The biggest mistakes in business are usually made when leaders react instead of act. Reflexive actions are rarely effective when compared to actions borne out of a well-thought-out strategy. Unfortunately, some entrepreneurs are simply winging it 24/7, and although they may be getting by, they usually aren't thriving.
In my 23 years of working alongside and consulting other entrepreneurs, I can testify that the best approach is balancing one's vision with a grounded, mapped out plan.
Yep, that means planning.
Boring, right? To many entrepreneurs, yes. But vitally necessary for success.
Winging it in startups
Picture an early-30's something entrepreneur named Jeff with an original, compelling idea. He shares his idea with others who similarly get excited, and quickly agree to help Jeff get his business off the ground. They refer Jeff to meet with technical experts who can help him launch his new idea, and they even pool money to provide funding. The project looks like a winner to everybody.
Things start with a bang. Jeff and his team create awesome marketing buzz and generate a lot of interest in their product. Everything looks good – on paper. Yet when it comes time to execute, cohesion breaks down and production takes four times longer than expected. In this age of rapid word-of-mouth occurring through social media, Jeff's company suffers a stain on its reputation.
A few of the technical geniuses get frustrated with Jeff's lack of organization and leave. Thing seemed okay at first, but it became obvious to them that after the ball was rolling, Jeff was unprepared for the load. Production limped along, but soon another company took advantage of the interest that Jeff had created and moved quickly to grab the lion's share of the market.
I share this story to emphasize the fact that having a great idea without a comprehensive plan for success just another way of saying "winging it." Oh sure, you can "say" you have a plan, but if it's a 40,000 foot flight path that doesn't consider the management details, then I'd predict your chances of success are greatly diminished.
Winging it in established companies
Another common mistake in business is reaction to a market shift instead of taking time to create a well-thought-out action plan. As humans, our reflexive actions rarely take into account all of our organization's strengths and weaknesses, not to mention all the external factors surrounding us.
Consider what happened to a home heating and cooling company that misread the growing interest in more "green" applications. Without any market research, they launched a "go green" campaign that went a bit overboard, to the point that they had clients wondering if it was still a company that could service their existing furnaces and air conditioners. It only took a few months to realize their mistake, yet in that time they damaged their brand, and they wasted a lot of time, energy, and money doing so.
I realize that planning is not glamorous, not exciting, and it doesn't make family and friends go "wow!" But without it, even the best ideas and intentions can come crashing down.
In my book Creating Passion-Driven Teams, I address the differences between management and leadership, and also where the responsibilities of both overlap. Again, in my 23 years of consulting, I've found that many people have never been taught the difference.
In part, one of the things a leader is responsible for is the horizon - what is happening "out there." But leaders are also responsible for ideas of where the company could and should be going. Not that other people in the organization can't have ideas, they should! But ultimately, it's the leaders who are responsible for them.
To be effective, leaders must also talk with others about those ideas. The purpose is to get multiple sets of eyes considering those ideas, looking for strengths and weaknesses. A leader who won't get this kind of feedback is in danger of missing key, necessary action items that could strengthen the chances for success.
Look at the idea from many angles. Consider the potential ripple-effects in "what-if" scenarios. In other words, what are the implications of a potential action? And if "A" happens, what are the potential ripple effects of that? The more you look at it this way, the more likely you are to identify the potential hazards and plan for them to they don't sneak up and bite you later.
By the way, the more eyes you have looking at project, the more likely you are to have buy-in, too!
I wish I could convey to you how many times I've had leaders tell me "yeah, yeah – we planned it out," only to discover later (after things crashed around them) that their paper-thin plan was nowhere near comprehensive enough.
May you learn from their lessons. Before winging something, take the time to count the costs. It will be time very well spent.