No one likes to fail.
We can feel foolish, outmaneuvered, incompetent, insecure, unlucky, silly, angry, overwhelmed, frustrated and in some cases afraid to try again. after suffering a defeat.
Failure is an integral part of the learning process.
Failure is required in order to become successful.
Rare is the successful individual, product or organization that has not met adversity, failure, defeat and loss.
One of the keys to success is the ability to accept failure, learn from the experience and try again.
The fear of failure is so great in some organizations that it freezes innovation, thwarts change and stifles growth.
Organizations try to reduce or limit failure by passing on historically successful methods and accumulated knowledge to new members.
Many times this information is not useful and out of date because the elements, players and dynamics of today’s challenges are quite different from those of the past.
Use the following list to analyze your current projects (and possibly prevent or limit failure), or use the list after a setback or defeat to identify where you can improve.
Reasons for business failure can be broken into 4 main groups:
- No plan
- Incomplete plan
- Wrong calculations
- Poor or incomplete interpretation of data and research
- Failure to take into account all factors
- Lack of experience
- Failure to evaluate competitor reactions correctly
- Failure to anticipate consumer response
- Significant difference between planned and actual costs
- Poor cash flow calculations
- Unrealistic goals and expected outcomes
- Underestimate risks
- Didn’t collect all the pertinent information for planning
- Product or service was not wanted or needed by customer
- Lack of knowledge of market
- Lack of knowledge of customers
- Lack of experience in the industry
- Lack of experience in manufacturing
- Lack of experience in sales and marketing
- Lack of experience in administration
Operations and Follow-through
- Lazy, didn’t do the work required
- No control of suppliers
- Did not stop in time and take corrective actions
- Did not recognize warning signs
- Ignored warning signs
- Did not seek professional assistance
- Lack of attention to logistics details
- Failure to focus on customers needs, desires and wants
- Poorly trained personnel
- Lack of initial capital
- Not enough capital to maintain operations for first years
Factors outside of our control
- Important changes in technology
- Environmental factors
- International, Federal, State or local government laws, regulations and legislation
- Aggressive competitor(s)
- Act of God
- Change in fashion and trends
- Theft and fraud