For many people, owning a small business is not simply an investment. Rather, the owner’s entire identity is often inextricably intertwined with the business itself. That is particularly true for someone who started the business from scratch – in that event, the business can often be an extension of the person. One of the difficulties faced by any small business owner is the struggle to differentiate between themselves and the business.
This phenomenon manifests itself in a variety of ways. For example, even in this difficult economy, we have seen small business owners who have retained employees, even though there is nothing for them to do, to avoid having a layoff. To do so is understandable. The owner knows his or her employees personally, and knows that the loss of a job would cause hardship. At the same time, the owner wants to protect good employees, particularly those who have been loyal to him or her. And, of course, most entrepreneurs tend to be a fairly optimistic lot and expect that the business will turn around in short order.
For many small business owners an obstacle even to addressing difficult issues is psychological. That is, the owner must be willing to accept that the business must be treated as separate from the owner. When faced with the difficult decisions facing a small business today, the question to be answered is whether the decision is good for the business, not whether it is what the owner necessarily wants. Often, the two coincide. But when they don‘t, the most successful business owners are able to make the distinction and take difficult action when necessary for the good of the business.
In many instances, the necessary action is fully known to the owner but difficult to take for any number of reasons. For example, while retaining loyal employees is a noble gesture, if the business does not survive not only will all of the employees lose their jobs, but the owners stand to lose their entire investment as well.
Many business owners will be faced with difficult issues in the near future, if not already. If you want your business to survive, you will have to learn how to put your personal preferences aside and instead make decisions based on what is best for the business in the long run.
Robert Nicholson