Startups: How To Prevent Your Business From Failing

Startups: How To Prevent Your Business From Failing

Doctors will often conduct postmortems to determine how an individual died. They do it to prevent other deaths, solve crimes and accumulate statistical data. Unfortunately, once someone is dead, there is no way to help that person. Entrepreneurs and investors will analyze a service, product, or company that is no longer profitable or had died. As with a deceased individual, postmortem is too late for the disused service, product, or company. Think about premortems as it relates to Gary Klein’s book on How People Make Decisions. His thoughts are to put a team together and hypothetically believe that your business has failed. You heard it correctly. Pretend that your business has shut down, closed its doors, and is no longer generating revenue. You then ask everyone in your team to give reasons as to why the business failed. Each member should be able to provide at least one reason. The critical and most important step is to analyze those reasons and prevent it from occurring. Don’t ask your team to discuss challenges and issues because frequently held staff meetings are lead by unwritten rules and mind games. For example, not being a team player, not creating enemies, and not embarrassing a fellow coworker. It is very unlikely that all team members are going to be openly honest at these meetings. In contrast, premortem is not finger-pointing. Nobody is bashing anybody. Everyone is working together and discussing hypothetical reasons as to why the business failed. Everyone means literally “Everyone” because it would be shameful if someone knew of a reason and never had the opportunity to share it.

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