I have made some foolish business decisions in the past and each time I make sure the lesson is implanted in my brain for recall when I wander again towards foolishness. Foolishness is the opposite of wisdom and the only thing that sustains a business is the wisdom to know not to make foolish decisions.
It would be valuable if all of us could learn from the foolish decisions each of us have made individually and collectively. Imagine the savings that could be realized from helping others avoid costly mistakes created from foolish decisions. The fact is that today anyone can improve the quality of their decisions, the wisdom of insight and the assurance of having access to the knowledge required to avoid foolishness.
Avoiding Foolishness Requires Knowing
To avoid foolish business decisions we have to look at what drives entrepreneurs and established industry leaders to make foolish decisions.
The drivers of foolishness for early stage entrepreneurs includes:
- Believing hare-brained ideas are the entrepreneurs most valuable asset.
- Believing that building an idea is enough.
- Believing that research and testing of assumptions are not necessary.
- Believing that they don’t need facts to support their assumptions
- They do not see the true complexity of the market.
- They do not seek the counsel of wise people.
- Believing that raising money for an idea is easy.
- Not learning what needs to be learned about their business proposition
- Listening to fools who promise to lead them into the promise land.
- When fame and fortune is the goal and not meaningful value creation
The drivers of foolishness for established organizations includes:
- Dishonesty: How often do we see managers make a promise to a client, an employee or an investor to learn later that they never intended to keep it? Sadly, it’s a common occurrence in America. It’s also just a matter of time until such nefarious behavior becomes known and results in the collapse of the enterprise and its people.
- Defective Culture: Organizations that mistreat employees and abuse customers are ripe for failure. Firms that base their philosophies’ on “win-lose” thinking can neither survive nor prosper. This approach generally begins with leadership that is arrogant and greedy. Then they hire and promote managers of the same attitude and behavior.
- Customers Are Not Important: Company leaders who don’t listen to and respond to customer needs are facing financial disaster. Sadly, these managers believe they know more than the customer. They suppose customers will never seek improvements or that competitors will never surpass them. They allocate no funds to research.
- Dreadful Customer Service and Support: Managers and leaders who over promise and under deliver will watch a steady stream of their unhappy customers head for the door, while also telling their friends to shop elsewhere. Managers who mistreat, abuse and disrespect customers will not be successful.
- No Vision, No Strategy: When people do not understand why the company exists, or have a clear and knowledgeable view of what value it creates, the organization will not survive. This is a firm with no leadership. They are lost and don’t know it. They are aboard a ship that’s is sinking and they don’t know it.
There are other factors that could be considered foolish in business. Things like not valuing your employees, hiring the wrong people and believing that change isn’t necessary to survive. Care to add your own thought to the list of “foolishness” in business?
It is easy to avoid foolishness if you care to study and listen to the wisdom of the ages and the insight of the crowd. Both are available at the click of a mouse to those wanting to avoid foolish mistakes.