10 Business Challenges of Starting a Small Business from Scratch

What are the major business challenges entrepreneurs face when starting a small business from scratch? How do successful entrepreneurs and drop out billionaires handle and solve problems in business? Must an entrepreneur face these business challenges when starting a business?

“Starting a business is like jumping out of an airplane without a parachute. In mid air, the entrepreneur begins building a parachute and hopes it opens before hitting the ground.” – Rich Dad

If any of the above questions is currently running through your entrepreneurial mind, then I will advice you read on as I trash out the top 10 business challenges you will face when starting a business from scratch.

“Without the element of uncertainty, the bringing off of even, the greatest business triumph would be dull, routine and eminently unsatisfying.” – J. Paul Getty

If you are an entrepreneur, then I believe you will be familiar with the challenges associated with the entrepreneurial process of building a business from scratch. But if not, and you dream of becoming one someday; then I think you will find this article worthwhile.

“A business has to be involving, it has to be fun and it has to exercise your creative instincts.” – Richard Branson

I am writing this piece to enable aspiring entrepreneurs prepare in advance for challenges involved with the entrepreneurial process. Please it’s never my intention to discourage or scare you from going into business; In fact, I intend to achieve the opposite. I want you to venture into the business world and start your own business with a feeling of confidence.

“He that is prepared has half won the battle.” – Chinese Proverb
“The biggest challenge you have is to challenge your own self doubt and your laziness. It is your self doubt and your laziness that defines and limit who you are.” – Rich Dad

10 Business Challenges of Starting a Small Business from Scratch

1. Developing the Vision and Business Idea

“To have a great idea, have a lot of them.” – Thomas Edison

Developing a business idea is usually the first challenge faced by every entrepreneur when starting a business from scratch. Finding the right business opportunity or creatively developing an idea is certainly not an easy task. I call “Envisioning the idea” the first true task of an entrepreneur. As an entrepreneur, you must possess the ability to see what others cannot see. While others see problems, you must see opportunities.

“There is far more opportunity than there is ability.” – Thomas Edison

But seeing opportunities is just the beginning. The main business challenge is going to be your ability to forge that opportunity into a business idea. I see this as a business challenge because the process of transforming problems into business opportunities is like trying to turn lead into gold. I call it the entrepreneurial process of “Creating Value out of nothing”; a process that brings innovative products into existence. Below is an illustration of how the process goes.

Identifying a problem > seeing an opportunity in the problem > Coming up with a solution > Forging the opportunity into a business idea > Integrating your solution into a business plan

“A good businessman must have nose for business the same way a journalist has nose for news. Once your eyes, ears, nose, heart and brain are trained on business, you sniff business opportunities everywhere. In places where people see a lot of obstacles, I see a lot of opportunities. At times, there is something instinctive in me that tell me a business opportunity exist even at a place where others see nothing. That is what makes me different, maybe unique. A good businessman sees where others don’t see. What I see, you may not see. You cannot see because that is the secret of the business… the entire world is a big market waiting for anybody who knows the rules of the game.” – Orji Uzor Kalu

Developing a vision is definitely a business challenge because an entrepreneur must sometimes assume the role of a sorcerer. Let me explain in detail. Most individuals are comfortable with the present way of doing things but it is the duty of an entrepreneur to envision and forecast the future.

An entrepreneur must always be ahead of his time or else he will lose his relevance. It is the duty of an entrepreneur to bring into present what is yet to be. It is also the duty of an entrepreneur to bring solutions to other people’s problems. Let me give you some practical illustrations:

“If you want to be rich, you need to develop your vision. You must be standing on the edge of time gazing into the future.” – Rich Dad

a) In the late 70s and early 80s, while IBM saw increase in demand for their mainframe computers, Steve Jobs envisioned a personal computer in every home and Bill Gates envisioned the need for easy to use software for personal computers. That single vision made Bill Gates the richest man in the world and Steve Jobs the most famous business person of the 21^st century.

“Business is going to change in the next ten years than it has in the last fifty years.” – Bill Gates

b) The Wright brothers envisioned a flying machine but they were massively opposed because the thought of humans flying was perceived as impossible. Today, the Airplane is a reality.

c) Back in those days when cars were custom made and exclusively for the rich, Henry Ford envisioned affordable cars for the masses. That single vision made Henry Ford one of the richest men in history.

“You are nuts and you should be proud of it. Stick with what you believe in.” – Trip Hawkins

I believe with these few examples, my point is clear. Developing the vision and idea is the first true task and challenge of being an entrepreneur.

