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I am a publicist for Sam Carpenter, author and owner of Centratel, a multi-million dollar telephone answering service in Bend, Oregon. Sam is author of the new book, "Work the System: The Simple Mechanics of Working Less and Making More." He's also the founder and executive director of Kashmir Family Aid, an international non-profit that provides relief work for earthquake victims in a third-world country. Please visit 
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New here? Employee Evolution is a blog written by Ryan Healy. Ryan is a Co-Founder of Brazen Careerist, the webs #1 social network for young professionals. Ryan speaks with organizations on best practices for recruiting and retaining Generation Y and how to effectively use social media to reach your target market. To contact Ryan, please visit our contact page.
Five Common Mistakes Young Adults Make When Starting Up a Small Business
College campuses are becoming a fertile breeding ground for up-and-coming business owners.
A recent study by The Global Entrepreneurship Monitor shows that 18- to 24-year-olds in the United States are starting businesses at a faster rate than 35- to 44-year-olds. Now is your prime time to consider opening up that tattoo parlor, bed and breakfast, or wilderness expedition center you’ve dreamed about.
So whether you’ve established a small business, are in the midst of launching one, or simply considering it for the future, it’s certain you want at least one thing out of this investment: success.
But it won’t be a cakewalk. It’s hard to believe, but over 50 percent of small businesses fail in their first year and 95 percent fail within the first five years, according to the U.S. Small Business Association. Starting a business is risky for most, but success can come for those who proceed with logic and discipline.
Here are five common mistakes people tend to make when starting up a small business – and how you can avoid them:
1. Business owners don’t create documented procedures for the day-to-day operation. It’s a simple equation: Systems = freedom. A “working procedure” is a documented description of how to perform a task. Having it prevents random problems and ensures the task is performed exactly and consistently. Procedures help you delegate, improve your scheduling ability, and allow you to work smarter and accomplish more with less effort. Thus, work less and make more. It’s ironic, but by implementing documented system procedures, your employees are free to be creative because they don’t have to “wing it” each time they perform their job duties; everyone operates at a smoother pace because there is a proven, working process. Everyone knows what to do and what to expect. Your people don’t have to be mind-readers or fortune tellers.
2. Owners don’t delegate – they are “doing the work.” The reason a business owner can work a few hours a week, or take an extended vacation without stress, is because they have created systems, implemented written procedures with supporting documentation, and have learned to delegate. I know, I know. You’re zealous, dreamy-eyed, and proficient at what you do, and as the leader of an organization, you’re committed to doing whatever it takes to get your new business off the ground. Successful people don’t work harder; they work smarter. This means focusing on what you do best, and delegating the rest. Ask yourself what you enjoy doing least for your business. Perhaps that’s bookkeeping or making phone calls to potential clients. Then, imagine literally giving away these tasks. Get rid of the “I am Superman” attitude and hire people who are trustworthy and qualified to take much of the weight off your shoulders.
3. Owners don’t use time wisely. Biological Prime Time is when your brainpower is at peak capacity. People function at maximum effectiveness about six hours out of a 24-hour day. It is important to understand this interesting facet of human performance, determine precisely when your prime time occurs, and then use it wisely. Six hours out of a 24-hour day is not much. Presuming you wish to reach your goals sooner rather than later, it is best the tasks that contribute most to your primary goals are performed during your prime time hours and you protect those hours from interruption. Also, don’t start your day without a to-do list. Make a list of tasks and categorize them into business-building activities, client activities, and personal items. Then, prioritize, remove distractions, delegate, and stick to your plan.
4. Owners see their job, life, and business as “holistic.” You must change your fundamental perspective to see the elements of your world as separate, linear systems. See that these systems can be perfected, one-by-one. Understand that by perfecting a primary system’s sub-systems, the primary system will be perfected – and, although you are taking a non-holistic approach, your end product – your business – will be a highly efficient, entirely holistic, “Primary System.”
