stand proudly among the elite.
7 Deadly Sins in Business
What are the 7 Deadly Sins in Business?
Navigating through business with your eyes shut is like choosing to take a walk down a busy highway during rush hour, hoping that you will make it to the next exit unscathed.
It’s simply diluted, and a little insane!
You have to have a plan of action, a great business plan will prepare you for the challenges ahead. Having an understanding of your vision and goal, will allow you to communicate this same vision to team members and potential investors.
But even more than that, putting pen to paper, or finger to key, will help you to understand your own vision and future. Writing forces you to clean and organize your thoughts, and as a creative, will be a great way to encourage inspiration.
Taking it on Alone
As I mentioned, embracing the entrepreneurial mindset will mean that you will find yourself standing alone on many occasions, but it does not mean that you should choose to be alone. Surround yourself with like minded individuals that support not only you, but your vision.
Sit your family and friends down beforehand and prepare them for what is to come. You will need their support and insight throughout this process.
Hiring a great business coach is also a great way to find support as you transition from employee to self-employed. A great coach will not only be a great consultant, but a hands on team member as you begin to establish a foundation for your business. Informing you about tax laws, and the registration process in your state, and more.
Some choose to partner with other innovators, and to work as co-founders. Combining experience and resources to build a strong foundation for the business.
The Disillusion that Passion is Enough
Yes, we know the importance of passion, but anyone who believes that passion will be enough is sadly mistaken.
Although passion will take you a long way, it cannot stand alone, because experience, brilliance, work ethic, are just a handful of the ingredients required to cook up success in business.
This is precisely why surrounding yourself with a great team will be a necessity as you prepare to build a strong foundation. Surround yourself with brilliant strategists and innovators, that will help to offer you the capability you will need to achieve success.
Taming a Confrontational Spirit, or Simply Avoiding it All Together
One that I had to face head on in the early stages of my business, my unwillingness to deal with confrontation of any kind. I have always had a tame spirit, one that has been challenged often throughout my personal journey, because although I am fiercely passionate, I always preferred not to challenge others in an attempt to create a peaceful collaborative environment?
Some of you may ask yourselves, what could be wrong with wanting a peaceful collaborative environment?
You need a balance!
There are times when confrontation is needed, and avoiding will simply create build up that can hinder you at some point as you begin to experience growth and the challenges that come along with that.
Forgetting to Trust Your Gut
The importance of gut feeling tends to be forgotten as we get lost in the politics of it all in business, but that can be a mistake.
Gut feeling is what lead you down the path to entrepreneurship, a path that requires a combination of instinct, and innovation. Use these same instincts in the establishment of your business, as it applies to your vision, strategy, and team building.
Blog Link Business Blogging Free
Your gut and instincts are the bomb, but you don’t know everything.
The best leaders are able to prepare for the unexpected, and to take prepare their companies for unexpected shifts in the market or industry, where others fail.
To be a great strategic leader, you have to be able to notice small shifts, little changes that will sway the direction of things, and put a plan in action that will allow you to be at the forefront of this change.
Being able to turn a seemingly unbalanced environment is essential in the role of leadership, because they will come, and they will be unexpected and can derail a whole organization with lack of preparation. A great leader is able to use their skills to capitalize.
An entrepreneur is resourceful, ready and willing to hit the pavement, prepared to do the research, and to find the resources needed to become successful, if you are incapable of at least shifting your mindset in order to learn how do this, you don’t belong here.
There will be many things that you will not know how to do, and may not be able to afford to hire somebody for, will you simply crawl into a corner and cry, or simply push those tasks to the side, allowing them to pile up?
There is a reason there are so many articles about transitioning from employee to entrepreneur, it is not easy, but the journey is full of excitement and challenges. Those who choose to follow their dreams are taken through a metamorphosis that will help to create a better you, even through failure.
What are some of the mistakes that you have made over the years, that would fit into one of the 7 deadly sins, and how did you overcome?
Nancy Laws is a virtual assistant specializing in business blog management. Through her virtual business LawsWrites, she offers business support to Start-Ups, Bloggers, and Authors. She has headed business operations, social media marketing, project, and blog management, from her home in OH.
Nancy has loved connecting with other Mompreneurs through her blog Afro-Chic Mompreneur. She launched her blog, after moving from Maryland to Ohio. She needed a way to connect with other working moms, to share tips for staying organized as a woman on the move. A blog that started as a way of reaching out and redefining herself as a business owner, mother, and wife, has turned into the go to guide for the Mompreneur. Connecting moms with brands that help to simplify business, fashion, health, beauty, and parenting, for the mom on the go. Nancy has been featured on several sites and is currently a contributor to Theindiechicks.com.
Connect with her on Twitter, and Facebook.
There are often several things that can be critical mistakes for an organization. This article, courtesy of the Process Excellence Network (PEX), suggests five different errors that are made, according to Peter Drucker.