2. Raising Capital for your Startup

After developing your idea, the next challenge you are going to face when starting a business from scratch is that of raising capital. As an entrepreneur, you are the only one that knows business your idea to the core. You are the only one that knows the story of your future.

“Capital can do nothing without brains to direct it.” – J. Ogden Armour

Trying to convince investors about something that doesn’t exist is definitely a challenge. Trying to make them understand that you are trustworthy and equal to the task is not child’s play especially when you are building your first business.

“If you want to know the value of money, go and try to borrow some.” – Benjamin Franklin

There is more to raising capital than just simply asking for money. Most investors want to invest in already established businesses with minimal risk and they want to be sure that they get returns for the risk they took. Most brilliant business ideas never scale through the venture capital stage because the entrepreneur is either not prepared or lacks what it takes to raise the needed capital. Just as my mentor, Robert Kiyosaki says:

“The world is filled with brilliant ideas and excellent products but the world lacks seasoned entrepreneurs.” – Robert Kiyosaki

To overcome the challenge of raising capital, you must develop the ability to sell your idea and vision to potential investors. When I say “sell your ideas“, I mean improving your communication skill and your manner of presentation. In the game of raising capital, you must have a good story to tell; backed by a strong business plan and good persuasion skills. You must know how to pitch angel investors and venture capitalists alike.

“The ability to sell is the number one skill in business. If you cannot sell, don’t bother thinking about becoming a business owner.” – Rich Dad

3. Assembling a Business Team

“Eagles don’t flock, you have to find them one at a time.” – Henry Ross Perot

The third business challenge you will face in the course of starting a small business from scratch is assembling the right business management team. When I talk about a team, I am not talking about regular employees. I am talking about a “strategic round table business team” that will meet regularly to brainstorm on ways to grow your business.

“Individuals don’t win in business, teams do.” – Sam Walton

The process of building a business team starts even before the issue of raising initial start-up capital arises. Remember I said that most brilliant ideas never scale through the phase of raising venture capital. Well; this is where most budding entrepreneurs miss it. Most brilliant ideas and products never get funded because the entrepreneur is trying to raise capital as an individual. A business team is a vital, yet often ignored key to raising venture capital successfully.

“Business and investing are team sports.” – Rich Dad

As an entrepreneur, you are bound to have strengths and weaknesses. That is the more reason you need a business team to cover up or compliment your weaknesses. A team is a necessity for building a successful business. Now finding a business team is just the second hurdle, transferring your passion and vision to your team is the next piece of cake.

“Teams should be able to act with the same unity of purpose and focus as a well motivated individual.” – Bill Gates

It’s your duty as an entrepreneur to make sure your team sees the future you see. They must believe in your possibilities and must also be passionate about making that possibility a reality. If they can’t grasp your vision, if they can’t see the future with you, then they are not worthy being your team.

“My model for business is the Beatles. They were four guys that kept each other’s negative tendencies in check; they balanced each other. And the total was greater than the sum of the parts. Great things in business are not done by one person; they are done by a team of people.” – Steve Jobs

Your strategic business team should comprise your banker, financial adviser, accountant, attorney or legal adviser and any other specialist that will be of tremendous impact to your business. A question on your mind right now might be “how am I going to pay this team” My answer is I don’t know. You will have to figure it out yourself or better still, you can consider bringing them on board as partners.

“Go to the wolf, consider its ways and be wise. A wolf will never hunt alone; it hunts in packs because it knows the power of team work.” – Ajaero Tony Martins

4. Finding the Right Business Location

Is finding a good location a business challenge? I don’t know but what I do know is that finding a good business location at the right price is definitely not easy. How do you get a location that has a rapidly growing population, good road network and other amenities at a good price? Well, you will have to figure out yourself.

5. Finding Good Employees

“If you own a butcher shop, don’t hire vegetarians. To hire the right people, you have to let the wrong people go.” – Rich Dad

Most writers and managers crank up the process of finding good employees as an easy task. They define the process of finding an employee as simply presenting the job description and the right employee will surface. But I think it’s more than that.

“The competition to hire the best will increase in the years ahead. Companies that give extra flexibility to their employees will have the edge in this area.” – Bill Gates

Business owners know how difficult it is to find a hardworking, trustworthy employee. Most employees want to work less and get paid more. Finding a good employee who will be passionate about delivering his or her services is quite difficult. Finding good employees is a minor task compared to the business challenge of forging your hired employees into a team. You may have great employees but if they can’t act as a team, they are worthless and will yield nothing but stagnation. A football team may have great skillful players but if they fail to play as a team, their possessed skill is useless.

