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Academics Parallel Professionals on Suggestions for Business Success

BY STACEY BENGTSON

Retired businessmen and women who volunteer as counselors at the Service Corps of Retired Executives, or Score, have firsthand insights into what the most common mistakes business owners and entrepreneurs make and how to avoid them.

However, when it comes to college professors connected to the business community, they, too, have in-depth knowledge, as well as a different perspective on how to create a successful business.

Vish Krishnan, a professor of innovation, technology and operations at UC San Diego’s Rady School of Management, said staying focused, but adapting and evolving to changing market conditions is key to a successful business.

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“One mistake that business owners should avoid is not being responsive to changing market conditions,” Krishnan said. “Balancing responsiveness with focus is the real art of business judgment.”

Krishnan, who specializes and leads the areas of business innovation, said entrepreneurs should be careful to “not get carried away by the periodic hype of the industry.”

“You often see business owners spreading themselves too thin and not focusing on specific customer pains. What you learn from business success and failures is the need for discipline and attention to scaling the business,” Krishnan said.


Similar Viewpoints

Peg Eddy, co-founder of University of San Diego’s Family Business Forum and president of San Diego-based Creative Capital Management Inc., a financial and investment advisory firm providing services to entrepreneurs, has directly seen mistakes happen, mistakes that run parallel to those the Score counselors advise against.

Being a business executive herself as well as personally helping support and guide family-owned businesses through USD, Eddy has the “hands-on” perspective that many Score counselors have.

Lack of business planning, lack of financial planning and doing all the work themselves are top mistakes Eddy has seen.

“Not committing a vision and business details to writing,” Eddy said is one popular mistake that is done by entrepreneurs. “Put your business plan to paper, use any reasonable business planning software, but detail your mission, your market, your management team, the money needed and how you will monitor your progress.”

Regarding finances, Eddy said, entrepreneurs err on the side of “having an unreasonable expectation regarding cash flow and, therefore, start a business with insufficient cash and capital.”

Eddy’s resolution to this is to know the expected and prepare for the unexpected.

“It always takes longer than expected for a new business to generate cash flow,” Eddy said. “Always have enough emergency funds available outside of the business to cover unexpected financial needs.”


Hiring Issues

Continuing on with another mistake the Score counselors also unfailingly highlighted, Eddy said, “too many young entrepreneurs skimp when it comes to hiring the right team to get the business up and going.”

This includes hiring financial advisers, insurance agents, bankers, realtors and attorneys.

“As the business takes wing, delegating what you don’t do best to others with complementary skill sets is vital to the longer term survival of any business,” Eddy said. “Letting go and delegating is a must.”

When it comes to resolving these mistakes to where it doesn’t jeopardize the success of the business, Krishnan said recognition and recovery is the essence of survival.

“Every company makes mistakes, but can they recover from them swiftly? A sense of humility is key to recognizing the mistakes; this must be followed up with the capability to address the mistake and permanently recover from it,” Krishnan said.

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