Whether a company experiences success or failure is largely dependent on its leadership. Throughout history, we have witnessed some of the world’s most powerful companies plummet into nonexistence because of poor leadership at the executive level. Rubbermaid, Schwinn and former telecommunications giant WorldCom are just a few that come to mind. If a company is going to survive, its leaders must avoid mistakes, better yet, bad habits such as these at all costs:
Inability to Separate Ego from Business
In order to be successful, a company must be driven by business executives that live and breathe for the organization under which they are employed. On the other hand, that drive can turn out to be a bad thing when their passion is misplaced and misguided. Executives who are unable to separate organizational goals from their own personal ambitions often fall hard, and can even take the companies they represent down with them. Need more proof? Look no further than Enron, a story many call one of the most shocking business failures in history.
At the turn of the millennium, Enron was arguably the biggest thing going in the gas and oil industry. The one-time giant of Fortune 500 stature was riding high until times got tough and bad decisions started to be made on the leadership end. All of a sudden, Enron was losing money at an alarming rate, and to make matters worse, executives started covering up losses by removing liabilities from the company’s financial statements, and hiding the truth from investors. By 2002, Enron was in such bad shape that it was forced to file bankruptcy, which at the time marked the largest bankruptcy in U.S. history.
The man who shouldered most of the blame for the Enron scandal and subsequent fall was Jeffrey Skilling, the company’s former president and CEO. Despite being the financial guru partly responsible for Enron’s huge success in the early 1990s, Skilling was also known as an egotistical entrepreneur who took perhaps one too many risks. The poor leadership that befell this once prominent corporation will be studied at business institutions around the world for years to come.
Refusal to Listen
There is nothing wrong with having confidence. After all, it is a quality every business executive needs to lead their company down the path of success. However, it is that little taste of success that can easily cause that confidence to turn into arrogance. And when arrogance settles in, there could be no getting through to the executive who thinks they know it all. The downside to this is that tuning out the advice of others creates a level of inflexibility that restricts adaptation and growth, both of which are vital for any company.
Savvy business executives realize that leading an organization is much more than being the head man (or woman) with all the bright ideas. They understand that when it comes to what’s right for the company, the best decisions are often those that are made with input from other members of the administrative team. As simple as it sounds, not all businesses get it, hence why the number of failed companies is going up.
Failure to Adapt
One trait shared by many of the companies we have seen crumble in recent times was the failure to adapt to the changes in their market and what’s going on around them. Not realizing that there is no future in the static business model, they stick with it under the belief that those same tactics will remain effective for as long as they need them to be. Not only is this a practice that can leave an organization stuck in drive, it could send it barreling in reverse. In today’s highly competitive business environment, the ability to adapt with the times and roll with the punches as they’re thrown is a skill that must be acquired.
If you are a business executive who thinks you have even a hint of these bad habits within you, I advise you to work on completely eliminating them right away. Look at them as the collective bad vibe you do not want anywhere near the workplace. Your employees will thank you.