Being your own boss can produce a lot of intrinsic rewards, but only after you effectively jump some challenging hurdles.
If you are thinking about going it alone in the business world, you need to understand fully the pros and cons of such a move. Yes, there are plenty of rewards that come with entrepreneurship, but the path to success is normally full of hurdles.
Before you take the plunge and start your company, consider these five major challenges in business ownership.
Being in the Hot Seat
If being your own boss is your main motive for starting a business, recognize that being in the hot seat presents some key challenges. These obstacles often stem from managing people and making tough decisions.
You know the challenges of employment from a worker's perspective, so you probably get that managing others can be extremely tough too. You have to make hiring, employment and termination decisions that don't always make you popular. When employees aren't happy, you become the subject of their ire. Additionally, you make the tough calls that impact the success or failure of the company. You have a lot to gain in money and prestige, but much to lose as well.
Taking Calculated Risks
When running a business, the potential financial repercussions of a bad decision are great. Money, time and energy are just a few of the key resources you typically put into running your company.
As the owner, you make the critical strategic decisions that involve significant risk. Failing to evaluate properly the risk-to-reward ratio of a decision is a big mistake. Not only is your money in play, but your credibility and standing in your community and with your staff are often on the line as well.
Developing a Work-Life Balance
It is hard for many new small-business owners to find a healthy work-life balance because of the time, sacrifice and money involved in running a company. In the beginning, it is especially difficult to walk out the doors of your new enterprise for date night when you must work your hardest to create a strong, stable revenue model
Balancing your passion for your company with a personal relationship and family responsibilities is challenging, but important. When you don't prioritize non-business relationships in your life, the stress that comes from home can hinder your ability to lead your company.
Leading the Charge
Don't make the false assumption that you will always get to enjoy the "fun" day-to-day activities involved in operating your business. In reality, coming up with short-term and long-term business plans, and then managing the execution of these plans is a major role for an owner. Much planning takes place behind-the-scenes.
You are the one who must come up with plans and ensure they get carried out. This role is quite different from being in a position to execute on directives from someone else.
Sharing Control and Delegating
It is tempting for many new owners to try to control every aspect of operating the business. You soon learn, though, that trying to tackle everything yourself is impractical and not very healthy. The stress alone diminishes enjoyment, but more importantly, you won't have time to lead if you try to do all the frontline activities.
To build a strong and enduring business, surround yourself with a strong team. Learn to delegate to free yourself to focus on high revenue activities. The goal is to put the right people with the right abilities in the right positions. Make good hires and trust the team to execute on your strategy and deliverables.
Starting a company with unrealistic expectations of money, fame and fun, without any heartache, is a setup for pain. Go in with your eyes wide open to the hard work and very real challenges that entrepreneurs face. If you remain hopeful and disciplined, and you are more likely to achieve satisfying results.
Take the next step in your path to owning a business and get the Become Your Own Boss Workbook.