“Bringing together the right information with the right people will dramatically improve a company’s ability to develop and act on strategic business opportunities.” – Bill Gates

Employees are your representatives to your customers and the outside world. They are a reflection of your business culture and ethics. If an employee of yours is bad or rude to your customers, it is going to portray a bad image for your company. So you must be careful when hiring employees. Remember the golden rule of business; “Hire slow and fire fast.”

10 Business Challenges of Starting a Small Business from Scratch

6. Finding Good Customers

The sixth challenge you will face in the process of starting a small business from scratch is finding good customers. Note the keyword “good customers.” In the process of building a business, you will come to find out that there are good customers as well as bad customers. You must be on guard for bad customers. Good customers are really hard to find. A good customer will be loyal to your company and will be willing to forgive you if you make a mistake and apologize. A good customer will try to do the right thing that will benefit both himself and your company mutually.

“Thank God for my customers. They buy my products before they are perfected.” – Henry Ford

Bad customers will always look for loopholes in the company’s policy to exploit and make a few gains. Bad customers will always try to exploit the company’s goodwill and look for ways to rip off the company. Bad customers are responsible for bad debts.

Good customers build your business and bad customers will always try to liquidate your business. Just as you fire employees, you must also be prepared to fire bad customers without hesitation. Remember the story of the customer that sued McDonald’s claiming the coffee was too hot.

“You must fire bad customers just as you would fire a bad employee. If you do not get rid of your bad employees, the good employees will leave. If I do not fire bad customers, not only will my good customers leave but many of my good employees will leave as well.” – Rich Dad

7. Dealing with Competition

“In business, the competition will bite you if you keep running. If you stand still, they will swallow you.” – Victor Kiam

Competition is the next challenge you will face when starting a business. Most individuals see competition as a plague but I see competition as a good challenge. I see competition as a benchmark for creativity, the main engine that stimulates innovation and production of quality products at great prices. Without competition, there will be no innovation and without innovation, the world will be stagnant.

“If you don’t have a competitive advantage, don’t compete.” – Jack Welch

I see competition as a welcomed challenge and I want you to do the same. Competition keeps us on our toes and drives us to constantly improve our products and services. But you must be warned. Competition can make your business lose its relevance in the eye of your customers so you must always be on guard.

“The competitor to be feared is one who never bothers about you at all but goes on making his own business better all the time.” – Henry Ford

8. Unforeseen Business Challenges and Expenses

“Smooth seas seldom make good sailors.” – Anonymous

Just as a sailor prepares for unexpected storm, just as a pilot is always on the watch for unpredictable bad weather and thunderstorms, so must an entrepreneur prepared for whatever comes. Unexpected challenges can come in the form of:

Unexpected law suits
Inconsistent government policy
Not being able to make payroll
Unpaid bills and taxes
Unexpected resignation of staff from sensitive office
Bad debts from customers
Loss of market share
Dwindling working capital
Inadequate stock or inventory

“A company’s ability to respond to an unplanned event, good or bad is a prime indicator of its ability to compete.” – Bill Gates

These business challenges, if not handled properly can ruin your plan to build a successful business. Another challenge you must expect is an unforeseen increase in business expenses. If not handled properly, it might result in constant negative cash flow and eventually; business failure.

9. Keeping Up With Industrial Changes and Trends

“In three years, every product my company makes will be obsolete. The only question is whether we will make them obsolete or somebody else will.” – Bill Gates

Change in trends is a challenge you must be prepared for when starting a small business. Trends have made and broken lot of businesses. I know a lot of profitable businesses that have been wiped out by slight industrial changes and trends. A typical example is the Dot com trend, where many established industrial based businesses were wiped out by new web based dot com companies.

“How fast a company can respond in an emergency is a measure of its corporate reflexes.” – Bill Gates

When the Dot com era began, business owners were left with only two options. Either they join the dot com train or they get crushed by the dot com train. Seasoned entrepreneurs know that trend is a friend and are always willing to swiftly adjust their business to the current trend. Keeping your eyes open to spot trends is really a challenge but the big task will be your ability to quickly use the trend to your advantage.

10. Exiting the Business

“In the world of business and investing, your exit is more important than your entry. A good thumb of rule is this; exit before you enter.” – Robert Kiyosaki

When building a business from scratch, you are going to face the challenge of determining your exit strategy. Just as the quote above states, you have to plan your exit strategy before you even start the business. Most entrepreneurs run their business without any plans to exit and even if they have an exit strategy, they find it difficult to implement it.

