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7 Business Mistakes to Avoid

Posted January 15th, 2013 by bbsadmin & filed under Education, General Business.

1. Learn from Pinocchio

Though it should be very obvious that dishonesty is the biggest mistake a business can make, this principle can be a little more complex than it was for Pinocchio. I would like to make two points for you to think about on this subject matter. First, though the example of integrity falls on the shoulders of those directing the company, all other workers represent the actual integrity of the company. Occasionally we hear about large companies which are shut down completely for fraudulent activity, but more often we hear individual cases from our friends about dishonesty at a specific location which leads us to believe the company as a whole is dishonest. The second point I would like to make is that honesty is interconnected with many of the daily decisions people make. Unlike Pinocchio, we can’t get a company wide nose measurement when people clock in and clock out and include this measurement in our quarterly reports. Nor, is it plausible or practical to write an all inclusive list of dishonest actions. In order for companies to make honest decisions continually, It requires a company wide understanding of the principle itself.

2. Know when it’s safe to exit the raft

I went white water rafting down the Snake River several years ago. Before stepping a foot into the raft, we had an experienced professional tell us about some of the dangers of rafting, things to avoid, and what to do in specific situations. Some of what he said was common sense, but there were some points he made which I never would have thought of. For example, there were some places where it was not safe to get out of the raft because the strong current can pull you under the rocks. We were also told what to do when one gets into a dangerous situation. Without that advice, some of the activities which would have seemed harmless could have been dangerous. Working with a lawyer early on is similar to getting the crash course on white water rafting safety. You can avoid some dangerous situations before they come about if you know what to look for. It is easier to prepare beforehand by getting help from a lawyer than to try to dig yourself out of an easily avoidable situation.

3. Choosing the wrong business partners

If you are partnering up, make sure you take the time to get the right partner. You might want to consider aspects such as how you think. If you are a business partner with a clone of yourself, chances are, you are going to be looking at problems from the same perspective and may not be as effective in your problem solving. On the other hand, if you find a partner who does not have the same vision or values as you do, you may be pulling the business in opposite directions. Also consider what is going to happen in the long term. What will happen if one of you leaves?

4. Conservatism Bias

Don’t get the wrong idea by the name. Conservatism bias does not mean it is bad to make conservative estimates or to be conservative in your spending or business image. Conservatism bias is a bias that leads people to be slow to accept new findings. People with this bias don’t accept new evidence contrary to their opinions of what they believe works. This can be detrimental because competition drives innovation and with this come improved means of doing things. If you are unable to accept new evidence, you may end up getting crushed by your competition.

5. Substituting what you see others do for research

I have a friend who would cut the end off meat when she cooked it. She did this because that is what she saw her mom do when her mom prepared meat. She later found out that the only reason her mother cut off the end of the end of the meat when she prepared it was because the pan was too small for the meat. There was no real secret recipe or compelling reason to cut the end off other than the pan size. People often do the same thing in business. They see successful businesses and mimic the actions of the business without understanding the reason behind it. Seeing other successful businesses doing things is is no substitute for your own research.

6. Lack of communication

Several years ago NASA lost a Mars orbiter which cost $125 million. After reaching Mars 36 miles from the planet, a 286 day journey, the probe malfunctioned and “continued beyond Mars.” NASA had partnered up with Lockheed Martin for the project. Lockheed used English measurements while NASA used the metric system (CNN). This lack of understanding of the measurements is the culprit of the major loss. It is amazing that a mishap could occur between two very large companies like this for such a high dollar amount. If you are not careful, you could end up with the same kind of problem on your hands. Assumptions can be very costly. If you don’t feel 100% confident you are on the same page as others, ask. It is more professional to ask, than to have a big expensive mess on your hands.

7. Not paying attention to details

Several years ago, 2008 to be exact, the Chilean 50-peso coin was printed with a misspelling. Instead of reading “Chile” the coin was stamped “Chiie.” Several people lost their jobs over this spelling error (BBC). If you have ever looked through resumes to hire an employee, you should have an understanding of the relationship between detail and credibility. For example, if you read a cover letter which speaks about how excited a candidate of employment is about “perusing this opportunity” or about their experience as a “manger” it might give you a laugh, and probably brighten your day, but it will probably end up in the recycle bin. In college you probably spent time looking at your written work up and down and even had others read it to make sure it was flawless. Take the time to do what is necessary to be free of flaws in your work.

Works Cited

BBC. n.d. http://news.bbc.co.uk/2/hi/americas/8511910.stm. 14 January 2013.

CNN. Metric mishap caused loss of NASA orbiter. 30 September 1999. http://articles.cnn.com/1999-09-30/tech/9909_30_mars.metric.02_1_climate-orbiter-spacecraft-team-metric-system?_s=PM:TECH. 14 January 2013.