There are a number of reasons why a business fails. Below are what I consider to be the Top Five.
- Ignoring Your Current Customers. I was once with a large company that continually spent their energy and time on internal issues and the politics that accompany the in house fighting. They literally ignored their current customers and lost one of their biggest accounts simply from neglect. It was a real eye opener for me. CEOs should be spending quality time consistently with their customers especially the most valuable and largest.
- Not Finding New Customers. Show me a company where the Finder ( CEO, leader, visionary ) is not spending the majority of their time with current customers and finding new ones and I will show you a company headed for The Danger Zone ( Mills, 2006 ).
- Financial Statements Are Not Timely And Accurate. How any company can possibly think it can succeed and win without ever knowing the score is a mystery to me.
- No Intense Focus On Cash And Cash Forecasts. You have heard it before but “Cash Is King”. You must know your cash balance daily AND what you expect your cash balance to be one, two, or even six months ahead. No cash, no business!
- The Company Is Operating Without A Business Or Strategic Plan. Allow me to explain this in a positive way. I once started with a company that at the time had approximately $ 17 million in annual sales. That company put together a well thought out and developed strategic plan that would enable them to grow to $ 100 million in ten years. Guess what the annual sales were ten years later? They literally created the future with their plan and their future became a reality.
* Mills, Jerry, ( 2006 ), The Danger Zone