The REAL Reason A Business Fails Print E-mail

The REAL Reason A Business Fails

by Eugene Vasconi, owner of Communication Arts and author of "Say What?  Do You Know What You Are Communicating"

As a long-time business owner and business communication mentor, I am often asked to provide business people with help to get their businesses back on track.  One of the reasons that my mentoring has been so successful is that I look at this type of problem from a different angle than most considering my 30 years in the media industry.


Many “traditional” business coaches cite the standard reasons why a business fails:  poor management, lack of capital, lack of planning, growing too fast, and even not having a web site.  While these may all contribute to the failure of a business endeavor, they all fail to address the REAL underlying reason.  Before I tell you that reason, let me give you an example of how this one concept makes all the difference in the world for success.

Let us look at two marriages.  All of our couples are in love, all are motivated to see the union succeed, all are intelligent, energetic, and all are the same age.  So, we have eliminated nearly all of the reasons for a marriage failure.  Have we?  

Couple one travels through today’s life each seeking their own career path.  They spend eight hours a day at work concentrating on their jobs and positioning themselves for advancement. If possible they meet for lunch and discuss the day’s activities, make plans for the evening or weekend, and simply chit chat.  When they re-connect in the evening, they spend time recovering from the day but also spend quality time re-bonding.

Couple two travels through the same world each seeking their own career.  They also spend eight hours a day at work but never take the effort to meet for lunch and never call one another just to connect.  When they return home in the evening, no attempts are made to inform the other person of the day’s activities and their current status.  They are simply too tired and caught up in their own world to think about including the other person in it.  

Now, over time which marriage do you believe will thrive?  The one in which constant bonding is important or the one in which each party sails the ocean solo and does little communication.  AHA!  The “C” word has just entered into our discussion.  If you dig down deep enough into our two couples’ lives you will find that communication is the lubrication that makes the union run at peak performance or, if missing, causes the train to screech to a halt.  Every other reason for failure is secondary if communication is absent.  The same is true for the failure of a business.  All of the other  reasons we mentioned above are secondary if the person(s) who started the business do not understand how to communicate.

As I tell my clients, marketing is critical to success but if you do not know how to communicate you cannot succeed in marketing.  How do you promote your services if you do not understand how to effectively speak or write or know which buttons to push?  Even in high-tech 2010, this forms the basis for success or failure in a business.  Want proof?

Problem / Solution

  • Are my business partners on board?--Solution:  Ask them (communicate)
  • Who are my clients? --Solution:  Survey them (communicate)
  • How much should I charge?--Solution:  Check your competition (communicate)
  • Ho do I get customers?--Solution:  Advertise (communicate)
  • How do I design my web site?--Solution:   Make the message effective (communicate)

Every solution to a business problem starts with communication.  Do not get bogged down with wildly complex problems -- sift through them and dig down to the root cause.  The problem has something to do with communication.  My experience is that most often this exact scenario is the center of the problem and when communication is corrected, dozens of other problems vanish.
A disturbing trend I am seeing more and more today is one of electronic detachment.  This is the tendency of some business people to isolate themselves from their clients by use of voicemail, e-mail, texting, and anything that enables them to avoid interacting on a personal level.  And, as you know now, this is a sure-fire way to not effectively communicate.  Communication is best served in person because all of the elements are in play:  physical presence, eye contact, aural reaction, body language.  Eliminate one or more of these elements and effective communication dramatically suffers.  Why would you wish to attempt to close the deal of a lifetime without putting in play all of the advantages interpersonal communication offer?  This is yet another example of how most  reasons for the failure of a business can be traced to simple communication technique.

In closing, if you are experiencing overly rough times in your business (more so than what is normal), do three things:  spend a week reading about business communication techniques, find a mentor who is successful, and do it NOW.  Business failures are cumulative and the longer they continue to grow, the more tentacles they put out to infest other aspects of the business.  Remember, start at the root of the problem and look for communication solutions.  Fix them first and other rough spots will solve themselves.

Good luck.