Do You Know the Reasons Small Businesses Fail?
Recent Growth Research Uncovers Why Companies Fail
In an on-going national research study focused on attempting to understand and decipher the patterns, the behavior and the characteristics of growth in entrepreneurial enterprises, it became apparent that most organizations struggle and fail with the challenges of growth as a result of three issues:
1. They don’t have a sustainable profit model.
2. They aren’t able to create a healthy work community that produces the level of enthusiasm,
focus and intensity required for extraordinary staff performance.
3. They don’t have a business model by which
they can understand and predict the growth of their organization.
Most companies in the study were operating in a state of ‘figuring it out as they go’. But the facts about entrepreneurial enterprises are still shocking:
Consider these questions
Why is it that after five years only 20 out of 100 companies are still in business?
Or why, after 10 years, there are only four companies left from the original 100?
All this framed inside the fact that 92% of the workforce in this country is employed by small businesses.
And why do the companies that do survive their first three years of business often go out of business within the following two years as a result of growing their businesses beyond their capabilities?
Walking the Line Between Chaos and Organizational Equilibrium
Unless the individual running the company has been down this road numerous times before, the research points to the fact that without a clear model for understanding the growth of a company most entrepreneurs don’t have the level of predictability necessary to survive the game.
And even if one has been down the road before, each new company venture produces its own patterns and personality that create unique challenges very likely not seen before by the operator.
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