Reasons for business failure identified
Most failed growth strategies fall into one of four categories, claimed a senior Royal Bank of Scotland director. Commercial and corporate director Donald Workman blamed poor timing and implementation, and bad strategy and ill luck for most business failures.
Workman said: ‘All of these interact to an extent, but one of them is almost always a dominant factor. With timing, if you are not first on the scene, there is a lot of evidence to suggest that you will fail.’
Examples included Lilley’s entry into property development as the sector boom ended, while TV AM’s doomed ‘mission to inform’ rather than entertain was a case of poor implementation.
Workman advised: ‘Do not kid yourself. Understand how you will make your money. The ability to delude yourself that everything will work in the mad rush for growth is incredible.’
He stressed the basic, but often ignored, importance of thinking ahead, developing options and planning for the worst. His final point was knowing when to quit.
‘Rapid and decisive action can really save the day, even when things are going badly,’ Workman concluded.