The Top 7 Mistakes Why Second Generation Small Business Owners Fail at Business Success
From my experiences as a business coach and an employee of a first generation business owner, this failure is probably much more about people failure than knowledge failure. These 7 mistakes may help you avoid the failure that many second business owners experience and achieve the business success that you desire.
Ivory Tower Mentality - Knowledge Failure
Successful first generation business owners had the ability to send the next generation to college to learn improved business skills. Unfortunately, many of these professors in business schools never worked in the real world, but rather pontificated what they believe should be instead of what is is.
External Customers Relationships transfer - People Failure
First generation business owners knew that their businesses needed loyal customers and took the time to develop these relationships. Second generation business owners believe that the relationships their fathers or mothers had would automatically transfer to them.
Source of Employee Loyalty - People Failure
The loyalty of many employees within family businesses began with the first management team and not necessarily with the company. When the second generation came in, they believe that the employees loyalty was to the company.
No Plan - Knowledge and People Failure
The success of many small businesses came from the entrepreneurial spirit and not necessarily from having a plan. With no plan to hand over, the next generation continues to conduct business without a solid written business plan. In today's market place any business that does not have both a strategic plan for establishing a new vision and a strategic action plan will have great difficulty in surviving less along thriving.
Performance Savvy - People Failure
Since businesses are comprised of people, managing people takes an understanding of what motivates people to do their very best. For example, when the current management team cries poverty and can't afford raises for the employees, but then purchases brand new expensive cars, their actions have a negative impact on the employees. Employees don't mind new cars, but do mind luxury cars.
Assumptions - Knowledge and People Failure
Today's second and third generation business owners carry numerous assumptions that were true for their parents or grandparents, but not necessarily true today. Assumptions include:
Market place What motivates employees How much time the business demands Owner entitlements
Values - People Failure
Many first generation business owners operated by core values where a man was as good as his or her word. Handshakes instead of formal contracts had much greater value. Today's business owners appear not to have the same deep seated values of their ancestors. The result of the lack of values can be summed up in one word - greed.
So if you truly want the efforts of the previous generation to be sustainable, then look to see if you as a second generation business owner are making any of these mistakes. Your small business success depends on the actions you take right now so that you are not 2 of those 3 family owned businesses that experience complete business failure.
Related Tags: business coach, business success, strategic action plan, small business owner, small business failure
Leanne Hoagland-Smith is a business coach who helps businesses to create executable strategic plans and the skills necessary to pull it off.
One quick question,if you could secure one new client or breakthrough that one roadbloack holding you back from success, what would that mean to you? Then, take a risk and give me, Leanne Hoagland-Smith, a call at 219.759.5601 to experience incredible results.
Visit http://www.processspecialist.com/ and explore everything from free articles to connecting with Leanne.
P.S. If you are seeking an affordable speaker or need a business writer, I may be just the person to meet your need.
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