A friend of mind was forced to close shop after almost twenty years of operation. It came as a complete shock to my system. Beside the fact that he is my friend, he was also my client.
There is this joke in my country that when someone dies, people cry for different reasons. Not everyone is crying simply because of the loss, they might also be crying for something bigger than the dead person.
This guy closing shop went down with almost thirty thousand pounds of my annul income. So while I feel genuinely sorry for my friend, my tears are not completely altruistic.
However, this article is not about me or my friend, it is about the greater lesson for many small business owners. It is a lesson I hope you will take and apply to your business.
My friend is a second generation business owner. His father started the business and brought him in to run it along with him. Therefore he did not have to endure the type of beating that his father ensured during the formative years of the business.
What should have turn out to be a blessing to him turned out to be a curse. One of the main reason most businesses fail is the lack of money. My friend like many second generation entrepreneurs did not have to stay up awake at the end of the month worrying about whether he was going to make payroll.
He did not have to fright to answer his phone for fear it might be his creditor. He did not have to scrounge around for money to fulfil order.
The fact that he did not have to do all of those stuff in the end became the thing that sank him.
Entrepreneurship like any profession in life requires years of training and pain. You don’t become a professional: lawyer, doctors, dentist or accountant by default, it requires long years of training.
You do not win an Olympic gold medal without four years of grilling training and endurance. In the same token, you do not become a successful entrepreneur by cheating the sleepless nights and the terrifying phone calls from your creditors.
The sleepless nights, the hide and seek with the creditors, the scrounging for money to fulfil order is our university or Olympic training.
I am not suggesting that my friend or other second generation entrepreneurs like himself have to invent suffering just to get the battle scars. I am suggesting that they need to prepare themselves for another battler – taking the business to the next level.
I have had this discussion with my friend on many occasions. I said to him your father has brought the business as far as his abilities could take it. To move the business from its current state to the next level whatever that may mean for you requires a completely different skill set from the one your father used to bring it to this level.
During the News of the World press scandal, when the younger Murdoch was questioned by the Parliament, it was evident that he was completely unqualified to be the CEO of such a massive company.
Understandable Murdoch senior has completely lost the plot. Murdoch junior had the opportunity to take control of the situation and prove to his doubters that he did not get the job simple because he was daddy’s boy. He fell flat on his face. He sat at the sessions looking nervous with no idea how to handle the situation.
Furthermore, he would have avoided that situation by making a simple decision the very first time news of the scandal broke especially when revelation of hacking of the phone of British soldiers and the dead girl was revealed.
All he had to have done was immediately fire Rebecca Brooks, pay her off and feed her to the lions and he would have saved the corporation and his job.
Any good CEO would have defused that situation easily without allowing it to explode into a full blown crisis that eventually resulted in the closing of the paper.
As intriguing as the Murdoch story might sound, the aim of this article is not to entertain you, the goal is to point out a lesson to you.
What is the lesson to be learnt from the story of my friend and that of the Murdoch?
The key lesson is the importance of training and coaching. Most second generation entrepreneurs strive under the shadow of their parents. Their parents been typical old school entrepreneurs run the business and hoped their children are going to learn by osmosis.
The real dumb ones send their kids to business school to learn how to run business from professors who have never ran business in their lives.
Many second generation entrepreneurs link my friend never once in their lives attend any form of business development training given by a successful entrepreneurs.
They never have a business coach even though they can afford to pay for it. They feel they can learn from their parents who themselves never attended any form of business training.
Years ago their parents could wing it. These days competition is so fierce that no business owner can afford to wing it you will get slaughtered.
Except you want to continue playing in the little leagues. If you want to play in the major leagues, you need to give yourself every advantage you can get. Coaching, training and mentoring are what provide advantage to entrepreneurs.
Even Bill Gates has a coach so what about you?
I admire my friend’s father a lot. He has served as an inspiration to me. His is a story of an immigrant who came to the UK with nothing, without a word of the English language. Started his business from nothing and managed to make it one of the most successful businesses in his town.
But at a point times changed and competition surfaced, it caught him completely unprepared to navigate the new business environment brought about by competition. His son who should have stepped in at that point and take over from where he stopped was unequipped to take over the reign.
You cannot learn how to run a successful business by osmosis. Business like any skill demands a certain process to be successful at it. The majority of small businesses fail because the owners or in this case their heirs try to subvert the process.
I hope you will learn the key lesson from this story and take the appropriate actions to give yourself a competitive advantage.
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