Every successful company is at risk of failure. I know this may sound contradictory, but it is the plain truth. Consider this; you start a small business in a highly profitable niche, you start getting clients, you are growing and making huge money, and there is zero or almost no competition. What are your chances of expansion? Most business owners will rest and start retelling their ‘success’stories. This is why a businessman and an entrepreneur are two different people with different visions.
What is the difference between a businessman and an entrepreneur?
A businessman will start a business with money as the end game. It could be a
You may be asking, what do entrepreneurs do different? Look at the way companies such as Google works. They ask people to add photos and reviews of places you have visited, then introduce a service where you can ‘call the salon.’ Using the data you have provided, they help people navigate routes as is the case in ‘The Birdbox.’ How cool! With a considerable amount of investment and help from people like you and me, they help you get a matatu home or to a totally new place, even book an uber!
Entrepreneurs solve problems. They identify gaps in the market and then fill them using creative solutions. You cannot resist an entrepreneur’s offer. I mean, just when you are getting tired of long queues in the bank, Safaricom brings you M-Pesa and links it to your bank account so you can deposit and withdraw money to and from your bank account without stepping into the banking hall, without queuing, without leaving your home!
Despite this, we have all seen successful companies fall. Nakumatt, Uchumi, Mumias Sugar, Akamba bus and Stagecoach are some familiar names that are have faded from the memories of some. They were big, growing and even enjoyed monopoly of sorts once in their lifetime. Internationally, we have Kodak, Nokia, Blockbuster, and recently Yahoo in the list of big companies that failed. All these companies were doing well, but have gone under. Why?
Reasons why big companies fail
One of the main reasons why these big companies have failed is resistance to change. Times change. People change. Technology changes. Governments change. Policies change. So, what happens to a company that observes all these changes from the back seat?
You cannot afford to do nothing in times of change. Many big corporations, however, fail to innovate because they are already successful. They busk in yesterday’s glory and thus never get to see new competitors coming in, technology changing or times swallowing them. Within no time, their products become obsolete!
Why success is the enemy of business growth
There was a time you could call Safaricom customer centre and they would hang up on you. Though they have changed, they still do. One time, one of the former leaders of Kenya Power told Kenyans that they don’t have to use their services, that there are many alternatives such as charcoal! Electricity is a key factor for economic growth. Imagine a business owner being told to use charcoal to deal with frequent power blackouts.
If you visit most of the big stores or high traffic boutiques in the city, nobody will talk to you. You will hold a product you like and start looking around for the salesperson who may or may not start a conversation with you. Some will even respond to ‘How much is this’ with ‘Are you buying or just asking?’ This is a very easy way for an employee to bring down a business. But as a business owner, what should you do to attract and retain clients? Good customer service is key. Systems can be put in place to maintain quality service.
Ever been in a highly competitive online niche? You will know that success is the enemy when you start ranking highest on the Search Engine Results Page. You will have to keep looking for ways to retain that position because your close competitors will be fighting to dislodge you. Regardless of the stage your industry is in, or the amount of success realised, you cannot stop innovating. As the fathers of innovation say, “Innovate or die.”