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The 5 Killer Myths For Any Business

The era of globalization is penetrating every nook and corner of the world. Today’s warfront is the marketplace where people buy or sell products or services. Everyone wants to achieve the highest volume of customers and the largest market share. However, the same phenomenon is now making it difficult for entrepreneurs around the world.

Through my many interactions with entrepreneurs from South Asia, Europe and North Africa as an academic, researcher, trainer and consultant, I have been able to observe some deep rooted issues associated with failing businesses. Most of the time, these failures are blamed on the market, competition and several other external characteristics. When I started researching the same phenomenon in India in the late 90s, I found some interesting psychological barriers in the minds of entrepreneurs that I call “The 5 Myths That Kill Any Business”. Recently, in a similar study in the UK, we found similar myths prevalent within the entrepreneurial community. Interestingly, Indian entrepreneurs were largely owners of goods-oriented manufacturing units and British entrepreneurs were service-oriented organizations. Here are these 5 myths that I have observed at all levels:

1. The myth of product growth: The belief that since our product has been doing well in the market steadily for a few years, there will be no problems for years to come.

2. The myth of the absence of an alternative: the substitute for our product has characteristics that the market will not accept.

3. The myth of quality: The market accepts quality first and cheap products will not be accepted by the market.

4. The myth of non-change: Growth would continue even if we didn’t change because the market accepted the product.

5. The friendly environment myth: Environmental factors won’t affect us much.

Let’s look at them a bit in depth with some examples.

1. The Myth of Product Growth: While working on an EU-funded project, I came across this industry cluster called “Rajkot Diesel Engine Industry Cluster”. The cluster has grown tremendously since the 70s and it started losing in the early 90s due to Chinese and Korean competition in the market. However, it took the cluster 10 years to realize the same mistake and guess what, it is still struggling to catch up to previous growth levels. Will he ever get it back is the question and we all know the answer. When entrepreneurs start settling for innovation, we know the cycle of decline (or certain failure) is not far away.

2. The myth without alternative: In Egypt, at the time of Eid, children use the fanoos (lantern), made of paper and it is tied with a stick. They go to houses in the neighborhood and ask for candy and stuff. This kind of celebration is also seen in other parts of the world at different times such as Diwali times in India or for that matter the ‘trick or treat’ on Halloween. Well, until 2003-04, these Fanoos were made in Egypt only by local craftsmen. However, as business with China grew, a Chinese businessman saw the opportunity and made some changes to the concept of Fanoos. He used a small battery-operated lamp instead of the candle and changed the paper Fanoos to a plastic Fanoos. The result, as one can imagine, is a durable, safe and easy to handle Fanoos that is far better than its previous incarnation which has been in use for centuries. The local industry is almost wiped out in 2 years. If you think the market won’t accept your substitute, this is one of the best ways to fail.

3. The myth of quality: This myth is so pervasive that it is sometimes easy to forget it. All the entrepreneurs I have met have told me that their product is a high quality product and that they take great care of the production processes. My only question for them is, does your customer really care? And each time the answer was a big YES. Somehow I rarely get the same response from their customers. If customers really cared about quality why was M&S in the UK struggling as a retailer while Tesco and ASDA were growing like never before. How come Primark (low-end clothing retailer) is one of the UK’s most successful retailers? How did George (another low-end clothing retailer) become the UK’s best-selling clothing brand? Consumers don’t understand an entrepreneur’s obsession with quality. They want VALUE FOR MONEY. As Wal-Mart does day in and day out, it is now the biggest company in the world and bigger than all of its competitors combined in the United States. How could anyone have imagined this just 40 years ago when Sam Walton started out in Bentonville, Arkansas. Remember that quality is in the minds of the customers and whether you are good or bad, they decide in their minds. In fact, the discrepancies between company and customer perceptions would not be at all unusual. However, even though the company works to the bone on the proverbial quality regimen, if customers see it as cheap, then it’s cheap – in their eyes and that’s what matters most.

4. The myth of non-change: This is another classic myth. I call it the livelihood symbol. Once a product or service has become a breadwinner for more than two years, entrepreneurs become obsessed with it. Buddha said 2500 years ago that “change is the only permanent constant” and this statement is truer today than ever. All the examples I have cited above fall into this area. Additionally, while speaking to some service businesses in the Essex area of ​​the UK, I asked contractors when was the last time they or their employees had undergone some sort of training to improve their skills. The response was shocking. In 90% of cases it never was. In the other 10% of cases, it was more than a year. In today’s world, if we don’t update ourselves, even God cannot save us.

5. The friendly environment myth: I have observed this myth mainly in developing countries like India, Egypt and other countries where entrepreneurs are highly dependent on local, state and national governments for subsidies and protection. As the waves of globalization have touched shores around the world, local, state or national governments can do little to avoid global competition and if entrepreneurs are unprepared for it, their fate is upon us. Already known. This myth is also observed in other parts of the world through the market phenomenon. It was around late 2005, I saw an interesting concept of a pet shop in Brighton, UK. All pink decor and it looked lovely from the outside, however, the first questions that came to mind after seeing this store in the city center, how long will it survive? The entrepreneur logic behind it all was pretty solid, as 7 out of 10 UK pets get gifts just on Christmas itself. However, within two years the store was relocated for many environmental reasons, as one might imagine. Another BBC show called Dragon’s Den really captures this phenomenon to the core.

Well, when considered, these myths may seem like a product of the environment, but the starting point may be different than what seems obvious. Most of the time, when the environment is blamed for the failure, it is actually the person behind the business who is not observing these changes. My suggestion would be for every entrepreneur to take a “thinking vacation” and observe if any of these myths are present in their mind or in their business? If so, now is the time to act sooner rather than later.

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