“Always start at the end before you begin. Professional investors always have an exit strategy before they invest. Knowing your exit strategy is an important investment fundamental.” – Rich Dad

Before starting a business, it is advisable to plan an exit. Lack of an exit plan is the primary reason why most businesses crumble after the death of the founder. An exit strategy is very important to the long term survival of a business. now how do you plan an exit strategy? There are benchmarks you can use to determine your exit from any business. Most smart entrepreneurs will use a certain benchmark as a target and once this specific target is reached, they exit the business. Examples of such benchmarks are:

Annual sales
Annual Turnover
Asset Base
Market Saturation
Customer base, subscribers or number of users

Now when it comes to exiting a business, there are three strategies you can apply. You can choose to exit a business in any of the following ways:

a) Turning over the business to professional managers

When your business reaches a certain stage of maturity, you can exit by turning it over to professional managers. In this case, the business still belongs to you but you are not involved with its day to day affairs. You will have to give up administrative role to assume the role of a watchdog. When you exit in this manner, you will have more free time to look at other projects or retire.

b) Selling the business privately

In this case, you are exiting the business by selling it to a private investor. In the business world, it is called M&A (Mergers and Acquisitions). Exiting your business this way means that after the sale and transfer of assets is complete, you have nothing to do with the business again.

c) Taking the company public

The unique thing about this type of exit strategy is that while you are selling your business (in form of shares) to public investors, you still maintain control over the business. Please before you apply any of these exit strategy, I will advise you consult with your attorney or legal adviser. But ultimately, it’s up to you to decide the exit strategy you want to apply; but always remember “your exit is more important than your entry.”

As a final note, I want to state clearly that challenges come only to make you stronger; so don’t faint in the face of challenges. Stand tall; keep moving your business forward and I will see you at the top.

11 Exercises to Boost your Critical or Strategic Thinking Skills

Critical thinking is a skill that only few possess. Fortunately, it is not an in-born gift. It is a skill that can be developed over time. Do you want to develop your critical thinking skills? Do you want to develop the skill to think with strategic intent and direction? Then read on as I share with you practical steps to developing your critical or strategic thinking skills.

Now what is critical thinking and strategic thinking?

In its simplest of terms, critical thinking is the concentration of the body and mind on a situation or problem; with the aim of finding a solution. Nothing more, nothing less.

Critical thinking is one of the important business skills every entrepreneur, manager or CEO must possess. The reason is because critical thinking is crucial to strategic planning, decision making, risk analysis and problem solving in business. Without critical thinking, there will be no creativity or innovation. Without strategic thinking; there will be no growth. Now how do you develop your critical thinking skills? Well, I will advice you read on.

11 Exercises to Boost your Critical or Strategic Thinking Skills

1. Believe in yourself

Self belief is the first prerequisite for engaging in critical thinking. How do you solve a problem when you don’t believe in yourself? The answer is that you can’t. To analyze a situation and come up with a possible solution, you must believe in your skills and abilities. You must see yourself as being capable of handling the situation. You must never believe in impossibilities.

2. Learn to concentrate on a single task or problem

The second step to developing your critical thinking skill is to learn how to concentrate on a single task or problem at a time. Those who get things done are those who focus on solving one problem first before moving on to another. That’s why Andrew Carnegie said that the first prerequisite for success is to concentrate your thoughts and your energies on the task at hand.

“And here is the prime condition of success, the great secret. Concentrate your energy, thoughts and capital exclusively upon the business in which you are engaged in. Having begun in one line, resolve to fight it out on that line; to lead in it. Adopt every improvement, have the best machinery and know the most about it.” – Andrew Carnegie

3. Learn to think in solitude

If there is one critical thinking technique that I have personally tested and proven, it’s thinking in solitude. The ability to think in solitude is what seperates the great inventors, problem solvers, analysts and philosophers from the average ones. By thinking in solitude, I have been able to solve intricate business challenges, come up with innovative business ideas and plans. If you can learn to think in solitude with minimal distraction from your surrounding environment, your problem solving skill will get better.

4. Know your strengths and weakness

Before engaging in critical thinking exercises, it’s advisable you know your strengths and weaknesses. What’s the essence of working your brains out in a field where you have no expertise? Or how do you engage in critical thinking when you cannot co-ordinate your thoughts. Knowing your strengths and weaknesses will help you avoid banging your head against the wrong wall.

5. Learn to control your emotions

The fifth step to strengthening your critical thinking skills is to gain stronger control of your emotions. Critical thinking is a thing of the mind and it can’t be harnessed if your mind is clouded by external thoughts. You must learn to keep your mind free when you want to do some strategic thinking. You must never allow prevailing situations to cloud your judgment. Great critical thinkers and problem solvers are those who think on their feet; even in the face of pressure.

