If you think many of your worries will be vanquished once your business becomes successful, you’re in for a rude shock. Without a proper plan, such success can actually turn into your biggest challenge.
Have you ever wondered how a business that was making big sales, suddenly lost market share and closed up?
Perhaps, the success of such a business was actually the reason for its downfall. Sometimes, success isn't what it seems to be…
1. A Hyper-Efficient System
Did you know that your health would be significantly affected if your entire body was completely sterilized? Human beings actually have 10 times more bacterial cells than human cells. If we eliminated every single bacteria in our bodies, several biological functions like digestion and immune systems would be affected, since bacteria play a crucial role in such functions.
A similar concept also applies in business. You might think that a hyper-efficient system will drastically cut down your losses and help you make more profits, faster. This might not always be the case.
As you try to create a super efficient system, you must be very careful not to eliminate some seemingly irrelevant, yet immensely critical aspects that support major functions of your business. Yes, you can actually make substantial savings initially from your efficiency measures, making it appear as a success. But this might be followed by major losses afterwards.
A case in point is the issue of customer service. At one point, businesses were all focused on hyper-automation. There was little regard to giving a personal touch to the customer, since this would mean additional processes in transforming products into hard cash in the bank.
You know how that went.
Dissatisfied customers who couldn't get their grievances across to the companies, had to look for other options to air the frustrations; and they did it in the public social media. That’s bound to create a negative image of the company – something that could be easily avoided by having an easily accessible customer help desk.
2. Massive Profit
How can massive profit be a bad thing? Isn't the whole point of getting into business about getting profit?
Well, profit isn’t really a bad thing, but the way it affects your business can lead to disaster. Getting big profit can create an institutional culture that’s against upsetting the apple cart in fear that doing anything out-of-the-ordinary will lead to loss of revenue. This can lead to a huge reluctance to innovate, which is bound to curtail future growth of your business.
One notable case of a company meeting its demise, influenced by massive profits, is the former heavyweight in analog film business: Kodak. Despite being the first to build a digital camera in 1975, the company was reluctant to develop this new, innovative product since it would mean cannibalizing its money-making film business. Ultimately, this led to it’s demise, with the company filing for bankruptcy in 2012.
3. Recognition/ Awards
Just about every businessperson would feel proud being awarded some type of recognition for his/ her exploits.
However, sometimes the aspects used in determining who gets an award or not are things that your specific market has little regard for. When awards are used to classify a whole bunch of businesses, they would obviously have to make use of some general guidelines. This means that they can easily overlook specific aspects that your special client base really values.
Now, if you go on to further specialize in those areas within which you were ranked, probably to maintain your top rank, you would be essentially sidelining your client base. Soon, your clients will realize that you’re working more to satisfy your own ego rather than working to satisfy their needs/ wants.
4. A Huge Array of Products/ Services
If you feel discouraged, as a young startup, that you have a very limited product offering, this should give you a bit of hope.
Established businesses might consider themselves the ultimate one-stop-shop, stocking a wide array of products and services that every customer would ever need. Why would anyone bother going to different stores, spread out in a wide area, when they can easily get everything they want in one place?
In some instances, that wide variety might actually be the thing that repels clients.
Such repulsion of clients, based on an overload of products/ services can be more clearly visualized in the online world. Not so long ago, it was common practice for webmasters to fill up every space of their websites with countless adverts. This was not only irritating, it made it so much harder to actually differentiate the main content from the adverts. Fortunately, many reputable websites have now eliminated such notoriously obtrusive ads.
If you’re planning to add more products or services to your catalog, ask yourself whether they will actually deliver real value to your customers, or will your clients just view them as a brazen scheme to squeeze as much money from them as possible.
5. An immensely Successful Spin-off
Depending on various aspects, this might either be a good or bad thing. If you do come up with a spin-off that becomes remarkably successful – even more successful than your original service/ product – you would be faced with a big dilemma.
The big dilemma would be to either focus more of your attention on the spin-off and less on your original offering, or to still maintain focus on the original offering while maintaining the spin-off.
At times, you might actually decide to give more attention to the spin-off, only to realize that the reason for it’s success is based on the original offering you had. This means that you would ultimately lose out on everything.
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