Pride and overconfidence could see your brokerage hit the skids. Here’s why.
A young broker takes a few risks and becomes a successful business owner. But one day they start having cash flow problems. The broker figures that his or her expertise has got them this far, it can get them out of any dilemma. The business fails.
This is a story that’s’ all too common in the Australian business landscape, says Vantage Performance MD Michael Fingland. In fact, he argues, the personality of an SME owner is the overriding factor in how a business performs.
“It is very personality-driven – it’s so much more a part of success or failure than other factors such as what industry you are in, or what state the business is based in,” says Fingland.
“If deluded self-belief and ego come into it, they often mess around trying to fix the problem themselves and their bank eventually forces them to take action – by then they have lost six to 12 months of time and the company is in much worse shape financially.”
A recent survey by Vantage Performance of the bankers, lawyers and accountants who have referred troubled clients to them found they don’t seek help early for three key reasons:
The best way to combat overconfidence is to surround yourself with people who are smarter than you in other areas, says Fingland.
“So directors whose businesses do get into strife and do survive are the ones who actually know their limitations and do seek to surround themselves with experts, either by hiring somebody with complementary skills or by seeking that advice from outside,” he says.
Furthermore, an SME owner who communicates clearly with their people and external stakeholders is much more likely to maintain their support and stabilise the business, he adds.
With Christmas approaching, Fingland says now more than ever is not the time to be complacent.
“With the economy still struggling and expectations of a less than stellar Christmas period, if a business is underperforming, is it equipped to deal with further shocks in the system?”
Related:
Time to let go of your ego: Moses
Three ugly habits of successful brokers
Is personality a factor in the success or failure of a brokerage? Share your thoughts below.
This is a story that’s’ all too common in the Australian business landscape, says Vantage Performance MD Michael Fingland. In fact, he argues, the personality of an SME owner is the overriding factor in how a business performs.
“It is very personality-driven – it’s so much more a part of success or failure than other factors such as what industry you are in, or what state the business is based in,” says Fingland.
“If deluded self-belief and ego come into it, they often mess around trying to fix the problem themselves and their bank eventually forces them to take action – by then they have lost six to 12 months of time and the company is in much worse shape financially.”
A recent survey by Vantage Performance of the bankers, lawyers and accountants who have referred troubled clients to them found they don’t seek help early for three key reasons:
- Self-belief (a genuine but often misguided and over-confident belief in their own ability to fix the problem): 73%
- Pride and ego: 68%
- Denial and delusion: 68%
- Cost of consultants
- Fear for their reputation if they call for external help
- General lack of awareness that such help exists
The best way to combat overconfidence is to surround yourself with people who are smarter than you in other areas, says Fingland.
“So directors whose businesses do get into strife and do survive are the ones who actually know their limitations and do seek to surround themselves with experts, either by hiring somebody with complementary skills or by seeking that advice from outside,” he says.
Furthermore, an SME owner who communicates clearly with their people and external stakeholders is much more likely to maintain their support and stabilise the business, he adds.
With Christmas approaching, Fingland says now more than ever is not the time to be complacent.
“With the economy still struggling and expectations of a less than stellar Christmas period, if a business is underperforming, is it equipped to deal with further shocks in the system?”
Related:
Time to let go of your ego: Moses
Three ugly habits of successful brokers
Is personality a factor in the success or failure of a brokerage? Share your thoughts below.
