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How to Learn from Business Mistakes

Running a business is a marathon. At every step, business owners make mistakes. But mistakes often don’t make a business fail; instead, it is a business’s response to mistakes that makes the difference. Successful business owners know how to identify their mistakes, focus on what they could have done differently, and can develop a plan to prevent similar errors in the future.

Use an Audit to Learn from Business Mistakes

Plenty of business owners might think ‘audit’ is a scary word, but frequent audits of your decisions can reveal a lot about your business. To start, thoroughly examine your most recent business mistake. It’s important to think about the problem holistically. What were your goals before the mistake occurred, and how did the result stray from those goals?

After evaluating your goals before the mistake, it’s important to have a clear understanding of how and when the problem occurred. Don’t be afraid to break out the whiteboard or a pen and paper. Visualizing the entire chain of events is critical for the next part in the process: focusing on your sphere of influence.

Focus on Your Sphere of Influence

Now that you have a clear idea of the timeline, you can begin learning from mistakes in business by focusing on your sphere of influence. There are many factors that are out of your control as a business owner. Market fluctuations, recessions, disasters, recalls, and more can all put a damper on your business. These unfortunate events are uncontrollable.

In this step, we want to focus on the actions that you took as a business. This is called your ‘sphere of influence’. By focusing on what you can change (rather than what you can’t) you’ll learn more from each of your business mistakes. It’s important to note here, however, that you shouldn’t completely forget about factors out of your control because you can control how your respond to them.

Incorporate Plans to Avoid Mistakes in Business

At this step, you should have an audit of your mistakes and a deep understanding of the part you played in making them. The last step in learning from your mistakes in business is to plan. This plan can come in many forms, from staff changes to supply chain adjustments. Regardless of what you need, you should make a detailed list of action steps that will help you right the mistakes. Be careful during this stage to craft actionable steps that will also help you avoid the same mistakes in the future. This can be incorporating a checklist into your business processes, hiring staff dedicated to managing these mistakes, or whatever you see fit.

Regardless of how you proceed, Falcon National Bank always provides small businesses with the support they need. As an SBA Preferred Lender, we offer flexible and competitive financing to help you start, manage, and develop your business. Contact us for more information or to set up an appointment.