Business going well? Everything on track? Sure? It’s time for a reminder. That next big crisis is right around the corner. We won’t see it coming because it won’t look like the last one. It will be new and unexpected. Kaboom. You’re in it. Are...
Daily I see overconfidence in business. I see too much faith placed in forecasts. I see big bets placed on anticipated market growth. I see investment in businesses that are near bankruptcy. I see these things because people tend toward certainty. They start with a belief and then look for all evidence supporting that belief while ignoring anything that contradicts that belief.
I work with too many people who think they can make a plan in an hour by just “deciding things”. That’s not a plan. That is a recipe for problems. Hasty decisions lead to problems and waste.
I can put today’s tip in a few words. Having reviewed many business plans, there is on common error that leads to disaster if not addressed. It starts with overly optimistic forecasting. That leads to bad budgeting which quickly ends in negative cash flow. Why...