| | MARCH 20198FIVE MISTAKES THAT PREVENT YOUR BUSINESS FROM ACHIEVING THE OPTIMAL SCALEBy K Mohan Bhaktha, Executive Director, Weizmann ForexMohan Bhaktha is a certified associate of Indian Institute of Bankers. He has previously worked at Mizuho Bank, as well as had a long stint at State Bank of India. He is in charge of Risk Management, Business Analytics, Business Process Re-engineering, and many other areas.Proliferation of startups is an accepted reality now. Thou-sands of startups spring-up every day. While very few of them become Unicorns in due course, many of them manage to scale-up only to become medium or small enterprises and a significant num-ber of others, unfortunately, close shop and exit the scene altogether even though their technical com-petence may be more or less simi-lar to those that survive and thrive.Why do some exit, some re-main as small enterprises, while only a few become large and keep growing? What is it that sets a few apart from the rest? What are the common mistakes to be avoided so that the business can scale-up to exploit the opportunities available and achieve optimal scale?Listed below are the five mis-takes unrelated to the technical competency of the business enter-prise, which most small businesses commit, thereby preventing them from achieving optimal scale.1. Incompatibility between Business Realities & Tempera-ment of the EntrepreneurThe first sin to be avoided is get-ting into wrong business vis-à-vis the temperament and financial resources of the entrepreneur. The entrepreneur who expects profits to come quickly and is not pre-pared to wait for a few years until the business attains scale to gen-erate profit, has entered a wrong business. Normally, low margin business takes a long time to break even, and an entrepreneur who is in such business but doesn't have the required patience or deep pockets may end-up focussing ex-cessively on cost cutting by not making required investment in good software and quality human resources, rather than focussing on revenue enhancement. This can result in employing inadequately qualified/experienced employees, cutting cost on workplace facilities, inadequate workplace hygiene, A THOROUGH UNDERSTANDING OF THE NEGATIVE EFFECTS OF THE FIVE MISTAKES THAT PREVENT YOUR BUSINESS FROM ACHIEVING THE OPTIMAL SCALE WOULD HELP SMALL BUSINESSES TO EXPLOIT THE IMMENSE OPPORTUNITIES THAT ARE AVAILABLE TO GROW AND PROSPERTHOUGHT LEADERSHIP
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