5. Owners don’t have a strategic objective or set of operating principles. A strategic objective is short, usually a single page in length. It defines overall goals, describes methodology, and prescribes action. It gives direction for making major and minor decisions. It’s an essential instrument for a business and for personal life. General operating principles are a two to three page collection of “guidelines for decision making” that are congruent with the strategic objective. Essential for the work environment and in a simplified and shorter format, they also guide one’s personal life. Two examples of simple operating principles are “Do it now,” and, “choose the simplest solution.”
Leave your thoughts here. (13 responses)
- 1 Trackback on Apr 30th, 2008 at 7:18 am
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Good post!
The information here applies to business in general also. For example you could replace ‘owner’ with ‘manager’ ant the same you apply.
I especially like point # 1. I think that too often managers (and owners) think that they are ‘empowering’ their employees to make their own decisions, when they really need to be providing much more guidance and instruction.
I read a very interesting book this year that included that point. It’s somewhat unwieldy title is “Why Employees Don’t Do What They Are Supposed To Do (And What To Do About It) by Ferdinand F. Fournes. Check it out!
Number Four was interesting…do you have any further information/reading on the ~6-hours of peak performance/day?
Your post was very reminiscent of my “required reading” for anyone who wants to start a business: “E-Myth Revisited” by Michael Gerber. Someone told me that I absolutely needed to read this before I started my business, and so very, very true!
Another one on my list is “The Four-Hour Work Week.” This is imperative for anyone who is looking for freedom in entrepreneurship as opposed to being chained to your business on a daily basis.
I think your first point is good, but loses focus quickly. What you mention IS the key to having organized procedures, it is obvious, but you then fail to mention what one does about those day-to-day procedures.
Should one write out a procedure for an UNusual day in which you have no deliverables to work on? If so, I’d like to hear more about those. Something like Business Development may not work properly with a procedural base, it requires a more natural flow of thought (for example).
Thom, I tried sending you several excerpts from Sam Carpenter’s new book, Work the System: The Simple Mechanics of Working Less and Making More (www.workthesystem.com), but I couldn’t get through to your e-mail address.
Please e-mail me at nataliet@workthesystem.com or call 1-800-664-7448, and I’d love to provide you several excerpts on the specific topic of Biological Prime Time and finding your peak performance time. You’ll find this incredibly useful.
Look forward to hearing from you.
Basically, these five points are different versions of the same thing, and yeah, it’s all about realizing that as any business grows you need others who can do some of the work. You get little benefit from being the main person doing all the work. In that situation you actually work harder than you would if you worked for someone else. Sure you might make a little more, but it’s not an ideal situation.
Having been an employee in a couple small businesses, I’ve got some first-hand experience with failure to delegate. I’d say both of my previous two employers could seriously benefit from just getting some trust-worthy people and equipping them to make decisions and keep things running so that personal involvement by the owners themselves is less necessary.
Number 2 is sooo true. My sister who owns and runs her own coffee shop used to run around like a headless chicken trying to get everything done herself when she was just opening up the cafe. She finally figured out that she had to use her time more wisely and started delegating to some of the people she had whom she thought could handle the extra work load. So far it has worked wonderfully. She has since then gone on to open up a dormitory and a cafeteria. And yep, she delegates a lot now.
I wanted to mention an open-source project that I’m in no way affiliated with but love anyway, because it’s really helped me clean up my work habits — I think it would help people with points 1 to 3. It’s called OpenGoo, and it allows you to create projects, deadlines, meetings, etc, and manage your time on projects in a detailed way. In multi-person operations, it allows one to delegate work to certain co-workers or employees.
In my web design business, it’s great because I can set up a set of tasks under a project or milestone, and use them as both a to-do list and a time tracker, tracking each minute job I do on a larger project. This (I hope) will help me when I estimate projects for clients in the future.
Anyway, here’s where to get it: www.opengoo.org
You can download it and set it up on your own webserver if you have PHP and MySQL available, or use their paid, managed service.