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Why businesses fail

by A.J. Rusli

Created on: February 28, 2010

One of the main reasons why businesses fail is due to the time and resources of the business spent on fire-fighting (problem-solving) rather than generating revenue and looking for new business opportunities.  This is best illustrated by the analogy of a sick patient: If we continuously treat the symptoms of a disease and not addressing the disease itself (the cause), we will end up being caught in an endless cycle of action-reaction, being engaged in a static rut that is much like quicksand, sucking all energy and hope the longer it continues, and drowning us further in helplessness without solving the issues.



To define fire-fighting in an organizational context: People running around, spending more time listening and managing complaints than solving them, jumping from one issue to another and trying to solve them without having enough time or/and resources to deal with them effectively, growing list of work, issues and backlogs.

Fire-fighting is caused by certain issues, and I've identified the issues as the following: Human resource deficiencies, training/skills/knowledge deficiencies, and process/procedure operational deficiencies.

In any organization, there's no shortcut to solving the underlying problems and these issues must be tackled head-on. A solid foundation of systems, knowledge/skills, and resources must be established with a strong cohesion, and this will ensure that there is enough 'elasticity' and competitive advantage for the organization to bounce back from challenges and pitfalls, converting obstacles to opportunities.

I'm of the opinion that this elasticity cannot be attained without the above elements put into place as pre-requisites.

The bad news is that establishing these elements will take a lot of planning, thinking, and learning, and of course creating and implementing anything new in an organization is a challenge. Progress will also be slow in the beginning, and we must thus not lose hope but to continue on to bring these changes gradually to the organization.  Then again, good things don't come easy and it's worth the time and effort to build a strong foundation so that subsequent activities will not be caught in an endless cycle of fire-fighting.

However, the good news is that once it's implemented, it will have an energy of its own and everything else will naturally fall into place. As a result, there will be less fire-fighting in the organization.

I was also given a book by my best friend as a birthday present and the book contains a chapter on fire-fighting. It was written by Roger Bohn and it's titled 'Stop Fighting Fires'.

I found this chapter to be immensely useful because it also gives the anatomy of fire-fighting:
- There isn't enough time to solve all problems
- Solutions are incomplete
- Problems recur and cascade
- Urgency supersedes importance
- Many problems become crises
- Performance drops

So if you find that your present situation covers some (or all) of the above symptoms, then you are also probably caught in fire-fighting mode! Recognize it for what it is, and then take steps to nullify the energy from the action-reaction cycle by establishing the fundamentals.

Learn more about this author, A.J. Rusli.
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