Top Ten Common Mistakes Business Owners Make and How to Avoid Them

By:Roberta Chinsky Matuson

I’ve been in business for 13 years and have seen my share of mistakes made by business owners – many that certainly could have been avoided.

Here is my top ten list of common mistakes business owners make, along with advice on how to avoid following suit.

1. Failure to hire for fit.

Think about a job that you worked in that didn’t work out. Was it because you didn’t have the skills to do the job, or was it because your values did not align with the organization’s? I’m betting most likely it was because you didn’t fit into the culture of the organization. Hire for fit, train for skill, and you should be able to slash costly turnover.

2. Poor interviewing skills.

I recently had a former business owner tell me that he would hire people who volunteered to help him out at the events that his company was working at. These people wound up being “Mr. Right” for right now, but turned out to be some of his worst hiring decisions. Learn how to use behavior-based interviewing techniques to assess whether this should be one date or more of a long-term relationship.

3. Expecting employees to act like owners.

The only people who act like owners are people who have a stake in the business. If you want your people to act like owners, share the profits.

4. Tossing people into management based on seniority.

I’ve heard this story so many times I could repeat it without looking at the script. Employee number 5 has been in the department longer than anyone else, so this employee is promoted to management. It doesn’t matter that he or she is not interested in managing people or that they don’t have the qualities one usually seeks in a manager.

This story never has a happy ending. Either the employees who are saddled with this boss get frustrated and quit, or the manager goes down in flames because they never really stood a chance. Hire or promote people who have the desire and the aptitude for a leadership role.

5. Dropping new employees into their chairs without any training.

I understand you may be hiring experienced people who should know exactly what to do, but the reality is that work gets done differently in every organization. Have a well-designed onboarding plan to smoothly assimilate employees into your organization and watch productivity of new hires soar!

6. Failure to manage performance.

Please don’t tell me you don’t have a performance management process in place because that sounds like something only the big companies use.

There is a reason they have these processes in place. People like to know what’s expected of them and they also like to know when they are not meeting expectations so they can improve. Don’t believe me? Ask your employees. That which gets measured gets done. If you want to maximize productivity, then manage performance.

7. Retaining poor performers.

I hear, “Well, this person really isn’t working out” all the time. Really? Then why the heck are they still here? Start replacing your B players with A players and you will see performance improvements all around the organization.

8. Lack of structure.

Most entrepreneurs come from bureaucratic companies and vow to keep things loose in their own organization. Loose is one thing, chaotic is another. At some point you have to put a strong foundation in place in order to maintain or increase revenues. It will cost ten times more to fix a mess than to prevent one from happening. Put the right structure in place so that you can focus on what you do best: growing your business.

9. Treated people the same.

Equal is not fair, yet owners often give everyone the same autonomy or pay increase, regardless of contribution or experience. Telling a top-performing three-year veteran employee that he or she cannot telecommute one day a week because it wouldn’t be fair to others will do little to inspire additional commitment. Treat people like individuals. Reward those who deserve to be rewarded and be prepared to tell others why they are not receiving the same treatment.

10. Doing everything on your own.

If you can really do everything on your own, then why isn’t everything getting done? I just outsourced a project that I knew was going to take me a full day to complete. This would take away from time I could better invest in marketing my services. Know thyself. Stop holding yourself back and use outside resources to strengthen your organization. In the end, you’ll be glad you did.

You can avoid making all of these common mistakes by doing things differently. What are you waiting for?


About Amr Badran

An Egyptian Business Consultant and Corporate Trainer since 1997. I've trained on Management, Leadership and Soft Skills to thousands of people from many nationalities, backgrounds and professions in more than 10 countries across the Middle and Far East. I've also provided my consultancy service for issues of Strategic Planning, Marketing, Sales and Capacity Building. Holder of an MBA and a Candidate for Doctorate in Business. Find more about my Management and Personal Skills Courses at and feel free contacting me at
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