A few years ago, a friend of mine launched a business. He worked hard, he worked smart, and he caught a few lucky breaks. His business steadily grew.
Then he landed the kind of deal every startup founder hopes for: a contract that, in one fell swoop, quadrupled his revenue and profits. Since nothing beats earned success, he threw a big party. He invited employees, vendors, and suppliers—everyone he could think of. After all, conventional business wisdom says we should celebrate success.
Or not. A study published in Emotion found that “expressive” winners—people who loudly and publicly celebrate their success—were seen less positively than “inexpressive” (read: “humble”) winners. The expressive winners were seen as arrogant, less emotionally intelligent, and less likely to be someone people would like to be friends with. This is important in business because really, who wants to do business with an arrogant, emotionally unintelligent person with whom you wouldn’t want to be friends with?
“Expressive winning” is just one of the pitfalls of reaching a certain level of business success. Want to ensure you keep adding to your list of accomplishments? Try to avoid these other common problems, too.
Confidence reduces fear and anxiety. It reduces emotional noise, which can help you to perform better under stress. It just might be the best performance-enhancing drug of all—until it’s not.
As the authors of a study in the Journal of Personality and Social Psychology determine, “Early successes […] induced a skill orientation towards the task. [Participants] over-remembered past successes and expected more future successes than the other two groups. Involvement had the effect of increasing expectations of future successes and tended to increase their evaluation of their past performance.”
This is especially true when luck, not skill, helped influence those early successes. The past informs the future, but it doesn’t predict the future. Dues aren’t paid; they’re earned, each and every day.
The best kind of confidence? A sense of self-assurance that helps you feel, based on your past success, that you have the intelligence, skills, and experience to figure out how to make a good decision, pull off a successful product launch, and hire the right people. With time and effort you will figure out how to be right. In other words: don’t assume that you’re already right.
Throwing money at problems
Most of the successful entrepreneurs I know are the product of bootstrapping. They had an idea, a vision, and a dream. But they didn’t have money. When they faced challenges, they overcame them through creativity and hard work. Those early struggles? They forged perseverance and determination, which in turn resulted in the belief that adaptability, innovation, and intelligence are the best ways to solve problems. Not money.
Still, it’s tempting, when you’re at risk of missing delivery dates, to simply pay more to expedite shipping. It’s tempting to simply hire someone to fix your inventory control problems. It’s tempting to spend more on supplies instead of streamlining production to make it closer to just-in-time.
Yet, the formula for running a successful business, no matter how large, is relatively simple. A successful business takes in more money than it spends. Follow that formula, and you’ll likely be successful. The more often you find a creative solution that costs no or a little money, the more likely you are to spend less than you make. And continue to spend less than you make.
Early on, the stakes feel incredibly high. Every sales call seems mission critical. You plan, prepare, and double-check. You do everything you possibly can to deliver.
With success, some of those standards can naturally slip. Missing one delivery date out of fifty? That’s not a huge deal. Deciding to “wing” a product demo instead of spending sufficient time to prepare? You’ll be fine. Letting an unpleasant conversation between two employees go, instead of dealing with it? It will all work itself out.
And before you know it, the high bar to which you once held yourself (and your employees) has lowered to general guidelines instead of standards.
Culture isn’t just what you encourage; culture is also what you allow to happen—the things you accept. The things you let your employees, and yourself, get away with. Spend time considering the values and behaviors you encourage. Spend more time considering the values and behaviors you allow. Because what you encourage may describe the culture you want to create, but the things you allow will ultimately define it.
Failing to evolve
Not to bash poor old Blockbuster (although I’m going to anyway), but the now-defunct video store clearly failed to recognize the impact of streaming. This is a classic example of failing to evolve. Another one that is likely to occur involves gas stations and convenience stores. Several states have already passed laws banning the sale of gas-powered cars after the year 2035. The writing is on the wall for business owners that rely on gasoline sales. At some point, they’ll have to evolve.
Current success, no matter how massive, does not guarantee future success. There will be new competitors, changing consumer tastes, transformations technology, public sentiment, etcetera. The old cliche is true: the day a business stops evolving is the day it starts dying.
Celebrate your successes, but do so in moderation. Hope they continue, but act as if they won’t. That way you’re a lot less likely to one day find yourself wondering when everything (except you) changed.