HomeBusinessSMEChat: Greatest obstacle to business success: Short-term thinking

SMEChat: Greatest obstacle to business success: Short-term thinking


The farmer’s reply was, “The wind picks up pollen from ripening maize and swirls it from field to field. If my neighbours grew inferior maize, cross-pollination would steadily degrade the quality of my crop. If I am to grow a good crop, I must help my neighbours do the same.

A lot of small business owners fail to act like this Indian farmer. By thinking of short-term benefits and looking out only for themselves, they fail to maximise on the abundant opportunities available to grow their businesses.

Some firms are failing to pay basic wages while others are moaning that high labour costs are threatening their companies’ survival. I overheard one person saying he is not paying his farm workers because they are going to steal from him anyway. That is short-term thinking, and it never leads to success. High performance entrepreneurs view people as their business’ most valuable asset.

The workers share a common vision with the business owners; that is, they all want to prosper. Giving workers ownership in the firm, in the form of equity stakes and profit-sharing, gives them the pride and motivation needed to make them fully devote to the company.

When the firm is in a cash crunch, the workers understand and endure the inconvenience, because they know that they are in the same boat with the owners and will do whatever it takes to help the company survive.

Another manifestation of short-term thinking is duping customers. Take some of the food sellers at Mbare for instance.

If you look at the egg rolls they sell, you will see a lot of egg and tomato showing from the sides. But buy one and look inside and you will find just tiny bits.

Similarly with vegetable traders; they hide bad potatoes deep inside the pocket so that you only see good ones from the outside. Also not different are retailers who sell cheap Chinese fakes packaged as original products. You may initially make money because you got something for nothing, but going forward, you will most probably fail. Customers will get to know about your ways and stop trusting you, which is a big loss that you will struggle to recover from.

A long-lasting business starts with a deep foundation. Most of the people who start small businesses come either from formal employment or straight from school or college. Very few have undertaken business courses and gone through some form of apprenticeship.

I was talking to a colleague last week about the new book “101 Tips For Your Business In 2011”. This book has just been completed and will be available for free downloading, and by email to those who requested, from January 19 (download at http://chichonip.wordpress.com.
Now, the issue was on how to distribute it to SMEs in the rural areas and growth points. My friend said I shouldn’t bother, because Zimbabwean SME owners don’t like reading, especially books on business. I don’t know if that is true, but it’s a widely-held perception.

In the book Rich Dad, Poor Dad, Robert Kiyosaki said “If you want to fly an aeroplane, I advise taking lessons first. I am always shocked at people who buy stocks or real estate, but never invest in their greatest asset, their mind. Just because you bought a house or two does not make you an expert at real estate.” So start now, invest in yourself, write your business plan and start building for the long-term.


About the Author

l Phillip Chichoni is business planning consultant who works with SMEs and entrepreneurs. You may contact him by email on chichonip@gmail.com

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