6. Learn to think an open mind

No man can claim monopoly of knowledge and every once in a while; solutions to problems come from external sources. Closing your mind to external opinions may make you miss out on such solutions. Keeping an open mind is vital to the critical thinking process. You must never reject anything outside your reality. You must keep your mind open and absorb as much external information as you can regarding the situation at hand; then you can proceed to analyze, filter and process the acquired information.

7. Be a voracious reader

This tip is self explanatory. If you want to develop your critical thinking skills, you must be a voracious reader. You must read beyond your field and know how to relate external situations to yours.

8. Learn from the masters

Another good way to enhance your critical or strategic thinking skills is to understudy the masters of problem solving. How do they handle pressure? What are their critical thinking strategies and techniques? Try to see if you can establish a pattern.

“When stumped for a solution to a particularly difficult problem, look to the past for a solution.” – The Mafia Manager

9. Engage in brainstorming sessions with people smarter than you

The ninth step to improving your critical thinking skill is to engage in brainstorming sessions with people who are smarter than you. This will enable pick their brains.

10. Learn to seek external advice

Just like I said earlier, becoming a good critical thinker requires you keep an open mind. Always seek external advice on situations or facts you don’t understand. But never form a judgment based on the advice given. Remember that your aim is to better understand the situation with the advice gotten; so don’t forget to analyze, filter and process the information before acting on it.

11. Follow your instinct

The last step to developing your critical thinking skills revolves back to step one: “Believe in yourself and follow your instinct.” After dutifully carrying out step one to ten and coming up with a solution, you might be faced with one more problem; which is acting on your solution. This is where self belief comes to play. You have to trust your instinct and do what your guts tell you. Forget about consequences and take action.

“It pays to trust your instinct.” – Donald Trump

How I overcame my Business Challenges and the Lessons Learned

As I write this piece, I find it touching that everyone loves success stories. When you are successful, everyone wants to associate with you but nobody gives a damn about the process you went through to achieve such success.

Everyday, I keep receiving accolades with respect to my achievements; yet deep down inside of me, I know success is not what it’s painted to be. This piece is about a recent business challenge I encountered, how I solved it and the lessons I learned from the experience. I am writing this for those who are currently experiencing hard times in business and life in general. I want you to know that you are not alone. As you read, I hope you learn and profit from my experience.

Sometimes, challenges or problems come so fast that you lose your grip. Regardless of your financial or social status; you will never be free from problems. I get my own fair share of problems everyday but just recently; I was hit by a massive setback.

The period April to July 2011 was one of the toughest in my life. I was practically running on adrenaline and living on edge within these four months. Now you may want to know what transpired within these four months but I think this should be a story for another day. However, I will give you a brief insight of what I faced recently, how I overcame and the lessons I learned. So if you are still eager to profit from my experience and foolishness, then read on.

The Business Challenges I faced

In the month of April 2011, I was robbed at gun point and it took me some weeks to overcome the trauma. In the month of May, my business suffered a major setback and in June; my bank placed a hold on our business account (meaning we can’t make withdrawals from the account) due to some differences that needed to be reconciled. My business suffered a major cash flow crisis as a result of this single action the bank took, so I resorted to borrowing cash from family and friends to keep my business afloat. By July, I was deeply in debt. Within this period, I was always on the go; shuttling from state to state to resolve the problem I was encountering.

Now let’s fast forward to this day; the third day of August 2011. As I write this now, I can’t really tell how I feel. All I just want to say is this; “I survived.” As at today, I have cleared all outstanding debt I incurred within the hard times, my bank account has been restored and my business has roared back to life. But it took my business team and I, 90 days of untold stress to bring things back to order.

Well, the business problem is now a thing of the past and I have moved on but not without the lessons I picked from this single experience and it’s these lessons I want to share with you today.

How I overcame my business challenges

a. I sustained my business cash flow

Cash flow is the life blood of business and when it begins to trend in the negative, it will only be a matter of time before your business collapses. When I resorted to borrowing cash from family and friends; I was only trying to keep my cash flow position positive, I had to make sure the daily operations of my business continues unhindered and this also implied that I had to make some cut on our daily expenses.

b. I took responsibility

When the problem began, I had every right to point a finger to any member of my business team and say; “it’s your fault” but I didn’t. I did not run into a hole and hide; rather, I placed myself in front of my team. I told them that a mistake has been made and I was not interested in trading blames at that moment; all I needed was a solution and my team responded positively. They thought I was going to axe someone but I didn’t. Rather, I preached the need to jointly assume responsibility and resolve the mess together; with me as the lead dog.

