5 Management Mistakes First-Time Small Business Owners Make

Date: February 14, 2011

Management mistakes and tipsWhen you’re running a business for the first time, you’re bound to make a few management mistakes. Since owners are typically experts in the products or services their businesses provide, they often get caught up in the technical aspects of the company, rather than developing strategies to manage and grow it.

But that’s the last thing you should do. “At the end of the day, you’re creating an organization and philosophy that embraces your people, because they are your most important asset,” says Greg Scheingold, president of The Growth Coach, a business coaching franchise system based in Cincinnati.

Scheingold shares some common management mistakes of first-time owners—and tips on how to avoid them:

1. Lack of Systems and Processes

New businesses often lack proper systems and processes to ensure that employees are working efficiently and effectively. Without these systems, “employees run around rudderless,” Scheingold says. Begin by documenting everything your business does. Establish goals, outline steps and create an operating manual.

2. Micromanaging

There’s a tendency for first-time owners to think they know best. But micromanaging will stifle employees’ productivity and loyalty to your business. Instead, train employees to do their jobs, and give them the freedom to do it. Getting them involved in decision-making can also encourage productivity and make them feel valued. “Elevate yourself so that you’re not a task manager and can focus on growing your company,” Scheingold says.

3. Failure to Define Jobs

Creating the right job definitions will help you hire the right people. Too often, owners will make hires without defining their roles. That results in less productive workers and more responsibilities for the owner. “As you are growing your organization…you need to define jobs so people can do them and optimize performance,” Scheingold says.

4. Working on ‘Clutter’

Too many owners confuse activity with results—say, spending two hours checking email instead of making sales calls. If you’re too consumed with what Scheingold calls “clutter,” or tasks that take away from the most important needs of the business, you may need to delegate this work or make a new hire.

5. Lack of Vision

First-time owners often fail to define their vision for the business clearly. If you get employees on board with your company early on, it will create happier, more efficient employees. It will also give you more time to work on growing your business. “If you properly instill vision, then your business can operate without you,” Scheingold says.

Read Next: 3 Goal-Setting Mistakes New Small Business Owners Make

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