Image for  "Five key pitfalls to avoid if you want a great business"

Five key pitfalls to avoid if you want a great business

The other week, the Kommek conference was held in Malmö. Chalmers researcher Henrik Eriksson was one of the speakers. Henrik is researching what Sweden’s best businesses have in common.

He listed five pitfalls to avoid if you want to run a good business. I thought these points are so important so I want to let you hear them too, with the addition of my experiences. The five pitfalls are:

  1. Not being driven by need and purpose
  2. Not having value-creating processes and networks
  3. Not leading
  4. Not being motivated
  5. Not to improve

I focus in this weekly newsletter on point number one.

1. Not being driven by need and purpose

To be successful in leading and working in a business, you need to understand WHY you exist. This is also expressed by Simon Sinek in his book Start with WHY, where he gives many examples of businesses that have achieved great success by being clear about why they exist.

Seth Godin, in his book Tribe, also describes the importance of a clear purpose, so that as a leader you can form a group of people who want to participate and perform the tasks needed as the purpose describes.


A clear WHY drives us to want to participate. This is important not only for a business as a whole, but also for its processes and projects. For example, when I give training on how to succeed with your projects, I always bring this up, because unfortunately too many people fail at it.

The project owner, i.e. the one who wants something done and chooses to do it in project form, is often unable to clearly explain WHY the project is to be carried out. And if the project owner can’t describe it clearly, how will the project members understand it?

The same is true in a business, if you as a leader can’t clearly explain why you exist, it’s hard for employees to understand. An entrepreneur who starts a business with a bunch of people has the advantage that everyone is on board from the start. But how does it work in larger businesses that have been around for a long time?

It is clearly much more difficult. Because in an established business of any size, people come and go. And how do newcomers to the business find out the purpose if it is not clearly described or communicated?

Collectively or individually?

If we are to work together in your business, and succeed in creating value together, we both need to share purpose. Because if we don’t share purpose, then we will have different purposes.

The fact is that there is always a purpose involved. It is either a common purpose, or each has its own purpose.

If you don’t share the purpose, then the purpose of the employees will be based on their own preferences and reality. They may be working with you because they need a job, because they’ve been told to, because they were free at the time, or something else like that.

Either way, it’s a far cry from them really wanting to share the purpose with you and the business.

If you have a clear purpose for your business, your process, and/or your project, then it will act as a magnet. A magnet that attracts the right people, who “just have to be there” and realise the purpose of the activity.

The need

The second part of what Henrik Eriksson highlights in pitfall number one is need. I think it is very important to really understand what the needs are, both overall and in detail.

Overall, the need is directly related to the purpose. Someone has a need and our purpose is to satisfy it.

But in addition, you need to understand the need in detail in order to manage the work well. This applies to the whole business and to you as a leader. For the business, everyone needs to understand who they are for, and what their needs and desires are.

You also need to have a clear picture of all your products and what needs each product satisfies.

The leader needs understanding

As a leader, you also need to have that understanding and how well you are creating the value in demand. In LEAN, we talk about Genchi Genbutsu, which means “go out and see for yourself”. This means that as a leader you have to be out in the field.

Examples abound where successful businesses have leaders who are with employees in their respective tasks to understand. For example, Apple and Ikea leaders are out in stores and department stores to serve customers and to learn, as well as to support. This is where you find out how things are going and have direct contact with your business’s most important stakeholder: the customer.

  • As a manager in the social field, can you be out there serving the elderly?
  • Can you, as a school manager or principal, be in the classroom, eat meals with the students, and be out in the schoolyard?
  • Can you, as the manager of the Water and Sanitation Department or Street Parks, be involved in the maintenance work or projects that take place?
  • As a CEO, can you be out in production and operate the machines in the production line?

Not all the time, of course, but occasionally.

Maybe you already do that? In that case; well done!

Easier to be a leader

A clear purpose with an underlying good understanding of the needs provides a driving force in the business that greatly facilitates a leader’s task. This is because things resolve themselves along the way, because everyone shares a picture of what is to be achieved and why. Then both want to, can and do it so that the business is driven forward successfully.

I’ll stop there for now and come back next week to talk about value-added flows.

What does it look like for you in your business? Do you have a clear purpose that is shared by all? And what about your and your managers’ understanding of the customer’s, whatever you call it, needs?

Please reply again and tell us how you feel about it. It’s always good to hear from you.

Have a good week until next time,