c. I engaged in critical thinking

I have said it in previous articles that critical thinking is a key to effective problem solving. In the midst of the ensuring tension, I still found time to think in solitude. In fact, I spent most of my free time alone to the extent that my dad became concerned over my health and began counseling me to take things easy. But I laughed him off and quietly explained to him that I wasn’t worrying, I was thinking. At this point, I want to make it clear that there’s a big difference between thinking and worrying. Thinking solve problems but worrying compounds a problem and may even get you killed. My dad probably never understood the difference.

d. I tackled the problem head-on

What do you do in the face of problems? Do you face them squarely or you run and hide? Well, I know from experience that people react differently in the face of problems. Some even ignore the problem as if it doesn’t exist. But to pull myself and business out of the mess, I knew I had to tackle the problem head-on and I did.

Six Lessons I learned while resolving this business problem

1. Integrity can be a life saver

The bible said that “a good name is better than precious ornament” and that’s definitely true. When I went to borrow money for my business from family and friends; none requested a collateral or interest, none blinked an eyelid before granting my request. But they made it clear to me that they were lending me their money because of my reputation of keeping to my words. When I heard this; I was humbled and I strived to make sure I didn’t disappoint.

Always make sure you preserve your integrity; it can be a life saver in hard times. Never make empty promises and when you eventually make a promise; keep to your words. I have seen entrepreneurs raise millions and even billions of dollars easily; just because they have a reputation of delivering on their words. If you want to achieve much in business; preserve the integrity of your name.

2. Do what you must today; not tomorrow

Most people are fond of procrastinating; I am also guilty of such and in fact, procrastination was one of the reasons our business got in trouble. So whatever you have to do today; do it. Don’t wait till tomorrow because it might be too late. Don’t wait till you are under pressure before you act.

3. When challenges hit you; don’t break

Challenges are part of life; they come to make you stronger only if you refuse to bow. When challenges hit you; don’t break. Rather, toughen up. Just like a famous politician said; “when vultures surround you, refuse to die.”

4. Never lose focus

One of the greatest mistakes you will make in times of hardship is to take your eyes off your goal. No matter how bad the situation is, never lose focus.

5. When all human effort fails; turn to God

Yes, God works and he answers prayers. I had a good experience of this during the hard time. I remember going to the bank to meet with my banker. As I discussed with my banker, I was lost in thought. I wasn’t interested in the sermon and big words he was spitting out; all I wanted was a solution and just when I thought a solution was coming, my banker said “I am sorry Mr. Ajaero; we still can’t allow your company make withdrawals from the accounts.”

Those words hit me like thunderbolt. My business was on the brink of collapsing and here was this smart looking guy telling me I can’t access my money. As I bow my head lost in thought, I noticed someone by my side. I turned and it was a man. He must have heard my banker saying the last words, he asked what the problem was and I told him. He asked me to see him in his office the next day and he gave me the office address. I went home that day crying to God for a solution; I couldn’t sleep that night as I kept praying asking God to come to my rescue.

When I got to the man’s office the next day, he simply signed a document; handed it over to me and said goodbye. No introduction, no cross questioning. This man didn’t even bother to know the name or identity of who he was helping. I was really surprised that someone I don’t know from Adam would help me with such a sensitive problem with no strings attached. Well, some will attribute such action to luck but I will say it’s God at work. So when it seems all hope is not, never forget to cry to God for help. He will surely make a way for you.

6. Always be prepared for the worst

This is the final lesson I learned from the whole scenario; always be prepared for the worst. Challenges and problems will never stop coming no matter how successful you are. Even though I have solved this particular problem, I know bigger problems are still lying ahead of me. Instead of praying never to encounter challenges; the question I constantly ask myself is “how prepared am I to handle the next challenged? I know you can never be too prepared for what’s ahead since you can’t predict what is to come; but at least, I believe that he who is prepared has half won the battle. Now how can you prepare for what is to come? A good way to start is to keep aside a certain amount of cash specifically for emergency purposes.

As a final note, I want to say that I am happy to be writing this now. Call it my survival write up and you won’t be wrong. It’s not easy being at the helm of affairs; it’s not easy being a business leader. This single incident made me wonder the amount of pressure top business leaders and CEOs go through during challenging periods. Well, like I said earlier; all problems will surely come to pass. The real bone of contention is whether you will survive or not.

Six Problem Solving Skills Entrepreneurs must possess to Build a Successful Business

In the article “What is the Primary Duty of an Entrepreneur?”, I emphasized the point that entrepreneurship or becoming a successful entrepreneur is all about problem solving and I backed that article up by highlighting the “Ten Steps to Effective Problem Solving in Business.”

