Management Mistakes To Avoid As An Entrepreneur

The Peter Principle: things that work well will be applied in more and more challenging applications – until inevitably, they reach a point at which they have exceeded their ability to be effective. Unless this principle is heeded, even an excellent tool or strategy will ultimately fail.

The same process can happen to talented people. Often, a company will single out top performers to be promoted to successive levels of management – but this “solution” actually leads to good employees being promoted and promoted and promoted, until finally they are placed in a role where they struggle and fail. The impact resonates within the company, which has just squandered the talent of a good employee, and it also affects the career trajectory of that person. A job search is typically based on the last position and title on your resume.

As a business leader, and especially as an entrepreneur, it’s much better to use the strategy of managing to people’s strengths. Every one of us has a set of skills and abilities that allow our natural talents to shine. Promote people within their zone of excellence, and elevate top performers by expanding their duties to include more of what they are naturally best at, instead of promoting them to an all-new position that requires management savvy, a totally different skill set. When considering any employee for a step up, evaluate how well they fit the criteria of the new role, not just how well they perform in their current role. If a distinct managerial role is needed as your team grows, consider bringing in a vetted manager or a strategist to help guide specific projects, which allows employees to continue working where they already succeed. Your team, and your business as a whole, will be much stronger for it.

For more ideas, inspiration, and lessons in entrepreneurship, check out my weekly column on Inc., Dollars and Sense!