Top 10 causes of business problems.

In the series of posts about becoming a great new General Manager, I’ve written almost exclusively about success, successful habits, success processes.  Its time now to consider the causes of business problems, and consider it in a positive way

Failure and the causes of failure, manifest themselves in many ways but to truly solve a problem you must make sure you have found the root cause.  No one wants to spend their time constantly fixing the same problem over and over again. And so, a good place to start is by understanding the top ten root causes of business problems you will encounter as a General Manager, so you can consider proactively how to address them, should they occur on your watch.

So where do I get my list… firstly personal experience. I’ve spent the last 25 years making mistakes and trying to solve problems, so its my personal view along with friends, and colleagues experience supported by a review of the literature.

So here’s my list of the top ten root causes of failure in today’s businesses.

 (1) Poor Training.  People don’t know what to do, what process, what procedure. So first ensure people are trained in what they do. This is not the sole reason why things go wrong.  Many times employees may  be …

(2) Not following procedures.  Unused procedures are not effective. People often decide they can do things better than they were trained, but often times their way isn’t the tried and true way.  Why aren’t they following procedures?  Perhaps because they are…

(3) Poorly written procedures.  If a procedure is unclear it is a lot harder to follow.  Even well-written procedures are not perfect. Especially if the procedures are not updated when improvements to the process are made.

So the top three causes of failure in business are easy to remedy, and essential to avoid. Lets progress

(4) Poor employee placement can result in business problems, too, and its my number four cause.  Your employee may not be the right person for the job.  Better screening when hiring, improved job descriptions, or testing can help you to place the right person in the right job.  Yet even with the right person you could have …

(5) Poor or outdated methods that have  not changed, or at least the changes were poorly communicated. As mentioned earlier people can improve processes but if the improvements aren’t noted, of if people aren’t trained to look for and note down improvements then this causes failure of the system. Next,

(6) Poor inspection causes mistakes both by the person responsible, by their supervisor and by you.  This is really about attention to detail (person doing the job, person supervising and you), understanding your product, and caring for the output that your team are passing on to the next step in the process.  Pay attention and have your team members take the time to inspect your product and you will reduce your chances of seeing these causes of business problems.  This starts with training them on what a perfect product is, and in detailing in writing what this is and how to inspect as part of the process. Related to inspection is …

(7) Poor maintenance.  If you team and managers neglect equipment then it is more likely to malfunction.  Modern management thinking focuses on preventive maintenance, which means regularly maintaining your equipment to ensure it does not break down in the middle of something important you are doing. This isn’t just on the manufacturing floor, but also caring for office equipment (printers computers etc).  Of course it could be breaking down because of a

(8) Poor engineering or design in the first place.  Focus on designing in quality into machinery and into the process of using this by doing it right the first time and you will avoid the number 8 cause of business problems.
Are you selecting …

(9) Poor inputs or materials because the price is right, or you consider good quality raw materials too expensive? If you are unable to afford the best then re-engineer your machines and process to cope with poor quality inputs. If you have challenges here, then perhaps your management has

(10) Poor rewards or incentives in place?  I am not talking about just the quantum of money. The first part of this problem is measuring the right measures and then finding the most appropriate means to reward people for achieving these measures.  Recognition of good quality or pointing out poor quality performance may be all that is needed to send the message that quality is important and thus preventing many of these root causes in the first place.

So that’s my list of the Top Ten Root Causes of Business Problems, simple aren’t they. So simple, that its assumed that these simple ideas have been implemented. But because these ideas are so simple, they are often ignored or overlooked.

In the end, rarely do people make mistakes on their own. Your systems help them to make mistakes. If you have a system for training, well-written procedures, following-up on procedure usage and enhancement (i.e. internal auditing, metrics, rewards), identifying and developing competent employees for the role they are placed in, updating and innovating methods used, attention to detail at all levels, disciplined maintenance, quality designs, consistent and focused measurement supported by appropriate rewards and incentives for good work, then you would have eliminated 80% of all of your business problems.

The last 20% is left to the individual’s ability to operate the system you have just created.

So as a new GM, the first thing you need to do is to create your proactive checklist for each of these top ten problem causes and ensure you only have to deal with the 20% of problems that this checklist doesn’t cover.