Now what entrepreneurial skill is required to solve critical problems in business? What business skill is needed to convert critical problems into business opportunities? Well, I will advice you read on as I highlight six critical problem solving skills entrepreneurs must possess to build a successful business.

Six Problem Solving Skills Entrepreneurs must possess to Build a Successful Business

1. Critical Thinking Skills

The human brain has been identified as the most powerful data processing machine but unfortunately; only few people ever utilize their brain power. Critical thinking is the ultimate key to problem solving and is the most important problem solving skill you should develop.

Napoleon Hill said that all achievements begin with an idea and ideas are the product of critical thinking. Critical thinking skill is important because it enables entrepreneurs identify problems and turn such problems into opportunities. Business and financial intelligence, competence, idea generation and strategic project execution are all results of critical thinking.

Most intricate business problems have been solved by challenging the brain to come up with solutions. Business challenges and problems can never be resolved without critical thinking; done either by the entrepreneur or business team. Just as Robert Kiyosaki says “your brain is your most powerful asset.” Now how do you develop your critical thinking skill? Well, I think that’s an answer for another day.

2. Understanding of the business

The next problem solving skill you must develop is thorough understanding of the business you are involved in. And this skill is not one you can develop in your closet; it’s a skill you develop by putting yourself on the line, it’s a skill you develop by getting your hands dirty.

Thoroughly understanding your business to the core is a product of experience; a product of staying in the game through thick and thin. Just as critical thinking is important to the process of effective problem solving in business; so also is understanding a core value to problem solving. Before critical thinking comes understanding.

Now how do you solve a problem when you don’t understand its workings or root cause? How do you solve a business problem you don’t understand? Let me cite a real life illustration so you will better understand my point. Bill Gates became the richest man in the world because he was an expert at solving software marketing problems. Donald Trump became a billionaire because he solves business problems relating to real estate and George Soros became success because he was an expert at handling market volatility. These successful entrepreneurs became billionaires because they thoroughly understood their line of business.

Now what if Bill Gates was presented with a problem relating to stock investing; will he be able to solve it? My answer is no. Why? The reason is because Bill Gates doesn’t understand the intricacies of the stock market.

Now how do you gain understanding of your business? I don’t know but a good way to start is by solving small problems arising from your business and taking note of its lessons. Understanding comes from experience and experience is all about being involved with the business process. You can also increase your level of understanding by attending seminars, reading books, listening to experts, magazines and analyzing industrial trends.

3. People Skills

The third critical problem solving skill you need to develop is people skills; but I prefer to use the word “team spirit.” To become an excellent problem solver; you must learn to think critically in solitude as well as part of a team.

Business and investing are team sports; and to succeed; you must learn how to think in synergy with your business management team. You must be able to assemble different experts from different walks of life and channel their intelligence to the problem at hand. This can never be achieved without a mastery of people management skills.

4. Faith

The fourth problem solving skill you must strive to develop as an entrepreneur is faith. The holy bible says that “with faith, you can move mountains.” I listed faith as a skill because it’s a trait you are not born with; you develop it over time by increasing your spiritual understanding and knowledge.

Is it possible to solve a problem you have lost hope on? The answer is no. To find an effective solution to a business problem; you must believe that a solution exist, you must have a firm belief that the problem can be solved. Faith is important to critical problem solving because it keeps the mind focused on finding a solution to the problem; rather than lamenting over the problem. Just as Ingvar Kamprad says “the word impossible has been deleted from our dictionary.”

5. Decisiveness

The next critical problem solving skill needed by every entrepreneur is decisiveness. After analyzing several possible solutions to the problem at hand; you must be able to arrive at a decision quickly. Take a look at successful entrepreneurs that solved intricate business challenges and societal problems; and you will see decisiveness at their core.

Henry Ford, Bill Gate, Donald Trump, Andrew Carnegie, Richard Branson and Larry Ellison are entrepreneurs that became famous because of their ability to reach decisions quickly.

6. Courage

The last skill you need to effectively solve problems in business is courage. Courage to face your problems squarely, courage to face the consequences of your decision; and courage to take extreme measures or solutions. Just like faith, courage is developed over time through personal mastery.

In conclusion, these are six most important skills required to effectively solve intricate business problems. Develop these problem solving skills and I will see you at the pinnacle of business success.

Ten Steps to Effective Problem Solving in Business

Are you experiencing problems in your business? Are you on the verge of business failure? How do you handle business challenges? How do you solve critical business problems?

