There are more ways to sink a business than there are to set it on a course for smooth sailing. Sinking is easy. All you have to do is the wrong thing. So a good first step is learning what it is others have done that wasn’t so successful, then avoiding it at all costs.
Complicating the matter is the fact that every situation is slightly different. What works for one business might be disastrous for another. It is not just a static list of dos and don’ts that make the difference. The following are also major factors:
• Sufficient capital
• Drive and determination
• Market conditions
Leasing an office in the industrial district may be a brilliant, cost-saving move. Or it may be the mistake that closes your doors. It might all come down to timing and political climate in the local area. But in general, there are some mistakes common to all businesses that are worth avoiding regardless of circumstances. Here are three:
Mismanaging Human Capital
While business owners like to say that human resources are the most important resource for the company, they demonstrate by their actions that what they really value the most is liquid capital. No one is denying the importance of proper capitalization. But that is not the only capital to consider.
HCM stands for human capital management. It combines some of the traditional points of human resources with other human considerations such as space management and desk sharing. The failure to incorporate some type of talent management into your business is a fatal mistake.
Humans are not particularly easy to manage. We have issues and bring that baggage to work. We have concerns like how often and how much we get paid. We need time off for dentist appointments.
You can’t manage humans by gut feeling. We are difficult, messy, and will run you broke talking about nothing around the water cooler. By the way, you’re going to need a better water cooler. Make sure your human capital management team is using the latest in precision HCM software. Human capital really is the most important capital you have. Mismanaging it can cost you everything.
Setting Up an Unappealing Workspace
Your million-dollar idea does not need a million-dollar office. But it does need a great space to inspire great work. You simply cannot hope to attract great employees if you don’t have facilities where they can feel comfortable.
The kind of facilities you offer signals how highly you prioritize worker satisfaction. It is not just the room where they are expected to work but also the equipment you expect them to use. Giving them a 10-year-old beige box running Windows XP sets the expectation of a management team that just doesn’t care. You will attract employees accordingly.
There is also the matter of attracting clients. Prospective clients will judge you by your office decor. They either need to be impressed by it or oblivious to it. But if they are put off by it in any way, then whatever you saved on office space is costing you money.
Offering Unequal Opportunity
There is no room in the workplace for racism, misogyny, homophobia, or any other kind of preference that advantages one category of human over another.
There are some who believe it is OK to engage in this sort of bigotry because it is hard to prove in court. But the threat of being sued is not the main reason why you shouldn’t do it. From a strictly practical perspective, you are limiting your talent pool dramatically by narrowing your choices to a particular group.
Some of the best candidates for the job are people with disabilities. No one has to overcome more obstacles every day than a person with a disability. You can’t offer a challenge too hard for them. And they are already used to working twice as hard as everyone else. Offering unequal opportunity tips the scales, but not in your favor.
When you start a business, you are going to make mistakes. Just make new and interesting mistakes. Don’t fail because of common errors like mismanaging human capital, providing an unappealing workspace, and ignoring equality.
Presented by a BusinessTown.com partner