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4 Factors That Cripple Your Long Term Business Plan

4 Factors That Cripple Your Long Term Business Plan

(Atit Phetmuangtong/Dreamstime)

By    |   Monday, 06 August 2018 06:04 AM

Every entrepreneur should have long term plans which in most cases involve deliberate effort, strategic planning, teamwork and a whole lot of commitment. You need to thoroughly study the most successful businesses in America to comprehend the rigorous tasks of keeping a business afloat.

Businesses don’t just fail, there are countless factors militating against it. Invariably, businesses succeed because a deliberate effort was made to set goals, monitor assigned tasks and correct deviations to achieve the set goals.

These are 4 factors that cripple your long term business plan and how to overcome them:

  1. Negative Organizational Values

Every organization, no matter its size, nature and location, has a set of values that helps an organization define its culture and beliefs and also guide the actions of its members and relations with the community.

Negative organizational values like lateness, laziness, poor communication, unhealthy competition among units and a host of others should be stopped to avoid chaos. It’s not enough to have value statements which list the principles and ethics to which an organization adheres, organizational leaders are supposed to lead by example.

For instance, if a manager frequently comes to work late, his subordinates will so follow him. Also, if the account unit is instructed to manipulate the company’s financial account statement, some members of the unit will someday defraud the company.   

The corporate values you uphold automatically become operational. Corporate values like integrity, accountability, employee engagement, respect, teamwork, leadership by example etc. should be encouraged to help achieve a business long term plan.

  1. Wrong Location and Poor Office Setup

A long term plan can be hampered by wrong location. A good business that finds itself in a wrong location will face difficulties. This could be in form of cost of engaging labor, energy cost, cost of getting inputs into the business, accessibility to infrastructural facilities and customer convenience. This alone can shift the management’s focus from long term business plan.

It’ll be difficult to focus on your business long term plan too when the work environment is detested by your workers. You can’t even attract the best talents in such situation. This is because the appearance of your work environment has a huge impact on how both clients and employees perceive the business.

Office design is crucial these days. An open floor plan can encourage creativity and enhance both communication and collaboration while the use of a cable railing design gives a clean, fresh finish, which is particularly popular in promoting a stronger collaborative work environment and increased productivity in the workplace.

  1. Wrong Team

Studies show that the cost of hiring the wrong employee can be as high as 30% of the employee’s first year earnings that 75% of employers have at some point hired a bad employee. The cost of wrong team is very huge.

This can reflect in the business productivity, employees’ turnover, decision making, quality of customer service and teamwork. What do you do in this situation? You can adopt close supervision and employee training.

If you’re still grappling with the issue, you have to access the strength and weakness of every member and lay off the unproductive, redeploy and encourage the productive ones to ensure that round pegs are put in round holes. You wouldn’t want to miss out on the benefits of having a good team, would you?

  1. Inappropriate Business Loans

Loan management is crucial and it is instrumental in ensuring the success or failure of any business, except you have the required financial resources. In reality, many of us have little option but to borrow to meet our short term and long term goals.

Some people make a huge mistake of using short term loan to finance long term plans. You need to have adequate information and skills to manage loan in order to make informed decision on taking loans. This is as a result of the disparity in interest rates.

Interest rates should be carefully examined when taking loans. Recent data by Paydayr indicate that more than 39 million people use overdrafts every year and that a third of them consider it a way to borrow money—in exactly the same way as a payday loan.

Hence, many consumers would have little to no access to short term credit, apart from bank overdrafts—at an interest rate that’s more than 50 times greater than that of a typical payday loan. Without the right info on which loan to apply, you may spend all your time, effort and business resources to pay heavily on interest rate, thereby shifting focus from your business long term plans.

Richard Agu is a researcher, entrepreneur and freelancer, passionate about entrepreneurship and self-development. Currently, Richard writes for Entrepreneur.com, Goodmenproject.com, among others. Follow him on Linkedin.com by clicking here now.

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Businesses don’t just fail, there are countless factors militating against it. Invariably, businesses succeed because a deliberate effort was made to set goals, monitor assigned tasks and correct deviations to achieve the set goals.
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Monday, 06 August 2018 06:04 AM
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