By Chuck Violand
March 30, 2015
Recently, I was having a conversation with a business owner who has a pretty successful company. For several decades, he has steered it through the normal ups and downs that accompany any growing business. He was lamenting some of the gut-wrenching decisions he has had to make regarding people’s employment when business got slow or finances got tight. He’s a nice guy, and it hurt him when he had to lay people off. He admitted that, when faced with this situation, he would delay it as long as he could, frequently longer than he should have, thus compounding his financial issues. He took his responsibility to his people seriously and these difficult decisions personally.
These decisions—and the emotions that go with them—are what entrepreneurs are made of. By definition, an entrepreneur is “a person who organizes and manages a business undertaking, assuming the risk for the sake of the profit.” Although this is a pretty good description of what entrepreneurs do, it doesn’t capture who entrepreneurs are. I think a better definition would be “nice guys who get lucky with an idea for a business.”
Most of us don’t start our companies with a clear understanding of the tough calls we’ll have to make as we run them. We’re focused on the adrenalin-induced euphoria of the startup phase and aren’t thinking about the competitive, employee, and financial pressures we’re going to face as our companies grow. And that’s probably a good thing.
It’s a lot like having kids: if our parents knew in advance all the challenges and heartburn we were going to cause them growing up, we might never have been born!
Running a business can be one of the most exciting and rewarding professional experiences. You can also count on it causing you to have heartburn from time to time. To minimize that heartburn, here are a few business fundamentals to follow.
- Avoid hiring friends. Instead, hire people who can do the job, and make them your friends.
- Pay close attention to your numbers. Wanting to be a nice guy doesn’t mean you don’t have to track your numbers. Use them to help you make sound business decisions. This way, you can make decisions earlier and based on hard data rather than just emotions. This will help keep every decision from becoming personal.
- Communicate openly and often—especially when times get tough. As entrepreneurs we tend to retreat within ourselves and not communicate when things aren’t going well. This leaves our people to come up with their own (usually worse) interpretations of the situation.
Entrepreneurs are often portrayed as hard-charging risk takers whose only drive is for more profit. While profit is certainly critical to the success of any business, this image overlooks the deeper side of entrepreneurs—the nice guys who are also able to make tough business decisions.