From 1975 to 1995, Peter F. Drucker wrote a column for The Wall Street Journal. On October 21, 1993, his column was titled “The Five Deadly Business Sins.” It could have been called “The Five Deadly Marketing Sins.” Many business experts suggest exactly what Drucker advised against. They still do. But his suggestions are still relevant in today’s market.
Sin #1: Seeking High Profit Margins and Premium Pricing
Drucker called this sin the worship of high profit margins and of 'premium pricing'. He said it was easily the most common of the five sins. Why shouldn’t marketers at least seek high profit margins? That sounds like good common sense.
Drucker’s definition of “premium pricing” is offering more features and then charging more to increase profit margins. He cited Xerox, which invented the fax machine. It allowed Japanese organizations to take over the worldwide market because Xerox kept adding features—not to add value for their customers, but to raise the price and increase the profit margin. The Japanese industry looked at this and did a little re-engineering. Then they entered the market with a product that did the job at a much more reasonable piece. They captured Xerox’s market with great ease.
The problem is that it seems so automatic and obvious that big margins must lead to maximum profits. But this is an error. Total profit is margin multiplied by sales. So what the marketer should be seeking is an optimum profit margin which, combined with sales over time, equals maximum profits. Perhaps the worst part is that the strategy of high profit margins combined with the necessary tactics of premium pricing invariably opens the market to the competition and could result in the loss of the entire market to a competitor.
Sin #2: Charging What the Market Will Bear
Let’s say you have a patent or a secret formula. Conventional wisdom is to charge as much as the market will pay. When your competition finally catches up, if ever, you can use all the extra cash you have accumulated to fight off any and all competitors that try to enter the marketplace. At that time, you can also lower the price below that of your competitors. This way, competitors can never catch you. It seems that charging what the market will bear is a “sure thing” marketing strategy when you enter the market before your competition and have some leverage to keep competitors away. But is it?
Drucker claimed that the only sure thing about charging what the market will bear is that you will lose your market—and a lot sooner than you might think. The problem is that a high price creates an almost risk-free opportunity for your competitor to jump in seize the market. Risk is always present, so that when a nearly risk-free opportunity presents itself, it is a wonderful incentive. Moreover, the higher the price, the lower the risk to your competitor is a greater incentive to jump in and compete.
Drucker contrasted the loss of Xerox’s fax machine with DuPont’s synthetic fiber innovations. DuPoint patented nylon and sold it at a price that they anticipated they would have to sell it at five years later to undercut any potential competitor. Drucker estimated that this price was less than half of the price they could have sold the product for at the time. However, when competitors attempted to get in the market, DuPont had no difficulty keeping them out. In the process DuPont made nylon affordable and kept competitors away.
Sin #3: Using Cost-Driven Pricing
Cost-driven pricing means that you simply add up all your costs, and then add a profit, and there you are—the price you should charge. It’s all very logical, but it is wrong, according to Drucker. This, by the way, is how governments insist contractors price their products. It’s supposed to ensure both competition and a “fair” price. All you need to do is look at government cost overruns to see how well that approach is working.
Drucker said that instead of cost-driven pricing, you needed to do price-driven costing. That is, you need to start at the other end with the right price, and then to work back from price to determine your allowable costs. Drucker blamed the loss of the consumer-electronics industry and the machine-tool industry in the U.S. directly on this deadly sin. One begins to understand why Drucker called these deadly sins, and not simply marketing mistakes.
Sin #4: Focusing on Past Winners
Drucker called this “slaughtering tomorrow’s opportunity on the altar of yesterday” to emphasize that managers commit this sin in the name of past success. He pointed out that after IBM had accomplished the remarkable feat of recovering from missing the demand for PC computers, it still insisted on subordinating its newly won PC business to its old winner, the mainframe computer. Not only did resources go to the mainframes, but IBM PC marketers were discouraged from selling their product to mainframe customers. The net result, according to Drucker, was that IBM would not reap the fruits of its amazing achievement of coming from nowhere and taking leadership of the PC market. Instead its achievement was mainly to create IBM clones—and this major marketing blunder didn’t help its mainframe business.
Sin #5: Giving Problems Priority over Opportunities
Drucker saw that many companies put their best performers to work solving problems with businesses that were on the way out. Meanwhile opportunities were frequently assigned to those who lacked experience or ability.
This frequently occurs because egos get in the way. Otherwise smart marketers put resources, money, and people towards fending off someone’s encroachment into an established markets. Sure it may be declining, but this is their turf. So the ego is involved and they allocate time and resources to defending what may be barely worthwhile, while the real opportunity is picked up by a competitor.
6 Deadly Business Blogging Mistakes Websites
When Drucker claimed these as sins, and not mere mistakes, he wasn’t exaggerating. Sinners take heed!