The year 2020 has arrived, and the decade which started in 2010 is now history.
From a professional and personal perspective, the past decade was significant for me and my businesses. We matured, we grew and we found success. We also had a few missteps. I would be remiss if I didn’t take some time to reflect on the past 10 years and evaluate what I have learned as an entrepreneur and business owner.
When I consider all the lessons I learned during the past decade, the list is long. But five lessons stand out as the top business lessons I learned from starting, owning and running multiple businesses.
It’s never as good as it seems, or as bad as it seems.
At the start of 2010, the economy was a mess. Many businesses did not survive. Those that did survive dealt with the challenge of withstanding the worst recession in years. As we enter 2020, our economy is in much better shape, and businesses are facing a different set of challenges today. When times are tough, it’s easy to become overly pessimistic. When business is good, it can be just as easy to be overly optimistic. What I learned during the past decade is to maintain a strong sense of reality. I learned that during bad times, it is important to maintain a level of optimism. Opportunities continue to exist, solutions can still be found and problems can be solved. It may be difficult, and the solutions may not be optimal, but there continues to be hope. Conversely, I also learned it is dangerous during the good times to become complacent, comfortable and over-confident. When business is good, it’s easy to believe the future will only hold greater success and overlook the potential for problems and challenges. While doses of both optimism and pessimism are both necessary components for success, maintaining a sense of reality will best serve the entrepreneur and business owner.
Arrogance will cost you more than a lack of self-confidence.
There are numerous articles written about the power of self-confidence in achieving success. To succeed in business, self-confidence is necessary. You must believe in yourself, be willing to take chances and persevere in the face of challenges. But it is arrogance, an over-abundance of self-confidence, that will negatively impact businesses much more than low self-confidence. During the past decade, my companies competed against firms that were much larger, better financed and had more resources. We did lose occasionally due to these reasons. But more often, our teams won because of the arrogance of our competitors. Arrogance in an organization shows itself quickly in the way a firm communicates with those outside of the business. Arrogance leads to thinking you have all the answers, know more than the customer, and your solutions are superior. Lack of self-confidence may hinder a business opportunity, but arrogance will cost a business its reputation, customers, and money.
The power of social media has changed business.
Ten years ago, social media was virtually unknown. Facebook and Twitter were in their infancy, and Instagram had not been founded. Today, businesses not only benefit from using social media but rely upon it for a number of purposes. Businesses now use social media to advertise, communicate, recruit and hire, and to build their brands. Then there are the businesses that exist solely because of social media. It has become the only platform for them to offer their products or services. Whether a company has one employee or thousands, firms have made social media an integral part of their business. More importantly, companies that do not embrace social media face the prospect of irrelevancy.
Strategy shapes culture.
The famous quote from Peter Drucker is “Culture eats strategy for breakfast” This is true. But culture is shaped and developed through strategy. To be clear, by strategy I am referring to a consistent focus on the process of strategic thinking and planning as it relates to the business. This is a process wherein the business is analyzed in an honest manner, strategic business plans are developed and these plans are consistently executed. It is during the process of strategic planning where a business determines its vision, why it exists, what it wants to accomplish, and the means and methods it will utilize to achieve those goals. Strategy determines how a business operates, how it manages its relationships, and how it is presented to the market. A company’s culture will develop as a result of the strategies it embraces, and the two become intertwined. Conversely, if a business has no strategy, then culture will develop around that as well.
Long-term controlled growth will produce more success than short-term quick growth.
Businesses that grow quickly from start-ups to millions of dollars of revenue are compelling and make great stories. But firms that can maintain success while experiencing significant growth within a short time are the exception. A significant number of companies actually fail during periods of rapid growth. The reasons are numerous, but primarily because business owners were not capable of managing the business during their accelerated growth. The best way to grow a business successfully is through controlled growth, where each step can be successfully managed. Growth requires personnel and financial resources, strategic focus to manage the new challenges presented and experienced management. Every business must grow to survive, but the companies that survive the longest and are the most successful are those businesses that grow in a controlled manner.
The 2010s were a decade of challenges. Each of us who owned businesses experienced some failure and saw some success. But the decade should not be forgotten. It’s important for any business owner, entrepreneur or manager to look back at the past 10 years and remember the lessons learned. Then it’s even more important to apply those lessons to the next decade, in the hopes that failure will be lessened and success will be enhanced.
Brian T. King is the founder and owner of multiple firms encompassing design, construction, real estate, and manufacturing, and currently president of the integrated Design-Build firm A M King. Brian shares his passion for mentoring young professionals, rising managers and entrepreneurs at speaking engagements around the country, on podcasts and via his blog.