Managing the Business

And Why It Will Happen to You (Maybe) and You Won’t Be Surprised – Part I of II

A colleague gave me a stat yesterday, one that we’ve all heard before in one permutation or another and one that (much like the divorce rate) we’ve all pretty much just came to take for granted. Something like, “80% of Small Businesses fail inside of two years.” Now this is a very meaningful (and potentially frightful) stat for him as he, of course, is running a small business in its first couple of months.

His expression relayed that he obviously did not expect my reaction - I laughed out loud.

Now unexpected laughter is one of the biggest instigators of curiosity there is. And I love it – I’m a BIG fan of curiosity. Never enough of it in the world, if you ask me.

Hence this article.

Here I’m going to address the two most interesting (to me) reasons that Small Businesses fail. The first is easy to understand (but hard for most people to really get through their heads), so we’ll get through it quickly. The second we’re going to spend some time on, ’cause I fully believe it’s the secret to ultimately succeeding. And we all love a secret, don’t we?
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Check out this article by Andrew Neitlich on moving from an independant contractor to a business owner. He makes some solid points about the decision process (making sure you are up to the task) and then walks you through 4 business approaches/models to consider.

We learned two really good lessons this week. Why do good lessons always cost thousand of dollars?

Lesson #1: Manage The Right People

Our most expensive contractor costs us a lot of money and he is totally worth it. Problem was, Peter & I spent so much time running around managing our Jr’s and making sure they knew what they were doing, we didn’t pay him or his project enough attention. In retrospection, we innately assumed, at that rate he should manage himself. Truth be told, he did well, but did not approach things as we would have preferred (it happens).

The problem is that when your $15/hr Jr. goes astray, that’s one thing. When your head developer or project manager goes astray , that is insanely more expensive. So thousands of dollars later we are back on track and got a good lesson. Manage the right people.
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