The word entrepreneur is derived from the French word entreprendre, something that literally means to do something or one who undertakes. An entrepreneur is one who sees possibilities where others have neither ventured nor visualised before. He takes a considerable amount of initiative and risk when launching a new business venture.
Some are successful, but most of them fail. Nevertheless, all entrepreneurs share the same driving spirit that leads them to embark on a quest to make true their dream of starting their own business.
“The entrepreneur always searches for change, responds to it, and exploits it as an opportunity.“Peter Drucker
Each of the following paragraphs contain a certain reason why certain kind of mistakes are repeated by different entrepreneurs.
1. Failure by gradualism – The changes were too slow for us to notice
Human brain is highly efficient at detecting change and our experience of a rich, stable visual world often leads to the intuitive belief that our representations of that world are correspondingly detailed and precise. But what if the change happens during several generations? Are we able to notice the patterns and to adapt our business to the changes?
Take for example global warming: most changes have been gradual, but the possibility of abrupt shifts concerns the scientific community. Since 1979, it has been a precipitous decline of summer Arctic sea ice, and is one of the most notable sudden changes already occurring. That trend is likely to continue and have a cascade effect on ecosystems in the region as well as impacting shipping, oil and natural gas exploration, and national security. Sea level rise is also a gradual shift that could have a big consequences for coastal communities. Seeing gradual changes and not responding to it may lead to abrupt changes, impossible to manage.
2. Failure by linear thinking – We fail to think exponentially
Today, stock markets for example move in milliseconds. The reason is that a significant proportion of the trades are made not by humans, but by lines of computer code known as algorithms. These algorithms live in a world of milliseconds. While our brain is organising commands like “grab that pen”, they have made hundreds of stock trades based on minuscule price shifts. Maybe this is one of the reasons why banking crisis in 2008 came so damn fast. Milliseconds markets shift the balance of power to those who are quick.
We have an inherent need for speed. Look at the news industry. When an accident happens people crave for information within minutes, minutes that look like an eternity. Speed is one of the most frequently attacked phenomena of modern society. Why? The most fundamental reason is that speed changes too fast the landscape in which we live and makes the previously familiar unfamiliar.
Linear thinkers solve problems of daily life by taking in information from one situation and applying the information gathered from it to another situation. Linear thinkers find consistency, a rule, formula, or a pattern in matters concerning life, so that they can apply it to other situations, and even make predictions. When things happen quickly, the forces of resistance tend to be stronger, since these things are seen as unnatural.
3. Failure by presentism – We believe that tomorrow will be like today
Human brain is built to deal with here and now, which is why a “sixth sense” remains a fantasy while our other five senses are design to detect things in our nearest spatial and time-based surroundings.
The Schumpeterian economic historian Dahmén introduced theories about Development Blocks.
“A new technology needs a number of complementary supporting technologies in order to reach its potential. Once they are in place, a development block can be formed.”
Social scientist often point to development blocks as related areas that develop in unison. A simple example is music and architecture, whereby a new type of building technology creates a new type of concert hall. Statisticians call this multivariate analysis (several different variables change at the same time). Successful marketers exploit this inability of the human mind to understand changes in many dimensions. That’s why they insist on using familiar references to create mental frameworks that help customer understand a new product or service (mobile phone, online travel agencies).
4. Failure by myopia – We believe that our world is the world
Twenty four hundred years ago, Plato, one of history’s most famous thinkers, said life is like being chained up in a cave forced to watch shadows flitting across a stone wall. Beyond sounding quite morbid, he meant a lot more. Found in the Book VII of “The Republic”, in this allegory a group of prisoners have been confined in a cavern since birth, without any contact with outside world. Facing a wall and chained, they couldn’t turn their heads and the only thing they could see were the shadows on the walls from a fire behind them. The prisoners were naming and classifying these illusions. One day, one of the prisoner was freed and went outside the cave for the first time. The sun hurt his eyes and all the environment was disorienting. At the beginning he refused to believe that the shadows in the cave weren’t the reality, but the things outside the cave. With time though, he adapted to the changes and returned to the other prisoners to share his findings. They didn’t believe him and resist any attempts to free them.
This allegory was written to explain that people are resistant to change and comfortable in ignorance.
We are content in our sphere of the world and obvious to the many other worlds we miss. We prefer most of the things in our life to be more or less anticipated. To wrap all these believes, scientists came up with the term “everydayness”. It refers to the mode of being, the attitude toward reality, which typifies our “normal” participation in the life-world.
5. Failure by faulty memories – The confabulation
Considerable research indicates that our memories can change. And we can even create new memories for events that never happened! Maybe would be better to think about our memory as a reconstruction of the past made of instances that can change over time even if we don’t realize it.
That’s why, always in business it is advisable to avoid “the 3 Ms”: Memory, Misinterpretation and Mood. It often can happen that two honest, well-meaning people remember two different facts and be adamant that they are correct.
Failure is a common outcome of entrepreneurial venturing and can produce a number of positive and negative outcomes. Therefore mistakes happen, but no one would never recommend anyone purposely make a mistake. If a mistake can be avoided it should be, so that’s why you should always keep in mind this short list of very common reasons to fail. So common that you might actually not be able to see them.
Sources of inspiration:
Thompson, Christine. “Authenticity and Everydayness.” Marilyn Zurmuehlin Working Papers in Art Education 2 (1983): 67-70.
For more articles like this, you might want to subscribe to our Newsletter.