Are You A Navy Seal?

I was thinking about hell week when recruits try to qualify as a Navy Seal. The program is not designed to help the soldiers but instead to break them, to fail them. Only about six percent of those that apply will survive the onslaught of tests to become a Navy Seal. Slim odds. 

Right off the top of my head, I can only think of one other pursuit with such abysmal odds for success: business ownership. Despite all the corporate trainers, executive consultants, online business resources, and mentoring Zoom calls, fewer than 57% of companies started will still be open after five years; 22% will close within a year. Only 25% survive 15 years or more. Again, slim odds. 

Most people would not buy a car knowing it had severe engine problems and would soon go caput, or purchase a home built on sinking swamp land, or buy stock with a performance record that was chronically abysmal. This makes no sense. All three would be a terrible investment. The same is true for business ownership yet so many people will invest in their own company (about 543,000 new firms start each month) even though the majority are destinated to fail. Further, did you know these ‘dropout’ statistics have remained relatively unchanged for the past 60 plus years so nothing we were doing then or doing now has really diminished the high business failure rate. Unbelievable but true. 

Many entrepreneurs (81.7%) will tell you they opened their own business to be their own boss. This lofty aspiration is commendable and reflective of the American business spirit. It is also terribly flawed because this view is often accompanied with the belief that failure is in the cards for everyone but them despite the statistics that indicate otherwise. So, is naivety the cause of America’s entrepreneurs failed companies? It certainly is a contributor. The fact is, it is easy to open a business but much harder to build one. When an entrepreneur is laser focused on the freedom of working for themselves, how they intend to build that dream is often overlooked.  

So, is the system, like the Navy Seals hell week program, designed to fail America’s entrepreneurs or are our entrepreneurs simply not properly prepared for the tough rigors of business ownership? The answer is, yes. 

Here are a few insights gleaned from my research regarding this topic: 

• There are 7 stages of business development: starting, surviving,  building, refining, thriving, maturing, exiting. Note: most companies never make it beyond stage 3. 

• There are 7 primary business competencies that an enterprise owner must master to progress from one stage to the next. Note: The majority of entrepreneurs fail to reach the needed proficiency level in at least two of these competencies at any given time, thus contributing to their company’s demise.

• Too few business owners fail to identify the three foundational elements necessary for success, before opening their business.

  • Entrepreneurs leading these young companies tend to thrust themselves into business ownership without a measurable system installed to hold them accountable for the performance of the company to someone outside the company.

  • There are few affordable, business building support resources in the market focused on teaching entrepreneurs, who are leading the most vulnerable businesses, start-up to five years old, the rudimentary skills and processes that must be applied for survival.

• Many small business consulting and coaching options will help identify why an enterprise will fail or is failing but seldom provide a viable resource to fix the problem.

  • Leaders of more established enterprises fail to adjust their operational processes to go to scale thus stall out at a time when they should be growing exponentially.

  • Too few entrepreneurs spend the time or money to boost their critical leadership competencies to address their own deficiencies that hinder the success of their enterprise at each stage. 

Here’s my 30,000-foot view of this dropout dilemma.  

Business failure is avoidable because 90% of the challenges that will destroy an enterprise are predictable. 

Like the recruits that want to be a Navy Seal, there are many entrepreneurs that want to be a business owner. In both cases, the dropout rate is astronomical. My obvious directive: get back to an academic mindset and learn about the predictive pitfalls in all seven stages of business ownership to prepare your enterprise to beat the dropout odds.  

If you knew there was a source to achieve this directive, would you use it? 

Questions: 

Are you ready to start your own business but want to avoid the predictable  

pitfalls? 

Do you know what stage of business you are in?  

Are you stuck in a stage but don’t know why?  

Do you know what dropout pitfalls are typical at each stage?

To learn more about or view Jet Parker’s business building network, visit www.ceowired.com.