What are the exact steps to effectively solve problems in business? How do successful entrepreneurs and drop out billionaires such as Bill Gates, Larry Ellison, Warren Buffett, Mark Zuckerberg, Aliko Dangote and Steve Jobs solve business problems? Well, you are going to find out below.

In this article, I am going to highlight ten steps to effective problem solving in business but before I do that; I want to acknowledge the impact of my mentors “Richard Branson” and “Robert Kiyosaki” with respect to the subject above. They provided the needed inspiration for writing this article.

Now how do you solve problems in business effectively?

Without wasting much of your time, below are ten steps to effective problem solving in business. These steps to effective problem solving in business can be applied to all sort of problems ranging from employee problems, competition, financial problems, marketing challenges or management problems.

Ten Steps to Effective Problem Solving in Business

1. Acknowledge there’s a problem

In the article “Four Essential Lessons from Companies Going out of Business”, I stated that one of the reasons why businesses fail is because the management turned blind eye to a problem or broken system. The first step to solving a problem in business is to acknowledge that a problem exists and needs solution. If there’s a problem but you want to believe that there’s none; then you don’t need to go in search of a solution.

2. Identify the cause

After acknowledging that there’s a problem and a solution needs to be found; the next step to take is to identify the cause of the problem. Philosophers believe that nothing just happens; and Isaac Newton said that to every action, there is an equal and opposite reaction. Business problems don’t just happen; they are prompted by something.

Identifying a problem is essential to the process of effective problem solving in business and to identify the root cause of a problem; you must be unbiased. Is the business problem you are facing a consequence of a decision you took? Is the cause of your business problem internal or external? You must find out and be prepared to take drastic measure if need be.

“Extreme problems often require extreme solutions.” – The Mafia Manager

3. Believe a solution exist

When you identify the root cause of your business problem; you will at that point know if your business problem has a solution or not. To me, I believe every problem in life and business has a solution. To effectively solve an intricate business problem; you must have the belief that the problem can be solved. Once you have this belief; be sure that your business problem will soon be a thing of the past.

“All problems resolves themselves; given time.” – The Mafia Manager

4. Throw open the problem to your team

If your business problem is a minor one; then you can take instant action to correct it before it escalates. But if it’s a critical problem; then you have to throw it open to your business management team and ask them to sleep over it. In an article I wrote recently, I highlighted 10 Strategic Reasons why you need a Business Management Team and one of such reasons is to help you handle business challenges.

5. Think it through on your own

“When stumped for a solution to a particularly difficult problem, look to the past for a solution.” – The Mafia Manager

Another step to solving intricate problems in business is to make use of your thinking creativity. Look for a quiet place where you can reflect over the problem on ground. Sometimes, solutions to critical problems usually come to us in moments of quiet reflection. So learn to think in solitude.

“The best thinking has been done in solitude. The worst has been done in turmoil.” – Thomas Edison

Ten Steps to Effective Problem Solving in Business

6. Draw up a list of possible solutions

The sixth step to effectively solving your business problems is to draw up a list of possible solution to your problems. You must have done some thinking in solitude and came up with some possible solutions but don’t put your ideas into action yet; just let it remain on paper.

7. Meet with your business team and brainstorm

After drawing up your own list of possible solutions; meet with you business and brainstorm on the problem at hand. This is important in keeping the team spirit and business mission alive. You must learn to think individually as well as part of a team.

“Teams should be able to act with the same unity of purpose and focus as a well motivated individual.” – Bill Gates

8. Take note of the solution they offer

During the brainstorming session with your business team; take note of the solutions they offer and pair it side by side with yours. This will help you make sure that only the best solution is implemented.

9. Take a stand

After hearing and weighing every possible solution to your business problem; you must take a stand and arrive at a decision quickly because when problems are left unattended to; they escalate. You are an entrepreneur; the chief decision maker of your business, so weigh all possible options and take a stand.

“Every remedy of a bad situation has its bad side effects. Choose the remedy with the least.” – The Mafia Manager
“Before making an important decision, get as much as you can of the best information available and review it carefully, analyze it and draw up worst case scenarios. Add up the plus or minus factors, discuss it with your team and do what your guts tell you to do.” – The Mafia Manager

10. Live with the consequences

You have taken a decision and implemented a corrective measure to combat the business problem on hand. The question now is this: are you prepared to live with the consequences of your decision?

After implementing a solution to address a problem; two things are bound to happen. It’s either the problem gets resolved or it escalates. Either ways, you have to accept whatever comes and move on.

Accepting responsibility for the consequences of action taken or decision made is the reason most people shy away from taking leadership role in any organization. But you don’t have to be afraid; being unafraid to live with the consequences of your decision is a mark of good leadership.