Eleven Easy Ways to Destroy Your Company
By Jay Goltz
NYT
Thinking Entrepreneur
Businesses make hundreds or thousands of decisions every year, many of which seem inconsequential. But the smallest details can have business-changing or even business-ending consequences. Here are 11 of my favorites to watch out for:
1. The lowly extension cord. People get cold feet. They get a space heater. They plug it into a two-pronged extension cord. They forget to unplug it when they leave work. That night, while you are sleeping, your entire business burns down. Your brilliant marketing plan, your three-year projections, all of your records, your new product samples … . You get the idea. This is not something that most business owners think about, but insurance companies know that extension cords and space heaters are major fire hazards. It is good practice not to allow any extension cords in your business that aren’t three-pronged.
2. Bad receivables. Let’s assume that you are using good judgment as to which customers get credit and how much. Even so, it is very easy to get into a business-life-threatening situation because of a big customer that goes broke. Months before the bankruptcy filing, the following statements will be made to you: “I’m not going anywhere. We’ve been short on cash before, and we always come out of it. You have my personal word.” And you will respond: “We’ve been doing business together for 30 years. I’m not worried about it.” Bad things happen to good people. Good and honest intentions do not always result in getting paid. It is very painful and difficult to cut off an old customer, especially when you need the business. But many companies go broke because of bad receivables.
3. Interviewing. It is both art and science. Like a bad science experiment, it can cause explosions. Having someone who hasn’t been properly trained interview prospective employees is a recipe for disaster. There are many questions that you cannot ask without risking a nasty lawsuit that will cost plenty of time and money.
(More here.)
NYT
Thinking Entrepreneur
Businesses make hundreds or thousands of decisions every year, many of which seem inconsequential. But the smallest details can have business-changing or even business-ending consequences. Here are 11 of my favorites to watch out for:
1. The lowly extension cord. People get cold feet. They get a space heater. They plug it into a two-pronged extension cord. They forget to unplug it when they leave work. That night, while you are sleeping, your entire business burns down. Your brilliant marketing plan, your three-year projections, all of your records, your new product samples … . You get the idea. This is not something that most business owners think about, but insurance companies know that extension cords and space heaters are major fire hazards. It is good practice not to allow any extension cords in your business that aren’t three-pronged.
2. Bad receivables. Let’s assume that you are using good judgment as to which customers get credit and how much. Even so, it is very easy to get into a business-life-threatening situation because of a big customer that goes broke. Months before the bankruptcy filing, the following statements will be made to you: “I’m not going anywhere. We’ve been short on cash before, and we always come out of it. You have my personal word.” And you will respond: “We’ve been doing business together for 30 years. I’m not worried about it.” Bad things happen to good people. Good and honest intentions do not always result in getting paid. It is very painful and difficult to cut off an old customer, especially when you need the business. But many companies go broke because of bad receivables.
3. Interviewing. It is both art and science. Like a bad science experiment, it can cause explosions. Having someone who hasn’t been properly trained interview prospective employees is a recipe for disaster. There are many questions that you cannot ask without risking a nasty lawsuit that will cost plenty of time and money.
(More here.)
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